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Blockchain development initiative

If China embraces transparency

by Port News Editorial Staff

The Blockchain will dramatically revolutionize logistics. They are convinced of this in China too where major players in the bulk market have recently published a white paper on the effects that this technology can have on the management of transport documents and the traceability of goods.

Two giants in the energy sector, China Merchants Energy Shipping (division in the Dry and Liquid segment of China Merchants) and Cosco Shipping Energy Transportation (China Cosco Shipping Group’s branch in the oil & gas sector), are promoting such an initiative.

The two giants have revealed that they want to develop a digital platform to transfer the entire documental process required for shipping goods.

It is striking to see that in China, too, they are embracing the cause of transparency and freedom of information. Oil companies, pipeline operators, ports, financial institutions and trading houses will all be part of a shared register that will allow everyone to add the data generated by their own systems to an infrastructure capable of storing all the information.

The initiative sponsored by CMES and CSEST has already made progress: many have signed the white paper. Among those involved are: Sinochem Energy Hi-Tech; PetroChina International,and institutions such as the Bank of China and China Construction Bank.

“The shipping companies active in the tanker segment are a key sector for the entire global economy” – say the promoters of the document – “the sector needs to operate in absolute security and manage a multitude of information promptly “.

Not only: the blockchain can become an important tool for acquiring new resources that today are very difficult to find in the market through traditional financing mechanisms, such as corporate guarantees and project financing.

A practical example of the various uses of this technology? The tool can automatically authenticate the application of demurrage fees for the use of terminal space beyond established time limits, or charge the other fees provided for in the freight contract, if due. The payment of these fees can also be facilitated through smart remote contracts.

“The Blockchain is the most disruptive innovation since the internet,” said CMES chairman Xie Chnuling.

Translation by Giles Foster

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