|22 September, 2019

Saudi Customs: Blockchain technology vital in shipping sector development

The adoption of this technology by Saudi Customs is the first in the region

Image used for illustrative purpose. Container ship in import export and business logistic, By crane, Trade Port, Shipping cargo to harbor, Aerial view from drone, International transportation, Business logistics concept.

Image used for illustrative purpose. Container ship in import export and business logistic, By crane, Trade Port, Shipping cargo to harbor, Aerial view from drone, International transportation, Business logistics concept.

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RIYADH — Saudi Customs, in partnership with the Ministry of Communications and Information Technology, the General Authority of Ports, and Maersk International Company, held a press conference to present the successful Blockchain pilot and the importance of blockchain technology in the shipping industry. It encompassed the guarantees the latter provides in enhancing the security of global supply chains and improving the reliability of shipping procedures through all stages, from origin to arrival.

Subsequently, the General Manager of Marketing and Customer Service at Saudi Customs Adel Baraja inaugurated the conference, emphasizing the role of Saudi Customs in alignment with Vision 2030. He pointed out that Saudi Customs is considered to be one of the most cross-functional organizations across both the government and private sectors, placing Saudi Customs at the heart of government entities essential to achieving the goals of the Kingdom’s Vision 2030.

For his part, Dr. Hisham bin Abbas, Advisor for Modern Technologies and Blockchain at the Ministry of Communications and Information Technology (MCIT), explained that the Ministry's direction is to develop new technologies to ultimately enhance the Kingdom's position and make it one of the most important centers of the world. Within the ICT sector, the Ministry focuses on enabling and disseminating blockchain technology as one of the most prominent modern technologies through an implementation plan to build an integrated ecosystem.

Mohammed Al-Otaibi, General Manager of Information Technology at the General Customs Authority, reviewed the experience of the institution in utilizing blockchain technology in the customs work and the steps of digital transformation in Saudi Customs, focusing on the most important challenges for this technology and the benefits it achieved.

Al-Otaibi addressed the launch of the first shipment by adopting the "Blockchain" technology from King Abdulaziz Port in Dammam to the port of Rotterdam on May 12 last year. He pointed out that the adoption of this technology by Saudi Customs is the first in the region. This step reflects the strategy of Customs in promoting automated solutions and smart systems to facilitate cross-border trade, especially through the seaports, which account for roughly 80% of trade in the Kingdom.

Al-Otaibi explained during the conference that blockchain technology supports the business development of major importers and traders by reducing time and cost and enhancing the security of supply chains. At the global level, he stressed that this technology offers a digital reference documenting all the phases of the shipping procedures and allowing the relevant parties to access them simultaneously, without the intervention of any external party, which promotes international cooperation to ensure safety of trade and the reliability of global supply chains.

In this context, the regional director of MAERSK, Mr. Mohamad Chehab, noted that: The company renewed its vision towards becoming a global logistics company for container shipping, and the company's most important step in achieving the vision was to develop shipping processes with its customers. To satisfy their expectations, the company has created various products and services to facilitate their shipments including Trade Finance, Remote Container Management (RCM), and Maersk Spot, which allows the customer to book the shipment directly through the Maersk website. As a result, the company's investment in the development of digital solutions has become a pillar for the prospective transformation.

Simultaneously, Maersk and IBM have built the TradeLens platform, a common platform for users from airlines, ports, terminals, customs authorities and customers, to automatically and reliably deliver their shipment data via blockchain technology. 

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