A Guide to Help American Exporters Navigate Trade Finance

For many exporters in the United States, understanding the intricacies of trade finance is often a challenging undertaking. Encouragingly, the International Trade Administration (ITA), a U.S government agency whose mission is to create prosperity by strengthening the international competitiveness of U.S. industry, promoting trade and investment, and ensuring fair trade and compliance with trade laws and agreements, created The Trade Finance Guide: A Quick Reference for U.S. Exporters.

The guide defines trade finance as "a set of techniques or financial instruments used to mitigate the risks inherent in international trade to ensure payment to exporters while assuring the delivery of goods and services to importers. In other words, trade finance is a means to turn cross-border trade opportunities into real transactions by effectively managing the competing risks as well as the inherent risks facing both exporters and importers." The guide importantly adds: "The WTO estimates that trade finance plays a key role in facilitating and supporting as much as 80 to 90 percent of international trade. However, the availability of trade finance and the risk of non-payment are among the most often cited obstacles by U.S. SMEs considering selling in global markets."

The ITA says its Trade Finance Guide "explains the basics of trade finance so that U.S. companies, especially small- and medium-sized enterprises (SMEs), can evaluate appropriate financing options to help ensure they get paid for their export sales." What is more, exporters "will also find information on how digitalization is helping to transform trade finance, with the prospect of increasing access, streamlining processes, and reducing costs."

The guide is designed to help exporters answer the following questions:

1. Is your business looking to make that first export sale or expand into more markets, but needs clarity on financing options and methods?
2. Did you know that having open account terms may help win customers in competitive markets?
3. Is insisting on cash-in-advance always a good idea?
4. What are the advantages of exporting on consignment?
5. What should you know about export working capital financing or export credit insurance?

Segmented in 17 chapters including "Access to Capital for Startups in Global Markets, "Methods of Payment in International Trade," "Export Working Capital Financing and Government Guarantees," and "Export Credit Insurance," the guide provides introductions to each of the three U.S. government finance agencies (Export-Import Bank of the United States' Office of Small Business; U.S. Small Business Administration's Office of International Trade; and U.S. Department of Agriculture's Foreign Agricultural Service's Credit Programs Division) in their respective chapters and have updated other chapters, as appropriate, in collaboration with experts from relevant fields. The ITA will be continuously updating the online Trade Finance Guide on an as-needed basis, with a revised PDF version available for download on an annual basis.

While myriad of opportunities exist for U.S. exporters, they also face major types of risks including:

• Country risk is the risk of exposure to financial loss caused by political, economic, and social conditions and events in a foreign country.
• Commercial risk is the risk of non- and delayed payment caused by the importer’s insolvency or cash-flow problems.
• Foreign exchange risk is the risk of exposure to financial loss due to the fluctuation of an exchange rate change when trading with countries that have a different currency.
• Cultural influences are an additional risk factor that can negatively affect all aspects of international business.

And as an advisor to many American exporters, I appreciate the following tips for exporters:

• Be mindful of emerging trends that could reduce the complexity, cost, and processing time of trade finance transactions.
• Inquire with your current trade finance provider about available or planned digital options that could enhance efficiency and reduce costs.
• Explore trade finance options, including consulting new fintech-based trade finance providers about both traditional instruments and innovative offerings.
• Be cautious of potential fraud and cyber security risks that may accompany new technologies and online trade finance platforms.

In presenting the benefits of exporting, the guide notes:

The United States is the world's second largest exporter, with $2.5 trillion in goods and services exports in 2021, according to the U.S. Census Bureau and the U.S. Bureau of Economic Analysis. However, less than one percent of America's 32 million companies export; and of those do, about 60 percent sell to just one or two markets—Canada and Mexico, for example. And SMEs, which account for 98 percent of the nearly 280,000 American exporters, are even less likely to export to more than one market. With 95 percent of the world's consumers living outside of the United States, beginning to export-- or expanding to additional export markets—can help SMEs expand their sales, diversify their portfolios, and insulate them against periods of slower growth in the domestic economy.

What tips do you have on financing new export sales?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

Report Explores a New Era for Digital Payments

Following a white paper, Going digital: payments in the post-Covid world, The Economist Intelligence Unit (The EIU) published in 2021, which showed how digital channels were replacing traditional modes of payments across the world amid greater uptake of mobile wallets and other forms of digital payments, The EIU recently developed a new dataset, along with five-year forecasts, confirming these trends. Entitled Beyond borders: a new era for digital payments, this white paper offers an overview of The EIU's forecasts for digital payments, as well as the accompanying stagnation of automated teller machine (ATM) numbers and the mixed outlook for card payments. It also looks at the new frontier for disruption: cross-border payments.

Below are the paper's key forecasts:

• Following a surge during the pandemic, when lockdowns forced consumers online, growth in digital payments will soften during our five-year forecast period (2022-26).
• The number of ATMs will stagnate or decline, while debit and credit cards will struggle to maintain market share as mobile payment platforms gain more traction.
• While digital disruption to domestic payments continues, the ongoing Russia-Ukraine war will cause parallel disruption to cross-border payment systems and potentially challenge the dominance of SWIFT.
• Countries will seek to interlink their national fast-payments systems, reducing intermediaries and bringing down the cost of sending money abroad.
• Countries across Southeast Asia are in the process of interlinking their fast-payments systems to allow travelers across the region to purchase goods and services by scanning quick-response (QR) codes.

