Artificial Intelligence (AI) is not a new concept, but since the emergence of ChatGPT last year, the advantages versus the risks it could present as it becomes smarter and more prevalent have been widely debated everywhere. When it comes to global trade, there are powerful arguments as to why AI should be embraced, and understandable concerns around the ethics, accuracy, and security of data. At a recent Thomson Reuters event, Liz Connell, Senior Director of Product Management at ONESOURCE Global Trade, discussed why AI is relevant to global trade and how it can be applied effectively.
AI is here to stay: it’s not something that businesses can simply ignore. So it’s important to understand what it is, and how it can help companies that engage in global trade. For Connell, one of the most important takeaways is that AI should be seen as an enabler, not a threat to jobs, pointing out that AI technology can help global trade professionals keep on top of the multitude of expectations on them.
Staying on top of demanding requirements
“Global trade managers must have the technical know-how of an engineer, the legal sense of an attorney, the scrupulousness of an accountant, the organizational skills of a project manager, the business acumen of an executive, the cultural awareness of a diplomat, and the communication skills of a leader. That is asking so much. There is a lot…to balance every day,” she said. “AI is not replacing you: this is a tool to help you…do your jobs better.”
As professionals’ roles become more demanding, so the business of global trade is getting more complex by the day, and sophisticated tech tools are increasingly necessary to keep on top of the fast-evolving regulatory and compliance requirements. A raft of new sanctions, export controls and regulatory updates were introduced last year, including more than 740,000 updates in the first eight months of 2023 alone.
Staying up to date with these changes can seem like a near-impossible task. Then there are the reporting and filing requirements. A huge amount of data is being generated in the process which must not only be reported to government agencies around the world but shared with supply chain partners too.
AI’s role in international trade
Against this backdrop, finding ways to make processes more efficient and being able to surface actionable insights easily can play a big part in improving international compliance programs. AI is the answer:
- AI can automate repetitive processes, such as in product classification. It can learn how to classify products, and then provide recommendations or predictions that you can either select or ignore, based on your knowledge and experience. This can help save time and improve accuracy.
- Another way AI in global trade can be extremely useful is in proactively detecting abnormalities in your data processing, such as by flagging up problems in the data flow, pointing out what data you might be missing, or highlighting where areas of risk in your business operations.
- There are helpful ‘conversational’ experiences you can have with AI, such as asking a chatbot for answers on what regulations you need to know about when shipping to a new location.
As is to be expected, companies are at different stages of the AI adoption journey. According to research by ONESOURCE, some are still managing everything through spreadsheets and disparate systems, while others are now deploying a global trade platform, and almost a quarter (23%) are exploring emerging technologies to help them – a finding which tallies with the Thomson Reuters 2023 Corporate Global Trade Survey Report.
AI in trade is delivering business benefits
As those companies with the most advanced tech tools in place testify (Source: Thomson Reuters Global Trade Survey 2023), they are largely pleased with how sophisticated solutions are enabling them to keep on top of trade classifications, make better decisions, become more efficient, and have greater clarity over trade rules and requirements. All of which have a bearing on compliance as well as competitiveness. As those tools become even more intelligent, there will be even greater compliance and business benefits to be gained.
It’s becoming clear that using clever tools can make a big difference to the task of managing the fast-paced and disruptive nature of global trade, putting power in the hands of global trade professionals.
As Connell said, “Technology is nothing without the right people. We need you, the trade professionals, to learn and to lean in, to be aspirational in your technology goals. You need to understand the technology you’re using, how it’s adapting and leveraging AI to make your business better.”
AI insightsFind out more about how AI can help you enhance your compliance program and keep up with the competition. | |
FAQs
AI's role in international trade
What is the role of artificial intelligence in international business? ›
The current digitalization trends have opened global borders and reduced entry barriers. Artificial intelligence is a digital technology that has changed the nature of international business and it enables businesses to use adaptive algorithms to perform tasks previously requiring human intelligence (Ahn et al., 2022).
