Is blockchain technology gaining traction?

Fibo Quantum

President Maada Bio (left), Ruhakana Rugunda (right) attending the conference

 

African countries have a long way to go as they continue being recipients of blockchain technologies

Kampala, Uganda | JULIUS BUSINGE | Blockchain technology has recently emerged as one of the biggest innovations in the world.

Michael Niyitegeka, a Kampala based information technology expert explained to this reporter that blockchain technology generally brings to the fore every transaction one can think of online.

“It means that if I initiate a business with you and somebody else owes you money, they will know that you have been paid because it will all be done on a platform that we are calling blockchain,” he said. “It enhances transparency on who is doing what and at what time,” he said, “All the people on the chain get notified,” he added.

Increasingly, experts say, this technology it is having a ripple effect on various sectors including financial, manufacturing, agriculture, education, health and more.

For instance, in financial services, blockchains can change the way stock markets work, loans are bundled, and insurance policies managed.

They can make banks to change their form of operations, once the advantages of a safe ledger without transaction fees is widely understood and implemented, with bankers becoming merely advisors, not gatekeepers of money.

This technology, however, is yet to be appreciated locally despite a few steps made so far.

Ruhakana Rugunda, Uganda’s Prime Minister, who spoke on behalf of President Yoweri Museveni during the Second Africa Blockchain Conference at the Kampala Serena Hotel on July 3-4, said the government will work with the private sector and other players to ensure that blockchain technology helps the country deal with healthcare challenges, increase household income and fight unemployment as well as poverty among the population.

He said the government continues to invest heavily in sectors of education, information communication technology, energy, defense and security where blockchain technology will also be applied.

Rugunda, however, emphasized that young people should take the lead in harnessing the opportunities in these new technologies.

This could be because the country has one of the youngest populations in the world, with over 70 % of it being under 30 years of age and, many are jobless.

State Minister for Planning, David Bahati said the government fully supports blockchain technology as evidenced by the continued investment in the National Backbone Infrastructure to support internet connectivity and related sector investments.

Currently, it is possibly only the beer maker, Nile Brewieres Ltd that is enhancing economic opportunities for smallholder farmers within its supply chain through blockchain technology.

Started in 2018 in Sebei sub region, the pilot in eastern Uganda recorded 349 transactions worth over Shs880million on 587 tonnes of barley from the 316 registered farmers.

The programme is being implemented as a partnership between Top brewer ABInbev, the parent company and BanQu, a non-cryptocurrency blockchain platform, with Barley farmers in Uganda and cassava farmers in Zambia being the pilot.

Through this collaboration, NBL executives are providing farmers with access to digital payments and technology to further their economic opportunity as a means of achieving agriculture sustainability goal and, to have 100% of its direct farmers skilled, connected and financially empowered by 2025.

“The technology allows transparent real time transactions with end traceability. Farmers’ data is recorded on spot and the farmer owns this data and is able to access it from anywhere,” said Theunis Coetzee, the agriculture manager EA AB Inbev.

“This therefore increases accountability, and the same data of produce and earnings enable farmers have better access to financial tools,” he said.

BoU, CMA following suit?

Kwame Rugunda, the chairman for Africa Blockchain conference organising committee and chief executive officer for CryptoSavannah said they are currently building on the success of the first conference to support the blockchain technology.

He said the Bank of Uganda has already put in place a blockchain working group to study the new technology and forge ways for its application in Uganda.

The Capital Markets Authority has drafted the cryptocurrecy regulations and at national level, the government has set up a national taskforce to drive the fourth industrial revolution, Rugunda said.

However, Sierra Leone’s President, Julius Maada Bio, who graced the conference under the theme ‘Preparing Africa for the 4th Industrial Revolution’ said whereas Africa remains a recipient of new technologies, by embracing blockchain technology, countries would go a long way to achieve their development goals.

He said African governments must first work towards fighting corruption, strengthening government institutions, reviewing policies and laws, harnessing trade integration and curbing land and property rights conflicts.

On policies, Maada said the African governments have to target information technology as a key sector for driving the fourth industrial revolution. He also said Africa must invest heavily in healthcare, education and technology and innovations.

Globally, banks and financial tech companies are increasingly embracing blockchain’s native capabilities as the basis for cross-border payment networks.

J.P. Morgan is said to have created one of the largest blockchain payments networks, according to Computerworld.

The financial services company is said to have announced in 2017 that the Royal Bank of Canada and Australia and New Zealand Banking Group Ltd are the first two banks to join the blockchain network, “representing significant cross-border payment volumes.”

J.P. Morgan created the Interbank Information Network (IIN), which it said will significantly reduce the number of participants needed to respond to compliance and other data-related inquiries that delay payments.

Similarly, Citibank has partnered with Barclays to launch a blockchain app store. Dutch based ING and BNP Paribas are just two of several big banks that partnered to create komgo, a blockchain trade commodity network, and Switzerland based UBS has partnered with the US-based BNY Mellon, Deutsche Bank, and Santander to create a way to exchange digital cash.

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