TheFutureofTrade|TheEmergingViewInsightsfromMul0pleExpertDiscussionsAroundtheWorld

ContextTradeisoneofthekeythemesaddressedintheFutureAgendaprogramme.

Inrecentyearsithasgrownininfluence,recogni0on,focusandhenceconcernforawiderangeofindividuals,organisa0onsandgovernments.

FutureAgendaTheFutureAgendaistheworld’slargestopenforesightprogram

thataccessesmul0pleviewsofthenextdecadesoallcanbebeFerinformedands0mulateinnova0on.

LookingForwardsOrganisa0onsincreasinglywanttoiden0fyandunderstand

boththean0cipatedandunexpectedchangessothattheycanbebeFerpreparedforthefuture.

FutureAgenda1.0TopInsightsfor2020Fromthe2010program,52keyinsightsonthenextdecadewereshared

widelyandhavebeenextensivelyusedbyorganisa0onsaroundtheworldtosupportstrategydevelopment,innova0onandleadershipthinking.

FutureAgendainNumbersThefirstFutureAgendaprogrammeengagedawiderangeofviewsin

25countries.FutureAgenda2.0hasdoubledtheface-to-faceinterac0onandsignificantlyraisedonlinesharing,debateanddiscussion.

FutureAgenda1.01HOST16TOPICS25COUNTRIES50WORKSHOPS1500ORGANISATIONS

FutureAgenda2.050HOSTS25TOPICS40COUNTRIES120WORKSHOPS4500ORGANISATIONS

FutureofTradeDiscussionsDiscussionsonthefutureoftradewereundertakeninpartnershipwiththeDMCC.InsightsfromeventsintheUK,HongKong,SouthAfricaandIndiaplusmanyfromothertopicshavealladdedmoreviewsfromaroundtheworld.

Ini0alPerspec0vesQ42014

GlobalDiscussionsQ1/2/32015

InsightSynthesisQ42015

SharingOutputQ12016

TheFutureofTrade|TheEmergingViewThisdocumentprovidesanoverviewofwhatweheardfrommul0pleexpertvoicesaroundtheworld–onthefutureoftrade,howitischanging,whatis

drivingthischangeandhowitmayevolveoverthenextdecade.

SixKeyThemesAcrossthemul0plediscussions,issuesrelatedtotrade

seemtobetouchinguponandconnec0ngwithsixunderlying,andinterwoven,themeswithdifferentemphasisindifferentcountries.

Shi^ingPowerandInfluence

ImpactofDigital

FundingforTrade

StandardsDrivingTrade

AccesstoTalent

SystemEfficiency

SHIFTINGPOWERANDINFLUENCE

ANewOrderWearewitnessingthetransi0ontoaneworder:Newna0onalinterests,

newtradingroutes,newproducts/servicesareallemerging.Howtoensurethedevelopmentoftradeinthisenvironmentwillbekeytosuccess.

CentreofGlobalEconomicPowerThecentreofgravityofeconomicpowercon0nuesshi^ingeastwards,backtowhereitwas200yearsago.Recentsuperpowersseektomoderatethepaceofchangebutthereali0esofpopula0onandresourceloca0onsareimmoveable.

ChangesinGlobalLeadershipAsdemographicshi^s,newalliancesandeconomicchallengesre-align

globalpowerandinfluence,newleadersemergeandcontrolintheworldchangesinfavourofsome-butwithotherss0llholdingthebalance.

ChinaasAsia’sVoiceDespitegrowthofotherASEANna0ons,forthenextdecadeChinaremainsthecleareconomicleaderintheregion–becomingmoreinfluen0alasthe

primarysourceofcapitalandthevoiceofAsiaontheworldstage.

SleepingEagle-WakingDragonChinauseseconomicmightandso^diplomacytoreshapetheworldorder,usurpthedollaranddominateworldtrade.Asaresultmigra0ontoAsia

increases,changingestablishedmarketplaces.Africawillsufferasaresult.

TheStartofChangefortheYuanSpecialDrawingRights(SDRs)areastartforChina’snewglobalroleastheyeffec0velymeanofficialrecogni0onbytheIMFthattheYuanisac0ngasareservecurrencydespiteChina’sextensivecapitalcontrols.

