Sub-Saharan Africa's smartphone penetration at 33%

Surge in SSA
smartphone use

Figures expected to
double by 2025.

Thursday, Oct 18th

Why should Africa's shipping industry invest in blockchain?

Why should Africa's shipping industry invest in blockchain?

Blockchain and IOT have been identified as key resources that could help to radically improve the efficiency of the Africa's shipping industry.

Speaking at the Transport Infrastructure Summit in Nairobi, Andrew Pike, the Head of Ports, Transport and Logistics, South Africa for legal firm Bowmans said, "Is blockchain the solution? I think it will have a future widespread industry application. I would suggest to you that it is a potential future for shipping and logistics."

"What the problems we see is the cost of processing administration and paperwork costs one third of the transport cost in a supply chain," he added.

Pike said there are many 'middlemen' in shipping who charge for services and this raises costs in the industry.

Another pressing challenge is that most ports in Africa do not have a well-designed layout of cargo containers which results in delay in locating containers.

According to Pike, blockchain has the potential to reinforce the supply chain, with smart contracts, for example, easing document exchange and helping to verify transactions.

He spoke of the IBM's Mombasa to Rotterdam flower export that accrues over 200 communication documents. In an experiment with the implementation of a blockchain platform, the documents were reduced to 9 and export of the commodities was transparent, with everyone in the supply chain aware of the steps.

IOT could lead to the introduction of smart ships that could be directed remotely to destinations.

This technology would then also track all shipped containers and make it easier for importers to locate them.

"We are seeing automated ships coming into the radar now. These are ships with no crew and it eliminates the costs and human error. In the end you are creating a far more efficient supply chain," said Pike.

He added a warning that the surge in cyber crime could lead to sophisticated methods of piracy, for example, a vessel being targeted, 'captured' and directed elsewhere.

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