The World Economic Forum rolled out a guide for adding blockchain technology into supply chains after the pandemic revealed critical vulnerabilities in the nervous system of the global economy.
As some factories around the world are completely shut down amid distancing and quarantine orders, the resilience of supply chains can be improved by deploying the technology which is underpinned by transparency and traceability, according to the Forum.
“There are many lessons to learn from the current pandemic and this toolkit is a starting point for improving long-term pandemic preparedness and accelerating an economic recovery led by public-private cooperation.” said Nadia Hewett, the blockchain and digital currency project lead at the Forum.
Blockchain, a digital record-keeper secured using unique ‘fingerprints’, promises to have far-reaching implications for global trade and supply chains as it can be used as a record-keeper to improve health and efficiency at various touch points.
Since 2016, the UAE government has been rolling out initiatives that harness the technology’s potential as a part of its digital transformation efforts. On the federal level, the UAE is aiming to have half of all government transactions conducted using blockchain by 2021. Already 80 per cent of public and private sector entities are using the technology, according to a January report from the Forum.
China, at the heart of the global export and import network, shows the extent to which supply chains were hurt by Covid-19’s spread. The country recorded a 4 per cent drop (in US dollar terms) in January and February combined from the same period a year earlier, while exports dropped by 17 per cent over the same time period, according to official Chinese trade statistics.
The Forum’s toolkit is the culmination of more than a year of efforts to capture best practices from blockchain deployment across industries to minimise vulnerabilities in the future. Drawing on the global expertise of more than 100 organisations – including governments, companies, start-ups, academic institutions, civil society, international organizations and technology and supply chain experts – the toolkit helps companies manage the complexities of deploying this new technology and aims to accelerate its positive impact.
“Covid-19 has shown us that there is a real and urgent need to accelerate the implementation of these technologies,” Abdulla Al Kendi, an executive director at Abu Dhabi Digital Authority, said. “The toolkit offers tangible next steps to implementing a blockchain system for greater transparency, visibility and accountability across supply chains.”
Saudi Aramco, part of the pilot of the new toolkit, used it to help with managing new suppliers who needed to be on-boarded and verifying the credentials of new hires.
Among the many others who contributed to its development in over 50 countries, were the Centre for the Fourth Industrial Revolution UAE, the Port of Los Angeles, the World Bank and the World Food Programme.