Adoption of blockchain route for the halal meat industry

It's no coincidence the cartel’s activities all these years were only unmasked once blockchain technology was deployed.


Published by Focus Malaysia, i3investor, Astro Awani, Business Today & Biztech Asia, image from Focus Malaysia.

IN the wake of the expose on the domestic halal meat industry late last year revolving around a cartel comprising foreign importers, EMIR Research has proposed that the relevant authorities to go the blockchain technology route to prevent such recurrence.

Apparently since October, the Royal Malaysian Custom Department (RMCD) has already implemented the use of blockchain-enabled TradeLens platform in Malaysia – jointly developed by AP Moller-Maersk with IBM, which is based on the Collaboration Application Programming Interface (API) concept – to modernise the shipping processes, create greater transparency and enhance customer satisfaction.

Joining the TradeLens platform marked the beginning of RMCD’s effort to digitise its operations which will boost efficiency, transparency and collaboration across supply chains, in addition to fulfilling its mission to facilitate legitimate trade, help combat smuggling and modernise the national logistics systems in support of Malaysia’s digital economy aspirations.

By digitising shipping processes, TradeLens will provide RMCD with an automatic and immutable tracking tool which will lead to a more highly secure, transparent, efficient and simpler workflow, with near real-time information sharing from a diverse network of ecosystem members.

It is no coincidence the cartel’s activities all these years were only unmasked once blockchain technology was deployed via the TradeLens platform, which is a digital global trade platform that enables more efficient and accurate container tracking and information sharing among platform members.

Indeed, it is a jarring indication of just how deep corruption among the few can severely impact the lives, food consumption and religious beliefs of millions of people. And the hitherto disjointed and fragmented supply chain processes that provided the “security gaps” for the meat cartel to exploit can be remedied with the extension and integration of blockchain technology.

According to experts, TradeLens digitises the voluminous, time consuming paper-based shipping processes which will enable the relevant authorities to receive shipping data as soon as containers leave the port of origin.

Paper-based procedures are said to have created some pain points throughout the global supply chain system, with the World Trade Organization (WTO) estimating digital technologies will have a profound impact on global trade, adding up to 34 percentage points to trade growth by 2030.

TradeLens will give RMCD more time to prepare for the arrival of shipments. This will enable more efficient and thorough fraud and forgery inspection as well as a more consistent and transparent revenue collection process.

The blockchain platform will also allow all logistic activities including trucking, warehousing, shipping and freight forwarding at both domestic and global levels to be integrated which will also improve the sharing of data-rich information through a single platform.

It also promotes trust among trading partners as the record of all transactions is shared within the network and permissioned parties can access the data in real-time, making it possible for RMCD to have permissioned visibility into supply chain activities with verified, highly trusted and near real-time data.

Besides Malaysia, a number of government authorities from other countries, shipping agencies, ocean carriers and port authorities have partnered with IBM and AP Moller globally in the use of TradeLens platform.

Moving forward, TradeLens could be the base by which the entire halal certification process and network driven by blockchain technology is operationalised, as it can be extended to be included as part of the entire halal food supply chain and transaction processes.

For this to be successful, the first and foremost requirement is the participation of industry players and stakeholders, especially the importers of halal meat, and this should be made mandatory, that is, any halal meat importers or their foreign associates must be mandated by law to be members of the TradeLens platform so that their supply chain activities including freighting and warehousing can be verified by the blockchain-enabled TradeLens platform resulting in highly trusted and near real-time data, and then shared among permissioned members of the platform.

To make this mandatory requires amending the Trade Description Act 2011, specifically in relation to the secondary legislation of the Trade Descriptions [Definition of Halal] Order, 2011 as well as the Trade Descriptions [Certification and Marking of Halal] Order, 2011).

The Department of Islamic Development Malaysia (Jakim) could then create its own real-time database containing information of all foreign suppliers and the concomitant transactions for oversight, monitoring and audit purposes.

This will promote digital security as well as complement and supplement the tamper-proof character of blockchain technology by ensuring hashed signatures can be double-checked against Jakim’s own real-time database.

At the same time, the real-time database should be de-centralised so that it’s inter-operable and inter-face capable with the other government agencies, namely the Malaysian Quarantine and Inspection Services Department (MAQIS) under the Ministry of Agriculture & Food Industries that issue the approval permit (AP), and the Enforcement Division of the Ministry of Domestic Trade & Consumer Affairs. Inter-operability is the key here which in general means the ability of different systems to “talk” to each other.

