UNIDO looks at how to assess value chain readiness to adopt blockchain technology

UNIDO looks at how to assess value chain readiness to adopt blockchain technology

ACCRA, 11 March 2020. – The United Nations Industrial Development Organization (UNIDO)  is piloting methodology to assess the readiness of a value chain to adopt blockchain technology. The Global Quality and Standards Project (GQSP) in Ghana, funded by the Swiss State Secretariat of Economic Affairs (SECO) and implemented in partnership with SIM (Supply Chain Information Management B.V.), looks into  methodology that aims to advise developing countries willing to enter the Fourth Industrial Revolution on the challenges and benefits of adopting blockchain technology in a specific value chain.

A fact-finding mission has piloted the methodology in the Ghanaian cocoa value chain and has provided recommendations for the adoption of the technology.

“Blockchain technology is aimed at securely storing and sharing information on transactions across a network of users, and can serve to improve proof of integrity along the value chain, including quality attributes, and environmental and social compliance to standards. One of the biggest benefits is its shared nature, whereby key data transactions validated in a given point of the supply chain can be monitored at any point in time,” said Juan Pablo Davila, UNIDO Project Manager.

“Blockchain is able to provide real time, accurate and complete interconnected data on provenance, quality, safety, transportation, certification and product ingredients from farm to end consumer,” Davila added.

UNIDO officials, experts on blockchain and a European retailer took part in the mission. It included visits to the cocoa value chain stakeholders to map and understand their risks and key transactions, and to identify their readiness for the adoption of the technology. The visited stakeholders included key actors in the value chain that participate in a transaction and generate validated data. These include farmers, primary producers, cooperatives, transporters, warehouses, the Ghana Cocoa Board (COCOBOD), Licensed Buying Companies (LBC), Quality Control Company (QCC) and the Cocoa Marketing Company (CMC), Cocoa Research Institute (CRIG), Cocoa Health and Extension Department (CHED).

European retailers and chocolate producers in developed countries are interested to ensure the sustainable provenance of ingredients, and to make sure premiums given for sustainable certified and high-quality compliant cocoa reaches the right farmers, thus contributing to their living wage and income. 

SIM has worked with over 30 European retailers and producers in making supply chains transparent, and collect and validate data they can use to continuously improve their sustainability impact where it is most needed. They joined UNIDO on this fact-finding mission:

“The aim of our blockchain projects is to have a positive impact and focus on the first mile, the smallholder farmers, their communities and environment. During the fact-finding mission, all actors in the Ghanaian cocoa supply chain warmly welcomed us. With this mission and project we hope to be of added value and can build on existing initiatives and taking the next step to empower cocoa farmers, democratize data, increase digital traceability and meeting growing market demands on transparency and sustainability,” said Leontien Hasselman, CEO of SIM.

 “The results of the methodology is the first milestone for the application of blockchain in the cocoa value chain in Ghana. It will lay down the foundation for the next steps of its implementation.,” said Safoa Osei, GQSP Ghana Chief Technical Advisor.

UNIDO has been providing technical assistance in Ghana with the support of SECO for more than 12 years. The Trade Capacity Building Project (TCB/2007-2018) provided opportunities to enhance Ghana’s quality infrastructure systems and expand the exports of Ghanaian products, including cocoa. The GQSP Ghana builds up on the results of the TCB project and continues to support the strengthening of the quality of the cocoa, cashew and oil palm value chains.

 

For further information, please contact:

Juan Pablo Davila Sanchez, UNIDO Industrial Development Officer

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