How Blockchain is solving Africa’s problems 

By Mohammed Ibrahim Jega, Co-founder, Domineum Blockchain Solutions.


There’s been so much said about blockchain in the past few months due to the astronomical rise in bitcoin prices and the restriction on cryptocurrency use/trading by governments around the world. While cryptocurrencies have received more attention, less attention is paid to how blockchain -- the underlying technology --  is solving Africa’s problems. Based on my work experience, here is how blockchain is solving Africa’s problems.


First, for those not familiar with the concept of blockchain, it’s a kind of database for recording and verifying transactions and terms of engagement. Information about who owns a specific asset, who bought a particular product from whom, or who has the right to make a certain type of decision can be recorded on a blockchain. The major advantages of blockchain are its permanence and transparency. This means prior records are never deleted and anyone can view a complete record of all processed transactions. 


Trade and Payment

Africa is riddled with corruption, it has some of the most corrupt countries in the world. 
While there have been advancements in technology that have helped reduce corruption, few are as promising as cryptocurrency - a digital currency that employs cryptography to ensure that transactions are secure.

The beauty of cryptocurrency is that using it as a mode of payment for a transaction allows the identification of each user of the money, unlike with traditional modes of payment like notes and coins. 
A popular drawback cited against cryptocurrencies like bitcoin is that users are anonymous, but it’s possible to include personal information, like the ID number, and make the cryptocurrency non-anonymous. For many Africans, a more popular use case is that it also allows for instantaneous transactions across different countries. This helps facilitate cross border remittance. It reduces transaction time and cost since financial intermediaries are not needed.
Bitpesa (Kenya) and SureRemit (Nigeria) are two companies that are facilitating cross border with cryptocurrency.

Also, for public sector projects, a block in the blockchain can be used to store the nature of expenses incurred on different activities carried out to fulfil a project.  To take things a step further, a smart contract can be used. A smart contract is a computer program that triggers processes according to the terms of a contract. These terms could define the conditions to be met to release funds, dates from which they can be made available, and so on. The satisfaction of the contract helps prevent improper expenses.


Land ownership

Over 90% of rural land in Africa is undocumented and therefore vulnerable to land grabbing. This hampers the growth of agriculture and other sectors as during times of conflicts lands are lost to other parties or could be taken forcefully by the government. To reduce the loss of lands, the proper documentation of land is important. 

Blockchain is also used to establish origins and ownership. A typical example of this in practice is the diamond industry, which has long been subject to corrupt activity. In western and central Africa, rebel groups have used “blood diamonds” to finance armed conflicts against governments. To prevent this from happening the diamond industry has attempted to create provenance certification programs, that certify the origin of the diamonds. 
The proper tracking of diamonds is bringing much-needed transparency to the industry. However, because these certificates are paper-based, they are prone to fraud and corruption. Tracr is an application used by South African diamond company De Beers to implement certification programs on blockchain to reduce fraud and corruption. Bitland is a Ghanaian blockchain company that is helping Africans cement legal ownership of their lands by providing land registry services through blockchain technology. 

Domineum is another company that provides blockchain-enabled digital land registry for government land departments, and the real estate jurisdiction in Nigeria and Sierra leone.

Supply Chain management

The cargo, transport, and shipping industry have long suffered from a lack of transparency in regard to the sourcing and timing of shipments.
Blockchain’s ability to track provenance can reduce the amount of inefficiency and lack of clarity in supply chains. In 2018, the Danish shipping giant Maersk and IBM announced a joint venture to create a real-time digital ledger for global shipping. Other companies like Walmart have also done the same to cover their entire supply chains. In Africa, Domineum Marine uses blockchain technology to offer supply-chain security management, revenue generation and collection for Cargo Tracking Notes and Transport and Port Management Systems.

The competitive advantage that this offers is that it allows companies to track information about sales in real-time so they can quickly adapt their product mix to local needs and trends. 

Blockchain is helping businesses process, trade and land ownership become more efficient and transparent in Africa.