As artificial intelligence becomes more visible across multiple aspects of daily life – from chatbots to self-driving cars – it has become increasingly clear that the technology will impact nearly all sectors of business. AI is transforming international trade at a rapid rate.
Already, international businesses are finding ways that they might leverage artificial intelligence, and questions are being raised about how international trade policy will be transformed to address AI.
1. Incorporating AI into the supply chain
One of the biggest challenges for operating businesses across a border is managing the supply chain. Adding elements of AI in the supply chain can help international businesses reduce risk while cutting costs. AI can aggregate and analyze data from a variety of sources – business records, online news sources, government data sources and more – to help generate the safest, fastest and most cost-effective shipping routes.
And once shipments are en route, AI-enabled tracking can provide increased visibility into the supply chain to make sure shipments are secure and on time. AI also can spot unexpected disruptions in the supply chain faster, and provide alternatives, so routes can be adjusted earlier to help avoid delays.
And AI can go deeper than just the supply chain. When AI technology is weaved into a business’s logistical system, AI can help to better manage inventory and production.
Artificial intelligence tools have the potential to predict upticks and slowdowns in demand so inventory can be adjusted accordingly to avoid supply shortages or an overstock of goods that have to be warehoused for an extended period of time.
An AI inventory management system can also automate logistics processes to remove the need for some manual processes, like ordering supplies or increasing production.
2. Using AI to ease cross-border regulation
Businesses that deal in international trade know that there are a lot of factors involved in moving goods safely, quickly and legally across borders, as well as in offering cross-border services.
Artificial intelligence can be used to analyze and manage applicable trade regulations. AI has the potential to automate form filings for border crossing, and it can be used to spot errors in trade documents, like misclassification, to help prevent delays or fines.
Eventually, governments could implement artificial intelligence to help with compliance checks.
AI could be used to automatically process customs paperwork. Scanners that integrate AI technology could quickly identify anomalies or illegal materials as they cross borders.
All of this stands to speed the customs process, as paperwork and shipping containers crossing the border can be processed more rapidly without the need for manual intervention.
3. Financing for international businesses with AI
For both businesses looking to finance their operations and businesses who offer financing, artificial intelligence can be used to minimize risk and borrow or lend more wisely.
Artificial intelligence can be used to make predictions about market trends and risk that will allow businesses to plan for growth and more accurately assess financing needs to achieve that growth. It also can help businesses identify areas of risk that are opened by borrowing or outside investment.
For lenders and investors, too, artificial intelligence can be used to assess the financial risk involved with taking on a new business. Artificial intelligence also can lower the risk for fraudulent loans, lenders or investment because AI can better assess the data and documents put forth to identify a fraudulent business offer, paperwork or partner.
4. Leveraging AI in international trade for small businesses
All businesses stand to benefit from the use of artificial intelligence in making more informed business decisions and improving the efficiency of operations.
Small international businesses particularly stand to benefit because AI can automate processes that are typically expensive, time consuming and require additional staffing or consulting.
In addition to automating logistical and compliance processes as discussed AI can help businesses with real-time language translation, automated contract generation, customer service and more.
AI writing tools can be used to generate trade documents or other business correspondence and translate those documents into a variety of languages. The full benefits and pitfalls of AI-text generators like ChatGPT are still being discovered, but AI text generators have shown promise in creating complete documents.
AI tools also have shown that they have the capability to understand the intricacies of laws and regulations; ChatGPT managed to pass the American Uniform Bar Examination with a score that was within the 90th percentile.
While businesses may proceed cautiously with more complex and important documents, they may be able to leverage AI text tools for some regular business documentation. Moving forward, more complex and reliable AI tools are likely to become available.
Language is a barrier for any business operating across borders. AI translating tools have proven helpful. Now, translation tools can work in real-time to ease conversations among business partners who speak a variety of languages.
AI translators also move beyond traditional translation tools because they are able to understand the nuances of languages and generate translations that are more accurate even when text includes idioms or more complex terminology. That means AI can reduce the need for additional staffing or translators, saving expenses and time for small businesses.
5. Considering AI and international trade policy
As artificial intelligence becomes more a part of international trade, it remains to be seen how it will affect trade policy and trade agreements.
At present, there has been some debate about how artificial intelligence will be regulated and tariffed.
Artificial intelligence raises questions regarding taxation – when do AI services cross over to be considered goods or services?
AI also raises questions about intellectual property. There are ownership considerations in terms of proprietary AI tools, as well as in terms of any documents or analysis that AI might provide.
Governments also may become increasingly concerned about how AI tools will impact national security. Restrictions may be set on the AI tools that can be sold across borders over concerns that those AI tools could be used by other nations or groups to cause harm.
Data security is also a consideration, as AI has to process data in order to generate useful analysis or text. That means that AI technology could make a business or nation more vulnerable to a data breach.
Discovering the benefits of AI in international trade
The benefits of AI technology are still being realized, but its clear that there are advantages to using AI in international trade for businesses of all sizes. AI can be used to help businesses operate more efficiently, automate processes to work faster and realize growth without needing to add a significant volume of staff.
AI technology also can help businesses to understand all of their data, as well as market trends and market climate, to better plan for the future. And AI can help with the everyday challenges of running an international business, such as managing complex supply chains across borders and dealing with business partners across languages.
Of course, as AI technology is still being developed and understood, there are questions about its reliability and usage. Trade businesses who wish to stay competitive and on the forefront of technology should be on the lookout for AI tools that benefit them and should train and acquire staff that will help them to take advantage of those tools, while remaining aware of new policies or regulations that may impact AI technologies.