The real-time database mimics and emulates the function of TradeLens blockchain technology in data-sharing but without the need to duplicate the transaction processes themselves.

So, the Jakim database can be integrated into and provide support and complement the role of the TradeLens system. In effect, the Jakim database performs the background role of monitoring the TradeLens system – enhancing the integrity of both data provenance and the overall transaction processes of the blockchain technology.

Data provenance is one of the most significant real-world applications of blockchain technology which refers to the documentation of where a piece of data comes from and the processes and methodology by which it was produced. It creates a single, secure chain of custody timeline, designed to be tamper-proof.

The system can be used to provide customers with a ‘story’ about each product on the sources, materials, locations, processes, ingredients and suppliers the businesses use, and enables businesses to substantiate claims about their products using real-time data. With such a system, provenance tracking of where each piece of data comes from and whether it is still up-to-date becomes a breeze.

The provenance blockchain has complete information about the addresses and their supply chain path right from source to the point of consumer purchase, giving the much-needed assurance for Muslims that the “halal-ness” of the food on their table can be traced back through all the locations of the halal supply chains that began with the original halal farm or livestock farm, including the identity of the farmers or livestock breeders.

Blockchain technology would inject trust into a halal supply chain and value chain of a brand owner who would be better able to guarantee halal integrity. They could also be integrated into the wider sustainability and corporate responsibility systems to extend the brand market beyond Muslim consumers.

Perhaps also, as part of the effort to further integrate the Jakim database into TradeLens rather than merely constructing a parallel, albeit inter-faced system, is the requirement for Jakim to have its own miners (cryptographers) as part of the blockchain transactions seen as set in the context of the wider halal certification process.

In this regard, Jakim needs to do what RMCD did – collaborate with expert entities in blockchain technology such as IBM to “blockchainise” its halal certification operation where data provenance is a must.

As the Religious Affairs Minister, Datuk Seri Zulkifli Mohamad is seeking feedback on halal certification process abroad, this article can be seen as one giving the necessary and critical feedback.

In conclusion, it’s time to ramp up the digitalisation of the halal certification process and what better way than to assimilate blockchain technology as a sure-fire way to ensure halal integrity and strict compliance.

Jamari Mohtar is Director, Media and Communications, while Jason Loh Seong Wei is the Head of Social, Law & Human Rights of EMIR Research, an independent think tank focused on strategic policy recommendations based on rigorous research.

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Diterbitkan oleh Malaysia Now, Malaysiakini & Utusan Malaysia.

Menyusuli pendedahan mengenai industri daging halal akhir tahun lalu yang melibatkan kartel pengimport asing, Emir Research telah menyarankan pihak berkuasa relevan mengambil kira penggunaan teknologi rantaian blok bagi mencegah kejadian berulang.

Sejak Oktober lagi, pihak kastam telah melaksanakan penggunaan platform TradeLens di Malaysia yang berasaskan teknologi rantaian blok bagi memodenkan proses penghantaran, mewujudkan ketelusan yang lebih ketara serta meningkatkan kepuasan pelanggan.

Penyertaan kastam dalam platform TradeLens yang dibangunkan bersama AP Moller-Maersk dengan IBM berdasarkan konsep Antara Muka Pengaturcaraan Aplikasi (API) Bersama itu, menandakan bermulanya usaha pendigitalan operasinya yang akan meningkatkan kecekapan, ketelusan dan kerjasama merentasi rantaian bekalan, selain memenuhi misinya untuk memudahcarakan perdagangan yang sah, membantu memerangi penyeludupan dan memodenkan sistem logistik nasional demi menyokong aspirasi ekonomi digital Malaysia.

Dengan pendigitalan proses penghantaran malalui kapal, TradeLens menyediakan kastam dengan alat penjejakan automatik dan tidak berubah yang akan membawa kepada aliran kerja yang lebih selamat, telus, cekap dan mudah, melalui perkongsian maklumat hampir masa sebenar di kalangan pelbagai rangkaian anggota ekosistem TradeLens.

Ia bukanlah satu kebetulan kegiatan kartel selama bertahun-tahun itu hanya dapat dibongkar setelah teknologi rantaian blok digunakan melalui platform TradeLens, sebuah platform perdagangan global digital yang membolehkan penjejakan kontena dan perkongsian maklumat yang lebih cekap dan tepat di antara anggota platform.

