Start-ups eye metaverse, NFTs to solve Africa’s economic woes

Sun, Jul 17, 2022 page12

Start-ups eye metaverse, NFTs to solve Africa’s economic woes

While tech entrepreneurs are trying to target unemployment and poor governance by launching a virtual African nation and marketplace, critics fear they could replicate the continent’s inequalities
- By Kim Harrisberg / Thomson Reuters Foundation, JOHANNESBURG
It might sound like science fiction, but a Nigerian-born tech entrepreneur thinks he has found a way for Africans to escape problems such as inequality and bad governance — a virtual nation born online.
His is among a number of African-led virtual projects that aim to help the world’s poorest continent capitalize on digital growth and tackle real-world problems, although some tech experts said such online spaces risk replicating offline inequalities.
“There’s so many things that limit us as Africans from real-world opportunities,” said Emole, cofounder of the Afropolitan network state project.

Women share information on a mobile phone in Lagos, Nigeria, on May 2. Some researchers and activists say that as access to mobile phones and the Internet grows across Africa it will create more opportunities for people.

Photo: EPA-EFE

The Internet “is the only place in the world which serves as an equalizer,” Emole said.
The development of the metaverse — a shared online environment where people can meet, buy virtual goods, and attend events — has sparked concern over digital rights, privacy and online inequality.

“What happens to a grandma in rural South Africa with no Internet connection?” said Thami Nkosi, a researcher at South African non-profit Right2Know, which works to improve access to public information. “We don’t have broadband, Internet, electricity, so who will benefit from this?”
However, some researchers and activists think that as mobile phones and Internet connections become more widespread across the continent it will open up opportunities, and they have stressed the need for products that are geared toward African needs.
The emerging virtual economy already includes about 2.5 billion people and generates billions of dollars each year, a report by market research company L’Atelier said.
“Most of the technology platforms we use in Africa were created in northern America, Europe, the Middle East or China,” said Johan Steyn, chairman of the Special Interest Group on Artificial Intelligence and Robotics at the Institute of Information Technology Professionals South Africa.
“We need an African lens on the use of smart technology in order to accommodate the people of this continent,” Steyn said.
South African tech start-up founder Mic Mann said bringing the metaverse to Africa is part of “future-proofing” the continent to ensure it keeps up with the rapidly expanding digital space.
“It’s going to completely change everything: the way we work, live, play,” said Mann, cofounder of Ubuntuland, which calls itself the continent’s first metaverse marketplace.
The Afropolitan project is aimed at the more than 140-million strong African diaspora — and ultimately aims to expand to a physical territory.
Emole, who was born in Nigeria and raised in the US, said it can offer solutions to poor governance in many of the continent’s countries, which he cited as a key factor behind emigration.
Afropolitan said it raised US$2.1 million from a funding round last month to help develop the digital state, and 10,000 people have subscribed for more information and updates.
Its founders plan to launch initially by selling non-fungible tokens (NFTs) that would act as a “digital passport” to Afropolitan events and physical spaces, before developing an app allowing members to transfer money and buy goods and services.
Emole, who is based in Silicon Valley, said the project would span the Internet and metaverse, gradually expanding to become a “full-blown digital country with its own native currency and shared purpose.”
The founders ultimately hope to acquire land from governments to create a series of Singapore-style charter cities with “full-scale sovereignty” and even provide services to citizens such as water and electricity, using cryptocurrencies for payment.
These physical territories would also include Afropolitan embassies that could help citizens to challenge government incompetency by providing alternative leadership and financial structures, they said.
“We want to fix the biggest problem of all, which is the governance issue, because when you have good governance, every other thing can thrive,” Emole said.
The project is still in a first phase of gathering supporters and cash before starting to build its planned app, while tech researchers question whether its plans are feasible.
“Governance is much more than an online, virtual space,” Nkosi from Right2Know said.
“I doubt that we can digitize nation-states, built on a power base of the political elite who would always wish to hold on to ultimate power,” said Steyn, although he added that the idea was “interesting and worth debate.”
Cities and countries have been eyeing the potential of the metaverse, with the city of Seoul and the island nation of Barbados announcing last year that they would enter it to provide administrative services.
Mann hopes that metaverse spaces such as his Ubuntuland will become a “job creation tool” where users can showcase their skills or earn online.
With land sales going public in February next year, Ubuntuland has begun selling plots of land in its virtual marketplace where it aims to showcase African art, music, tech and design.
Telecom giant MTN Group Ltd and M&C Saatchi Abel, a South African marketing agency, have already invested in plots.
Using the Ubuntu Token cryptocurrency, users would be able to buy and customize land, set up shops, therapy spaces, concerts, films and games, Mann said.
“I’m hoping millions of jobs will be found in various metaverses around the world,” said Mann, whose native South Africa has a 35 percent unemployment rate.
Tech researchers said such online and metaverse projects open new avenues for communities, but are unlikely to be a silver bullet for complex issues.
“Technology offers promising solutions to healthcare and educational issues, with the hope of resulting in a better chance for all... We need people like these to push the boundaries and to dream of what could be possible,” Steyn said.
However, utopian online projects could run into the same issues of crime, corruption and inequality they are trying to escape, Nkosi and others said.
“We are seeing a replication of the frictions of the physical world in the virtual world,” said Kanis Saengchote, an associate professor of banking and finance at Thailand’s Chulalongkorn University, who has researched the metaverse.
Even as some metaverse plots sell for millions, Saengchote said it was debatable whether virtual land has “actual value.”
There are also risks of fraud and scams, just as with offline transactions, he said.
Emole said the concerns about financial crime are “valid criticism,” which they would combat through advanced fraud detection and education about potential scams.
Emole and Mann said there would be lots of trial and error to ensure virtual spaces do not become elitist or divisive.
“I think the beauty of it is that it’s going to be like an experimentation of what’s really possible within our times,” Emole said.
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