Blockchain for a Connected Africa trade

Coronet Blockchain
6 min readFeb 8, 2022

The low hanging fruits for the continent — Credit Anele Dube

African trade has been a growing topic of conversation for hundreds of years, more so, since the official launch of the African Continental free Trade Area (AfCFTA) in January 2021. This landmark agreement provides countries in Africa with the necessary industrial policy space to improve productivity and inter-trade among themselves. The AfCFTA sets out to provide a crucial part in global trade development and the bolstering of supply chain centric trade flows where it is a valuable source of industrial connectivity and a beneficial catalyst to Africa’s supply chains.

The use of this long awaited trade agreement addresses issues of trade within the continent, that have long been a thorn on the side for heads of state and entrepreneurs alike. The reality is: significant trade flows, requite intentionality and a connected infrastructure, to give Africa’s developing countries Africa, a fighting chance. Significant trade volumes are not the only bedrock of the agreement, but equitable trade, via fair trade mechanisms built into the agreement and its ideals, makes this a fresh dawn for Africa. Among the early priorities of its implementation, is the removal of tariff related and non-tariff barriers, that if left in place could impede the realisation of a true intra-African Trade environment. Momentum is underway in this regard.

Coronet Blockchain
Photo credit: Coronet Blockchain

Africa’s Trade Problem

The development of the African continent, to a fully productive, self-sustaining ecosystem, has for generations been hindered by the missing link in the unlocking of African trade growth through sub-regional and intra-Africa trade arrangements. Whilst most hold varied opposing views on what Africa’s direction ought to be: inhabitants of the continent and its offshore neighbours hardly disagree on the evident great need to create more development through trade to promote African trade internationally, and within the continent’s borders. The secondary concern, tiered to this is the currently modest or limited amount of formal trade within the continent. Much of the focus has been on exporting mainly natural resources with declining terms of trade, and little benefits beyond the first mile, whilst other nations evolve these materials only to send them back to Africa, fully produced, at exorbitant and prohibitive costs. This has proven to be a non-sustainable approach, to build any state that holds hopes to compete competitively in the global trade landscape. Edging further into the value chain, beyond the raw material phase, is pivotal to Africa’s well-being and future.

Additional advantages of AfCFTA

Beyond the afore-said, additional advantages of this agreement, includes the creation of an increased integrated regional market for African goods, after all, consumption and demand already exists, but is being fulfilled by alternate means beyond the continent. This regional integration, will allow African based consumers to get better access to cheaper imported products from other African countries. A knock-on effect around this, will also entail an increase in better allocation of resources and naturally, a faster inward economic and trade growth. Subsequently, this will decrease the challenges that are a resulting negative residue, from having to host and implement multiple overlapping trade agreements across Africa. These additional advantages, jointly, shape a future were the strengthen of intercontinental economic integration and political integration, is inevitable.

Coronet Blockchain
Photo credit: Coronet Blockchain

Connectivity in Africa

Historically, from an infrastructure legacy perspective: mobility and logistical connectivity in Africa requires further priority to ensure that both rural and urban centres benefit robust methods towards aiding the continent to deepen and enhance better connectivity are assigned priority attention, as they are very important to the continent’s drive to simplify commerce across income groups. Priority to connectivity enabling projects continues to receive top tier focus across public and private entities, as far as the implementation of the trade agreement is concerned.

Deepening connectivity also paves way for greater adoption and implementation of trade supporting technologies such as blockchain. Making it easier to spread awareness and adoption of Decentralised Ledger Technologies (DLTs) and favourable usage to the advantage of the AfCFTA.

The “Trust Machine”

In layman’s terms the notion of blockchain is the incorruptible method of economic transactions that are being recorded at all points, it makes use of the simple question of asking “if” an action or event has taken place “then” what must occur and once this is complete what “else” must be done in order for the transaction to be completed. What this technology does is eliminate several steps that might be necessary in verification with the help of a shared database or digital record of transactions otherwise known as a digital ledger.

The technology also known as a trust machine is used to create a transparency in cases where there might be less trust. The “trust machine” unlike a normal database is secure from fraud, corruption, errors, and criminal activity such as hacking. Hence being seen as a main solution for innovation in Africa.

Developments in parts of the continent are seeing an increased interest in the use of this technology in businesses and research towards this topic. Use cases of blockchain implementations are seeing the technology catalyse trade catalyst in businesses to help change certain areas such as healthcare, land registry, finance, and supply chains. Start-ups are beginning to leverage the potentials of blockchain, by tapping into its equaliser possibilities for informal and mainstream economies. One of those use cases of blockchain technology, is found in Coronet Blockchain. The start-up is applying blockchain to reforming of supply chains. Starting first and foremost with reshaping Africa’s sizeable 7 billion USD a year, hair industry, whilst adapting it to adjacent sectors such as food and fashion, among others.

Photo credit: Coronet Blockchain

From paper to implementation

On paper the advantages of AfCFTA are quite evident and can be easily seen and are attractive towards the African states as they seek to retool and reposition their respective economies. This includes the recent launch of a unifying much awaited Blockchain in this regard: with the need to improve its economy but in reality, there is a long way to go before an agreement such as the AfCFTA could use the solution of blockchain.

Rather, what this would do for most African countries is open doors to new methods of transparency as a means of development and therefore create more opportunities towards working with the technology for a sustainable development.

About Anele Dube

Picture Credit: Anele Dube

Anele Dube, did her Bachelor of Commerce Honours in Information Systems at North West University- Mafikeng Campus. Her research is based on Examining the role of Blockchain in South African government: a method of service provision. Mainly to find out what this technology can do to better the country.

She is passionate about building small communities such as the one she lives in with innovative technology and pushing to better herself in these aspects. Her biggest project is working on efficient methods for waste management leveraging the use of Artificial Intelligence (AI) to help struggling communities. She codes in her spare time and totally adores animals.

Sign up to discover human stories that deepen your understanding of the world.

Free

Distraction-free reading. No ads.

Organize your knowledge with lists and highlights.

Tell your story. Find your audience.

Membership

Read member-only stories

Support writers you read most

Earn money for your writing

Listen to audio narrations

Read offline with the Medium app

Coronet Blockchain
Coronet Blockchain

Written by Coronet Blockchain

B2B2C Marketplace providing blockchain vetted products to African Markets. Beyond hair products: our focus is across Beauty Food & Fashion supply chains.

No responses yet

What are your thoughts?