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18 December 2018 20:49
A new trial blockchain aims to solve the transparency and the infrastructural challenges related to international development.
KfW Bankengruppe, the German public development bank is testing a blockchain application for public finance management in Burkina Faso. It's all part of a program to improve cooperation for economic development when giving money to other countries for development projects.
On behalf of the German Federal Ministry for Cooperation and Economic Development (BMZ), Kfw will lead a six-month pilot to the poor country to explore the potential of the blockchain.
BMZ has worked to improve economic development in Germany and around the world for decades, working with the International Monetary Fund, the World Bank and the United Nations. He is responsible for the "Marshall Plan with Africa", an initiative between Africa and Europe aimed at improving the economic capacity of African countries.
For its part, KfW has financed nearly $ 8 million in water and sanitation improvements in Burkina Faso. KfW will now test its TruBudget blockchain software for processes such as the contract design, tendering and payments on projects such as improvements to water supply. The platform should enable stakeholders to view these processes – and modify them – in real time to "ensure the proper use of funds".
The blockchain pilot project will be implemented with Burkinabe's Ministry of Finance and support of project partners and Accenture and BearingPoint consultancies.
The new blockchain platform could replace expensive infrastructure implementations, created by international donors when funding projects to compensate for the risk and lack of existing infrastructure in the recipient countries.
Professor Joachim Nagel, a member of the executive committee of KfW Bankengruppe, says that a blockchain-based system will be better for the independent development of a country and will allow "donors to use the funds safely, even directly through the partner country structures" . (Translated with Google).
Karsten Ebersbach, CEO of Accenture, highlights the potential of the blockchain to solve an ongoing burr in the part of international aid, that of the clarity of the use of funds: "Together with KfW, we have designed, tested and implemented a solution that creates much needed transparency in development cooperation ".
The open source protocol of the blockchain project will be made available to others at no cost and could be an example of "best practices" for other African countries. If this use case is successful in providing transparency, it could encourage the granting of future aid by minimizing infrastructure obstacles to initial development projects.
Melanie Kramer is a freelance writer of FinTech, blockchain and cryptocurrency based between France and Canada. Melanie has studied and maintains an eager interest in global politics, business and the economy.
ETHNews is committed to her Editorial policy
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