Ghana has recently announced plans to become Africa’s first blockchain-powered government. This was announced at the 14th Commonwealth Regional Conference and Annual General Meeting of Heads of Anti-Corruption Agencies in Africa by the country’s Vice President Mahamudu Bawumia. The plan is to implement blockchain technology across government operations and significantly reduce the risk of manipulation and fraud in government processes. “We are going to adopt blockchain technology to ensure that all data and transactions in the Government space are transparent and tamper-proof,” Bawumia said.
How does the blockchain work?
At its core, blockchain technology can be visualized as a digital ledger. However, unlike traditional ledgers controlled by a single entity, a blockchain is decentralized. Copies of this ledger are distributed and stored across a vast network of computers. This decentralization is what makes blockchain so secure. Each entry, or transaction, on the blockchain is called a block. These blocks contain data and a unique cryptographic code. This code is cleverly linked to the code of the block before it, forming a chain-like structure, hence the name blockchain.
Adding a new block to the chain involves a verification process by the network of computers. Once a transaction is validated, the data is bundled into a new block, along with a code referencing the previous block. This creates an immutable chain and any attempt to alter a block would require changing all subsequent blocks, a near-impossible feat due to the distributed nature of the system. The core concept behind a blockchain-powered government hinges on the transformative power of blockchain technology itself. This inherent security and transparency hold immense potential benefits for governments.
Traditionally, governments and institutions rely on ledgers to record transactions and data chronologically. However, these ledgers are often centralized, meaning they are controlled by a single entity like a bank. Blockchain technology takes a different approach. It creates a digital ledger all government transactions would be recorded on the blockchain, providing a clear and verifiable audit trail.
Ghana’s plan to become Africa’s first blockchain-powered government is ambitious.
Ghana is diving headfirst into blockchain technology. These innovative technologies have the potential to address longstanding issues, drive economic growth, and foster social development. However, several factors need to be considered to ensure their successful integration into African societies.
For one, there is the infrastructural challenge. Mobile internet connectivity and rural internet penetration pose a challenge for adoption. The International Telecommunication Union (ITU) estimates that sub-Saharan Africa lags behind other regions with only 27.8% broadband penetration compared to the global average of 59.5. Last year alone, Sub-Saharan Africa witnessed a financial setback of $1.74 billion during 30,785 hours of internet downtime, affecting 84.8 million people, Top10VPN revealed in research. This stark reality paints a picture of a continent where a large portion of the population remains offline, hindering their ability to participate in a blockchain-driven economy. Building a blockchain-based government system would require a robust and accessible digital infrastructure that reaches all corners of the country.
Also, the adoption of disruptive technologies on the continent seems to be slow or unresponsive. Consider cryptocurrencies. Although cryptocurrencies, which operate on blockchain networks, have widespread use on the continent, governments have not yet taken full advantage of them. Building a blockchain-based government system requires a robust and accessible digital infrastructure that reaches all corners of the country. Also, no government has fully implemented a nationwide blockchain-powered system like Ghana is aiming for, making the project a pioneering effort with inherent uncertainties. Instead, several countries are actively exploring and testing blockchain technology in different areas of governance. This makes the project a pioneering effort with inherent uncertainties. When the UAE launched its Emirates Blockchain Strategy in 2021, it first set a goal of transitioning only 50% of government transactions onto a blockchain platform.
However, Ghana is one of the African countries displaying gait with disruptive technologies. Their government’s investment in digital tools to fight corruption is a prime example. So far about 99% of all government agencies (1507 out of 1517) have been onboarded onto the Government digital platform Ghana.gov, with the remaining 1% set to be completed by the end of the year. As a result, Ghana has realised GHC 201 billion in revenue through digital transactions on Ghana.gov.
Blockchain is an interesting disruptive technology, that can be used in any sector. It has helped transform agriculture in Africa. In the same vein, Ghana’s ambition to use blockchain as a corruption deterrent holds promise. The country currently has a score of 43 on the Corruption Perceptions Index with a change of 0 since last year. It ranks 70 out of 180 countries. If successful, it could serve as a model for other African countries seeking to leverage blockchain technology for a more transparent, efficient, and secure government system.
