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A collective that includes the African Continental Free Trade Area (AfCFTA) Secretariat, Iota Foundation, the Tony Blair Institute and the World Economic Forum has joined forces to develop a digital platform in Africa to digitize trade across the continent.
Announced on Monday, the Africa Digital Access and Public Infrastructure for Trade (ADAPT) is an open-source digital public network that will enable cross-border payments through stablecoins and store digital trade documents and interoperable digital identities, according to the Iota Foundation.
Dominik Schiener, co-founder and chairman of the Iota Foundation, said in an X post that ADAPT aims to be rolled out across all 55 African nations by 2035 and streamline trade-related operations.
Among ADAPT’s other goals is to generate $70 billion in additional annual trade, cut border clearance times from up to 14 days to under three days, and reduce cross-border payment fees from the current levels of between 6% and 9%.
“Border & customs clearing will go from weeks to hours, cross-border payments will be reduced to less than 3% and exporters will get access to global trade finance liquidity,” Schiener said.
ADAPT rollout will start in Q1
ADAPT will launch in Kenya during Q1 next year, according to the Iota Foundation, and then move to Ghana and a third country, which is still to be confirmed. The full launch is slated to start in 2027 and continue until 2035.
“This will be a long and challenging road, but thanks to the commitment of the AfCFTA and the dedication of our partners I am convinced that we will realize this mission to connect Africa through the most modern digital trade infrastructure in the world,” Schiener said.
Structural inefficiencies a major problem in African trade
Chido Munyati, head of Africa at the World Economic Forum, said that trade inefficiencies have become a significant obstacle for African countries, one that he hopes digitization and blockchain technology can solve.
“Trade inefficiencies remain one of the key barriers to business growth, yet the digitalization of trade processes has the power to transform how African economies connect and collaborate.”
Paper-based documentation and slow border payments, which can take weeks, are some of the key inefficiencies, according to the Iota Foundation.
Africa is already a big player in crypto
Across Africa, it’s estimated that over 75 million users will be in the crypto space by 2026, according to online data platform Statista, with a user rate of 5.9%. The total revenue from the continent is projected to hit $5.1 billion by 2026.
Related: Countries across Africa approve new crypto laws as adoption grows
Stablecoins already account for approximately 43% of the Sub-Saharan African region’s total transaction volume, Chainalysis reported on Oct. 2, with Nigeria, South Africa, Ghana, Kenya and Zambia making up the top five.
Magazine: The one thing these 6 global crypto hubs all have in common…
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