CiUesNotCountriesCi0esaremoreimportantthancountriesandincreasinglysetthestandardsasculturalconnec0onspredominateoverna0onaliden00esandurbanmarketsgrouparoundcommonissues.

TheRoleofAfricaLedbyagrowingnumberofbreakawaycountriesshowingeconomicandpoli0calprogress,thenext1bnconsumersinAfricajointheglobalmarket.

Barrierstotradeareli^edandinfrastructureisimproved.

InternaUonalSecurity–aPublic/PrivatePartnership?Increasingglobalunrestandrisinginterna0onalfundamentalismchallengetraderoutesandplacesofproduc0on.Corporatesenhancegovernmentsecuritytoprotectassetsandmaintainsafeworkingenvironments.

STANDARDSDRIVINGTRADE

Globalvs.BilateralAgreementsAkeyques0onforthenextdecadewillbewhetherwewillbeabletoachievetrueglobalagreements,orwillbilateraltradeagreementsremainthewaybywhichna0onscanbeFermanageandcontroleconomicinfluence?

AppropriateRegulaUonMoreappropriateregula0ondriveshot-spotsoftradegrowththroughspecialeconomiczonesandfree-zonesthatresultinthemovementofbusiness,peopleandwealth.Protec0onistregimesloseoutasaresult.

StandardsProtecUngInterestsGlobalandregionalstandardsareusedasatooloftradeprotec0onismwithinspecificsectorsandmarkets.Locallyfocusedregula0onsandprotocolsfavour

mul0na0onalsandincumbentsbutarebarrierstonewexporters.

TheFallofTradiUonalTradeInsUtuUonsCivilsocietyandchangingbusinessnormschallengethecalcified,outpacedandincreasinglyirrelevantstate,governmentandglobalins0tu0ons.Thedigital,opensource,IPsharingeconomyplaysbydifferentrulesandagreements.

NewTradeDialogueAslegacyins0tu0onsbecomeirrelevant,inorderfortradetoflourish,thereisaneedfornewformsofsocialinterac0onandabilitytocommunicateacrosscultures.Thisemergesaroundnew,highgrowthtradingroutes.

AutomatedTradeBeFerandmoreautoma0oniscoupledwiththegrowthofsensorsandotherM2Mmobiletechnologiestomakemoreefficientconnec0ons

betweenitemsandcustomsagencies.Costsdeclineandspeedincreases.

GrowthofSpecialEconomicZonesAlthoughsomeseelimitstotheirapplica0on,goingforwardSpecial

EconomicZonesareexpectedtoplayacon0nuedmajorroleinprovidingthefacili0esforaccelera0ngchangeandimprovingtradeefficiency.

FUNDINGFORTRADE

NewTradingRoutesThenextdecadewillseethepost-warrouteseclipsedbythepowerofthe

IndianOceanregionwithnewportconstruc0onplusproposedrailwaysfromcoast-to-coastacrossSouthAmericashowingtheshapeofthingstocome.

CapitalAvailabilityToovercomecon0nuedconstraintsonbanks,theneedforbeFer

SMElendingseesmorepeer-to-peerini0a0ves,smootherregula0onandmoreflexibleaccesstocapital–especiallyinemergingmarkets.

Cross-BorderCommerceCross-bordercommerceisgrowingfasterthandomes0ccommerceandsowillbecomeincreasinglyimportantandinfluen0al.Cross-borderflowofgoods,

servicesandfinancecouldincreasethreefoldto$85trillionby2025.

SeamlessUbiquitousPaymentsTheabilityto‘transactanywhere’withintegrated,sophis0cated

authen0ca0onsuchasbiometricsincreases:Morecontactlesstechnologyandaconvergenceofstandards,enableglobalinforma0onexchanges.

TheFundingChallengeInausterefinancial0mesthereisasignificantchallengefor

governmentsbeingabletofundthemaintenanceoftheexis0ngtransportsystemandinvestmentinnewinfrastructure.

NewInfrastructureInvestmentWith$4trillionofforeignreservesinitssovereignwealthfunds,China

hasplentyofcash.The‘OneRoad,OneBelt’ini0a0vewillre-openancientcommercialtraderouteswiththeWestandredefinetraderoutes

WiderPublicPrivatePartnershipsInregionswheregovernmentisseenasaninefficientprovider,pressureshi^stowardsmorepublicprivatepartnerships.Acrosshealthcare,educa0onandtransport,approachesincludeNGOs,technologyandnewbusinessmodels.

