Project Title

Improving Supply Chain Transparency with digital exchange of traceability and ESG (Environmental, Social and Governance) credentials to facilitate APEC trade flows 

Project Year

2023   

Project Number

CN_CTI_207_2023 

Project Session

Session 2   

Project Type

Standard 

Project Status

Project in Implementation   
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Project No.

CTI_207_2023A 

Project Title

Improving Supply Chain Transparency with digital exchange of traceability and ESG (Environmental, Social and Governance) credentials to facilitate APEC trade flows 

Project Status

Project in Implementation 

Publication (if any)

 

Fund Account

APEC Support Fund 

Sub-fund

ASF: Digital Innovation 

Project Year

2023 

Project Session

Session 2 

APEC Funding

105,000 

Co-funding Amount

Total Project Value

105,000 

Sponsoring Forum

Committee on Trade and Investment (CTI) 

Topics

Trade Facilitation; Digital Economy 

Committee

Committee on Trade and Investment (CTI) 

Other Fora Involved

Digital Economy Steering Group (DESG); Sub-Committee on Standards and Conformance (SCSC) 

Other Non-APEC Stakeholders Involved

 

Proposing Economy(ies)

Peru 

Co-Sponsoring Economies

China; Hong Kong, China; Korea; Singapore 

Expected Start Date

03/01/2024 

Expected Completion Date

30/04/2025 

Project Proponent Name 1

Maria Elena LUCANA 

Job Title 1

Coordinator 

Organization 1

Ministry of Foreign Trade and Tourism 

Postal Address 1

Not Applicable 

Telephone 1

+51999082412 

Fax 1

Not Applicable 

Email 1

mlucana@mincetur.gob.pe 

Project Proponent Name 2

Not Applicable 

Job Title 2

Not Applicable 

Organization 2

Not Applicable 

Postal Address 2

Not Applicable 

Telephone 2

+51971462551 

Fax 2

Not Applicable 

Email 2

servicios_dam05@mincetur.gob.pe 

Declaration

Maria Elena LUCANA 

Project Summary

The Putrajaya Vision 2024, pursues among others, transparent trade by promoting seamless connectivity and resilient supply chains, cooperating on facilitating the flow of data and strengthening consumer and business trust in electronic transactions, including MSMEs.
This project aims to support this vision by applying electronic exchange of paperless Traceability Registries and ESG (Environmental, Social and Governance) credentials on specific goods and trade routes in three pilot projects. Hands-on technical assistance will be provided for up to three voluntary economies.

The pilot projects are the best vehicles to validate supply chain transparency based on paperless exchange of traceability and ESG credentials (including traceability, deforestation, etc.) as they help trade facilitation, specifically to MSMEs, who finds it more difficult to meet these international trade requirements.

Relevance

Benefits to Region: Lack of traceability and trust on Environmental, Social and Governance credentials (ESG) across supply chains hinders trade facilitation. Works towards overcoming them will have sustained benefit for APEC economies and all sizes of companies, but
especially MSMEs. Pilots efforts with voluntary economies will provide guidance on how to successfully address these challenges.

The pilots will address issues such as efficiency (by eliminating unnecessary transactions, preventing the proliferation of different domestic standards and, enabling better informed and more accurate risk assessments); integrity (by verifying the reliability of the credentials exchanged and supply chain′s relevant information at each step); visibility (by increasing the transparency of supply chain processes, from origin to the end) and innovation (by enabling new ways to use information through ‘electronic ’ and “paperless” supply chain processes). In the absence of traceability and ESG Credentials, such benefits may be lost and it is likely that a number of different systems for sharing different types of information will be established, reducing the efficiency of trade.

Eligibility and Fund Priorities: This project meets the eligibility criteria of the Digital Innovation Sub-Fund because it is aligned with the following key areas of focus: (i) development of digital infrastructure, (ii) promotion of innovation and adoption of enabling technologies and services, (iii) facilitation of E-commerce and Advancing Cooperation on Digital Trade and (iv) enhancing trust and security in the use of ICTs.

Capacity Building: This project will provide hands-on technical assistance for up to three voluntary economies on the use of electronic exchange of paperless traceability registries and ESG credentials as a tool for supply chain transparency and efficiency. One of the expected outcomes is to develop a framework for replications with focus on MSMEs.

The project will provide information/data to demonstrate the impact on improving supply chain transparency and efficiency and contribute to better compliance and risk management, as well as to identify enablers, challenges and mitigation policies. The project will also provide information about the cost effectiveness for relevant stakeholders.

