A Moroccan fertiliser company says it has executed the first use of blockchain for an intra-African trade finance transaction, in a deal facilitated by the Eastern and Southern African Trade and Development Bank (TDB).

OCP Group, a state-owned phosphate mining and fertiliser producer, says US$270mn-worth of phosphate fertiliser exports to an Ethiopian buyer were executed through a blockchain platform provided by Singapore fintech dltledgers, with the total deal worth US$400mn.

The remaining transfers will be completed in “upcoming months” says TDB, the Nairobi-based development finance institution.

OCP Group says the use of blockchain for trade finance deals is part of its digitisation strategy. In a joint statement, the companies involved in the deal say that the use of blockchain allows the trades to take place in under two hours, compared to over three weeks through the traditional banking system.

TDB has previously used dtledgers to handle the importation from Singapore’s Agrocorp of US$22mn-worth of sugar into Ethiopia from India. The bank said that transaction was the first live end-to-end trade finance deal using blockchain technology for an African development finance institution.

TDB says it has already facilitated OCP fertiliser exports to Ethiopia worth almost US$1bn over the past three years, and over US$500mn of overall trade finance in Ethiopia during 2020.

The companies say blockchain allows parties to the transactions to simultaneously view, edit and validate documentation and that the technology improves transparency and traceability.

“As part of our response to the pandemic, we have been providing liquidity to our clients to curtail cross-border trade and supply chains disruptions, and ultimately, to help our member states continue working towards their development objectives,” says Admassu Tadesse, TDB’s group managing director and CEO.

“With transport logistics slowing down, blockchain has been instrumental in making this happen. We are thrilled to continue our partnership with dltledgers which will enable us to increase our volume of trade finance executed via blockchain during this difficult period, and beyond.”

Singapore-headquartered dltledgers operates a global platform to handle documentation and digital trade processes. It recently switched blockchain platform providers from Hyperledger Fabric to Corda.

Farooq Siddiqi, dltledgers’s CEO, says the company is looking forward to working with TDB to help “scale its digital capabilities in 2021 and beyond”.

The companies’ statement says TDB wants to boost the use of blockchain for trade finance transactions in Africa.

“We look forward to work[ing] with more financial institutions in our region as well as traders and suppliers, both globally and in Africa, who stand to significantly benefit from the digitisation of their trade finance activities,” says Michael Awori, the bank’s deputy CEO and COO.