A world-first centre dedicated to accelerating the digitalisation of international trade is to be set up in conjunction with the Teesside Freeport.
The Centre for Digital Trade and Innovation will be co-ordinated by the International Chamber of Commerce UK and supported by the Tees Valley Mayor and Combined Authority, industry and government.
Frictionless trade
The centre will drive forward the government’s ambition for the UK to become the global leader in digital trade by providing a focal point to develop the latest technologies and approaches to frictionless trade, reports the Darlington & Stockton Times.
The virtual launch was attended by trade minister Ranil Jayawardena MP and Brexit opportunities chief, Jacob Rees-Mogg MP.
Jayawardena said digital trade, trade in services and e-commerce were priorities for the centre.
Rees-Mogg added that the centre is partnering with the Cabinet Office to deliver pilots for its Ecosystem of Trust concept, as outlined in the government’s 2025 UK Border Strategy.
Digital catch up
Digitalisation in trade has lagged other sectors and only about 1% of trades happen digitally at present.
It is claimed that trade costs could be cut by 80% and generate £25bn of SME export growth and an additional £1bn in SME trade finance, halving the country’s trade finance gap.
According to Politico, the centre will be industry-led, but working closely with the Treasury, Department for International Trade and BEIS, all of which have offices in Darlington.
Pilots
The centre will run pilots to test digital trade systems and identify and lobby to remove barriers to e-payments, e-invoices, legal entity identification and digital assets.
'Huge benefits'
The Institute of Export & International Trade, which recently published its Trade Data and Digitalisation report, welcomed today’s launch.
Director general Marco Forgione, said:
“The launch of the Centre is a major step forward for trade in the UK and beyond. Digitalisation offers the prospect of huge benefits to traders and consumers. Training is the key to unlocking those benefits – especially for SMEs – and we are looking to forward to helping traders unlock them.”
At the 15 March launch of the IOE&IT’s report, at Westminster’s Church House, Minister for Exports Mike Freer MP told guests that the “future of trade will be paperless” and “faster…and cheaper” if digitalisation is fully embraced.
Benefits of digital trade
The report sets out the opportunities and challenges of digitalising trade (available to download here) taking a comprehensive look at the benefits of adopting full digitalisation of trade, including:
- Lower costs of trade, including reduced delays at borders
- New combinations of goods and services and ‘servitisation’
- Lower barriers to entry
- Economies of scale
- Wider supply of finance and insurance
- Reduced carbon footprints and improved sustainability
- Greater resilience to shocks
- Reduced theft, fraud, and tax evasion
- Growth in coverage and visibility of supply chains
- Better and speedier trade data
Minister Freer said:
“In 2020, the UK exported almost a quarter of a trillion pounds worth of digitally delivered services, but we can go further. As rightly highlighted in the IOE&IT report, advances in technology in the future will be paperless. The documents required to navigate customs can be transmitted in the blink of an eye from one side of the world to another.”
Smart border
The government’s 2025 UK Border Strategy for the post-Brexit era underlined the need for an “efficient, smart and responsive” border. It highlighted the importance of data at the heart of the operation of the border.
“Data is key to allowing businesses to manage complex international supply chains, and for carriers to manage the movement of millions of passengers a year,” it said.
The strategy outlined the need for a single trade window “through which all information required to import and export can be submitted to border agencies.
“This will allow parties involved in trade and transport to lodge standardised information and documents within a single electronic entry point to fulfil all UK import, export, and transit-related regulatory requirements”.