POSCO International Builds 'Blockchain Trade Platform'... "Leading Trade Advancement"

POSCO International-KTNET Business Agreement Ceremony. Ju Si-bo, President of POSCO International (left), and Cha Young-hwan, President of KTNET.

Photo by POSCO International

[Asia Economy Reporter Hyunseok Yoo] POSCO International is pioneering a new paradigm in the trade sector by building a blockchain-based platform.

On the 28th, POSCO International announced that it had signed a Memorandum of Understanding (MOU) with Korea Trade Network (KTNET) to promote trade digitalization. The signing ceremony was held at POSCO Tower Yeoksam Center, attended by POSCO International President Joo Si-bo and KTNET CEO Cha Young-hwan, among others.

Korea Trade Network is a wholly owned subsidiary of the Korea International Trade Association and is the only company designated by the Ministry of Trade, Industry and Energy as an ‘Electronic Trade Infrastructure Operator’ in South Korea.

Through this MOU, both companies agreed to cooperate on ▲digitalization of the export negotiation process ▲linkage and utilization of digital logistics information ▲building a blockchain-based digital trading platform.

The blockchain-based trade platform moves away from the traditional paper-based trade methods and is a system that verifies ownership and manages the history of documents used in trade, such as bills of lading and drafts, within a designated platform.

For example, when exporting products to Japan and receiving payment via a letter of credit, the existing process takes at least a week. After shipping the goods, the bill of lading is received, and various documents including this must be submitted to the bank to receive payment. Additionally, delays in customs clearance often occur because the original bill of lading, which represents the rights to the cargo, does not arrive at the destination on time.

Applying blockchain technology to trade can significantly improve these inefficiencies. Exporters, importers, logistics companies, and banks can upload the relevant documents to the blockchain platform in the order the trade progresses. Blockchain technology verifies the processing steps and timing, enabling trusted transactions without the need to send original documents.

POSCO International plans to first pilot the blockchain trade platform for its own trading corporation and POSCO’s overseas steel production subsidiaries. It is also reported that they plan to develop a global blockchain network that can be accessed by general overseas companies in the future.

A POSCO International official stated, “Integrating AI technology or digitalizing international trade operations, which involve different languages and cultures, is not easy. We will combine POSCO International’s extensive trade experience with Korea Trade Network’s digital technology to develop a transparent and efficient digital trade platform accessible to everyone.”

Meanwhile, in February, POSCO International established a task force composed of employees with deep understanding and practical experience in international trade to enhance business competitiveness and operational efficiency. This MOU is a result of the creative innovation project titled ‘Digital Trading System Establishment.’