Blockchain technology can impact how we approach international development significantly. Platforms such as Thorenext app leverage top-notch trading tools and analysis to provide better insights into bitcoin trading to beginners.
For example, its unique characteristics, transparency and security can lead to more streamlined and effective aid distribution. The most revolutionary technology is currently available for the field of international development as we know it is Blockchain.
Devex has previously written about how blockchain technology could revolutionize the development industry.
Blockchain has been referred to as a “mega-trend” by the World Economic Forum, and Tamara Giltsoff, the department’s innovation director, has dubbed it the subsequent significant technological development.
As a result, the US Department of State is eager to investigate how this technology might be used for diplomatic and international development work.
What Are The Advantages Of Blockchain In International Trade And Business?
The $16 trillion market known as international trade includes transferring money, goods, and services across international boundaries or territories. Generally speaking, there are two categories:
- 75% of different goods are typically transported by ground or shipping containers
- 25% are commodities.
The trade and financing sector, particularly in emerging to developed markets, needs more coordination and trust between exporters and importers from a shipping and transportation perspective.
25% of global trade is made up of commodity trading, which includes
- 40% power
- 30 % base and commercial metals
- 30% are soft commodities and agriculture
Banks and other financial institutions or funds provide more than half of the funding for the commodity trading industry. Over the past 20 years, software and new technologies have emerged to support this industry with varying degrees of success, particularly CTRM.
But just like the global trade in containerized goods, operational costs and inefficiencies continue to affect the commodities markets, including:
- Fraud: The pervasive use of paper documents raises the possibility of criminal activity.
- Delays: Scheduling the shipping of a commodity, requesting trade financing, gathering documents, providing the documents to buyers, and facilitating payments all take 90–120 days.
- Loss of income and opportunity: The industry is hindered from innovating by these fractured processes and high operational costs, resulting in annual losses of income and opportunity amounting to billions of dollars.
Through a distributed, immutable ledger that prevents the information from being changed without informing all parties, blockchain technology offers the ability to reduce fraud.
It is possible to use blockchain technology, such as Ethereum, to implement solutions to the various problems that arise during the KYC and regulatory compliance process. Blockchain networks’ historical records and transparent ledgers enable multiple parties to track transactions in close to real time.
In addition, access to permissioned blockchain consortiums for AML or auditing is available to regulatory agencies. Finally, Blockchain may improve the accessibility of trade finance.
What Global Trade And Commerce Use Cases Are There For Blockchain Technology?
- Management of the supply chain and business procedures
- Commodity logistics in bulk
- Trade financing
- Post-trade resolution
- Asset tokenization and online marketplaces
- Track and trace
- Blockchain technology for the global development
Several international organizations are considering using blockchain technology to improve efficiency, accountability, and transparency in the development sector.
Here are some more instances of blockchain applications being used for global development:
Blockchain As A Tool To Combat Poverty
Poor people lack official identification documents, limiting their access to assistance and public services. Utilizing blockchain technology, digital identities that make it easier to access essential public services can be created.
Blockchain As An Anti-Corruption Tool
The technology can store governmental databases (for example, land registries) and reduce the possibility of fraud, manipulation, or misuse by those in positions of authority.
Blockchain In The Fight Against Human Trafficking
The United Nations Office for Project Services (UNOPS) has collaborated with several other organizations to establish an online identity for unaccompanied children and minors using blockchain technology, which can help to track and prevent trafficking attempts.
To Sum Up
Blockchain is a global technology which has prompted international institutions like the World Bank and the United Nations to adopt it.
However, due to its law-like nature, some of the technology’s applications by international organizations raise ethical and legal concerns from a foreign policy and international law standpoint.
But there is no doubt about the fact that Blockchain has greatly improved internationalization.