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Companies that turned to digitised trade documents and processes in response to the Covid-19 pandemic have proven more resilient to supply chain disruptions, new research has found.

The UN Conference on Trade and Development (UNCTAD) says maritime trade volumes are forecast to drop by 4.1% over the course of 2020 as a result of the slowdown in economic activity caused by virus containment measures.

However, it says that “first movers in terms of technological uptake have been able to better weather the storm”, giving the examples of platform-based business models and data-rich logistics offerings.

“The digitalisation of interactions and information-sharing has been critical to the continuity of maritime transport operations during the pandemic,” UNCTAD says in this year’s edition of its annual review of global maritime trade.

“It has helped to maintain continuity in transport operations and trade processes while reducing the risk of contagion.”

One of the report’s policy recommendations is that governments do more to encourage the use of digital documentation rather than paper-based processes, including by making sure banks and insurers are able to accept them when supporting a transaction.

UNCTAD singles out electronic bills of lading (eBLs) as an area of interest, citing recent research by the Digital Container Shipping Association (DCSA) that estimates the global shipping industry could save US$4bn per year with 50% uptake.

The report says DCSA members have reported “a sharp increase in electronic bill of lading adoption, in an effort to keep trade moving” during the pandemic.

“The use of electronic trade documentation, including electronic bills of lading equivalents, has increased significantly in importance since the Covid-19 pandemic, and related physical distancing, teleworking and disrupted or suspended postal services have affected large parts of the world population,” it says.

“This matters, particularly since trade finance transactions typically require significant levels of in-person review and processing of hard-copy paper documentation.”

Wider adoption of eBLs could be facilitated through international co-ordination, so that private sector entities in different jurisdictions can accept the same electronic records, as well as through legal reforms if necessary.

Capacity building may also be required, particularly in developing nations, UNCTAD says.

However, the report acknowledges that an increasing reliance on technology within the trade sector would likely increase companies’ exposure to cybersecurity risks.

As ships and ports become more deeply integrated into technology networks, or make greater use of automation, UNCTAD warns attacks “are likely to continue to grow significantly”.

“This heightens vulnerabilities across the globe, with a potential for crippling effects on critical supply chains and services,” it says. “Coordinated efforts towards developing appropriate protection mechanisms against cybercrime and attacks should therefore be pursued as a matter of urgency.”

The report adds that an incoming International Maritime Organization resolution, which takes effect from January 2021, will require shipping companies to include IT policies as part of their safety management systems. Failure to do so could result in ships being detained by port authorities, it warns.

Though maritime trade volumes are expected to drop significantly this year, UNCTAD says it currently expects an increase of 4.8% during 2021. If accurate, that would offset this year’s drop within a year, returning to the 0-1% growth rate seen in 2019.

A recovery in global goods trade is already underway, led by a surge in exports from China, according to separate UNCTAD research.

Those findings echo the result of a recent survey of 200 traders and operators working in shipping and commodity trading carried out by law firm DWF.

Though more than 60% of respondents said the pandemic had a negative impact on their revenue and on employee headcounts, the majority were not concerned about the ability of the shipping industry to recover within two years.