China Adopts Blockchain to Facilitate Cross-Border Trade

Asia Blockchain Review
October 25, 2019
China Adopts Blockchain to Facilitate Cross-Border Trade

The Chinese government has disclosed that it will be implementing blockchain technology to enhance efficiency in processes relating to border trade in Hangzhou.

Digitizing Systems to Enhance Efficiency

According to Ledger Insights, the project will be initiated in Hangzhou as the city has seen rapid growth in trading due to developments in the logistics and e-commerce industries.

Another factor driving growth is that Hangzhou houses many bonded warehouses — tax-neutral spaces — where imports and exports must pass customs clearance before entering and leaving the country. Overall, Hangzhou handles over US$37.4 billion worth of imports and exports annually. 

City authorities have been attempting to digitize the border trade systems using new technologies, with import clearance times reportedly decreasing to 27 hours from approximately 191 hours previously. Exports take a much shorter time at a mere 12 minutes.

Promoting Border Trade with Decentralized Technology

The new blockchain platform will be jointly operated with the Hangzhou Internet Court, with payments, exchanges, taxation, and transportation data from custom clearances to be recorded on a blockchain.

The implementation of decentralized technology is expected to enhance the transparency of border trade processes, as well as ensure the accuracy of trade-related information.

Apart from the blockchain project, Chinese authorities also announced that they will be establishing a digital distribution platform, a ‘cross-border e-commerce college’ for training, research and development centers, and tax rebate pool for exporting enterprises.

Source: https://www.ledgerinsights.com


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