Trends in Frontier Tech: (4) Blockchain solutions in East Africa
During the Frontier Technologies Hub sixth call for applications we received 29 applications interested in piloting innovations in East Africa. One of the key trends for this region, compared with other regions, was a spike of interest in testing blockchain solutions. Indeed, almost two-thirds of the blockchain applications we received wanted to pilot the technology in East Africa.
The applications we received are potentially reflective of wider trends in the region, where a range of actors have already begun to explore the opportunities and challenges for blockchain. In the private sector, companies in both Uganda and Ethiopia have piloted blockchain solutions for tracing coffee shipments from farm to store. They aim to support fair trade practices and provide consumers with more visibility on where they are buying their products from. In Kenya, blockchain has been piloted as part of broader initiatives to support micro-lending to farmers.
Governments in the region have also expressed an interest in using blockchain to support the delivery of public services. In 2018 the Kenyan government set up a distributed ledgers and artificial intelligence taskforce to evaluate applications of distributed ledger and AI in the public sector. Also in 2018, the Common Market for Eastern and Southern Africa (COMESA) announced that it has completed the design of a digital free trade solution — which could be underpinned by distributed ledgers.
Thematic use cases for blockchain
The applications we received for pilots in East Africa explored a range of use cases for blockchain. Broadly these fit under three key categories of use case.
1) Increasing transparency of humanitarian spending
One use case applicants explored related to increasing transparency of donor and humanitarian spending. Here, applicants emphasised how blockchain, as a shared immutable ledger for recording transactions, might provide a means for providing all ecosystem actors with a more transparent view on how funding is used — all the way through to the completion of individual activities, or purchase of goods and services. Applicants emphasised that a more transparent system could incentivise individuals or organisations to overcome distrust and hesitancy and invest in specific humanitarian activities. Applicants also suggested that a transparent view of all transactions in the value chain might enable actors to diagnose bottlenecks and find more efficient ways to spend funds.
One of our Call 6 pilots will be exploring the use of blockchain in relation to this wider use case — albeit in South America, rather than East Africa. Our ‘a blockchain-enhanced platform to support humanitarian crises’ pilot will look to test the potential for a secure, reliable, and transparent platform to enable the Venezuelan diaspora to support and monitor humanitarian projects in the country.
2) Enabling transparency in supply chains and supporting fairer trade
A range of applications explored private sector use cases for blockchain. Specifically, applicants identified instances where blockchain could support more transparent and fairer trading opportunities. This included proposals for using blockchain to facilitate carbon-credit trading. Here blockchain could be used to capture individual level contributions to carbon-offsetting, in order to provide those purchasing credits with more transparency, and enable fairer compensation.
Applicants also proposed that blockchain be used to deliver similar benefits in relation to agricultural supply chains. Here blockchain was proposed as a solution which could be used to capture the end-to-end journey a product has taken along a chain of custody from production through to point of sale. Applicants felt this information could provide consumers with a greater visibility of the provenance of agricultural products, and the ability to make consumer choices in support of more ethical and sustainable agricultural and market practices.
3) Supporting claims of identity and ownership
A final area where applicants identified opportunities for blockchain relates to supporting individuals to make verifiable claims around their identity and ownership of physical assets, resources, rights and achievements.
Applicants identified that, in different contexts, individuals sometimes lack official or accurate documentation to support their claim to ownership of something — whether a piece of land, or an academic qualification. They also identified the wider issues and consequences that this can create — including disputes, loss of ownership and loss of opportunity. .
Applicants identified opportunities to use blockchain as a solution to better support claims of identity and ownership. For East Africa we received proposals to use blockchain to document an individuals education or work history — effectively creating a digital CV.
While not based in East Africa, another of our Call 6 pilots will look to explore these types of considerations. ‘‘Improving land ownership records using blockchain technology’’ aims to pilot blockchain to digitise the land registry records in an Indian state.
Identifying the need for blockchain
While our applicants identified a wide range of use cases for blockchain, a common lesson from previous blockchain projects is that the technology is best applied under a specific range of circumstances. This lesson has been shared by previous Frontier Technologies partners, who in this blog post observed that many blockchain projects fail to ask important questions about the value-add and cost-benefits of blockchain.
Many of our applicants argued for the value-add of blockchain for their use case. Almost all applications pointed to the immutable nature of blockchain transactions as a key reason for piloting this technology. In particular, applications were keen to highlight the significant risks, for their use case, of data tampering.
Other applications emphasised that they needed a solution which could facilitate decentralisation of existing business processes and transactions, and disrupt the status quo. For example, one applicant working on a humanitarian funding use case, outlined a vision to support a more decentralised ‘market place’ type approach to humanitarian aid funding, which deviated from more traditional top-down approaches for funding and reporting.
This is the last post in our series on trends from Call 6. This series has sought to share insights from across the 110 applications we received, and point to those use cases and technologies FCDO staff were most interested in exploring.
Other blogs in our series have shared insights relating to the interest FCDO staff demonstrated in piloting Nature Based Solutions and Sensors, Electric Vehicles, and Machine Learning (especially in South Asia). Based on our applications, we also produced a blog on the qualities of ‘frontier’ technical solutions.
We hope that you enjoyed the series. Please continue following our Frontier Technologies Hub Medium page to follow the progress of our selected Call 6 pilots as they begin to start testing frontier technologies for a range of different social, environmental and humanitarian use cases!
