It is common knowledge that Africa has paid her dues to the world. The continent is still highly dependent on exports for most of her income

 In 2019 alone over Africa exported 65% of primary goods to the EU, including raw materials and energy. Despite relying heavily on exports, Africa ranks 5th on the dollar value for global shipments with $420.5 billion. While Asia is ranked as number one with $7.326 trillion according to 2017 data. The stark difference is due to the nature of exported goods. While most of these other continents export finished products like cars and phones, Africa is still reliant on raw materials. How can the Algorand blockchain help the continent in changing its narrative? 

The blockchain technology has proven to be a revolutionary technology, transforming the way things have always been done. It's transparent, immutable and secure nature has endeared it to many industries. However, how can it be integrated successfully with the African Raw material industry? The Algorand blockchain was founded in June 2019 and aims to create and promote a decentralized digital economy that is both open and permissionless through its Pure Proof-of-Stake protocol. It also aims to create an ecosystem that will help scale custom made blockchain projects through its transaction management system. 

The Current State of the African Raw Material Industry

There have been calls for the African turn to large-scale manufacturing which is mostly absent in the continent except for few countries like automobile manufacturing in South Africa. However, the content is still moving up to doing that. There have also been policies laid out to increase manufacturing and self-dependence in the continent but several factors mitigate against these plans. So what is the current state of the African raw material industry? 

Dependency on Colonial Nations

Africa is still dependent on its former colonial masters. Countries colonized by France still have a strong affiliation with the French. France still has interests in influencing African internal affairs and still has companies running In its former colonies from the colonial era. France has also oftentimes influenced the political tension in its colonies. In fact, 14 Western and Central African countries still had to pay a “colonial debt” and have their national reserves held in France's Central Bank. France also left its former colonies with only 15% of their own money having these countries place 65% of their foreign currency reserves into the French Treasury with an additional 20% for financial liabilities. You can also consider the fact that France still controls most of that natural resources with its strong military presence in oil-rich countries like Carbon and Congo for its cobalt and copper. 

Greed and Corruption

African is populated with corrupt leaders whose sole concern is their pockets and this affects its production and manufacturing rate. Since these leaders are in charge of policies export rates are manipulated to suit their narratives making it difficult for those at the bottom of the chain to make profits.

Lack of Education on Value of the Raw Materials

An exposé on the 120 years old Tannery in Nigeria revealed that tanners get paid less than they should. For instance, a Louis Vuitton bag may cost thousands of dollars but the tanner gets as low as $5 to $20 for their hides. Also, despite the fact that over 70% of cocoa production takes place in West Africa with Ivory Coast, Ghana, Nigeria and Cameroon being it's largest producers, none of these countries are among the top 10 exporters and manufacturers of chocolate in the world. This means that farmers have to produce cocoa, export them at a cheaper rate and in the end the country imports chocolate.

Other factors affecting the state of Africa's raw material industry may include insurgency or war over natural resources. This also limited the revenue generation for the continent. There is also the fact that Africa carries out more cross consistent trades than intra-country trade within its continent. Power source and energy is also a factor as the continent needs the power to maintain a continuous manufacturing rate. All these factors can be explored by the Algorand blockchain.

What Can Algorand Do to Change the Narrative?

Governments across the world are already implementing the blockchain in their systems. Algorand, proof-of-stake blockchain is ideal for the creation of custom financial products. It can be implemented in solving the issue of Africa's raw material industry especially by giving the continent autonomy over its finances. Algorand has already partnered with SFB Technologies to develop the CBDC (Central Bank Digital Currency) of the Marshall Islands called Marshallese Sovereign (SOV). If African nations can adopt this system as well, it will improve cross border raw material trade making it faster and cheaper.

When it comes to electing public officials a transparent system can be utilised. Alogrand based Dapps can be used to track the voting process and ensure that the electorate is not manipulated. Also, public funds can be monitored using Algorand. A smart contract will be enforced and funds released according to the contract. Farmers can also state the amount they want and have a smart contract deployed enabling farmers, banners, miners and the likes get the right value for the raw materials produced. 

Algorand can also help in the tracking process. First, this can be applied in the raw material supply chain. An RFID can be inserted in raw products and they can be tracked using Algorand. Bandits and terrorists can be tracked this way as well as all armed weapons will be tagged. This way, insurgencies can be nipped right in the bud.  Rare and endangered species in Africa can be protected using this method. One of the beauties of the Algorand protocol is that it enables the expansion of the range of Dapps and processes that can be built on the platform. The platform also accepts the creation of Fungible and non-fungible tokens which can further help the continent in placing value on its raw materials. 

Conclusion

Although governments across the world are slowly embracing the blockchain technology, it will take a while for adoption to become widespread. Currently, Africa has embraced the use of cryptocurrency, a use case of the blockchain. But, with the use of a network like Algorand, the continent can slowly rebuild its financial structure and stand independent of loans and handouts from other continents. The Algorand blockchain can enable the continent to build its own financial structure and help it from inflation. Hopefully, the government in the content being its application soon.