Bank of China and the news spy: Blockchain against poverty in Tibet

The Bank of China wants to use blockchain solutions to combat poverty in the Himalayan province of Tibet, according to Chinese business news. In the future, Blockchain software will help to secure infrastructure programs in the mountain region, which is characterized by poverty. The autonomous province of Tibet is one of the statistically poorest regions in the People’s Republic. It is to serve as a pilot project for similar funding initiatives in the provinces of the Middle Kingdom.

With the blockchain pressing ahead worldwide, one of the greatest strengths of the technology still lies in the financial sector. If the Chinese government has its way, it should help the provinces groaning under poverty.

According to the China Money Network financial news this week, the Bank of China (BOC) is to upgrade its infrastructure program with blockchain software. With the help of distributed ledger technologies, the State Bank wants to support development aid. In concrete terms, the distribution of funds from the infrastructure funds for projects is to be made more transparent and efficient in the future.

The news spy should above all help the people in Tibet

The news spy is where the first pilot technology adaptation is located. Stricken by poverty, the Chinese mountain region in the Himalayas has been one of the problem children of the People’s Republic of China since its integration in 1950, which was disputed under international law, both politically and economically.

For the autonomous province groans below a poverty rate of 12.4 percent of the population – three times the official statistics of the rest of China. The majority of Tibetans live from agriculture and as shepherds in the mountains. Apart from sluggish tourism, the province has little economic power, transport routes are poor and industry is limping. Beijing has been responding to this since 2012 with a decisive investment offensive, which is now to support the blockchain.

Tibet as a pilot
In order for the pilot project in Tibet to bear fruit, the seventh largest bank in the world also wants to enter into partnerships, for example with the Agricultural Bank of China. In this way, the bank wants to better network potential candidates for fund funding in the future and drive the region forward.

If this is successful, the BOC, which is one of the four major state-owned banks in China, intends to expand the project further. The blockchain-supported distribution of funds will also help in the Gansu, Yunan and Qinghai parts of the country, according to the bank.

Poverty reduction thanks to Blockchain

However, far from the Middle Kingdom, Chinese banks are by no means the first to adopt the blockchain in poverty reduction and development aid. The United Nations, for example, has long been committed to the implementation of distributed ledger technologies as part of its Sustainable Development Goals. It was not until March that the organisation entered into a strategic partnership with the start-up Blockchain. The aim of the cooperation is to combat global poverty.

And corresponding initiatives are already underway in Germany. The Kreditanstalt für Wiederaufbau (KfW) is currently testing the use of Blockchain technology in project funding on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ). With the help of the software, the development bank intends to make the work and approval steps in procurement, contract drafting, tendering and disbursement processes for development projects more reliable in the future.

Blockchain on the advance
While concrete information on blockchain adaptation in Tibet is still lacking, technology is experiencing a real boom among Chinese state banks. The BOC had already filed a patent for blockchain scaling in February. A research institute of the Ministry of Industry and Information Technology on the other hand had launched a blockchain index in March under the leadership of the central bank. This index was probably intended to evaluate various software formats on the basis of the criteria of technology, applicability and innovation, also with a view to domestic industry.