Time and cost savings

Shenzhen-based OneConnect Financial Technology, a fintech service company under Chinese insurance giant Ping An, leverages blockchain in the Greater Bay Area in finance, smart city, and transportation industries. It established a blockchain-based platform for port cooperation with the State-owned conglomerate China Merchants, connecting 21 inland ports and more than 4,000 exporters and importers.

Using the platform, cargo needs be declared and inspected only once between two different customs checkpoints, compared with twice previously, saving 150 yuan ($20.53) to 200 yuan on average per customs declaration order.

Fang Hong, general manager of the south region at OneConnect, said that customs clearance for export was reduced from 4.5 to two days, while the average cargo storage period at terminals was shortened from 5.7 to two days. "The program boosts container turnover and better utilizes the limited cargo storage space," she added.

The efficiency improvements can save energy too. Fang expected the declining delays and logjams to reduce 80,500 metric tons of carbon emissions, along with the consumption of 25,600 tons of oil and 37,300 tons of coal.

Scale for profit

"Many companies and applications have emerged (in the Greater Bay Area), but it has yet to spark rapid industrialization and commercialization," CDI's Liu said. He admitted that profitable consortium blockchain projects are still very rare now, but technology giants are investing heavily into the domain for "the next blue ocean". He believes the sector will incubate breakthroughs in the business world.

The lack of visible payoffs from the high cost of blockchain projects inhibits private-sector industry adoption. Liu said the long-term payback and heavy investment required sees current blockchain applications led mostly by government authorities. Public data protection falls under government jurisdiction, which is another factor requiring the authorities to steer most of the pilot blockchain applications.