The report also points that APIs, tokenization and blockchain will together become the new normal. "As well as challenging SWIFT, disrupting cross-border payments will mean adopting innovative solutions and emerging technologies, including blockchain, APIs and tokenization."

• APIs have been a game-changer for retail payments, providing end-to-end tracking of payments and confirmation of transactions to all parties involved. They enable interaction across the digital marketplace, higher levels of transparency, and a seamless experience for both customers and merchants.
• Tokenization, which creates a unique code for every single transaction conducted through an API, and blockchain technology, have also emerged as a major way to ensure security, improve efficiency and raise the transparency of payments.
• Blockchain technology employs encrypted distributed ledgers that eliminate the need for any intermediaries but still provide verification of transactions in real time.
• As with domestic payments, real-time payments will also become a cornerstone for the acceleration of cross-border payments.

With respect to governments encouraging development of cross-border payments linkages, The EIU expects "increasing involvement from government entities to facilitate the development of the fintech sector, promote financial inclusion or aid the flow of remittances from overseas workers." The paper further says "Singapore (with PayNow) and Thailand (PromptPay) were the first countries to interlink their fast-payments systems in April 2021. More countries, especially in Asia, have since unveiled plans for similar tie-ups." Importantly, "This process will also be facilitated by the development of central bank digital currencies. These digital currencies aim to provide efficient and inclusive payments services—which traditional systems have failed to provide—and also emerge as trustworthy alternatives to private projects such as stablecoins, cryptocurrencies that (in theory) peg their value to another currency or commodity."

At the same time, the paper notes that "countries like Russia, China and India could encourage international trade denominated in their own currencies, or enter into bilateral trade agreements—between the rupee and ruble, for instance—to avoid settlements in dollars or euros." What is more, "Although the US dollar’s dominance of international trade will remain unchallenged in the short and medium term, emerging powers in Asia will try to reduce the greenback’s influence to avoid runs on their foreign-exchange reserves and mitigate the impact of any future disruptions."

The report provides a thorough explanation on how digital channels are replacing traditional modes of domestic payment around the world amid greater uptake of digital wallets and other forms of mobile transactions. Moreover, businesses of all sizes will find value in The EIU's latest forecasts for domestic payment flows and the deep-dive into the future of cross-border transactions.

How is your business taking advantage of the digital disruption of cross-border payments?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

GSMA Report Says 5G Coverage Will Accelerate Across Asia Pacific Supporting Advancements in Next-Generation Services

"At the end of 2021, the number of mobile internet users in Asia Pacific exceeded 1.2 billion, reflecting a penetration rate of just under 45% of the population," the GSMA notes in its annual report on the state of mobile economy in the Asia Pacific region. "This means that more than half of the population live in areas covered by a mobile broadband network but do not yet subscribe to a mobile internet service (usage gap)."

The UK-based organization, which represents the interests of mobile operators worldwide, adds that "The main reasons for the usage gap include the lack of digital skills (especially among older populations), lack of affordability among low-income households and online safety concerns among minority and vulnerable population groups. Addressing the usage gap for these key groups will extend the benefits of the internet and digital technology to more people in society. This requires concerted efforts by a broad range of stakeholders working together with mobile operators and other ecosystem players, such as device manufacturers and digital content creators."

The report's other key findings include:

• 96 percent of the population of Asia Pacific are covered by mobile broadband networks
• By 2025 there will be 400 million 5G connections across the region – just over 14 percent of the population
• $770 billion of economic value added by the mobile industry in 2021, approximately five percent of the GDP in the region
• Security and sustainability move up the agenda for operators
• Policymakers and regulators can fuel growth and innovation by finding the proper balance in the regulatory environment to support mobile network deployment and operations.

In addition to providing significant economic value to the region's economy, "The mobile industry continues to deliver social impact across Asia Pacific, primarily by providing the connectivity that enables the growth of small businesses and digital transformation of enterprises, and granting access to life-enhancing services and tools for citizens," the report explains. "Mobile money is one example, with adoption scaling rapidly in parts of Asia Pacific as operators support the region’s shift to digital payments."

The report also mentions that "The metaverse ecosystem is growing in many countries around the world, including in Asia Pacific. This is demonstrated by the interest of public agencies and private enterprises in establishing a presence in the metaverse and actively utilizing the platform in their engagement with customers and other stakeholders." For example, "South Korea plans to spend at least $186.7 million to create its metaverse ecosystem, as part of the country's Digital New Deal."

As highlighted in the image on right, the GSMA highlights how "Other governments in the Asia Pacific region, both at national and provincial levels, have outlined plans to harness the potential of the metaverse to increase the efficiency and quality of public services, as well as improve collaboration between local and national government agencies. This will be crucial to the development of the broader metaverse ecosystem, including for content creators and telecoms operators."

On the topic of security and sustainability, the report points out that "Security is the top priority for network transformation strategies among operators in Asia Pacific. This is not surprising given the backdrop of rising security threats to telecoms networks and, increasingly, to end users." Using Thailand as an example, the GSMA says 56 percent "of cyber threats in 2021 reportedly occurred via vulnerabilities in mobile devices."