THEIMPACTOFDIGITAL

DigitalMarketplacesSharedbusinessmodelsanddigitalaggregatorsimproveefficiency,eliminatemiddle-menanddrivehigherincomes.Indiamovesbeyond

labourarbitragetobeaproviderofknowledgeandprofessionalservices.

ADataExchangeDataisacurrency,ithasavalueandaprice,andthereforerequiresamarketplace.Anecosystemfortradingdataisemergingandanything

thatisinforma0onisrepresentedinanewdatamarketplace.

RisingCyberSecurityGreaterinterconnec0vityandtheInternetofThingscreatesnew

vulnerabili0esforgovernmentsandcorpora0ons-astheunscrupulousandthecriminalincreasinglyseektoexploitweaknessanddestroysystems.

TheEndofIP?Followingchangeinthemusicindustry,technologiessuchas3Dprin0ngaredecouplingtheproduc0onofcontentfrom

theoriginalcreatorand,indoingso,IPisbecomingirrelevant.

Consumer-DrivenTradeAnewtradeorderleavesbehindthemonolithic,legacyins0tu0onsofthepost-warera:TradeisempoweredfromtheboFom-up,withconsciousci0zenshipdrivingmorenimbleself-regula0onandareduc0onoftariffs.

ACCESSTOTALENT

TheTalentChallengeAstheglobalworkforcebecomesmoremobile,howwillorganisa0ons

aFractandretaintoptalentandhowwillgovernmentsensuretheyprovidethemwiththerelevanteduca0onthatwillalloweconomiestothrive?

Non-LinearEducaUonPathsBuildingonthesuccessofonline,opencourses,therewillbeariseinnon-

lineareduca0onpaths.Successwillbere-definedtoincludeself-actualisa0onandmicro-badgingwillgaincredibility.Interna0onalbenchmarkswillemerge.

TheHybridExperienceLearningincreasinglytakesplaceviaacombina0onofphysicalspacesand

digitalclassrooms–andflowsseamlesslyacrossboth.Studentsusedifferentpartsoftheirbrainaseduca0onbecomesmuchmoreexperien0al.

InternaUonalMeasuresAccessible,affordabletoolswillemergetomeasureinterna0onalstudent

experienceabroad.Universallyacceptedstandardsincreaseaccountabilityofstudentsandstakeholdersandhelpgrowtheinterna0onaleduca0onmarket.

SkillConcentraUonsThegrowthofthenomadicglobaleliteci0zenshipacceleratesthe

concentra0onofthehigh-skill/high-rewardopportuni0eswithinaselectgroupofglobally-connectedci0zens,whomoveaheadoftheurbanpack.

SYSTEMEFFICIENCY

AutomatedTrucksAutonomousanddriverlesstrucksarenowstar0ngtohaveimpact.Thevisionoflong-distanceplatoonsoftrucksallrunningonintelligenthighwayswithout

drivershasbeenatopicforsomeyears...buttherealityisnotfaraway.

DroneDeliveryForsmall,0me-cri0caldeliveriesaswellasemergencyrelief,theuse

ofdroneswillgrow.Regulatoryandenvironmentalconstraintswillhoweverimpactshort-termwideruseatscale.

OpenSupplyWebsTheshi^fromcentralisedproduc0ontodecentralisedmanufacturingdrivesmanytotakea‘smalleranddistributed’approach:Globalsupplychainsarereplacedbymoreregional,consumer-orientatedsupplywebsandnetworks.

NewExchangeandDistribuUonModelsConnectedconsumersco-createnewformsofexchangeanddistribu0on,whicharesensi0vetoculturaldifferencesando^enlocalinnature.Thisreduceswasteandmaintainstheindividualityandvarietyofproducts.

LastMileEfficiencyThebenefitstobegainedfrombringingthesamelevelofefficiencytothelastmileasthereistothefirstthousandisaFrac0ngaFen0on:Therewillbemorefocusonreducinginefficienciesaroundthefinalpartofdelivery.

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