Ultimately, over the medium to longer term, the project is expected to provide relevant experience an information to facilitate economies’ decisions related to supply chain management and cross border trade facilitation. In addition, the project is also expected to increase the wider adoption of electronic exchange of paperless traceability data and ESG credentials in and across APEC economies by the public as well as private stakeholders.

Relevant processes, methodology and templates, in form of documents and presentational materials assisting member economies to understand and/or apply the project outcomes will be made available via the APEC document database.

Objectives

This project aims to facilitate trade among APEC member economies, with special focus on MSMEs.

Specific objectives are:

1.Demonstrate how supply chain transparency based on electronic exchange of paperless traceability and ESG credentials helps to facilitate international trade by identifying enablers, challenges and implementation framework for easy replication.

2.Provide capacity building to the voluntary member economies in using paperless electronic exchange of traceability and ESG credentials.

3.Determine if the adoption is cost-effective for relevant stakeholders and 4.Depending on the pilots results, encourage wider adoption of this practices to facilitate trade under the Putrajaya Vision 2024.

Alignment

APEC: The project is aligned with the following Collective Actions of the Aotearoa Plan of Action: “Increase trade predictability and openness by improving economies’ transparency through trade measures and policies”; “Advance capacity building programmes to support the implementation of and adherence to WTO rules, including transparency and notification obligations”; and “Implement APEC's Connectivity Blueprint, including by strengthening connectivity and resilient supply chains within APEC, and by cooperating to equip businesses to better understand their supply chains”.

The project has a relationship with the overarching goal for Phase Three of APEC's Supply Chain Connectivity Framework Action Plan (SCFAP III), which is: “To support our businesses in building secure, resilient, sustainable and open supply chains that create a predictable, competitive and digitally interconnected Asia-Pacific region for all”.

Forum: This project is relating to the following key priorities of CTI: (i) advancing regional economic integration, (ii) trade facilitation and strengthening connectivity and infrastructure, and (iii) promoting innovative development and inclusive approaches.

TILF/ASF Justification

Not Applicable.

Beneficiaries and Outputs

Output 1: Research and design standardize processes using international standards for digital exchange of Traceability & ESG Credentials.

Research and design standardize processes using international standards for APEC economies to implement and improve supply chain transparency through digital exchange of traceability and ESG credentials with special focus on MSMEs. Pilot efforts with voluntary economies will allow to provide a guidance on how to successfully address these challenges. This outcome will be measure through the delivery of the Framework(document that contains a roadmap with activities and recommendations for the implementation of the digital exchange of traceability & ESG credentials). The standardize methodology to be designed will impact in the following key areas:

- Sustainable Development: Including best practices to promote sustainability in sectors such as agriculture, fisheries, and forestry, among others.

- Capacity Building: Providing technical assistance and capacity-building programs, including training, knowledge sharing, and best practices dissemination. This includes training on basic concepts on what traceability and ESG credentials are, MSMEs impact, relevance and the standard process and methodology for implementation.

- Digital Economy: Fostering innovation and digital connectivity in the region and

- Micro, Small and Medium-sized Enterprises (MSMEs): Facilitating their growth, access to market and participation in international trade.

This output has 2 main activities:

1. Define the standard processes as well as the international standards that will be used as part of the execution of the pilots for validation and development of the final Framework, by the core team members of the Contractor Company, composed at least by an Expert in Traceability and ESG Credentials, IT Expert in the registries and visibility platform and a Project Manager for compliance with established deadlines and committed deliverables.

2. Execution of a pilot in APEC economies to validate the standard processes based on the research conducted as described above to develop the final Framework. This activity has the following sub tasks:

2.1. Local facilitators of each economy (from the Contractor Company) will carry out the processes mapping jointly with the MSMEs companies of the selected products in each economy. This task includes the Mapping of all the processes/information/registries/data that are required and needed to be collected for the digital exchange, not only for Traceability, but also for ESG Credentials “in each” of the product’s supply chain selected by the participating economies. Peru will be one of the three participating economies. The pilots will map a total of six (6) products' supply chain (two per each participating economy). The project will provide hands on technical support for each participating economy to develop this activity within expected times and deliverables (through local facilitators from the contractor company)

