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Colombia experiments with blockchain to curtail corruption

Don't worry, we speak : Español (Spanish), too!

Contxto – “Gimme your lunch money!” While that’s usually the type of phrase that comes from your playground bullies, it’s also used by other punks: government officials in Colombia who tamper with public funds tagged for school meals.

So to cut back corruption, the World Economic Forum (WEF), the Inter-American Development Bank (IDB), and the Office of the Inspector General of Colombia partnered up.

And last Wednesday (17), they announced that through a joint team they’ve developed blockchain-based proof-of-concept (PoC) software. Through it they hope to reduce corruption within government procurement processes.

Dubbed “Unlocking Government Transparency with Blockchain Technology” this system was designed and tested to add transparency to a public-school meal program.

Colombia and corruption-fighting Ethereum

The Programa de Alimentación Escolar (PAE) is a public initiative in Colombia for procuring lunches to vulnerable children. According to the WEF, the PAE has been the object of corruption for quite a long time. Primarily in the vendor bidding process.

But that’s also why the team chose the PAE to pilot its new permissionless blockchain software that works over the Ethereum network. 

As a result of the trial, the WEF concluded that there were a few unexpected challenges in relation to the use of permissionless blockchain to reduce corruption. Primarily when it came to scalability and handling vendor anonymity.

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Blockchain adoption and terminology

The team concluded that adopting a hybrid approach with blockchain might be a better approach to manage scalability

Terminology cheat sheet

Permissionless blockchain: Anyone can participate in the system. In this case, to cut back corruption, permissionless blockchain offers the advantage of evidencing when someone tries to trifle with the data. Although permissionless blockchain can be less scalable because the system is literally overloaded with data to process.

Permissioned blockchain: Implies that a party needs approval to mess with the data stored on the network. It allows for more transactions on the network to be processed quickly because not just anyone can add on information.

Hybrid blockchain: A combination of the previous two. By using two protocol-level blockchain networks, the team believes countries can get the best of both worlds to cut down corruption.

A useful and technical experiment to tackle a problem that plagues most of Latin America. But as the report by the WEF states, it can only do so much.

Technology cannot fully solve what is at the heart of human behavior problems.”

To truly kill corruption, tech solutions will prove an invaluable ally. But if the social and cultural practices linked to corruption don’t change, then as Metallica put it, nothing else matters.

Related articles: Tech and startups from Colombia!


Mariana López
My topic darlings are startup management, edtech, and all-things pop culture. J Balvin is Latin America's best reggaetonero and I dare you to convince me otherwise.


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