This report provides a preliminary estimate of the costs and benefits of deploying digital trade products and processes for New Zealand.
Digital trade encompasses the supply of cross-border goods and services enabled by electronic data flows based on a myriad of interoperable platforms and applications. TradeWindow is a provider of these products. While they and their direct customers will be major beneficiaries of digital trade, the benefits will spill over to all participants in the supply chain, including government, logistics companies, customers, banks, and other supply chain participants.
Digital trade products such as those provided by TradeWindow have the potential to fundamentally change the supply chain for specific products by providing automated services that make it much easier and faster to trade legitimate products. These automated services offer multiple benefits:
- Productivity gains. These include ‘one off’ productivity gains from moving away from paper-based systems, ongoing benefits as resources shift from skilled labour-intensive paper systems to more productive activities, and improved ability to innovate.
- Connectivity gains. Increased ability to trade as barriers to trade are broken down allowing more trade in old products in old markets, old products in new markets, and new products in new markets
- Predictive gains. Digital trade generates a large amount of new product-specific data at low cost. This data can be used to predict product-specific demand and fluctuation in demand, greatly increasing the ability of suppliers to anticipate demand.
- Visibility and transparency gains. All permissioned parties within the value chain can access one set of documents (the source). This avoids confusion on what trade terms parties agreed upon and clarifies the obligations of each of the parties.
- Inclusiveness gains. By making it easier to trade, trade barriers are reduced especially for MSMEs (micro-, small and medium-sized enterprises) and SMEs (small and medium-sized enterprises). This allows more SMEs and MSMEs to be involved in trade and share in the potential benefits relative to trading exclusively on the domestic market. It may also improve perceptions of trade more generally