Zimbabwe’s economy is facing challenges, especially because its economy is built on agriculture. The decline in the economy is further aggravated by the slowdown in industrial output. According to a report, the GDP per capita of the country dropped down by 40% and industrial production slumped by 51%.
Country’s economic analysts suggest using blockchain technology can improve the economy. The technology is a distributed ledger that facilitates transactions between two parties without the need of a third –party or intermediary like a bank.
What is blockchain technology?
Blockchain technology can be used for money transfer, assets, and other information. Bitcoin is the first-ever application of blockchain in the world. And Bitcoin has seen unprecedented growth over the last years. Bitcoin has seen successful adoption in Africa. The Bitcoin reached a success rate of 96% in Africa.
Similarly, Sierra Leone, witnessed improvement in results after the implementation of blockchain-based ballot to conduct elections last year. The technology has seen successful growth and results in various parts of the African continent.
Blockchain can revive the economy of Zimbabwe
Looking at the success of Bitcoin in the rest of Africa, it is presumed that Zimbabwe can derive similar benefits.
Using blockchain technology, users can safely transfer their money from anywhere in the world without an intermediary. The absence of third-party will make the transaction faster and efficient. Further, the absence of an intermediary will reduce the cost of the transaction. International transactions too are free. Reduction in the cost of transactions will enable everyone to avail of self-serving services. Unbanked people will get on-board.
Blockchain technology allows to trade energy as well. Using blockchain-based apps, users can sell excessive energy close to them. This will take the controls away from utility companies and put in the hands of the residents of Zimbabwe. Plus, this will serve as a medium of saving money for the people of Zimbabwe.
The transactions made on blockchain are secure and can’t be altered (without making a record), this will add more transparency in the process and reduce corruption and frauds, which are common in the country. In the 2016, Corruptions Perception Index the country ranked 160th among 180 countries. The use of blockchain will curb corruption in political and civil areas.
Blockchain technology serves a secure storage of confidential information. In the context of the Zimbabwean economy, this can be used to store medical data, which can be used for research and facilitate better healthcare services to the people of Zimbabwe.
One of the biggest benefits of blockchain is its decentralization of transaction data. Zimbabwe stands as a developing country. Application of blockchain technology gives more control to the general public of Zimbabwe of their transactions. This will encourage entrepreneurship among people of the country and help flourish the blockchain industry in Zimbabwe.
The technology is still in its nascent stages. An increase in awareness of the technology and accelerated pace of development will create demand for developers skilled in blockchain development. This can be achieved with blockchain certification, courses, and other online and in-person programs. The increase in jobs will further help the economy to grow.
Increased blockchain development in the country will propagate the use of blockchain-based apps among residents of Zimbabwe. The increased use of blockchain applications will enable the public to explore and know blockchain better, this will likely encourage users to invest in cryptocurrencies, which will help revive the economy of the country.
Overall, the characteristics features of blockchain technology—transparency, security, decentralization can play a pivotal role in gaining the confidence of the people and create a cost-effective, fast, and efficient transaction system, which users find it easy to use and trust. Once the adoption of such a system picks up, the economy of Zimbabwe could revive.