Sememangnya, ini adalah petunjuk jelas betapa rasuah yang mendalam dalam kalangan sebilangan kecil mempunyai impak besar dalam kehidupan, penggunaan makanan dan kepercayaan agama berjuta-juta orang. Dan proses rantaian bekalan yang selama kini terputus dan terpisah menyediakan “jurang keselamatan” untuk dipergunakan kartel daging, kini dapat diatasi melalui perlanjutan bersepadu aplikasi teknologi rantaian blok.

Menurut para pakar, TradeLens mendigitalkan proses penghantaran yang membolehkan pihak berkuasa berkenaan menerima data penghantaran sebaik sahaja kapal kontena meninggalkan pelabuhan asal.

Ini berbeza dengan proses penghantaran sebelum pendigitalan yang memakan masa berpanjangan kerana melibatkan prosedur berdasarkan kertas, yang dikatakan telah menimbulkan beberapa titik rentan di seluruh sistem rantaian bekalan global.

Malah, Pertubuhan Perdagangan Dunia (WTO) menganggarkan teknologi digital akan memberi kesan mendalam kepada perdagangan global, menambah hingga 34 mata peratusan bagi pertumbuhan perdagangan menjelang 2030.

TradeLens akan memberi kastam lebih banyak masa membuat persiapan bagi ketibaan penghantaran.

Masa ini membolehkan pemeriksaan lebih cekap dan menyeluruh bagi membanteras penipuan dan pemalsuan serta proses pengumpulan hasil pendapatan yang lebih konsisten dan telus.

Platform rantaian blok juga akan membolehkan semua kegiatan logistik termasuk pengangkutan lori, pergudangan, perkapalan dan penghantaran barang di peringkat domestik dan global disepadukan, sekali gus meningkatkan perkongsian maklumat dengan data melalui satu platform.

Ia juga mendorong kepercayaan di kalangan rakan dagang kerana rekod semua urusan dikongsi bersama dalam rangkaian dan pihak yang dibenarkan dapat mengakses data dalam masa hampir sebenar, memungkinkan kastam keterlihatan dalam aktiviti rantaian bekalan yang semua datanya telah disahkan, sangat dipercayai dan dalam hampir masa sebenar.

Selain Malaysia, sejumlah pihak berkuasa pemerintah dari negara lain, agensi perkapalan, kapal kargo pukal dan pihak berkuasa pelabuhan telah bekerjasama dengan IBM dan AP Moller secara global dalam penggunaan platform TradeLens.

Melangkah ke hadapan, TradeLens dapat menjadi pangkalan di mana seluruh proses dan rangkaian pensijilan halal yang berpandukan teknologi rantaian blok dapat beroperasi oleh kerana ianya dapat diperluas untuk dimasukkan sebagai sebahagian keseluruhan proses urusan dan rantaian bekalan makanan.

Untuk ia berjaya, satu syarat penting adalah penyertaan pemain industri dan pihak berkepentingan, terutama pengimport daging halal, dan ini harus diwajibkan, iaitu adalah mandatori bagi mana-mana pengimport daging halal atau rakan sekerja asing mereka diberi mandat oleh undang-undang untuk menjadi anggota platform TradeLens agar kegiatan rantaian bekalan mereka termasuk perkapalan dan pergudangan dapat disahkan oleh platform TradeLens dan kemudiannya dikongsikan di kalangan anggota platform yang memperolehi kebenaran.

Ini pula memerlukan pindaan Akta Perihal Dagangan 2011, khususnya yang berkaitan dengan undang-undang subsidiari Perintah Perihal Dagangan [Definisi Halal], 2011 serta Perintah Perihal Dagangan [Pensijilan dan Penandaan Halal], 2011.

Jabatan Kemajuan Islam Malaysia (Jakim) kemudian dapat mewujudkan pangkalan datanya yang berdasarkan masa sebenar serta mengandungi maklumat semua pembekal asing dan selanjutnya semua urusan untuk tujuan pengawasan, pemantauan dan audit.

Ini akan meningkatkan keselamatan digital serta menambahbaik dan melengkapkan ciri-ciri teknologi rantaian blok yang kalis perubahan dengan memastikan tanda tangan yang disulitkan (encrypted/hashed signatures) untuk mengaburkan maklumat supaya tidak dapat dibaca tanpa pengetahuan khusus, diperiksa semula berdasarkan pangkalan data sebenar Jakim sendiri.

