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Public Contracts on a Blockchain – Mexico Takes the Lead With Blockchain HACKMX

To improve complex processes, reduce costs and fight corruption

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Mexico’s Project HACKMX to Bring Public Contracts on to the Blockchain

Mexico’s national digital strategy coordinator, Yolanda Martinez, has recently detailed a project in which the government of Mexico is working towards using blockchain to track bids for public contracts. The revelation came at a recent conference in Mexico.

An unofficial translation of Martinez’s tweet on April 3rd read as follows.

“With #blockchain applied in public procurement today, you can already tell if a company that serves the government is reliable”

– Yolanda Martinez

Blockchain HACKMX Seeks to Improve “Complex” Processes

According to a local news report by Debate, [unofficially translated] Martinez explained that this project called blockchain HACKMX seeks to improve the “complex” processes of public procurement that need to be transparent and visible to the entire population.

Blockchain HACKMX is an initiative of the National Digital Strategy and the Ministry of Public Administration, in collaboration with Campus Talent Mexico. The initiative was prompted by the growing use of internet in the Mexican economy:

  • 41.28% growth in internet users in Mexico (2016 over 2013)
  • 22.2% of users used the internet to interact with the government in 2016 (as compared to 1.1% in 2013)
  • Noteworthy growth in the usage of e-commerce and social media in Mexico

To Increase Confidence in Public Institutions and Fight Corruption

The association also believes thatThe use of blockchain technology in the public sector represents the possibility of providing highly secure and reliable digital services, at low cost, based on open technology, and a transparent process de facto for all participants; which significantly increases confidence in public institutions and effectively fights corruption.”

The system was originally designed by the winning team of the Talent Hackathon of Campus Party 2017, as a blockchain solution that could improve public services in Mexico. The prototype designed by the university graduates and called “Intelligent Hiring”, was built to be an intelligent contracting system that validates proposals and sends them to the evaluators via email in order to verify that they meet the necessary criteria. In the end, the system selects the proposal that generates the greatest social benefit to grant the bid.

Advantages of Using Blockchain in Public Contracts

  1. Smart Tender uses a hybrid Blockchain system to ensure that any registered citizen can participate in decisions that could affect them and to be able to vote at a local, state or federal level. At the same time, it allows certified evaluators to vote and rate proposals anonymously, preventing companies from contacting them to influence their decisions.
  2. The importance of the Smart Tender system is a win-win solution since the evaluators know that if the winning proposal does not meet the agreed expectations, it will have repercussions on their reputation and their income will decrease.
  3. Citizens will always pursue the best proposal because at the final recipient of the benefits is these people themselves.

Image Credit: Deposit Photos

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