In 2021, the Egyptian government made it mandatory for all cargo information to be declared in advance. The company to carry out the logistics for inbound cargo is Misr Technologies. The company partnered with Cargo X, an Ethereum blockchain document transfer provider, to handle the massive data. Egypt has now extended its agreement with Cargo X to ease the global transfer documents needed at the ports and by the customs authority in the country.
The new agreement will see Cargo X extend its services to about 30 new locations in the country. Egypt owns 80% of Misr Technologies, the company responsible for setting up the country’s customs (trade) platform NAFEZA ( National Single Window For Foreign Trade Facilitation). NAFEZA was initiated on October 1 2021 and is one of Egypt’s long-term strategic plans to help the country achieve economic development.
Since its initiation, Egypt has integrated more than 26 government systems that deal with cargo clearance at the ports. Cargo X’s blockchain service has helped the country reduce the custom documents needed for clearance from 18 to only 6. According to the company, it handles more than 12,000 trade transactions daily. The use of blockchain has transformed Egypt’s custom process into a modern digital system that has made cross-border trade relatively easy. The system has eliminated paperwork and reduced the time traders wait for their cargo to be released from one month to nine days.
Compliance costs that traders used to pay to the customs authority have also been reduced significantly from $600 to $165. Since NAFEZA became operational, it has been used by 300 shipping agencies, 2,200 brokers, 32,000 importers, 20,000 exporters, and over 74,000 foreign exporters. The new long-term agreement will see that Cargo X blockchain services have been extended within the NAFEZA system to include air cargo and cover operations at seaports, dry ports, airports, border posts, and bonded warehouses across Egypt.
Following the success of Global X in streamlining Egypt’s custom services, the company has been hailed as one of the fastest-growing blockchain platforms in the logistics and trade sector. Africa has been at the forefront of adopting blockchain and crypto to facilitate smoother and more transparent operations in its financial endeavours. One major sector that has adopted blockchain as a go-to option is the trade sector. Innovative solutions are key to making trade easier and more accommodating. Egypt has taken great steps to simplify trade while making it effective and transparent.
Blockchain technology is being adopted worldwide to help solve and simplify some of the world’s complicated tasks dealing with large amounts of data, such as banking, land registry, supply chain, and logistics. Blockchain eliminates bureaucratic red tape and also ensures transparency in trade deals. Africa’s trade policies are holding back the potential for economic recovery, especially after the hard-hitting effect of Covid 19. With most African economies growing at 2- 3 percent, modern solutions could help with the economic recovery. Egypt has positioned itself as a pacesetter in global trade by adopting modern technology. Other African countries should follow suit to ease global and cross-border trade with their neighbours.