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A sweeping new initiative called ADAPT (Africa Digital Access and Public Infrastructure for Trade) focuses on reshaping how commerce flows across the African continent, with blockchain technology and stablecoins at its core.
Launched by the African Continental Free Trade Area (AfCFTA) Secretariat in partnership with the IOTA Foundation, the Tony Blair Institute, and the World Economic Forum (WEF), ADAPT promises to deliver faster, cheaper, and more transparent cross-border trade.
The announcement of this initiative stimulated debates among individuals. To address these controversies, the Iota Foundation explained that this open-source digital public network is significant in promoting seamless trade as it allows cross-border payments using stablecoins. This project will also safeguard digital trade documents and ensure the compatibility of digital identities, the organization added.
ADAPT project set to promote a seamless trade in Africa
Dominik Schiener, an Italian entrepreneur, co-founder, and chairman of the IOTA Foundation, shared an X post stating that ADAPT is scheduled to be implemented in all 55 African nations by 2035. According to Schiener, this move aims to enhance trade operations on the continent.
Meanwhile, reports from reliable sources indicate that ADAPT also aims to generate an additional $70 billion in yearly trade, reduce border clearance times from up to 14 days to under three days, and lower the charges for cross-border payments to 6% from their current rates of 9%.
In a statement, Schiener mentioned that border and customs clearing will shift from taking several weeks to only consuming hours. He further elaborated that cross-border payments will drop drastically to below 3%, while exporters will have the opportunity to access global trade finance resources.
Notably, the IOTA Foundation is a global non-profit entity that develops open-source distributed ledger technology (DLT) for the “Internet of Things” (IoT). The organization hinted that the ADAPT project will initially be introduced in Kenya in the first quarter of next year, before extending its reach to Ghana and another nation, which has yet to be disclosed.
According to reports, the full rollout is scheduled to commence in 2027 and is expected to continue until 2035.
Similar to the launch of other initiatives, Schiener acknowledged that this journey will be long and challenging. However, the Italian entrepreneur pointed out that, with backing from the AfCFTA and the commitment of their partners, he believes they can achieve their goal of connecting Africa to the world’s cutting-edge digital trade infrastructure.
Chido Munyati outlines a significant obstacle to trade in Africa
Chido Munyati, the Head of Africa and a Global Leadership Fellow at the World Economic Forum, noted that inefficiencies in trade have become a significant obstacle for African nations. He expressed his optimism that digitization and blockchain technology will help overcome these challenges.
In a statement, Munyati acknowledged that, although trade inefficiencies remain a substantial barrier to business expansion, digitizing trade processes could considerably enhance how African economies interact and collaborate.
When reporters reached out to the Iota Foundation for comment on the matter, the organization highlighted problems such as slow border payments, which can take weeks, and the use of paper-based documentation as significant inefficiencies.
In the meantime, reports from Statista, an online data platform, highlighted that over 75 million individuals in Africa are expected to use cryptocurrencies by 2026, with a user rate of 5.9%. The overall revenue from the continent is also expected to reach an all-time high of $5.1 billion by the same year.
These predictions followed reports from Chainalysis dated October 2, which mentioned that stablecoins account for around 43% of the total transaction volume in Sub-Saharan Africa. Countries ranked in the top five in this trend include Nigeria, South Africa, Ghana, Kenya, and Zambia.
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