Trademark East Africa and IOTA - Paperless Trade with the Tangle Aims to Become a Standard in 2022

Partnerships Jul 6, 2021

TL;DR:
In a single trade transaction, an African entrepreneur is likely to fill 96 documents, all on paper. The IOTA Foundation has extended its partnership with Trademark East Africa to facilitate paperless trade, cutting costs and delays while improving efficiency. Today we are testing the system with government agencies in Kenya, to be followed by a roll-out of testing in neighbouring countries.

Paperless trade is the holy grail of international trade as it can massively improve the global economy and benefit the lives of both the independent African trader and the international consumer. Trademark East Africa, one of the largest aid-for-trade organizations worldwide, has estimated that, in a single trade transaction, an African entrepreneur is likely to fill 96 documents, all on paper.

The IOTA Foundation and TradeMark East Africa have teamed up to address the challenge of digitizing the process for Kenya’s exporters. Together, we have mapped the process of flower farmers, established improved user journeys, and engaged with the technical teams within border agencies such as the Kenyan Revenue Authorities (KRA), the Kenya Plant Health Inspectorate Services (KEPHIS), and other agencies. Today we have a system that can anchor the key trade documents on the Tangle and share them with customs in destination countries to speed up the export process and make Kenyan companies more competitive globally. The system is being tested and tried with flower exporters, airliners, and freight forwarders, as can be seen in this short video:

Results are promising. TradeMark East Africa has made the project a strategic priority and extended its contract with the IOTA Foundation to take it to the next level. The plan is to expand testing into more trade lanes, such as tea export to the UK, fish to Belgium, textiles to the US, and so on, while also working with other governments in East Africa to test the integration of the technology with their border agencies. As international trade is complex and has many stakeholders, this approach will onboard new actors and build experience and capabilities. Technology is only one part of the equation: regulation and international standards for the exchange of trade data between countries are also impacted.

“COVID19 challenged the project as travel became impossible. Despite many challenges, the IOTA Foundation has proven to be a steady partner in development and we are excited to enhance our collaboration with the IOTA Foundation”. Alban Odhiambo, Sr. Director Trade Environment, TradeMark East Africa.

As a result of the increasing scope with TradeMark East Africa, the IOTA Foundation is building out its local team in Kenya from three to seven full-time employees to cover both technical and engagement skills. We believe that the project has the potential to realize the promise of distributed ledger technology in international trade and show how the Tangle’s no-fee structure and scalability can be leveraged to improve public infrastructure and support economic development.

With this significant step, we are establishing a standard for how border agencies can exchange trade information across borders and industries. The IOTA Foundation will engage with governments around the world to take advantage of this innovation and practice - and thus contribute to the global goal of making trade inclusive and easy for all.

The development of the project is made possible by the generous support of the development agencies of the following governments: the Netherlands, the United Kingdom and the United States of America.

About IOTA

The IOTA Foundation is a global not-for-profit foundation incorporated and headquartered in Germany. The IOTA Foundation's mission is to support the research and development of new distributed ledger technologies (DLT), including the IOTA Tangle. The Foundation encourages the education and adoption of distributed ledger technologies through the creation of ecosystems and the standardization of these new protocols.

The IOTA Tangle moves beyond blockchain by providing the world's first scalable, feeless, and fully decentralized distributed ledger technology. The Tangle uses its own unique technology to solve three fundamental problems with blockchain technology: high fees, scaling, and centralization. It is an open-source protocol connecting the human economy with the machine economy by facilitating novel machine-to-machine (M2M) interactions, including secure data transfer, feeless micropayments, and secure access control for devices.

About TradeMark East Africa

TradeMark East Africa (TMEA) is an aid-for-trade organization that was established to grow prosperity in East Africa through increased trade. TMEA operates on a not-for-profit basis and is funded by the development agencies of the following countries: Belgium, Canada, Denmark, Finland, the Netherlands, Sweden, the UK, and the USA. TMEA works closely with East African Community institutions, national governments, the private sector, and civil society organizations.

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Jens Munch Lund-Nielsen

Jens is head of the IOTA Foundation’s trade and supply chain efforts. He holds an Executive MBA from INSEAD and a Master in Philosophy. Expert advisor to the UK Parliament, World Economic Forum etc.

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