The report also notes that "Operators across the region are also accelerating the shift to more sustainable operations, given the demand for a greater focus on energy efficiency from key stakeholders, including shareholders and customers. The industry is addressing the challenge through a comprehensive set of actions, such as the use of solar and improving the energy efficiency of networks.

As for creating policies to facilitate digital innovation, the GSMA asserts that "As society now moves towards a 'new normal' post pandemic, mobile connectivity will be central to the development of new and innovative technological solutions to today's problems. As 5G network deployments continue, 5G's ability to support next-generation offerings (such as cloud services, AI, IoT and edge computing) will drive digital economic growth and innovation."

Moreover, I support GSMA's assertion that "Policymakers and regulators can fuel growth and innovation by finding the proper balance in the regulatory environment to support mobile network deployment and operations." The organization says policymakers should also take steps to:

• establish a forward-looking regulatory regime that supports the financial sustainability of the industry and provides non-discriminatory conditions to drive new innovations from large companies and SMEs
• adopt policies that enable the building and deployment of infrastructure to support future networks accessible to all
• create and maintain a safe and trustworthy online environment to protect users from threats
• ensure that available spectrum serves the future demand for connectivity.

"These steps have the potential to set the proper foundation to support future economic growth, societal development and technological innovation."

Infographic: GSMA

Despite some near-term geopolitical and socioeconomic risks, I remain bullish about Asia Pacific's mobile economy. How are you positioning your business to capitalize on the region's growing mobile market?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

Today's Digital Economy Is the Economy, Says Annual Report on the Global Startup Ecosystem

The entrepreneurial universe was a much smaller place when Startup Genome published its first Global Startup Ecosystem Report (GSER) in 2012. As stated in its latest version of its annual report on the global startup ecosystem, "Six of the top 10 hubs were in the United States, and just one Asian city — Bangalore — broke the top-20 ranking. Four ecosystems accounted for the year's whopping nine unicorns (a term that would not even be coined until 2013). Almost two-thirds of early-stage funding was concentrated in North America."

Ten years later since the publication of its initial report, Startup Genome, a policy advisory and research organization for public and private organizations committed to accelerating the success of their startup ecosystem, says with "$1.65 trillion in funding, 1,227 unicorns, a global pandemic, and massive revolutions in everything from AI and social media to autonomous vehicles and precision medicine later, and the situation is very different. Today, the digital economy is the economy — or at least the economy's future."

Below are the report's key findings:

• The same five ecosystems remain at the top of the ranking as in 2020 and 2021, but Beijing has dropped one place, with Boston taking its former place at #4. Silicon Valley is #1, followed by New York City and London tied at #2, Boston at #4, and Beijing at #5.
• Seoul entered the global top 10 ecosystems for the first time, up six places from #16 in 2021 and #20 in 2020.
• Several Indian ecosystems have risen in the rankings, most notably Delhi, which is 11 places higher than in 2021, entering the top 30 for the first time at #26. Bangalore has moved up one place from last year, to #22.
• Overall, China's ecosystems have declined in the rankings, a reflection of the relative decline in early-stage funding in comparison to other ecosystems.
• Helsinki has risen more than 20 places from last year, joining the runners-up category at joint #35.
• A record 540 companies achieved unicorn status in 2021, up from 150 in 2020.
• In 2021, Brazil saw 237% growth in the dollar amount of Series B+ rounds compared to 2020. The nation's total exit amount for 2021 was $49 billion, a huge leap from $1 billion in 2020.
• Asia experienced a 312% increase in the dollar amount of exits over $50 million from 2020 to 2021.
• In 2021, the dollar amount of exits in London grew 413% from 2020. The ecosystem's Series B+ rounds increased 162% in terms of dollar amount from 2020, and it saw 55% more $50 million+ exits in 2021 versus 2020.

With respect to the top 100 emerging ecosystems, the Startup Genome explains that these "ecosystems are startup communities at earlier stages of growth, and our ranking methodology is adapted to reflect this, to showcase the strengths in these ecosystems that have high potential to be global top performers in the coming years." Key findings from the top 100 emerging ecosystems include:

• Oslo is in the top 20 Emerging Ecosystems (#19), a huge leap of over 20 places from last year, and a reflection of two unicorns — industrial IoT platform Cognite and online grocery Oda — helping to increase its Market Reach.
• Minneapolis has moved up 18 places from last year, to #4. Six exits over $50 million and one $1 billion+ exit helped to improve its Performance score.
• Manchester-Liverpool has moved up eight places from 2021, to #6. A $1 billion+ exit and Matillion — an integration platform for cloud data warehouses — becoming a unicorn add $7.8 billion to its Ecosystem Value.
• India's recent success is reflected in both Chennai (tied #31–40) and Pune (tied #51–60) moving up in the rankings. The Chennai ecosystem saw a $1 billion exit in business software startup Freshworks, which moved to Silicon Valley after founding in India.
• Mumbai's has moved out of the Emerging Ecosystems ranking and into the global overall rankings (tied #36). Three exits over $1 billion (including Nykka's $7 billion valuation at IPO) and six unicorns contributed to the move.
• Pittsburgh moved up 10 spots from last year to #13, aided by Duolingo's $3.6 billion exit.
• Prague has moved up more than 40 spots, to tied #41-50, thanks to three exits over $50 million and one over $1 billion. These big exits are helping to increase its ranking in Performance and Market Reach.

