HOW CAN WEB3 ARCHITECTURE ENHANCE THE AFRICAN AGRICULTURAL SUPPLY CHAIN?
Agriculture is the largest sector in Africa contributing to 35% of the continent’s gross domestic product and employing the largest percentage of Africa’s employable population. Despite these growing numbers the full potential of African agriculture has yet to be realized. According to the World Economic Forum, Africa is home to 60% of the world’s uncultivated arable lands, meaning that there are large swathes of land across the continent with the potential to provide employment and feed the population. However, the cultivation of these tillable lands is obstructed by various issues such as poor land governance, lack of capital to engage in intensive mechanized farming, poor transportation infrastructure, and climate change. With the proliferation of mobile technology across the continent, giving farmers access to services to overcome these challenges like financing for the acquisition of farming inputs — machinery, fertilizer, as well as transport and buyers for their produce has never been easier. Much of the current state of these mobile-connected farming services is based on the Web2 architecture and as the interconnected world pivots to Web3, it is interesting to investigate the potential benefits the new paradigm will provide to farmers.
What is Web3?
Web3 refers to the third iteration of the World Wide Web, which is focused on enabling decentralized and peer-to-peer interactions through blockchain technology. While the traditional Web (Web 1.0) facilitated the sharing of information and Web 2.0 introduced user-generated content and social networking, Web3 aims to create a more open, transparent, and user-centric Internet by integrating blockchain, cryptocurrencies, and decentralized applications.
Figure 1: Evolution of the Web from 1.0 to 3.0
Blockchain is the technology central to Web3. Blockchain, at its core, is a distributed ledger technology that enables the secure storage and transparent verification of transactions across a network of computers. In a blockchain network, each transaction is recorded as a “block” and linked together in chronological order, forming a “chain” of blocks. The block consists of two main parts: the block header and the transactions. The block header contains important metadata, including the previous block’s hash, a timestamp, a nonce (used in the proof of work algorithm), and the Merkle root of the transactions. To link blocks together, each block includes the hash of the previous block’s header, thus creating a chain-like structure. The blockchain operates on a distributed network of nodes, where each node maintains a copy of the entire blockchain.
Figure 2: Process of adding a block to the blockchain.
This decentralized nature ensures that no single entity has control over the blockchain, making it resilient to censorship and single points of failure. Once a block is added to the blockchain, it is challenging to modify or tamper with the data. The immutability of the blockchain is guaranteed by the computational work performed during mining and the consensus mechanism employed by the network. This structure ensures that the data stored on the blockchain is tamper-proof and resistant to censorship.
How does Web3 benefit farmers in Africa?
To export farm produce with an organic label — which generally sells at a higher price, a farmer needs to provide a comprehensive list of information about their crops, such as origin, inputs, harvest date, and certifications. The global food export market is extremely competitive, food is one of the few constants in the lives of every being on the planet hence the demand will always rise. As weak institutions are endemic to Africa, it becomes challenging for farmers to compete on the international stage as there are low levels of trust in their governments’ record keeping. With the blockchain infrastructure focused on Web3, farmers can provide bulletproof records of the crops without the need for intervention from other parties helping them unlock access to international markets easier than they can presently.
Blockchain technology can be used to create transparent and immutable records of every transaction and movement in the agricultural supply chain. This can help track the origin of products, verify their authenticity, and ensure compliance with quality standards. Consumers can have access to accurate information about the products they purchase, including details about their production, transportation, and storage conditions.
Web3 platforms can enable the use of smart contracts, which are self-executing agreements with the terms of the contract directly written into code. Smart contracts can automate various processes in agriculture, such as agreements between farmers and buyers, lease agreements for land or equipment, and insurance contracts. The automation and trust level of these contracts greatly reduces the possibility of disputes between farmers and other related parties.
However, with blockchain, farmers can store their data directly on the blockchain or decentralized storage systems, ensuring that they retain ownership and control over their data. Currently, most data stores are on cloud storage provided by large tech companies. Moving to a decentralized system means that farmers can choose to share specific data with trusted parties on a need-to-know basis while keeping the rest of their data private. With the growth of artificial intelligence and data analytics to derive insights and improve farming practices, money can be earned for quality agricultural data, such as crop yields, weather patterns, soil conditions, and pest management information by selling it to researchers, agronomists, or other stakeholders.
In a nutshell, Web3 architecture can improve the lives of African farmers. It provides a means of control over aspects such as data and financing that farmers are not allowed to have currently. Like every tool in the world, it has its drawbacks. Farmers need financing to own mobile phones and access to the internet connection. Furthermore, the opportunity cost of the time the farmers will spend learning about the intricacies of web3. Overall, the implementation of web3 in the African agricultural context will be a huge boost to all involved. Many of these benefits can be applied to several areas in the African context the focus on farming is due to its importance to the continent and the entrenchment of the people.
