Leanne Kemp, Everledger
Background: Australia is a country rich in critical minerals, which are essential for the manufacturing of products in high-tech industries such as electronics, aerospace, and renewable energy. However, the global supply chain for critical minerals is complex and often opaque, with multiple actors involved in the extraction, processing, trading, and recycling of these minerals across different countries and jurisdictions. To enhance transparency and traceability in this supply chain, the Australian government partnered with Everledger, a blockchain-based platform for digital certification and verification, to conduct an interoperability pilot for the electronic exchange of trade documentation.
Here are three key issues and lessons learned from this pilot:
1 The need for standardisation and harmonisation of data formats: The pilot identified that the lack of standardisation and harmonisation of data formats across different IT systems used by different stakeholders was a major obstacle to interoperability. For example, different countries may use different codes, languages, or units of measurement for the same minerals or products, which can create confusion and errors in data exchange. To address this issue, the pilot developed a common data model and a messaging standard that can be easily integrated with different IT systems and allow for seamless data exchange. This lesson can be applied to other geographies where the lack of standardisation and harmonisation is a barrier to cross-border trade.
2 The importance of trust and security in electronic trade documentation: The pilot identified that the lack of trust and security in electronic signatures and certificates of origin was a major concern for stakeholders in the critical minerals supply chain. This is because the authenticity and integrity of these documents are crucial for compliance with legal and regulatory requirements, as well as for the prevention of fraud and counterfeiting. To address this issue, the pilot developed a blockchain-based solution that enables secure and tamper-proof digital signatures and certificates of origin, which can be verified and audited by all stakeholders in real-time. This lesson can be applied to other geographies where the lack of trust and security in electronic trade documentation is a barrier to cross-border trade.
3 The challenge of integrating different IT systems and stakeholders: The pilot identified that the complexity of integrating different IT systems and stakeholders was a major challenge for the implementation of electronic trade documentation. This is because each stakeholder may have different requirements, capabilities, and incentives for using digital solutions, and may use different software or hardware that may not be compatible with each other. To address this issue, the pilot developed a user-friendly online platform that provides guidance and assistance to stakeholders and facilitates the integration of different IT systems through APIs and connectors. This lesson can be applied to other geographies where the integration of different IT systems and stakeholders is a barrier to cross-border trade.
However, the implementation of electronic trade documentation also faces significant challenges and opportunities, depending on the specific context and stakeholders involved.
Some of the challenges include the lack of awareness and capacity among SMEs, the complexity of customs procedures, and the need for compliance with legal and regulatory frameworks.
Some of the opportunities include the potential for cost savings, time efficiency, and data analytics, as well as the potential for innovation and competitiveness.
To address these challenges and seize these opportunities, it is important to develop tailored solutions that take into account the specific needs and priorities of different stakeholders, and to foster collaboration and communication among them.
Moreover, it is important to monitor and evaluate the impact of electronic trade documentation on the broader economy and society, and to ensure that it contributes to sustainable development and inclusive growth.
In summary, the Australia Everledger platform blockchain pilot for critical minerals trade documentation has shown that interoperability can enhance transparency, traceability, and efficiency in cross-border trade, but requires standardisation, trust, and collaboration among stakeholders.
The lessons learned from this pilot can be applied to other geographies and industries where electronic trade documentation is becoming increasingly important.
