Guinea-Bissau becomes first African country to use blockchain for fiscal transparency
03 Oct 2024
Guinea-Bissau, a tiny West African nation, has made a big leap in the use of financial technology by successfully launching a blockchain platform for wage bill management, the International Monetary Fund (IMF) says in a report.
The blockchain system, developed in collaboration with the IMF under the Extended Credit Facility (ECF), with financial support from selected partners and technological advise from Ernst & Young, will revolutionise the country’s public wage bill management, according to the Fund.
The initiative, the first for an African nation, is a big leap for Guinea-Bissau in the use of technology that would bring in transparency in transactions and governance.
The platform acts as a virtual ledger, which securely stores and exchanges information. Transactions are recorded on a real-time basis on a tamper-free register. The system identifies discrepancies and raises alerts in such circumstances.
Guinea-Bissau is moving ahead with implementation of this new technology that would help the country in tackling governance challenges and enhancing public service delivery, says the report.
The platform enables, secure, real-time monitoring of salary and pensions eligibility, budgeting, payment approvals, and salary and pensions disbursements, the Fund quoted blockchain project lead Concha Verdugo Yepes as saying.
The system is currently not integrated with AI models, but has the necessary data for use in AI-based analytics used for decision making.
The system supported by the Enhanced Competency Framework (ECF) and the blockchain solution have helped in improving the fiscal and economic stability of Guinea-Bissau, according to mission chief Jose Gijon.
Guinea-Bissau’s total public wage bill has come down to 50 per cent of the country’s tax revenue from 84 per cent of tax revenues at the start of the mission in 2020, the IMF report quoted him as saying.
