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Global Trade and the Evolution of Digitization

Global Trade and the Evolution of Digitization

During this year’s eighth annual Asian Logistics and Maritime Conference in Hong Kong, one of the most common themes discussed was the impact, success to-date and history involved in the world of digitization for the supply chain sector.

Mr. Wilson Pang, Fintech Senior Manager, spoke on the topic during the second Supply-chain Management and Logistics Forum on day 2 of the conference, emphasizing the importance of improved research methods and application for the industry. Key highlights from his presentation included a thorough SWOT analysis of the Hong Kong trade sector and what possibilities can be utilized for maximized success and elimination of inefficiencies.

Strengths included the obvious leading role the Hong Kong market plays in the global trading arena and the fact that it accounts for 3 percent of the world’s total trade. Weaknesses were identified as lack of financing for less than 50 percent of total trade between 2006-2015. The Belt and Road initiative provided the strongest opportunity for the market, with an emphasis on expanding trade in an effort to support and promote economic cooperation and peace.

Here comes the game-changer: the threat. From all of the perspectives addressed thus far, threat prospects can range from a variety of factors. Nonetheless, Pang identified the high transaction cost spurred from documents and manual processes combined with very likely risk of data errors and duplication.

Digitization in the form of e-trade connect is a solution Pang presented. He also shared a very interesting illustration proving the evolution of digitization through the story of Russian world class chess champion Garry Kasparov and his defeat by an IBM supercomputer. Factoring in the elimination of human error and outsmarting the human mind through digital solutions, the risk of duplication and errors are resolved.

Pang took it one step further and broke down the process into three priority functions: agreement creation, financing and reconciliation.  Through this process, trade and trade finance is simplified while benefiting all players in the trade sector. This is how industry leaders can unleash the full potential of business.


Source: Presentation, “eTrade Connect: Welcome to the Future of Trade” by Mr. Wilson Peng, Senior Manager, Fintech Facilitation Office

“A Force to be Reckoned With”

The Asian Logistics and Maritime Conference kicked off this morning with a strong opening message from Mrs. Carrie Lam Cheng Yuet-ngor, Chief Executive of the Hong Kong Special Administrative Region of the People’s Republic of China. Lam didn’t fail to mention this was her fourth year in a row speaking at the eighth annual conference and noting that the representation brought is “One of Hong Kong’s and the world’s most vital sectors” paired with a strong turnout each year.

Lam focused on how the recent topic of the Belt and Road Initiative continues to “connect the region and the world” and building on the ties among other industry leaders around the world is vital to continued success. Additionally, she touched on the importance of free trade within the Hong Kong region, noting it as “immutable” before confirming the conclusion of a free-trade agreement with Australia within the last few days.

Adaptability and rolling with the market changes were a high point during Lam’s address, noting that trade and logistics are one of Hong Kong’s four pillar industries that contributes 22 percent of GDP, making Hong Kong a leader in logistics and financial centers in addition to trading economies in the world.

“Hong Kong’s noble market may be modest, but our ability to serve and create markets for trading goods and services for the world is inexhaustible. For that, we can thank our formidable foundation for international trade… I’m talking about world-class infrastructure, superb connectivity.. institutional strengths as well as an abundance of talents…”

Lam went on to expand on the massive container port quantities and TEU numbers within Hong Kong which include 320 lining ships per week, and over 3.8 million TEUs on record for last year. She also mentioned that the shipping rates are the fourth largest in the world and in regards to the air, “Hong Kong is a force to be reckoned with”  noting their airport has been the world’s busiest for international air cargo for the last 22 years in a row, serving high-value logistics in the Asia-pacific region and boasts sustainable air-service agreements with dozens of countries around the world, 67 to be specific.

As she concluded her opening address by reinforcing global connectivity and the ability to adapt to an evergreen market. The primary message remained consistent that Hong Kong will continue to leverage its impressive trade momentum regardless of market trends.