"The top 100 Emerging Ecosystems are collectively worth over $1 trillion in Ecosystem Value," the report notes, "which is a 96% increase from last year. Europe and North America still boast the majority of emerging ecosystems, and Latin America, MENA, and Africa have held steady in the number of ecosystems in the top 100 from last year, with five, four, and three respectively." What is more, "Asia has 17 entries in the Emerging Ecosystems ranking versus 18 last year. Oceania has the same two entries in the top 100 as last year: New Zealand and Brisbane."

The report also provides an important analysis on the global startup sub-sector, which include the following key findings:

• Since the GSER 2021, there has been an overall increase in the growth of exits and a general slowing in the growth of Series A rounds. The increase in the growth of exits has helped investors hold dry powder (marketable securities that are highly liquid and considered cash-like), as revealed in the record high VC investment amounts.
• Cybersecurity has received growing attention, as a side effect of the acceleration in digital transformation. Exit growth in this sub-sector has increased by 14% since the GSER 2021.
• All sub-sectors have accelerated in growth overall, with the largest growth in artificial intelligence (AI) & big data (BD), Blockchain, Fintech, and Advanced Manufacturing.
• AI & BD is becoming an overarching vertical that is increasingly overlapping with other industries both in terms of the amount of investment and count. In 2014, the overlap in the investment amount was outperforming the count, showing fewer investments in AI and tech. In 2020, the trend is the opposite, indicating competition among global AI startups to attract funds.
• Cleantech is the only sub-sector that has seen a considerable increase in count at both Series A (by 35%) and exit (by 12%, both 2016-2017 vs. 2020-2021), indicating increased innovation and investor focus on this topic.
• Advanced Manufacturing has grown by 70% in early-stage funding (2016-2017 vs. 2020-2021), driven by supply chain needs and a focus on improving efficiency and productivity through automation, monitoring, and failure prediction.

Having been involved with startups for close to 30 years, I concur with JF Gauthier, Startup Genome's founder and chief executive, that "The world of tech startups is changing. More importantly, tech startups are changing the world." The coronavirus pandemic accelerated the development of the digital economy. And as previously stated, today's digital economy is the economy.

What aspects of the report did find of particular interest or relevance?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

Is the US Economy Headed for a Recession?

"Is the US economy headed for a recession?" is a question many people, myself included, are asking these days. In a whitepaper titled with the same question, The Economist Intelligence Unit (The EIU) says "Some economic warning signs started to flash in early 2022, raising concerns that the US could be headed for a recession" Furthermore, "The US economy was one of the first to rebound from the negative effects of the covid-19 pandemic, with strong residential investment and consumer spending boosting real GDP by 5.7% in 2021. However, positive economic momentum has started to ebb in recent months. Real GDP contracted at an annualized rate of 1.5% in the first quarter of 2022 as the war in Ukraine sent energy prices soaring and China's zero-covid policy exacerbated existing supply-chain issues."

What is more, The EIU explains "that economic growth in the US will slow sharply over the course of 2022 and 2023, owing to stubbornly high inflation, rising interest rates and stalling growth elsewhere." The UK-based company expects "consumer demand to be resilient enough to avoid an outright recession, thanks in part to the tight labor market and strong household balance sheets. However, this does not mean that a recession is completely off the cards."

The whitepaper explores the three main downside risks to the US economic outlook, and identifies potential triggers for a recession:

Risk #1: Second wave of inflation

Risk scenario: Unforeseen factors prompt another spike in inflation—from an already high level—in late 2022 or early 2023, causing household spending to contract.

Possible triggers: Double-digit increases in the consumer price index for two consecutive months (or more) in the second half of 2022.

Risk #2: Overly-aggressive Fed

Risk scenario: The Fed overestimates the strength of consumer spending in the summer and raises interest rates more aggressively than we currently expect, causing consumer spending to crater in the autumn.

Possible triggers: Combined interest-rate hikes of 150 basis points or more in June and July, coupled with a further decline in consumer confidence measures.

Risk #3: Asset price collapse

Risk scenario: A combination of rising interest rates, high inflation, concerns over the economic fallout from the war in Ukraine, and worsening business and consumer sentiment spook US markets and cause asset prices to crash.

Possible triggers: The US bear market deepens. US stock market indices fall by 40% or more from their recent peak by July as a result of one or more of the factors above, without changes in monetary policy to compensate.

Additional key points from the report include:

• Price pressures to wane in the second half of the year as energy prices stabilize and supply chain constraints begin to ease. However, if inflation were to jump later in 2022, after rising interest rates and falling real wages, an outright contraction in consumer spending could occur.
• The Fed will raise interest rates by a total of 300 basis points. A surge in consumer spending in the summer, coupled with still-high inflation, could potentially push the Fed to tighten more aggressively than The EIU currently expects, which would likely be too much for households to bear.
• US stock prices are expected to cool in the second half of 2022. The Fed will maintain a gradual approach to tightening, helping to prevent a severe collapse in asset prices that would exacerbate the drop in consumer spending.