Each MSME company and product’s supply chain selected by the economies, will be visited/evaluated/analyzed “on site”, so travel expenses will need to be included in the budget. We need to consider that many MSMEs companies are not in the capital of the city and in some cases, they are located in rugged locations with hard weather conditions, rain, altitude, high temperatures, among others, that involves costs of transfers in special transport (Van rental, in some cases motorcycles, river transportation, among others). Each economy and their local facilitators will receive technical support from the central team of the selected Contractor Company. Travel within each of the participating economies of the pilots will be carried out by local facilitators. MSMEs supply chains to be researched for the pilot will be in urban or regional areas instead of remote areas, to avoid risk of potential harm to contractor personnel. It is estimated that for each product’s supply chain, at least two trips should be made to the areas where the MSMEs companies are located: First to train MSMEs for capacity building, collect information and identify the main control/check points to have all the processes mapped and the second to support MSMEs participating during the traceability and ESG data online registry using the visibility platform according to the following task (to validate the viability of the digital exchange of this data).

Each economy and their local facilitators will also receive support from the core team members of the selected Contractor Company.
The criteria for the selection of MSMEs will be based on: 1. Prioritized sectors of the participating economy that may be the most impacted by international demands. Just an example in case of Peru, the prioritized products are actually: Cocoa, Coffee and others. 2. Given that one of the requirements that will be requested to the selected contractor is that they will need to assure not only to have offices and local experience in the issues of traceability and sustainability, they may also collaborate with the proposal of companies with which they have worked or are working on similar projects in order to make MSMEs selection process faster.

2.2. Parameterize the visibility platform that will be provided by the Contractor Company (*) based on the information collected from records and data of task 2.1. This activity will be carried out by an IT expert who knows in detail the visibility platform that will be used for the pilots.

2.3. Local facilitators will support each of the MSMEs participating in the pilots to fill or registry in real-time all the information generated in each of the product’s selected chains, to validate the viability of the digital exchange of traceability data and ESG credentials. This will be done for a period of 4 weeks.

2.4 Standard Processes, using international standards for digital exchange of Traceability and ESG Credentials validation completed and ready for the elaboration of the Framework by the core team members of the Contractor Company/

(*) The selected contractor company must provide a traceability platform which will be used only to support the development of the pilots (supply chain transparency and digital exchange of traceability and ESG credentials) with demonstrative purposes (the visibility platform can be owned by the contractor company or subcontracted). There would not beany kind of software development, just Human Hours dedicated to parameterizing the visibility platform with the information and data fields to be filled with the registries that will be generated in each of the productive chains selected by the participating economies.

It will not be the objective of the project to develop a visibility tool or to recommend an existing visibility tool to be used by APEC economies, as we understand that there are many visibility tools developed and being offered in the market. The standardize processes through the Framework on Supply Chain Transparency that will be developed, will allow, with special focus on MSMEs, that no matter the sector or company size, the implementation process will allow all of them assure supply chain transparency, facilitating trade among APEC economies.

Output 2 - Research report on outcomes of traceability and ESG credentials pilots

A Research report comprising Mid-Term Reports on each of the 03participating economies in the pilot will be produced. The Research reportshall be 30-50 pages and include a summary of key findings.

Output 3 - Final Report (including APEC Framework on Supply Chain Transparency)

A Final Report of 50-70 pages shall be prepared, containing the APEC Framework. A summary of the Research Report findings will be part of the Final Report, that will also include Best Practices Guidelines, Lessons Learned, Recommendations and General Action Plans for broader implementation in other APEC economies. A virtual meeting (of maximum3 hours) convening CTI delegates and APEC economy stakeholders will be organized following preparation of the Final Report, to present the key findings of the project, results of the pilot and the Framework to all members, including how the Framework may be implemented in other economies.

Output 4 - Video with a summary of the pilot projects and main outcomes

A video in English or with English subtitles as necessary of minimum 3minutes will be developed following APEC publication, branding and nomenclature guidelines, as an excellent complement to the Final Report, bringing an effective means of sharing information in reduced time, providing greater accessibility, explaining concepts clearly through graphics/animations and generating greater emotional impact.

Outcome 1:
The key outcome of this project is to promote standardize global supply chain processes, using international standards for APEC economies to implement, improve and integrate supply chain transparency and digital exchange of traceability and ESG credentials with special focus on MSMEs. Pilot efforts with voluntary economies will provide guidance on how to successfully address these challenges. This outcome will be measured through the delivery of the Framework.

Outcome 2:
This project will increase knowledge and capacity amongst participating APEC economies. This outcome will be measured by a survey of the participating economies stakeholders following the pilot. The training for capacity building includes topics on basic concepts on what traceability and ESG credentials are, MSMEs impact, relevance and the standard process and methodology for implementation.

