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Advancing Digital Trade and Trade Finance Solutions by Investing in Startups, Pilot Programs, and Digital Infrastructure
TL;DR:
The UAE-based IOTA Ecosystem DLT Foundation commits $10 million to support early-stage startups and ventures focusing on TradeTech, Trade Finance, and tokenization solutions. This funding aims to bolster a digital tradetech ecosystem in the UAE, Africa, and around the globe by advancing the roll-out of digital trade and finance solutions. The initiative builds on a recent collaboration agreement for the establishment of the TLIP organization, announced at WTO MC13.
In a move to advance the digitization of global trade and the creation of more accessible trade finance solutions, the UAE-based IOTA Ecosystem DLT Foundation announces its commitment to invest more than $10 million toward early-stage startups, ventures, pilots, and infrastructure roll-outs in TradeTech, Trade Finance, and Tokenization of real-world assets. The first investments will be shared publicly over the coming weeks and will include newly founded tradetech ventures and dedicated startup accelerator programs for startups building on IOTA.
This announcement follows the official signing of the collaboration agreement for the Trade Logistics Information Pipeline (TLIP) at the WTO MC13 event. TLIP is a public global trade infrastructure initially developed by the IOTA Foundation and TradeMark Africa. The TLIP Consortium will be founded jointly by the World Economic Forum, the Tony Blair Institute for Global Change, Trademark Africa, the Institute of Export and International Trade, and the Global Alliance for Trade Facilitation. Together they will advance TLIP by developing a neutral governance framework and establishing TLIP as a global, public goods infrastructure for trade.
Supporting TradeTech Ecosystem Through Investment
With its investment of $10 million, IOTA supports a flourishing tradetech ecosystem that advances trade digitization, and, in doing so, makes trade finance more accessible for all. The funds are earmarked for early-stage startups, accelerator programs, and pilot programs that will drive the development of digital trade infrastructure. There will be a particular focus on supporting startups headquartered in the UAE and across Africa, reflecting IOTA’s belief that these regions hold huge potential to spearhead the advancement of digital trade globally.
TLIP's experience in Kenya indicates that Africa is poised for a leapfrog opportunity akin to the transformative shift witnessed in the widespread adoption of mobile phones and mobile payments. The digitalization of trade from farm to transshipment and toward end consumers in the rest of the world presents a vast opportunity to enhance processes and make regional products in Africa more competitive and accessible, ultimately creating new jobs and sustainably improving living standards in the long term.
Grants for Ecosystem Projects
Dominik Schiener, Co-Founder of IOTA and Chairman of the IOTA Foundation, emphasized the strategic importance of this initiative: "By investing in the future of TradeTech, we are not just facilitating smoother trade transactions; we are laying the groundwork for a more interconnected and efficient global trade ecosystem. Our collaboration with leading organizations through the TLIP is a testament to our commitment to innovation and excellence in this field."
This initiative will be kickstarted with the launch of a public grants program over the coming weeks, followed by an accelerator program for startups in the UAE before summer and in Africa before the end of the year. These programs are designed to empower entrepreneurs and innovators who are building new trade solutions on the IOTA and TLIP infrastructure, offering them the resources and support needed to bring their visions to life.
Benefits of Digitizing Trade
The economic and operational benefits of trade digitization are profound. Digitizing trade transactions could slash costs by 80%, halve the trade finance gap, reduce cross-border processing times from 25 days to one day, and increase SME efficiency by 35%, studies by ICC UK suggest. These improvements will be pivotal for enhancing global trade efficiency and opening up new opportunities for businesses worldwide.
An Ecosystem of Digital Trade
The IOTA Ecosystem DLT Foundation's investment is a step toward redefining the landscape of digital trade and finance. By fostering a supportive ecosystem for innovation, the Foundation will unlock new possibilities for seamless and efficient trade, benefiting societies and economies around the globe. Interested parties are encouraged to join this ambitious journey toward a future where digital trade infrastructure empowers businesses and enhances global commerce.