While it is difficult to predict the future direction of the US economy, The EIU's paper provides valuable information on which risks to monitor. What efforts are you taking to mitigate the impact of a possible recession?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

GSMA Predicts There Will Be 362 Million Mobile Internet Users in the MENA Region by 2025

"Since the emergence of Covid-19, mobile networks have been instrumental in providing the reliable connectivity needed to sustain social and economic activities," the GSMA says in its annual report on the state of the mobile economy in the Middle East and North Africa (MENA) region. "As countries bring the pandemic under control, a priority for governments" in the region "and elsewhere is to drive economic recovery and promote sustainable development. Digital services and technologies will be crucial to realizing this objective, by stimulating economic growth, mobilizing the workforce and enabling industrial efficiencies."

The report's key findings include:

• Mobile internet users surpassed 300 million in the region in 2021
• There will be 116 million 5G connections in MENA by 2025
• Mobile operators continue to push ahead with network transformation
• The mobile industry continues to deliver benefits to the economy and wider society
• Policy decisions are fundamental to accelerate MENA's digital future

"The number of mobile internet users in MENA exceeded 300 million in 2021, with penetration due to reach 50% of the population by the end of 2022," the GSMA notes. While the six countries that comprise the Gulf Cooperation Council (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates) "are home to the highest concentration of mobile internet users ... low take-up rates elsewhere reflect the work that remains to connect offline populations."

What is more, "Smartphone adoption is growing well and is set to increase most strongly in MENA's less advanced mobile markets over the period to 2025, underpinned by continued network investment from operators. Increasing user engagement with bandwidth-hungry applications such as video will lead to a surge in data consumption across the region, growing by 430% between 2021 and 2027."

The GSMA also explains that 4G may be MENA's leading mobile technology with almost 270 connections at the end of 2021 but "4G adoption is projected to peak in 2023 as consumers increasingly migrate to 5G plans." The UK-based organization, which represents the interests of mobile operators worldwide, adds that while "5G remains at a nascent stage" throughout the MENA region, the "current adoption rate of just 1% is expected to grow to 17% by 2025. However, operators in the GCC Arab states are among the global leaders in 5G, with competition and government support triggering launches of some of the world's first and fastest next-generation mobile networks. 5G connections in this part of MENA are set to reach 41 million by 2025 (49% of total connections)."

Investors and companies looking to capitalize on the growth of 5G in MENA will appreciate that "[w]hile the consumer market has been the focus of early 5G deployments, B2B is the largest incremental opportunity in the 5G era, with a raft of digital transformation projects underway across industries. To fully exploit these opportunities, 5G leaders in MENA are investing in new capabilities, with edge computing a priority."

As for the mobile industry delivering benefits to MENA's economy and wider society, the GSMA encouragingly notes that mobile technologies and services generated "5.4% of GDP in the region in 2021 – around $255 billion of economic value added. The mobile ecosystem also supported approximately 890,000 jobs (directly and indirectly) in 2021 and made a substantial contribution to the funding of the public sector, with around $20 billion raised through taxation."

With respect to mobile's contribution to economic growth, in 2021, the report points out that "mobile technologies and services generated 5.4% of GDP in MENA – a contribution that amounted to $255 billion of economic value added. The mobile ecosystem also supported approximately 900,000 jobs (directly and indirectly) and made a substantial contribution to the funding of the public sector, with $20 billion raised through taxation on the sector."

Looking forward, the report says "mobile's contribution to the regional economy will grow by more than $20 billion (approaching $280 billion)" by 2025 "as countries in the region increasingly benefit from the improvements in productivity and efficiency brought about by the increased take-up of mobile services."

As for policy decisions being fundamental to accelerate MENA's digital future, the report says:

In a post-pandemic world, digital connectivity is expected to become even more vital to citizens, firms and institutions alike. Regulatory frameworks that are conducive to investment will be crucial to incentivizing the deployment of telecoms infrastructure. Such infrastructure will be key to economic recovery and future crisis resilience. Seizing the mobile opportunity will require forward-looking spectrum policy, with well-designed assignment spectrum roadmaps, fair prices and technology-neutral licenses needed to support the growth of 5G over the course of this decade and beyond.

Lastly, I support the GSMA's assertion that "[i]t is also more important than ever before to address the barriers to mobile internet adoption and usage in MENA, while data protection regimes must ensure privacy, safety and security for those engaging in the digital economy."

Infographic: GSMA

With the adoption of the mobile internet continue to rise coupled with investments in 5G, companies worldwide that develop software-as-a-service solutions should consider developing solutions localized for smartphone users in the MENA region. Which mobile solutions do you think consumers or enterprises will utilize in the coming years?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

Five Elements Organizations Should Monitor for Effective External Attack-Surface Management

According to an infographic produced by Microsoft, "The cybersecurity world continues to become more complex as organizations move to the cloud and shift to decentralized work. Today, the external attack surface spans multiple clouds, complex digital supply chains, and massive third-party ecosystems. Consequently, the sheer scale of now-common global security issues has radically shifted our perception of comprehensive security."

The infographic highlights "five areas that help better frame the challenges of effective external attack-surface management." The information is provided by RiskIQ, a company Microsoft acquired in 2021 to help organizations assess the security of their entire digital enterprise.

1. The global attack surface may be bigger than most think

"In 2020, the amount of data on the internet hit 40 zettabytes, or 40 trillion gigabytes. RiskIQ found that every minute, 117,298 hosts and 613 domains add to the many interwoven threads making up the global attack surface's intricate fabric. Each of these web properties contains a set of elements, such as its underlying operating systems, frameworks, third-party applications, plugins, and tracking code. With each of these rapidly proliferating sites containing these nuts and bolts, the scope of the global attack surface increases exponentially."

