Blockchain for more transparency
Blockchain technology is a novel way of storing data and information in a tamper-proof way. A blockchain is essentially a database in which transactions are stored in a continuously growing chain of data blocks. With the help of cryptographic processes, a high level of data security and transparency is achieved. Transactions can be any type of information, such as financial transactions, contracts, shares or land register entries.
Within development cooperation, for example, blockchain technology can help make supply chains traceable, administrative processes more transparent and thus more efficient, or the use of financial resources traceable and thus reduce corruption.
In practice, however, hardly any scaled, sustainable blockchain solutions have been used in partner countries of German development cooperation so far. Moreover, many actors are not in a position to design the use of blockchain technology in a sustainable manner. At present, therefore, hardly any local innovations in the field of blockchain technology are taking place in developing and emerging countries.
In multi-stakeholder initiatives and in the BMZ digilab, we develop application examples for the use of blockchain technology within the framework of our blockchain partnerships, e.g. for transparent resource allocations of public investments, transfers of financial resources in partner countries and within the tracing of value chains. Policy makers are sensitized for a sustainable design of blockchain solutions. At the same time, we strengthen tech entrepreneurs and civil society (e.g. think tanks, non-governmental organizations) for the development and application of sustainable blockchain solutions as well as opportunities for political participation.
Blockchain Partnerships aims to strengthen selected actors of the digital ecosystem for a sustainable use of blockchain technology: politics, tech companies and civil society of the partner countries should be able to critically engage with the applicability of blockchain technology in the local context and to use the disruptive potential of blockchain technology effectively and efficiently for economy and society.
For example, blockchain technology is already being used as part of TruBudget in Burkina Faso, Ethiopia, Georgia, and Brazil. Designed as a Open Source solution, TruBudget allows a transparent and tamper-proof control of the use of donor funds in development cooperation that was previously impossible to present. This is made possible through the use of blockchain technology, with each partner being granted only certain rights. Allocation of funds, tendering procedures and payment transactions are logged on the blockchain.