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by Christopher Tozzi, Jul 26, 2018

IBM Partners With Saudi Capital for Blockchain-Based Government Applications


Riyadh

Riyadh, the capital of Saudi Arabia, is set to become the next major proving ground for IBM’s efforts to deliver government functions built on blockchain technology. This month, the city’s municipal government announced a partnership with IBM designed to improve the municipality’s services. 

The partnership, which was made public on July 11, also includes the Elm Company, an entity owned by the Saudi sovereign wealth fund whose offerings include technological services and solutions for local governments.

It remains to be seen which specific services IBM might help Elm and Riyadh to improve, or how exactly blockchain technology would factor in. For now, the partners have stated only that they “will jointly organize workshops in collaboration with key government departments, and private and semi-government sectors in Al Riyadh to identify services which can be transformed and enhanced through blockchain [technology].”

IBM will take the lead in designing the solutions that the workshops identify, while Elm puts them into practice within local government agencies.

The partnership aims to help advance Saudi Vision 2030, a blueprint for diversifying the country’s economy and developing public services. 

Making Government Blockchain Services a Reality for IBM 

Despite the lack of detail about future plans, the news is significant as one of the first real-world test cases for IBM’s government blockchain initiatives.

Big Blue has said much over the past couple of years about how blockchain technology can improve government services, thanks especially to the ability of distributed ledgers to make government data more transparent

IBM has recently signed some major deals with other government agencies, including the Australian national government and the state of Delaware, to develop blockchain-based solutions. The company has also partnered with other governments in the Middle East surrounding trade finance.

The Riyadh initiative, however, represents the first effort by IBM to apply blockchain technology to local government services. It’s an endeavor to watch in order to determine how well IBM’s local government blockchain vision will play out in practice.

Advancing Blockchain Technology in Saudi Arabia

The partnership is also the latest sign of the momentum that blockchains are enjoying within Saudi Arabia.

Saudi Arabia may not be one of the first countries to come to mind when you think about distributed ledgers. But, in fact, the Saudi government has busily supported blockchain-based initiatives in recent years.

The national communications ministry partnered in May with ConsenSys, a Brooklyn-based blockchain startup, to sponsor a “blockchain bootcamp” designed to help local developers learn to build DApps. The Saudi central bank also recently approved the use of Ripple as a payment settlement solution. And the country’s state-owned oil company is reportedly exploring ways to take advantage of blockchain technology for accounting and management.

Viewed against this backdrop, IBM’s decision to experiment with government blockchain technology in Saudi Arabia is less surprising. At the same time, however, it’s worth noting that this is the first example of a major American enterprise — as opposed to a less established organization, like Ripple — partnering with the Saudi government around a blockchain initiative.