Beneficiaries: MSMEs Supply Chains will be the main/direct beneficiaries and will implement thepilots with the support of the selected contractor company.
In addition we will promote the collaboration and participation of Government Agencies providing policies, standards, authorizations, requirements, among others, to safeguard environmental sustainability aligned with ESG credentials.

Dissemination

The plan to disseminate all output documents/reports and other results of the project, includes:

A Final Report of 50-70 pages shall be prepared, containing the APEC Framework on Supply Chain Transparency. A summary of the Research Report on outcomes of traceability and ESG credentials pilots of each of the 3 economies participating will be part of the Final Report, that will also include Best Practices Guidelines, Lessons Learned, Recommendations and General Action Plans for broader implementation in other APEC economies. The Final Report shall be produced as an APEC publication.

As a complement to the Final Report, a video with a summary of the pilot projects and main outcomes will be developed.

The target audience will include government regulators, trade officials and representatives of industries (private sector).

There is no intention to sell the outputs arising from this project. Member economies will be encouraged to disseminate results of the pilots with their respective agencies and business communities through their websites and other media.

Gender

Please refer to Project Proposal in Supporting Tab.

Work Plan

Please refer to Project Proposal in Supporting Tab.

Risks

Please refer to Project Proposal in Supporting Tab.

Monitoring and Evaluation

Please refer to Project Proposal in Supporting Tab.

Linkages

This project will engage other APEC fora such as DESG, SCSC, SCCP, PPFS and SMEWG. Non-APEC stakeholders such as the private companies directly involved in the pilot project and global standards organizations will also be engage by delivering technical assistance. The project will also look to share the results with relevant third parties, such as the United Nations Centre for Trade Facilitation and Electronic Business (UNCEFACT), the World Customs Organization and explore the ongoing synergies that could be built with them.

Sustainability

1) Pilot project Final Report will be published after the pilots, which will include all the results, recommendations, conclusion and the Framework developed for Supply Chain Transparency and Digital Exchange of Traceability and ESG Credentials. It will be sent to the representatives of each APEC economy for their information and application. In addition, all materials, key findings, best practices, recommendations, presentations, video and other relevant information, will be uploaded to APEC website.

2) Depending on the feedback of member economies and the availability of funding, the project proponents will look forward on holding future events to continue our efforts (workshops, symposiums, field trips) to trace progress and stimulate more actions on Supply Chain Transparency. The main activities of future events can be stock-taking and measuring the progress of Members reflecting the outcomes they learned from this workshop. Members would also be invited to share their progress and/or best practices on Supply Chain Transparency.

Project Overseers

Ms. Maria Elena LUCANA is the project overseer. She is the Coordinator of International Logistic of Directorate of Trade Facilitation of the Ministry of Foreign Trade and Tourism (MINCETUR), and has worked at SUNAT, customs agencies and freight forwarders, among others.

Cost Efficiency

Not Applicable.

Drawdown Timetable

Not Applicable.

Direct Labour

Please refer to Project Proposal in Supporting Tab.

Waivers

Not Applicable.

Are there any supporting document attached?

No 
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Project No.

Project Title

Project Status

Publication (if any)

Fund Account

Sub-fund

Project Year

Project Session

APEC Funding

Co-funding Amount

Total Project Value

Sponsoring Forum

Topics

Committee

Other Fora Involved

Other Non-APEC Stakeholders Involved

Proposing Economy(ies)

Co-Sponsoring Economies

Expected Start Date

Expected Completion Date

Project Proponent Name 1

Job Title 1

Organization 1

Postal Address 1

Telephone 1

Fax 1

Email 1

Project Proponent Name 2

Job Title 2

Organization 2

Postal Address 2

Telephone 2

Fax 2

Email 2

Declaration

Project Summary

Relevance

Objectives

Alignment

TILF/ASF Justification

Beneficiaries and Outputs

Dissemination

Gender

Work Plan

Risks

Monitoring and Evaluation

Linkages

Sustainability

Project Overseers

Cost Efficiency

Drawdown Timetable

Direct Labour

Waivers

Are there any supporting document attached?

hdFldAdmin

Project Number

Previous Fora

Secretariat Comments

Reprogramming Notes

Consolidated QAF

Endorsement By Fora

PD Sign Off

Batch

Forum Priority

Committee Ranking Category

Committee Priority

PDM Priority

Priority Within Funding Category

Monitoring Report Received

Completion Report Received

PMU Field 1

PMU Field 2

PMU Field 3

On Behalf Of

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