Dalam pada itu, pangkalan data sebenar harus diagihkan supaya ia berupaya untuk saling beroperasi (interoperable) secara antara muka (interface) dengan agensi kerajaan lain, iaitu Jabatan Perkhidmatan Kuarantin dan Pemeriksaan Malaysia di bawah Kementerian Pertanian & Makanan Industri yang mengeluarkan permit kelulusan (AP), dan Bahagian Penguatkuasaan Kementerian Perdagangan Dalam Negeri & Hal Ehwal Pengguna. Saling beroperasi adalah kunci di sini yang secara amnya bermaksud kemampuan sistem yang berbeza untuk “berhubung” antara satu sama lain.

Pangkalan data sebenar Jakim itu boleh meniru dan mencontohi peranan TradeLens dalam perkongsian data tanpa perlu mengulangi proses urusan platform itu sendiri.

Jadi, pangkalan data Jakim dapat digabungkan serta menyokong dan juga melengkapi peranan sistem TradeLens.

Dalam hal ini, pangkalan data Jakim sebenarnya memainkan peranan latar belakang memantau sistem TradeLens – meningkatkan integriti kedua-dua sumber data dan keseluruhan proses urusan teknologi rantaian blok.

Sumber atau asal usul data adalah salah satu aplikasi teknologi rantaian blok paling penting yang merujuk kepada dokumentasi dari mana datangnya data dan proses dan metodologi yang mewujudkan data tersebut.

Ini membentuk satu garis masa jagaan tunggal yang selamat, yang juga kalis gangguan.

Sistem ini dapat digunakan untuk memberikan “naratif” kepada pelanggan mengenai setiap produk berkenaan sumber, bahan, lokasi, proses, dan identiti pembekal yang digunakan oleh perniagaan, dan juga memungkinkan perniagaan untuk membuat dakwaan tertentu mengenai ciri-ciri produk mereka menggunakan data sebenar.

Dengan ini, penjejakan asal usul setiap data dan adakah ia masih terkini menjadi mudah.

Rantaian blok tersebut mempunyai maklumat lengkap mengenai alamat dan jalur rantaian bekalan dari sumber hingga titik pembelian pengguna, memberikan jaminan yang sangat diperlukan bagi umat Islam bahawa “halalnya” makanan di meja mereka dapat dikesan kembali melalui semua lokasi rantaian bekalan halal yang bermula dari ladang halal atau ladang ternakan pertama, termasuk identiti petani atau penternak itu sendiri.

Teknologi rantaian blok menyuntik keyakinan kepada rantaian bekalan halal dan rantai nilai pemilik jenama yang akan dapat menjamin integriti halal dengan lebih berkesan.

Ia juga dapat digabungkan ke dalam sistem keberlanjutan dan tanggungjawab korporat yang lebih luas untuk mengembangkan pasaran jenama di luar pengguna Islam.

Mungkin juga, sebagai sebahagian usaha untuk lebih menyepadukan pangkalan data Jakim ke dalam TradeLens dan bukannya sekadar membangun sistem selari, walaupun saling berantara muka, Jakim perlu menimbangkan adanya penambang (cryptographer) sendiri sebagai sebahagian urusan rantaian blok yang dilihat sebagai ditetapkan dalam konteks proses pensijilan halal yang lebih luas.

Sehubungan itu, Jakim perlu melaksanakan apa yang dilakukan kastam – bekerjasama dengan entiti pakar dalam teknologi rantaian blok seperti IBM untuk “merantai blok” (“blockchainise“) operasi pensijilan halal di mana asal usul data adalah satu kemestian.

Sebagai kesimpulan, sudah tiba masanya untuk meningkatkan pendigitalan proses pensijilan halal dan pendekatan yang lebih baik ialah penerapan teknologi rantaian blok sebagai kaedah yang paling terjamin untuk memastikan integriti halal dan pematuhan ketat.

Jamari Mohtar dan Jason Loh Seong Wei merupakan sebahagian daripada pasukan penyelidik di Emir Research, sebuah organisasi pemikir bebas yang berfokuskan kepada pencernaan saranan-saranan dasar strategik berteraskan penyelidikan yang terperinci, konsisten dan menyeluruh.

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