PSA International (PSA), Pacific International Lines (Pte) Ltd (PIL), IBM Singapore (IBM) have successfully concluded a blockchain-based supply chain trial.
PSA is one of the world’s largest port operators with over 40 terminals in 16 countries across Asia, Europe and the Americas and flagship operations are in Singapore and Antwerp. PIL is ranked 11th amongst the top containership operators in the world, offering container liner services and multi-purpose services at over 500 locations in 100 countries worldwide
PSA, PIL and IBM signed a MOU in August 2017 to collaborate on blockchain-based supply chain business network innovations. The objectives included achieving better security, efficiency and transparency in regional supply chain business networks, as well as connecting to trade finance solutions that can facilitate faster approval and fraud prevention.
Following the signing of the MOU, the companies worked on a Proof of Concept (POC) exercise, built on IBM Blockchain Platform, applying and testing a blockchain-based supply chain platform to track and trace cargo movement from Chongqing to Singapore via the Southern Transport Corridor.
The trial successfully achieved the objectives of transparent and trustworthy execution of multimodal logistics capacity booking and regulatory-compliant execution of multimodal logistics capacity booking process. It enabled real-time track and trace and permissioned access control for ecosystem participants.
The partners believe that there is now sufficient evidence to show that the concept can be taken to the next stage. The scope of the POC will be widened and the partners are eager to engage more participants from the different nodes of the distribution network that form the supply chain logistics ecosystem.
Roger Tan, Regional CEO Northeast Asia of PSA said, “PSA’s collaboration alongside our partners and relevant stakeholders in this Blockchain trial demonstrates our efforts to enhance physical and digital connectivity, as well as to improve efficiencies along the global supply chain. Ultimately, we hope to create value for our customers along the Southern Trade Corridor – a key route in the Belt and Road initiative.”
“We are highly committed to this idea because we as a company believe the wider application of blockchain across the global logistics and shipping businesses will lead to much greater operating efficiencies, security and transparency. It is the future for our industry,” commented Mr Teo Siong Seng, Managing Director of PIL.
Blockchain is expected to transform the shipping industry, which relies on large number of (often physical) documents passing through a long chain of parties to ensure payments and delivery of cargo. Blockchain-based smart contracts with their transparent information sharing can radically alter this process.
In January this year, A.P. Moller – Maersk, a global leader in container logistics and IBM today announced their intent to establish a joint venture to provide more efficient and secure methods for conducting global trade using blockchain technology. The two organisations plan to jointly develop a global trade digitisation platform built on open standards and designed for use by the entire global shipping ecosystem. According to the press release, customs and government authorities, including Singapore Customs and Peruvian Customs, will explore collaborating with the platform to facilitate trade flows and enhance supply chain security. The global terminal operators APM Terminals and PSA International will use the platform to enrich port collaboration and improve terminal planning. The platform can also link users to important trade corridors in and out of China with support from Guangdong Inspection and Quarantine Bureau by connecting to its Global Quality Traceability System for import and export goods.
Looking beyond the shipping industry, blockchain has the potential to bring significant benefits to the entire logistics industry, across all stakeholders. Recently, Singapore announced collaborations with Hong Kong and Japan for blockchain-based cross-border trade platforms, which would lay the foundation for a regional digitalised trade and supply chain platform in Asia.