2. Sometimes, threat actors know more about an organization's attack surface than their SOC does

"The rapid growth of internet-exposed assets has dramatically broadened the spectrum of threats and vulnerabilities affecting the average organization. With the advent of COVID-19, digital growth accelerated once again, with almost every organization expanding its digital footprint to accommodate a remote, highly flexible workforce and business model. The result: attackers now have far more access points to probe or exploit."

What is more, "With the rise of global-scale attacks orchestrated by multiple threat groups and tailored for digital enterprises, security teams need to mitigate vulnerabilities for themselves, third parties, partners, controlled and uncontrolled apps, and services within and among relationships in the digital supply chain."

3. Threat actors don't have to compromise assets to attack an organization or its customers

"Most cyberattacks originate miles away from the network; web applications comprised the vector category most commonly exploited in hacking-related breaches. Unfortunately, most organizations lack a complete view of their internet assets and how those assets connect to the global attack surface. Three significant contributors to this lack of visibility are shadow IT, mergers and acquisitions (M&A), and digital supply chains."

4. The mobile attack surface goes beyond major mobile app stores

"Each year, businesses invest more in mobile as the average consumer's lifestyle becomes more mobile-centric. Americans now spend more time on mobile than watching live TV, and social distancing caused them to migrate more of their physical needs to mobile, such as shopping and education."

However, "These rogue apps appear in official stores on rare occasions, even breaching the major app stores' robust defenses. However, hundreds of less reputable app stores represent a murky mobile underworld outside of the relative safety of reputed stores. Apps in these stores are far less regulated than official app stores, and some are so overrun with malicious apps that they outnumber their safe offerings."

5. Threat infrastructure is more than what's on the network

"Today's global internet attack surface has transformed dramatically into a dynamic, all-encompassing, and completely entwined ecosystem that we're all a part of. If you have an internet presence, you interconnect with everyone else, including those that want to do you harm. For this reason, tracking threat infrastructure is just as important as tracking your own infrastructure."

The infographic also points out that "More than 560,000 new pieces of malware are detected every day, and the number of phishing kits advertised on underground cybercrime marketplaces doubled between 2018 and 2019. In 2020, the number of detected malware variants rose by 74 percent."

The infographic concludes that:

Traditionally, the security strategy of most organizations has been a defense-in-depth approach starting at the perimeter and layering back to the assets that should be protected. However, there are disconnects between that kind of strategy and the attack surface, as presented in this report. In today’s world of digital engagement, users sit outside the perimeter—as do an increasing number of exposed corporate digital assets and many of the malicious actors. As such, companies need to adopt security strategies that encompass this change. Applying Zero Trust principles across corporate resources can help secure today's workforce—protecting people, devices, applications, and data no matter their location or the scale of threats faced.

What recommendations do you have on how organizations can effectively monitor these five elements?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

Exploring How Digital Technologies Are Used in Natural Resource Management

"In the coming years, as the environmental crisis becomes even more complex and far-reaching, digital technology will play an increasingly critical role in protecting livelihoods and the natural resources on which they depend," according to a report published by the GSMA. Through the GSMA CleanTech program, the UK-based organization conducted research to explore the "digital dividends" of various types of technology on natural resource management in low- and middle-income countries. Through desk research and stakeholder interviews, they captured and documented global trends and examples of best practice; identified the common incentives, bottlenecks and benefits natural resource management (NRM) stakeholders encounter when deploying digital technology; and highlighted opportunities for the GSMA and its members to enhance the reach, scope and effectiveness of NRM programs.

The report explains that "[n]atural resource management (NRM) refers to the sustainable use and management of the planet's natural resources, including forests, watersheds, oceans, air and a diversity of plant and animal species." Furthermore, "These and other resources work together to produce the benefits and services on which human existence depends, such as the provision of food, medicine and timber, the regulation of our climate, the improvement of our water and air quality, and protection from natural hazards."

Below are the report's key findings:

• Natural resources, livelihoods and poverty are interlinked. "The areas of the world that will be most affected by global changes in climate, biodiversity and ecosystem functions are home to many of the world's poorest communities. This, combined with limited access to and rights over natural resources, is a major contributing factor to poverty, particularly in rural areas. A lack of livelihood opportunities can put unsustainable pressure on local ecosystems by eroding community support for protected areas, instigating unsustainable changes in land use, or incentivizing participation in illegal logging and poaching activities. Conversely, sound NRM practices can have a positive impact on livelihood creation, reward communities for the ecosystem services they provide and drive sustainable agricultural, fishing and land use practices."
• You can't manage what you don't measure - and analyze. GSMA's "review of 131 NRM projects in LMICs shows that digital technologies are transforming the frequency, reliability and transparency of data collection activities, and improving organizational capacity for data visualization, analytics and evidence-based decision making. Nearly 100 of the NRM projects leverage data collected through satellites, drones or connected devices, and one in five uses artificial intelligence to discover, explore and derive insights from datasets. NRM organizations are highly motivated to work with mobile network operators (MNOs) and other technology organizations to find low-cost connectivity solutions that enable them to transmit data from remote or protected areas."
• Digital technologies can incentivize community participation in NRM activities and influence the way people perceive, think about and engage with nature. "There is growing recognition that poverty is more than a lack of material necessities and income; it also includes fewer rights and capabilities and less voice and influence over decision making. Although current approaches to NRM often fail to consider the needs and rights of local communities, digital technology—especially mobile—offers new ways to facilitate dialogue between stakeholders, leverage local knowledge and incentivize community participation in NRM activities."
• MNOs and other technology organizations have a critical role to play. "Although NRM organizations are increasingly tech savvy, many still lack the technical skills and expertise required to keep pace with technological innovations, and are typically overly cautious using donor funds to test 'experimental' digital solutions. The projects in our dataset indicate that when an NRM initiative receives support from an MNO or other technology organization, it is twice as likely to leverage emerging technologies like connected devices, blockchain or artificial intelligence."
• The GSMA and its members can support ambitious responses to climate challenges. "As the environmental crisis becomes even more complex and far-reaching," the GMSA expects "to see even greater integration between digital technology and NRM activities."

