Barter an option for traders with the aid of new technologies
by: Wang Yanlin
published: June 1, 2017
BARTER trade can be a good option, especially for countries involved in the “Belt and Road” initiative, to do business because the model of goods-for-goods can help countries waive risks generated from volatile exchange movements, participant said during the 2017 International Barter Exchanges Global Summit.
“Barter trade is the earliest way for people to do business, and it is reviving in the modern days thanks to new technologies such as digital currency and block chain,” said Jiang Ming, president of the China General Chamber of Commerce.
Barter trade is a direct exchange of goods or services without using a medium, such as money. In 2015 when some countries suffer from excessive capacity, barter trade was chosen as a means to digest inventory. About 30 percent global trade was conducted through barter trade that year, and many big companies set up departments for barter, according to media reports.
For countries involved in the “Belt and Road” initiative, among which some are cash-strapped but resources-rich, barter trade can make doing business easier because of it does not need reserve currencies like the US dollars, participants said.
At the same time, new technologies can make barter trade more reliable in determining the value of trade and its credit-worthiness, participants said.
In China, Huamao International Barter Exchange is the only official exchange to conduct barter business. It aims at lifting barter trade to a level of more than one trillion yuan next year, and yesterday, it launched an online platform for traders to check company reliability, with the hope of making barter trade more popular in the country.