The latest headlines on international trade have run the gamut of positives and negatives. More recent discussions have covered threats of trade wars, damaging tariff exchanges, and the overall health of global trade. Although these conversations can productivly contribute to improvements in organized global exchange, a more hopeful conversation should center around the advancements that innovative technology has brought to the scene. Through its inclusion, trade has been made more efficient and inclusion.
Some of the early advancements in tech development date back to the Industrial Revolution and the use of steam to power both the manufacturing and transportation industries. However, the invention of the shipping container, while not technologically sophisticated at the time, completed blew open the door for globalization.
Now, the trade industry uses technologies like Optical Character Recognition to help decode container numbers, Radio Frequency Identification to trace or identify shipments, and digital trade documents to improve the accuracy and reliability of international trade contracts. Before the age of digital commerce, transactions could get bogged down in slow-moving paperwork processes. Now, as digital documentation provides more efficiency in trade agreements, there is a snag in the financial sector.
Trade agreements are still depending on traditional banking methods rather than using cutting edge technologies that could develop a more inclusive, efficient, cost-effective solution for invoicing and payment. GBTI Bank is one of the few traditional options that is making headway in offering modern banking approaches to the trade industry, However, more global change could be lurking on the horizon, as several technologies in the works that, when combined, could undermine current systems and fundamentally alter how international trade is conducted and resources are allocated. These are some of the trends on the horizon.
Using blockchain or blockchain-based distribution ledger tech could have a substantial impact on global trade supply chains. This technology addresses trade issues that have long caused concern for businesses looking to explore international trade.
Blockchain helps promote transparency and security with transactions and works to reduce the costs associated with global trading needs. This tech would help make the transport of goods more reliable, but yet it will impact the realm of trade financing as well. Obtaining a Letter of Credit (LoC), the payment method used for global commerce, is a tedious process that blockchain will be able to simplify and deliver more timely. Some companies are experimenting with passing on receipt of an LoC altogether and using inventory financing or real-time goods tracking to help take the risks out of international transactions.
Machine Learning and Artificial Intelligence
The advancements in AI aren’t just about developing human intelligence replications. Machine learning is a way to optimize shipping and trade routes, navigate both truck or vessel traffic in key ports, and conduct e-commerce search queries in other languages.
The use of AI greatly reduces the risk of error, as computer computing is much more complex and efficient with large amounts of data. This isn’t the only area that AI can improve. Artificial intelligence is also working to develop sustainable global trade. Suspicious behaviors are able to be monitored and tracked across a global scale, as intelligence gleaned from satellite data is analyzed in commercial fishing vessels, their movements, and their patterns. This can help develop more sustainable policies across governments and organizations.
Digital Platform Trading
Through the Internet, it is much more convenient to trade services. There are a number of digital platforms that allow users to complete tasks or find jobs all over the world, but it also provides a centralized platform for finding a service provider. International trade isn’t just about commercial vessels transporting cargo across the seas. It could be employing the services of a web designer in Germany, a language tutor in China, or a customer service call center in India. Digital platforms connect individuals with services remotely, opening new areas of both employment and for-hire providers in a number of areas previously removed from global trade.
Printing in 3D
There is growing concern that the impact of 3D printing on global trade will be destructive. New studies are predicting that international trade might decrease by up to 25% once high-speed 3D-printing becomes affordable enough for mass production. This printing option would require significantly less labor and resources, limiting the need for reliance on imports. However, there are many voices that argue that the complexities of 3D printing aren’t realistically aligned with the processes of mass manufacturing. In spite of these concerns, 3D-printing will impact global trade once cheaper, faster methods of production come on the scene.
The ability to send money through mobile apps and connections is changing the way people connect to market opportunities. Nowadays, you can quickly transfer money to a person or any service provider using mobile apps. Even on google play store, many apps are available that pays you money by completing simple tasks like commenting, watching small videos, subscribing youtube channel, etc. Financial inclusion in many areas is going to see many changes as people turn to mobile money accounts rather than traditional checking or savings accounts. This global trend will encourage both purchasing or investment opportunities for businesses and consumers alike.
While there are some threats on the horizon for global trade, the benefits of improved technology show equally impressive growth potential. Smart investments into a more reliable and efficient goods exchange improve the costs and delivery for partners all across the world.