Last year, Ghana entered into a $3 billion loan agreement with the International Monetary Fund (IMF). It will now become the first African country to reduce government corruption by implementing blockchain technology for all government procedures.
“We are going to introduce blockchain technology to ensure that all data and transactions in the government space are transparent and tamper-proof,” Vice President Mahamudu Bawumia said at the May 14 Commonwealth regional conference and annual general meeting of heads of anti-corruption agencies. in Africa.
Ghana’s previous Revenue Assurance and Enforcement Plan was designed to identify and plug revenue leakages in areas such as oil bunkering, gold and mineral exports, port operations, goods in transit, warehousing, border controls and free zone operations.
“Implementing blockchain technology to protect government revenues involves creating a transparent, secure and efficient system for managing and tracking income and expenses,” says Arthur Augustus, senior software engineer at Parthian Partners Limited, a Lagos-based financial technology provider.
By leveraging the immutability, decentralization and transparency of blockchain, African governments can significantly reduce fraud, improve tax compliance and ensure efficient use of public funds. This will, in turn, lead to improved governance and increased public trust, Augustus said.
“Government procurement processes can be managed using smart contracts, ensuring that contracts are awarded and executed based on pre-defined criteria. Additionally, blockchain can be used to track the supply chain of goods and services procured by the government, ensuring that there is no distortion in the supply chain,” he said.
These automated contracts ensure that all parties compete fairly and select the most suitable supplier, while ensuring proper traceability throughout the supply chain. They also ensure that goods and services are delivered as specified and prevent fraud and misstatement. Governments must be prepared for the downsides of this innovation, including data privacy concerns, environmental impacts and resistance to change, Augustus said. He added that they can mitigate these challenges by investing in technical expertise, creating a strong legal framework and ensuring that the transition to blockchain is inclusive and sustainable.