In a first for West Africa, a digital economic area, similar to that of Dubai, will be developed in Nigeria in partnership with the crypto behemoth, Binance.
Free Economic Zone In Nigeria
The largest crypto exchange in the world by volume, Binance has signed a contract with the country of Nigeria to build an Export Processing Zone Authority (NEPZA).
According to NEPZA Managing Director Adesoji Adesugba,
“[The country’s] goal is to engender a flourishing virtual free zone to take advantage of a near trillion dollar virtual economy in blockchains and digital economy.”
The two parties, i.e., Binance and the Nigerian government, are currently in advanced talks regarding establishing this zone as a digital city project that will support Nigeria’s fintech sector and give a much-needed boost to its digital asset development. The digital city, if established, would be the first of its kind in the West African region. Binance has already helped launch a crypto education hub in Cameroon to support crypto and blockchain adoption in the region.
Inspired By Dubai
The federal government of Nigeria has been in talks with the exchange for a while to develop a digital city similar to that of Dubai to fast-track the nation’s blockchain technology. Earlier this year, Dubai launched its Virtual Assets Regulatory Authority (VARA) license and partnered with Binance for the Dubai World Trade Centre Authority (DWTCA) for its own virtual free zone.
Africa’s still significantly unbanked population has been one of the reasons cryptocurrency found such a strong foothold in this continent. The Central African Republic (CAR) became the second country to adopt Bitcoin as legal tender, while several other African governments have been working on setting a framework of regulations for their individual crypto sectors. Even though Nigeria had clamped down on the local use of cryptocurrencies, especially for sending remittances from abroad, its CBDC project seems to have warmed up the government to the benefits of digital assets.
Pivoting From Oil To Crypto
As one of the most progressive countries in the African continent, Nigeria’s major commodity has always been crude oil. However, the country is attempting to carve a different niche for itself by shifting focus to digital assets and blockchain. The attempts to diversify its economy through cryptocurrency and blockchain technology are even enhanced by the fact that the country has one of the youngest average populations in the world. On top of the many new budding fintech companies (e.g., Interswitch, Flutterwave, etc.) emerging out of this region, the Central Bank of Nigeria has already launched the eNaira or the central bank digital currency (CBDC) to support the existing physical currency of the country in daily transactions.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