The GSMA importantly notes:

The use of digital technology in NRM, such as mobile devices, satellites, the Internet of Things (IoT) and artificial intelligence (AI), is still nascent, but has grown steadily over the last decade. There is increasing evidence that when developed and applied in a customizable and scalable way, digital solutions can significantly improve the efficiency, responsiveness and efficacy of NRM activities. However, current efforts are generally fragmented and poorly documented, making it difficult for stakeholders to learn from best practices, replicate success or identify opportunities for collaboration.

The report, however, points out that "In the coming years, as the environmental crisis becomes even more complex and far-reaching, digital technology will play an increasingly critical role in protecting livelihoods and the natural resources on which they depend." The UK-based organization says that its "analysis of existing projects and conversations with stakeholders suggests there are two impact areas where further support could help mature and mainstream digital innovation in this sector. First, further research and insights are required to reveal and promote examples of best practice, to help technology organizations develop sustainable business and partnership models, and to empower underserved populations to play a more active role in NRM. Second, there is potential for new cross-sector partnerships and dialogue within and across stakeholder groups to catalyze new action."

Lastly, GSMA's "research found that when developed and applied in a customizable and scalable way, digital solutions can enhance the quality and efficiency of data collection, empower local and global communities to be engaged in conservation efforts and aid real-time decision making. It is also clear from the three case studies presented in this report that digital technology can help scale nature-based solutions to climate action in ways that reduce biodiversity loss and optimize nature's contribution to resilient livelihoods."

Which digital technologies do you think will be utilized to facilitate the sustainable use and management of our planet's natural resources?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

Report Explores How Political and Economic Developments Will Shape Africa's Mining Sector

"Rich in natural resources, the African continent has attracted a large inflow of investment in recent years," says the Economist Intelligence Unit (EIU) in a report that explores how political and economic developments will shape the future of the mining sector in Africa and their key implications on prospective projects in the region. The report adds that "Although extraction of Africa's reserves has been largely hindered by weak domestic governance structures and policy impediments, the continent is set to remain one of the major supplier of a number of commodities in the coming years."

Focusing on four key themes: (1) the upside and downside of risks caused by elevated commodity prices, (2) how sanctions against Russia will affect mining activities in the region, (3) the effects of exploration activities and prospective project development in the region, and (4) and the future of mining in Africa, the report's key findings include:

• Sanctions against Russia—which have largely been more severe than initially expected—will disrupt Russian mining activities in Sub‑Saharan Africa, without having a serious negative impact on domestic mining sectors themselves.
• African economies will face manageable downside risks, which are markedly outweighed by the risks to the upside that stem from steep commodity price growth. This is due mainly to the insignificance of Russian exports for African economies.
• As sanctions become increasingly severe, the EIU expects that Russian miners will struggle to finance current and prospective operations, and may ultimately be forced to sell their concessions for reduced amounts.
• Russia's mining activities in Africa have been growing in recent years, and are increasingly concentrated in weakly governed and authoritarian states. We expect this to continue as the West continues to exclude Russia from the global economy.
• Although higher prices will benefit current production and operations, inflation will disrupt exploration activities and prospective projects. High energy costs, coupled with heightened global risk and uncertainty, will add to the costs of project development.

The EIU explains that "The African continent is home to substantial reserves of copper and cobalt (in the Democratic Republic of the Congo—DRC—Zambia, South Africa and Zimbabwe), diamonds (in Botswana and Angola), platinum (in South Africa and Zimbabwe), uranium (in Namibia, Niger and South Africa), gold (in Ghana, South Africa and Sudan), iron (in South Africa), manganese (in South Africa, Gabon and Ghana), bauxite (in Guinea), lithium (in Zimbabwe), coal (in South Africa and Mozambique), natural gas (in Algeria, Egypt and Nigeria) and petroleum (in Nigeria, Angola, Algeria and Libya)." Moreover, "Africa contains about 12% of total global oil reserves, 12% of natural gas reserves, more than 80% of platinum group metals and more than 40% of the world's gold. Extraction of Africa's reserves has been largely hindered by weak domestic governance structures and policy impediments, alongside the high risk of investments in Africa and low commodity prices during 2016‑20. This has resulted in a notable shortage of exploration activity in the African mining sector."

