For the last two years, the rate of economic crime has shot up by 7 percent in the African continent to about 57 percent (vs. a global rate of 36 percent). The rationale behind this is the simplicity to bleach the economic measures in African countries.
The Problem with Trading in Africa
It is expensive to transport goods from a country to another and this makes the cost of trading a little too high. In fact, crossing borders and ports in Africa is so expensive that it ends up minimising the benefits that the continent can get from international trade.
According to the Business Daily Africa, the cost of transporting goods to African countries exceeds that of the United States by up to five times. In most cases, the poor transportation networks and slow government procedures make exporters and importers spend at least 50 percent longer to reach the market compared to Eastern Asia.
Blockchain, the Inevitable Revolution
With blockchain, Africa (and the world) can get on track. The network has immense benefits for trade and government activities. Although few anticipated that blockchain could redefine the way commerce is carried out in the world, but it is doing much more. After starting out on cryptocurrencies, the technology is now influencing how industries and governments are carrying out their activities.
The blockchain influence is also being felt in the public sector. For instance, 90 percent of governmental institutions are already planning to use the blockchain to revolutionise their services. For example, public organisations are keen to utilise the blockchain’s accessibility and convenience to impact in the management of assets, identification, supply, contracts, and regulations.
The Benefits of the Blockchain for African Countries
In the major industrial ecosystems, the blockchain can be essential in handling sophisticated missions and processes across borders. In the same way, governments can use the technology to improve their citizen services.
While many governments in the world are trying to achieve globalisation, it is important that they foster trust. Trust means increasing transparency in the country’s economic sectors. Efficient management of funds, citizen participation, and accountability are all key pillars towards the realisation of trust in a country.
Blockchain can be helpful to help Africa achieve economic trust and to reduce corruption. The technology is efficient enough to enable governments to record transactions transparently so as to prevent fraud. Of course, politicians will also have to be willing to move towards more transparency, which could be a bigger challenge than actually implementing the technology.
If a state embraces blockchain technology, it can have customised digital identity for its citizens, which would be encrypted but available for them to access essential social services. This could be critical in achieving the Sustainable Development Goals in Africa.
Again, the technology is key to improving the way local and national governments deliver services to their citizens. For instance, the network could be critical in helping electoral commissions in ensuring voters exercise their right only once during an election. Also, the system can be crucial in storing medical records, which can have substantial benefits to the health crisis in Africa.
African governments that want to make their tendering and procurement processes more efficient should also embrace blockchain technology. This could help rid the authorities of the losses that come from errors and fraud. Countries such as Senegal and Tunisia are already launching national cryptocurrencies on the blockchain. This could revolutionise and simplify financial transactions throughout the continent.
In summary, there are hundreds of benefits in store for African governments that embrace the blockchain. Apparently, even other countries in the world are starting to launch the technology. According to a report by the Economist Intelligence Unit and the IBM’s Institute for Business Value (IBV), there is an increasing number of government bodies embracing blockchains in a bid to increase accuracy and innovation.