ICT to Overstep North-South Trade Barriers

Information and Communication Technology (ICT) enables people and organisations to work better across distances, to co-ordinate more closely and to bring together multiples sources of information on a common platform. These advantages are increasingly relevant in international trade to facilitate complex import and export procedures.

 Over the past 10 years, developing countries have also become more engaged in international trade. Africa traded USD424 billion in 2007 – an increase of 16 per cent from 2006 – providing a significant source of income and economic growth to the continent. Microsoft believes that encouraging greater access to technology in the developing world provides an opportunity to facilitate trade, emulate best practices and overcome North/South barriers.

For example, in Senegal, the local ICT company Gainde2000 developed ORBUS, a paperless electronic single window solution based on Microsoft technology to facilitate preclearance formalities by linking multiple Government agencies, banks and importers and exporters. By putting in place the best available infrastructure from the outset, Senegal has been able to provide a full end-to-end secure paperless customs platform that enables the country to trade more effectively with the rest of the world. The solution is also being implemented in Kenya.

Another Microsoft partner, TradeFacilitate, developed an electronic platform that updates existing customs systems, including ASYCUDA (Automated SYstem for CUstoms DAta system implemented by the UNCTAD in the 1970s), to the latest technology standards for paperless trade – leapfrogging gradual improvements in infrastructure. This platform has specifically targeted small and medium enterprises (SMEs) in developing countries throughout Africa, Latin America and South East Asia so that they can benefit from the latest technology and meet paperless trade requirements from the US and EU. An African and APEC program will be rolled out in 2009 with the EU CP3 Group on Import/Export Electronic Trade for SMEs, with an initial pilot project launched in April 2008 for Ethiopian exporters. It is estimated by CP3 that the time elapsed between the initial transmission of data by an exporter and the receipt of permission to export will become minutes rather than the current paper-based 30 days through the use of the TradeFacilitate platform. CP3 warns that Ethiopian exports of USD923 million could be in jeopardy by 2011 and that 400 Ethiopian exporters are expected to benefit from access to the solution by 1 July 2009. Other countries currently in discussion to use the platform are Taiwan, Vietnam and Thailand.

As technology skills develop globally, innovative applications are increasingly being created locally to address the specific needs of developing countries thus benefiting them directly and enabling the North to learn from the South. In Kenya, Microsoft partner Virtual City Ltd. built a unique radio frequency identification (RFID) tracking solution to help Kenya’s cattle farmers keep track of data on the medical history and whereabouts of each cow destined for the export market. By inserting a low-cost tracking device in cows’ stomachs and digitizing the relevant data, cattle farmers in Kenya now meet EU food traceability regulations, thus reopening a market that had been closed in the past. The system can also easily be adapted for use in other countries.

As global trading systems change, large trading partners (US and EU) are increasingly imposing more stringent requirements on imports. Technology will help developing countries meet these requirements, ensuring continued market access and the ability to remain competitive in the long-run

Source: Frank McCosker, Managing Director, Global Strategic Accounts, Microsoft.