How AI is affecting international business? ›
AI can improve predictions of future trends, such as changes in consumer demand, and better manage risk along the supply chain. By enabling businesses to more effectively manage complex and geographically dispersed production units, such tools significantly enhance efficiency of GVCs.
How will AI/ML change cross-border trade? ›
AI will facilitate quicker, cost-effective, and transparent cross-border transactions by overcoming the constraints of existing systems and revealing untapped potential. This will facilitate global economic expansion and provide advantages to enterprises of every scale.
How to stay up-to-date with Generative AI? ›
To stay updated on the latest AI developments and trends, subscribe to AI newsletters, join AI-focused online communities, follow leading AI researchers and organizations on social media, and participate in webinars, conferences, and continuous learning platforms.
How do you keep up with the rapidly evolving field of AI? ›
One of the best ways to keep up with the rapidly evolving field of AI is to learn from the experts who are leading the research and innovation. You can follow the blogs, podcasts, newsletters, or social media accounts of AI thought leaders, such as Andrew Ng, Yann LeCun, Fei-Fei Li, or Geoffrey Hinton.
How can AI be used in international trade? ›
AI algorithms can analyze transaction data, financial records, and shipping information to identify suspicious patterns or anomalies that may indicate fraudulent activities. This enables customs authorities and businesses to take proactive measures to prevent illicit trade and protect intellectual property rights.
How is AI harming the economy? ›
For the other half, AI applications may execute key tasks currently performed by humans, which could lower labor demand, leading to lower wages and reduced hiring. In the most extreme cases, some of these jobs may disappear.
How does AI connect to globalization? ›
This revolutionary technology has shaken the foundation of globalization and changed every aspect of our work lives. With large language models (LLMs) and neural machine translation (NMT) entering the market, AI has the potential to wipe out even the most consolidated and efficient globalization structures.
Where will AI be in 10 years? ›
What will AI look like in 10 years? AI is on pace to become a more integral part of people's everyday lives. The technology could be used to provide elderly care and help out in the home. In addition, workers could collaborate with AI in different settings to enhance the efficiency and safety of workplaces.
Roles focused on data analysis, bookkeeping, basic financial reporting and repetitive administrative tasks are highly susceptible to automation.
How is AI used in trade compliance? ›
Used for broad tasks such as mapping supply chains down to classifying Harmonized System (HS) codes, AI offers an opportunity to improve how logistics service providers and enterprises approach compliance, and how governments can improve each of their enforcement measures.
Can AI replace trading? ›
Artificial intelligence (AI) is transforming the way that investment decisions are made. Rather than relying primarily on intuition and research, traditional methods are being replaced by machine learning algorithms that offer automated trading and improved data-driven decisions.
How will AI impact trading? ›
AI enhances trading algorithms, making them more efficient and capable of executing trades at unprecedented speeds. These advanced algorithms process extensive data sets quickly, enabling real-time decision-making and strategy adjustments.
How do I stay up-to-date with AI? ›
Subscribe To Newsletters
Newsletters are arguably the best way to stay up-to-date with the actual “news” in AI and the latest on the big tech giants. My go-to is The Rundown AI. You receive one email Monday to Friday with 2–3 of the recent biggest AI stories. It's unbelievably easy to read and scan over.
How do I stay updated with AI news? ›
To stay on top of the latest AI news and updates, you can check trusted news sources such as AP News for the latest articles on AI developments, new technologies, and industry trends. You could also follow some popular tech news websites, or even subscribe to email newsletters that focus on AI and related topics.
How do I get involved in AI development? ›
To pursue a career in AI after 12th, you can opt for a bachelor's degree in fields like computer science, data science, or AI. Focus on learning programming, mathematics, and machine learning concepts. Further, consider pursuing higher education or certifications to specialize in AI.
 - Shopify)