In a leap towards modernizing its trade infrastructure, the Mongolia National Chamber of Commerce and Industry (MNCCI) has embraced Blockchain through Morpheus Network to issue Certificates of Origin (COOs). The news was celebrated in the Morpheus Network community town hall earlier this week.
This initiative, funded by the Asian Development Bank (ADB), aims to streamline trade operations and enhance the integrity of COOs, which are vital documents in international trade.
Overcoming Traditional Challenges
Traditionally, verifying the authenticity of COOs has been a cumbersome process. Business entities often face inconsistencies that necessitate direct verification. This verification process not only incurs additional costs and delays but also undermines the benefits of preferential trade agreements and increases the risk of fraud.
The introduction of blockchain technology addresses these issues by providing a secure and efficient alternative to paper-based systems.
The Importance of Certificates of Origin in Mongolia
COOs are critical in international trade as they certify that goods in a particular shipment are wholly obtained, produced, manufactured, or processed in a specific country.
They are essential for benefiting from preferential tariffs under various trade agreements. For Mongolia, this includes the Generalized System of Preferences (GSP) covering 37 countries, the Asia-Pacific Trade Agreement (APTA) for six countries, and the Mongolia-Japan Economic Partnership Agreement (EPA).
By leveraging blockchain technology, MNCCI ensures that COOs are immutable and easily verifiable. This advancement significantly reduces the risk of fraud and errors, thereby fostering greater trust and reliability in international trade processes.
Introducing Morpheus Network and Blockchain Technology
With backing from the ADB’s Digital Learning Labs and collaboration with ADB’s East Asia Department (EARD), MNCCI embarked on an exploratory venture into blockchain technology. After stringent selection criteria, Morpheus.Network was chosen for its expertise in blockchain services.
From April to November 2023, Morpheus.Network developed a Minimum Viable Product (MVP) that digitizes, tracks, and manages the digital footprints of COOs on the blockchain.
This solution, branded as “Trust Powered by Blockchain,” integrates seamlessly with MNCCI’s existing systems. It ensures a smooth transition from traditional methods to advanced digital processes with minimal operational disruption. The immutable nature of blockchain records enhances security and trust among all stakeholders, promising to eliminate inefficiencies associated with paper-based systems.
Successful Implementation and Future Prospects
Despite the inherent complexities of integrating advanced technology into established infrastructures, Morpheus.Network delivered the project within the stipulated timeframe and budget. Their adept problem-solving skills, responsiveness to MNCCI and ADB requirements, and ability to navigate challenges were particularly noteworthy.
Looking ahead, MNCCI is keen on further expanding this solution through partnerships with international donor organizations. This commitment underscores Mongolia’s dedication to leveraging cutting-edge technology for enhanced transparency and efficiency in international trade.
This initiative sets a precedent for other countries looking to modernize their trade infrastructures using innovative technologies.