The report, however, encouragingly points out that "many African commodity exporters—Zambia and Namibia in particular—have initiated procedures to create a business-friendly environment in order to attract investments into their domestic mining sectors. Elevated commodity prices are fueling an export boom across Africa." What is more, "High prices for copper, oil, iron ore, aluminum and gas will stoke investments and are all helping to reduce external imbalances, stabilize currencies and boost economic growth. However, downside risks abound. The continent depends on energy imports (as net crude exporters have insufficient refinery capacity), and the war in Ukraine is set to stoke strong inflationary pressures."

With respect to the impact of Russia's unprovoked invasion of Ukraine on African economies, the EIU notes: "Total African exports to Russia add up to only about US$5bn, with imports totaling about US$14bn. Total trade between the regions is small, at about US$20bn, and trade disruptions resulting from the Russia-Ukraine conflict will not seriously affect African economies. However, it will affect certain African industries, such as cocoa and tobacco, and textiles and clothing." The EIU expects "the clothing industry in Tunisia, in particular, to be hit by negative impact. The tobacco industries in Nigeria, Tanzania and Mozambique will also be affected by the conflict."

Lastly, the EIU is forecasting "that Africa's mining sector traders will not be heavily affected by loss of Russian exports or activity. The total amount of exports to Russia is relatively small, and the growth in commodity prices will outweigh any marginal loss to total exports." The report importantly notes that "alternative export partners, China in particular, will take up the excess output. Given the strong demand for global commodities, the small amount of lost Russian exports will quickly be taken up by alternative buyers. In countries such as Sudan, Mali and the CAR, discrete Russian mining operations are likely to continue, circumventing sanctions."

What political and economic developments do you think will shape Africa's mining sector?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

GSMA Report Explores How to Reach and Empower Women in Digital Solutions in the Agriculture Last Mile

"In low- and middle-income countries (LMICs), the digitization of agricultural value chains is enabling access to markets, assets and services for smallholder farmers," the GSMA says in a report that examines "the limited participation of women in digitized agricultural value chains by identifying the main barriers for women in D4Ag [digital agriculture] initiatives and shedding light on best practices to increase women's participation and empowerment in these value chains."

The report further notes that D4Ag "solutions, such as digital payments and digital procurement, create efficiencies for both agribusinesses and farmers in the last mile. Digital procurement solutions can generate a range of records, including farmers' production data that enable the creation of economic identities and help them access finance. Digital procurement solutions can also be bundled with digital advisory services that provide farmers with vital information on new farming techniques, weather forecasts and crop production."

"Yet," according to the GSMA, "women farmers are being left behind. Although they represent 43 percent of the agricultural labor force, women face social and structural barriers that typically relegate them to traditional, low-value and labor-intensive activities, such as plowing, sowing and harvesting." What is more, "Restrictive social norms, lack of access to resources and the mobile gender gap all make it more challenging for women to participate fully in agricultural value chains and embrace the digital agriculture solutions that can connect them to markets and services and strengthen their decision-making power."

The report identifies the following digital solutions in the agricultural last mile:

1. Digital profiles: Mobile for authentication and verification, and a tool to create economic identities/digital profiles
2. Track-and-trace systems, farm management systems: Product verification services, accountability tools
3. Information services: Agricultural extension, education, certification standards, skills development
4. Digital financial services: Mobile money-enabled transfers, payments and financial service
5. IoT applications for agriculture: Equipment logistics, crop, soil and weather monitoring, smart warehousing
6. Agribusiness analytics: Predictive analytics, precision agriculture

With respect the barriers facing women in digitized agricultural value chains, the report looks at the social norms, lack of access to resources, and mobile gender gap that contribute to these barriers. It also presents steps to increase women's participation in digitized value chains including defining a gender strategy to guide gender-inclusive interventions, creating a gender-inclusive environment through foundational interventions, and addressing women's barriers through gender-inclusive interventions.

The report produces the following conclusions:

• "Women's low participation in digitized agricultural value chains can only be addressed through approaches that purposely consider women as well as men."
• "The early impact of gender-inclusive last-mile digital solutions on women farmers' participation and decision-making power is promising." through the efforts of organizations creating digital agriculture solutions that has "increased yields and incomes, as well as increased decision-making power in the household."
• "A deeper understanding of women's agency and the social norms shaping their lives is needed to bridge the gap in commercial agriculture value chains."
• "Donors and impact investors are uniquely positioned to push gender inclusive interventions forward. They can inject capital in initiatives that purposely include and target women, and ultimately help to create a level playing field in which women smallholder farmers have equitable access to digital solutions."
• "Donors and investors should first apply a gender lens to their own investment strategies to identify and reward new D4Ag investees that already apply, and want to test, approaches that reach both women and men."
• "Donors and investors should also leverage their ongoing investments to encourage investees to adopt best practices, such as consistently collecting and using sex-disaggregated data, or involving women in human-centric design research to inform the design of solutions. Investors can also make investments that strengthen the resilience of women farmers to climate change since they are disproportionately affected as a result of lower input use or weaker safety nets."

Lastly, I support the report's assertion that "By incentivizing and rewarding D4Ag providers, donors and impact investors can guide them towards gender-inclusive approaches that aim to improve women's influence, leadership roles and decision-making power, and promote sensitive and equal gender norms at all levels. Without this, gender inequalities are not only likely to remain, but become exacerbated."

What are your recommendations for increasing women's participation in digitized value chains? Which digital solutions are you creating in the agricultural last mile?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.