60% or thereabouts of our foreign aid, the ‘bilateral’ portion of it, goes to developing countries. Many of these countries have endemic corruption in their public sector. What would happen if foreign aid was transmitted and monitored via a Government blockchain?
Major recipients include Pakistan, coming in at 117 place in the Corruption Perceptions Index, Ethiopia, slightly better, at 103 rd, and Bangladesh, at 139th out of 168 countries. (FYI North Korea and Somalia take joint last place.)
The problem with corruption is that it keeps millions, perhaps billions of people locked in poverty, denied access to essentials such as clean water, healthcare, education, and a decent future. It’s possibly the single biggest obstacle to poverty alleviation, it’s the leak in the pipeline of money, and the more money flowing through the pipe, the greater the leak becomes. It’s a problem that cannot be fixed by ‘throwing more money at it’. Quite the opposite.
What if a condition of receiving UK Taxpayers money in the form of foreign aid was that the NGO, Charity, or overseas agency, including recipient governments, were required to be part of a distributed ledger that records every transaction, making it near impossible for money to be ‘lost’ or to pour out between the joints in the pipelines? What if it was made corruption proof, utilising the blockchain features of security, transparency, and accountability.
Our financial systems are instrumental in sculpting our societies, our cultures, and our individual lives. When the financial systems change, the social and cultural systems change accordingly. Humans and money are in a feedback loop. Changing one changes both.
What if companies developed their own private blockchains, and required their supply chains to be part of them, for contractual information, orders, communications, and also transmission of funds. Prevents mandate fraud for one. And then extend that into the supply lines of their suppliers, and contractors, and so on and so forth. Might help prevent sub-contracted child and slave labour.
The supply and flow of diamonds is already monitored through a blockchain process, Everledger have nearly a million diamonds on their system. And this can be extended to other commodities, pharmaceuticals, art, artifacts, where provenance is crucial.
Sporting sponsors might also like to take note.
(Fintech sectors involved: Blockchain Infrastructure. Private Blockchains. Whitelabel Blockchains. Blockchain as a Service.)
[author title=”Bird Lovegod” image=”http://thefintechtimes.com/wp-content/uploads/2015/12/JS-9721.jpg”][/author]