A look at PwC's "Time for Trust" report (October 2020)
A few days ago, the consulting firm PwC published an analysis report entitled "Time for trust"[1], which aims to explore how blockchain technology will impact the economy and business by 2030. The interest of prospective studies is to draw lines of force, major trends. In this respect, this report is particularly interesting in that it moves away from the ideological discourse of both aficionados and antiblockchain advocates, to focus on the uses, quantify them and place them in a dynamic. Three elements seem particularly interesting to highlight.
A notable impact
First of all, the magnitude of the impact is striking: PwC estimates it at an additional USD 1,760 billion for global GDP by 2030. To give an order of magnitude, this is the 2018 GDP of Russia or Canada, ranked tenth worldwide. To better understand this figure, we must look at the second striking element of this report.
For what purposes?
PwC sees the main source of value linked to blockchain technology in the traceability and origin of goods, which would be the source of nearly 55% of the value created on the GDP (i.e. 960 billion USD). Payments come in second, with half as much value created (24.5% at 433 billion USD). In third place is identity management. This is in line with the idea behind the creation of Tilkal since 2016: blockchain has a very important contribution to the traceability of supply chains, and it is even likely to be the major use case by 2030.
But is the order of magnitude of the estimated gain of the traceability of goods for the world GDP (nearly 1000 billion USD) plausible? To put it in perspective, it is interesting to compare it to estimates of losses induced by the lack of traceability for world trade: illicit trade is currently estimated by various international organizations to be between 1,000 and 2,000 billion USD, with an annual double-digit growth rate. Thus, the gain related to traceability estimated by PwC for 2030 would finally correspond to the low range of the value of malfunctions related to the lack of traceability in 2020.
Countries benefiting from blockchain
To analyze the beneficiaries, it is natural to compare the estimated share of gains and their share of world GDP. Taking all uses together, the main beneficiaries by volume are China (25%) and the United States (23%). For the United States, this makes sense since it represents roughly 24.2% of world GDP. For China, it is more surprising, as it represents 15.8% of world GDP: yet this increased benefit for China, greater than its share of world GDP, is consistent with its technological strategy. If we look at the European players, the estimated GDP gain for France (3.3% of the total) is slightly higher than its share of world GDP, while the gain for Germany (5.4% of the total) is 20% higher than its share of world GDP (4.7%).
If we focus the analysis on the use of traceability, we find more or less the same ratios of gain to GDP, with two exceptions. On the one hand, the United States, whose "blockchain and traceability" gains are much lower than their share of GDP (-37%). On the other hand, Germany whose gains on traceability alone are still increased, at +30% compared to its share of global GDP.
Articulation of industry and digital
A few elements allow us to put these gains on "blockchain and traceability" in perspective of different industrial strategies.
First of all, China's share is unsurprising. It reflects a strategy that clearly identifies 5G, artificial intelligence and blockchain as the three technologies for which global leadership is sought. However, on blockchain, the Chinese government largely excludes what concerns crypto-currencies. It is therefore rather towards the link with the development of the New Silk Roads[2] that we must see the coherence: blockchain appears as the "data" backbone, especially through the Belt and Road Initiative Blockchain Alliance (BRIBA) created in 2019. Clearly, managing the traceability, and therefore the exchange data, of global industrial chains would ensure de facto control of these chains.
Conversely, the drop in the United States is difficult to explain without additional data. However, the dynamics of catching up may already be underway: the recent initiatives of the FDA on traceability within the framework of the FSMA tend to suggest this, at least in the food industry. In addition, it is visible that some US IT players are positioning themselves on traceability, especially in Europe: this "Big Tech" proactivity is consistent with the geographical distribution of expected gains.
The increased impact for Germany is consistent with its strategy around Industry 4.0. Traceability, with blockchain as a support, finally allows to enhance this articulation of industry and digital, by improving the control of flows and their fluidity, while responding to the growing demand for real transparency.
In France, the ambition defined by Bruno Le Maire in April 2019[3] is indeed to benefit from the potential of blockchain, or even to build a "blockchain nation." This ambition is often understood through the sole prism of crypto-currencies. However, if we are to believe the PwC study, this is in fact mainly due to its application to traceability issues. It is in the articulation of blockchain at the service of industry through traceability that the greatest opportunity for economic development lies. There is a tremendous growth potential for French manufacturers who seize it, in value and differentiation.
An article by Matthieu Hug, co-founder and CEO of Tilkal