The World Economic Forum (WEF) published a paper by Matthew Van Niekerk, co-founder and CEO of SettleMint, in which he discusses the potential of blockchain to combat corruption.
This Monday, the World Economic Forum published a article written by Matthew Van Niekerk, co-founder and CEO of SettleMint, to address the use of blockchain technology as a powerful tool to combat corruption within government systems.
Qualified “How blockchain can help dismantle corruption in government services” (How blockchain can help fight corruption in government services)The article discusses transparency, property records, disclosure of processes and immutability as elements that play in favor of the equity and efficiency of government systems, helping to reduce the risks and opportunities for corruption within these systems.
Van Niekerk noted that choosing a centralized government management system can lead to or contribute to corruption, while a blockchain-based system ensures much-needed efficiency and fairness within this space.
SettleMint, the company led by Van Niekerk, is focused on helping companies make their journey and delve deeper into the benefits of blockchain technology, to discover its potential, its use cases and its multiple applications. For its part, the World Economic Forum, WEF, is an international non-profit organization founded to bring together world leaders and shape global, regional and industrial economic and political agendas, in a neutral and impartial way.
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Blockchain applications in government systems
Van Niekerk noted that there are two main potential applications for blockchain technology within government systems. The first of these applications is focused on procurement and public contracting; the second, on property records and transparency in management.
public contracting
In summary, the author of the article pointed out that procurement, which is carried out through public contracts, is the main means used by governments for corruption. Through this process, which involves a large part of the government budget, public officials can commit large acts of corruption, due to the magnitude of the money that moves through contracts and the close relationship that exists with contractors.
There is no transparency in the evaluation and bidding processes of companies, so compromised officials can manipulate the results for their own benefit. However, the use of blockchain technology has the potential to protect systems against these weaknesses, at almost all stages of the procurement process, Van Niekerk said.
First, implementing the technology would ensure that processes occur publicly, as well as all changes made during the process. Blockchain can keep a detailed and immutable record at all times, as well as a detailed record of each person who makes any changes, ensuring transparency and a tamper-proof system that maintains efficiency and fairness.
Property title records
Blockchain also has an important role to play in land title registries that track land ownership or ownership of a specific region. According to the author, current land registry systems are inefficient and provide a wide window for corruption. Furthermore, they are extremely slow and consume at least 5% of the value of a sale, so they can act as real “bottlenecks” rather than facilitating processes.
In this field, blockchain technology can help reduce inefficiencies, streamlining processes and providing transparency at all levels. The use of smart contracts would significantly reduce the steps or overall process a person must take to sell a particular property.
Van Niekerk cited the UK land titling system as an example, where a citizen currently has to complete 14 complex steps or procedures to sell a property, and compared this to a blockchain-based land titling system, where a citizen only has to complete 5 simple steps to complete the same sale process.
Blockchain use in countries around the world
Blockchain applications and use cases in government systems have found a place in several countries around the world, such as Georgia, Sweden y Africa, which have used technology to register millions of property titles in a transparent and reliable manner. Colombia is another of the nations cited by Van Niekerk, which is implementing a pilot program for acquisitions based on blockchain technology.
The World Economic Forum has also addressed the potential of blockchain to address the inefficiencies, challenges and potential risks that arise within global capital markets. On the other hand, in addition to the article published by the WEF, other entities such as the World Bank Group they have also supported the use of blockchain technology in government systems, to provide transparency, efficiency and reliability in public procurement processes.
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