Blockchain for Brexit


29 March 2019 is set to be another D-Day: Brexit. Some people think there might still be a new referendum in the UK which could potentially halt the whole Brexit process, but even if companies are hoping that this will happen, they should still be making preparations in case it doesn’t.

“Brexit is the same as 28 divorces”, explained Gartner analyst Tom Enright in a packed auditorium during a recent conference in London. He predicted that Brexit will spell disaster for supply chains. “14,000 trucks arrive in the UK every day and 28% of the goods come from the EU. The contracting side is a problem because companies must have visibility of the entire suppliers’ network.”

To illustrate his point, he used the example of a purchaser at an Italian company that mainly sources semi-finished products from France. But the French supplier has used components from Spain that in turn contain some parts originating in the UK and others from Germany. The supply chain in this real-life example crosses the UK border twice. “Supply chain managers and directors must lead their company’s Brexit strategy”, advised Enright. “Because a silo-based approach won’t fix this.”

Lack of clarity about future trade agreements

A recent survey by the Chartered Institute of Procurement & Supply found that 43% of British businesses are unable to prepare for Brexit because of a lack of clarity about future trade agreements. In contrast, the Dutch customs authority is making preparations by recruiting 900 extra employees to deal with the new customs formalities resulting from the UK’s departure from the EU. These controls could cause a 20-minute wait for trucks, mainly carrying fresh fruit and vegetables, at the ferry terminals en route to the UK.

Earlier this year, Maersk and IBM conducted a successful pilot project using blockchain to speed up the processing of 200 documents associated with the import of avocados from Africa to Rotterdam. Meanwhile, the Belgian start-up called T-mining has already supplied three successful blockchain applications to the Port of Antwerp, including one for the import of apples from New Zealand. The European ports should seize Brexit as an opportunity to make large-scale use of blockchain to automate and hence speed up the completion of the customs procedures.

Martijn Lofvers, Chief Trendwatcher Supply Chain Media