The Lekki Free Zone Development Company says it is in talks with a blockchain technology company, Gluwa, to digitalise trading among new and existing Free Zone enterprises.
According to a statement, the partnership would also explore the creation of a virtual free zone within the LFZ.
It stated that Lekki Free Zone’s Head of Strategy, Innovation and Special Projects, Tomiwa Idowu, disclosed that discussions were ongoing between the firm, the Nigerian Export Processing Zones Authority and the Gluwa team.
Idowu explained that the partnership, when finalised, would create a dashboard for the tokenisation of goods into non-fungible tokens, and provide digital asset-backed loans for new and existing enterprises who are looking to fund operations and expand their businesses, similar to the integration of OpenSea and Compound.
He said, “I am extremely excited and motivated by the endless possibilities and enormous potentials of such a partnership, it would further establish Lagos State as Africa’s leading sub-national in terms of innovation, economic development and revenue generation.”
According to the statement, the use of blockchain technology within Special Economic Zones was not a new concept, as China, Russia and Switzerland had begun implementing plans for the technology.
The Chief Executive Officer, Gluwa, Tae Oh, noted that the firm was keen to partner with the Lekki Free Zone due to its size and proximity to the Deep-Sea port and the Dangote refinery.
He said, “Trading has been the bedrock of the Nigerian economy, with annual volumes running into billions of dollars. We believe the digitisation of the sector can allow us to harness its full potential. For instance, a standard process to digitise goods manufactured or processed within the zone in tandem with a market system on ‘Web 3’ will allow manufacturers to trade globally via the blockchain.”
He added that all trades would not only be registered but would benefit from the incentives of the Lekki Free Zone, such as zero taxation and free circulation of goods.
“As soon as the goods get settled for export by the in-Zone Customs Processing Center, they will get shipped out straight from the Lekki Free Zone via the Deep-Sea port. This would reduce delays, eliminate human errors, exponentially drive-up Nigeria’s non-oil exports and sustain a positive trade balance for the nation. While we are still working out the fine details and a specific framework with NEPZA, we believe it is the future of commerce and trade in Africa,” Tae Oh added.