Article by GTDW Head of Content & Intelligence Michelle Wong
The rise of digital technology advancement, globalisation and e-commerce has lead to the opening of borders and transformation of global flow of goods. According to the World Trade Organization (WTO) World Trade Report in 2017, "No two forces are driving the global economic transformation more than technology and trade. Indeed, because economic openness encourages innovation, and vice versa, the two are not just related but mutually reinforcing."
The report takes a similar view of history, from the Industrial Revolution 200 years ago through the rise of Asia in the 20th century to the digital economy of today. In the 19th century, the new technologies were steamships, railways, and the telegraph – inventions that enabled Europe and North America to industrialize and become dominant in international trade. In the last century, automobiles, airplanes, and telecommunications became enablers of the next wave of industrializers and international traders, such as South Korea, Singapore, and other Asian countries. In the 21st century, "even more advanced technologies – computers, smartphones, the internet – are fueling the latest and biggest wave of economic catch-up, as dozens of developing countries achieve sustained annual growth rates of 8 percent or more," the report says.
However, the report also says, "At each stage, continued economic advance has hinged on the ability of countries to adjust – to reconcile the tension between the opportunities presented by economic progress, on the one hand, and the challenge of helping people adapt to economic change and share in its benefits, on the other”.
Technological disruption is constantly evolving and the world benefits from new innovation and technologies that could make trade more efficient, more connected, safer, faster and less costly. Today we have replaced our discussions on technology from computers, smartphones and the internet to blockchain, artificial intelligence, machine learning and 3D printing.
With globalization and the rise of cross border trade, regions and countries have moved to negotiate free trade agreements. For countries to expand their markets, they understand they must initiate, or at least participate in, mutual agreements to support their economic growth. While new trade agreements are good for driving foreign direct investments and have powerful impacts on technology transfer, they also create challenges. Governments are required to look at their regulations, implement new legislations, and strengthen patent and intellectual property rights law to accommodate new agreements. Businesses must plan their supply chains to ensure they capture the benefits of a new trade agreement whilst having to understand new obligations, compliance and the impact on intellectual property rights.
Technology has definitely changed the fundamentals of trade, in both legitimate and illegal economies.
It is interesting to note that while supply chains are becoming more international and complex and technological advancement is paving the way for more efficient and inclusive global trade, at the same time these advancements are also increasing vulnerabilities for illicit traders to exploit and threaten the integrity of the very same system we are trying to facilitate.
According to a 2017 study commissioned by the International Chamber of Commerce, the global trade in counterfeit and pirated goods is estimated to generate between $923 billion to $1.13 trillion annually, making this segment of illegal trade more profitable than the drug trade and human trafficking. The growth of illicit global trade undermines trust in the economy and brands, causes loss of legitimate tax revenues and fuels the growth of transnational organised crime.
Supported by emerging technologies and the dark web, the nature of illicit trade is evolving and the extent of its threat to economies is growing. Criminals are making the most of technology breakthroughs and are exploiting loopholes to traffic illegal goods. Those working to combat it need to invest in the latest techniques to keep up with these criminals. Stakeholders (governments, international organisations and businesses) need to collaborate, share resources, link existing initiatives and work on joint international responses to this growing threat.
Recognising the need to identify commonalities and points of convergence, the 19th edition of Global Trade Development Week (GTDW) will provide a connecting platform to global trade stakeholders to explore opportunities to facilitate and increase sustainable and seamless cross border trade and to detect and counter illicit trade by:
Collaborating and linking existing initiatives
Sharing resources and best practices
Discovering emergent and interoperable technologies and innovation
Initiating recommendations to overcome threats and challenges
Facilitating closed door G2G, B2B, B2G meetings
I have spent weeks speaking to industry experts and have written the draft programme for the upcoming GTDW China 2020 event. Feel free to reach out to me at michellew@kwconfex.com if you would like to speak/attend/exhibit at the event.
I also welcome any feedback on pertinent trade issues you think GTDW should cover and I'm happy to jump on a call if you would like to contribute some ideas for our upcoming events.
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