Global blockchain adoption got a boost as countries in Africa and the Middle East are set to increase their spending on blockchain solutions. This is according to a market study conducted by US-based research firm International Data Corporation (IDC).
In its recent research publication titled, Digital Transformation and Government Spending Growth on ICT, the IDP forecasted Africa and the Middle East to massively increase their spending on blockchain technology in the next four years.
The study outlines that blockchain technology is growing rapidly in line with the increasing digital transformation initiatives in both regions. Specifically, countries in Africa and the Middle East are expected to step up their spending on blockchain solutions from $21 million in 2019 to as much as $105 million by 2023. The compound annual growth of this spending is also predicted to be as high as nearly 50%.
What’s the Focus of These Blockchain Solutions
The three main areas of focus highlighted in the report are to minimize fraud, improve security and enhance public administration. These are all issues that blockchain adoption and promotion can solve as is already evident across several industries today.
However, there are also concerns about whether governmental structures are actually prepared for digital transformation. In the report, IDC’s vice president and regional managing director for the Middle East, Turkey, and Africa notes that
“Governments across the region are under mounting pressure to become both more efficient and more effective. However, this is proving to be a troublesome task as many government organizations are simply not prepared for digital redesign. Whether it’s finding ways to integrate 5G, AI, and blockchain or protect against intrusions on digital trust, government agencies have a whole new set of IT skills to learn.” She added.
This is perhaps one of the reasons why despite the increasing exploration of the technology in both regions, spending on blockchain has often been just a small part of their total digital transformation initiatives. But if this report holds true, then blockchain spending could be in for a huge overhaul.
What’s the Current Blockchain Adoption Situation in Africa and the Middle East?
Even though Africa is not yet close to embracing blockchain technology as Europe, North America or Asia, it continues to see sizeable growth in its blockchain communities across Nigeria, South Africa, Kenya, Sudan and many more countries. From transportation and gaming to digital identity security and land registry settlements via smart contracts, the growth of blockchain in Africa is unstoppable.
In Nigeria, government officials believe blockchain will fuel the fourth industrial revolution.
“Africa was not part of the first, second, and the third industrial revolution & these group of lawmakers believe that the fourth industrial revolution, driven by digital transformation should not pass us by. Hence, the need to engage all stakeholders to initiate the process of blockchain and internet discussions at this time.” said Honorable Solomon Adaelu, chairman of the House of Representatives bipartisan committee on blockchain technology.
Meanwhile in the Middle East, things may have taken off to a slow start with the Middle East Institue noting that interest in blockchain technology adoption in the region began in 2016. The United Arab Emirates (UAE), Saudi Arabia, and Bahrain lead the pack with a keen focus on the legal frameworks as well as the current and future applications of blockchain systems for government, financial, and commercial services.