Blockchain can help solve Southeast Asia’s corruption woes
SOUTHEAST Asian countries tend to have an image problem; governments and businesses have issues with transparency, and therefore carry a perception of shady dealings and even corrupt practices.
The Global Bribery and Corruption Review 2016 by Hogan Lovells, released earlier this year, found that although the anti-corruption landscape throughout the region is showing gradual and steady improvement, instances graft was still at high levels in a number of the countries observed.
Among others, Malaysia, Thailand and Indonesia, are countries held back in reputation or progress due to vested interests and actions by public officials and law enforcement, the study revealed.
And while all the governments involved have made a concerted bid to combat the level of bribery that has smeared their reputation abroad, observers say the next five years looks to be promising for the effort, aided by the widespread adoption of blockchain.
For those unfamiliar with the revolutionary technology, blockchain is the digital ledger devised to record transactions for cryptocurrencies like Bitcoin.
Simply put, blockchain technology can be seen as a unchangeable digital public record that can be accessed by all stakeholders. Due to blockchain’s highly encrypted and decentralised nature, it would be extremely difficult to hack its platforms and tamper with the recorded transactions.
According to the Voice of America, proponents of the new technology are showing encouraging progress in its adoption, highlighting nation states like Canada, Singapore, China and Germany, which are either exploring or conducting trials of their own central bank digital currencies using blockchain.
Enthusiasts like Michael Hsieh, a non-resident affiliate at the Center for International Security and Cooperation at Stanford University say much of this could be applied in Southeast Asia to eradicate corruption and poverty that is prevalent throughout many parts of the region.
“In the long run, we believe if there is any threat at all to governments, it is that other governments will lead the way in adopting blockchain technologies in producing low-corruption, high-transparency, highly-secure digitized economic infrastructures that will attract business, investment and stakeholder confidence,” he was quoted as saying
“The societies who lead in the great fintech [financial technology] innovation race of the 21st century will syphon all the capital and productivity from those that lag.”
Two weeks ago, Erin Murphy, the Founder and Principal of Inle Advisory Group, a Burmese and emerging market-centric business advisory firm, said the potential impact of blockchain could be huge as ASEAN countries look to technological approaches to developing their economies.
Southeast Asian countries could not only play a role as an early adopter of such technologies but as an active shaper of them as they are improved through experience.
“The challenges typically associated with emerging economies (poverty, corruption, opaque legal and regulatory regimes, high political, economic, and reputational risks) combined with an incapacity of existing technologies and institutions to overcome those challenges in a timely or economical way, gives the blockchain an opportunity,” she wrote in the Raddington Report.
“It could not only pave the way for the development of frontier economies but inspire a revolution in thinking about how technology can enable good governance and economic efficiency everywhere.”