The Saudi kingdom receives over 15,000 ships with 6.5 million containers yearly. The country prides itself on its ability to process clearing transactions in 24 hours or less from time cargo enters ports.
It now has the ability to do it in less than 30 minutes.
You can thank its blockchain tracking system Fasah for that.
Fasah is an automated 100% electronic system, adopted by Saudi Customs, and aims at removing SAR1bn ($270 million) in unnecessary cost, and saving 34 million hours of work, according to a Fasah video on Youtube.
And recently it took an important step further to bolster Saudi’s cross-border trade.
What is Fasah?
According to NewsBTC, and quoting a report in RTT News, Saudi Customs is currently experimenting with tracking shipments on the blockchain. The project will link the Saudi customs officials’ existing shipment tracking platform, known as Fasah, to a blockchain-based one, powered by TradeLens.
Danish logistics firm Maersk and IBM created the blockchain shipment tracker solution with the aim of moving the world’s global supply chain to the blockchain. TradeLens itself was announced last August.
The TradeLens platform is expected to save thousands in overall costs for those customs agencies that choose to use it.
The Saudi pilot involves the integration of Fasah with the TradeLens platform.
“Fasah is a preexisting platform connecting all those involved in the nation’s cross-border trade. This includes both government and private entities,” says NewsBTC.
“The TradeLens integration with Fasah will reportedly bring greater traceability and reduced auditability. This is expected to lead to large savings for Saudi Customs. In fact, it is said to be capable of reducing shipping time by a massive 40%.”
Saudi hopes to position itself as the No.1 logistics hub regionally and 25th globally through its early use of blockchain in supply chain tracking.
TradeLens currently comprises of over 20 port and terminal operators.
Saudi blockchain pilot scheme concluded
According to the CoinTelegraph, Customs authorities in Saudi have concluded on December 26, 2018, a pilot scheme linking its cross-border trade platform Fasah with IBM and Maersk’s TradeLens blockchain platform, launched with almost 100 entities willing to take part in the pilot.
“The pilot comes in line with our strategy that aims to facilitate trade and enhance security levels, while working to establish the kingdom as one of the world’s premier logistics hubs,” Saudi Customs governor Ahmed Alhakbani said.
The UAE and Saudi have stepped up activities aimed at integrating blockchain technology at the state level in recent months.
“In December, a partnership launched to develop interbank blockchain tools for Islamic finance, while the Kingdom also announced it was joining the UAE in creating a joint cryptocurrency for interbank transactions,” said CoinTelegraph.
Saudi customs stats
Saudi Customs succeeded in completing the customs procedures for more than 1,373,000 customs declarations during H1 2018, according to the Saudi Gazette.
Faisal Saad Albedah, Deputy Governor for Trade Facilitation, Saudi Customs, pointed out that the volume of exports and imports during the mentioned period exceeded 66 million tons with a value of $99.7bn.
Albedah emphasized the contribution of the electronic national system for import and export “Fasah”, a joint effort of 25 government entities, in achieving positive outcomes in the clearance procedure, through enabling companies to track and complete their clearance procedures electronically.
Supply chain faces a crisis
Transportation and logistics industries have operated largely the same way for decades.
But the surge in e-commerce in the last several years, combined with consumers’ appetite for same-day delivery, has brought us to a tipping point, according to Business Insider (BI).
“Delivery companies are doing all they can to get orders to customers’ doors as quickly as possible, which has facilitated wholesale changes in how they operate,” says a recent BI report.
Cutting-edge digital solutions (including digital freight services, warehouse robotics, AI for supply chain management, delivery robotics, and autonomous driving software) are forcing traditional delivery companies to either evolve or see their core businesses erode.
In the first half of 2018 alone, fintechs secured $57.9 billion, nearing the previous annual record of $62.5 billion set in 2015.