Mexico to Conduct First Public Procurement Procedure on Blockchain

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Mexico to Conduct First Public Procurement Procedure on Blockchain

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A blockchain project birthed at a Mexican hackathon in April 2018 has, in turn, led to the Mexican government to begin conducting a public procurement procedure via a blockchain network.

The project

This will be Mexico’s first use of the technology for this purpose and is a bid to bring transparency to a public tender; the organizers will be publicly releasing the white paper and object of tender in late August.

According to Mexican business news outlet El Economista, the governance model of the network is a collaboration between several government entities, notably the Coordination of the National Strategy and the Digital Government Unit as well as the consultancy of Mexico’s blockchain industry and international experts.

Additionally, public institutions, universities and civil societies will be part of the model’s horizontal structure; these parties will supervise and validate the transactions within the blockchain.

The project is to utilize Ethereum to create several smart contracts that operate at each level of the procedure. Firstly, the “Buyer Unit” is a registration contract for the government agency purchasing services or goods, while the second is the registration of suppliers and it stores the data of companies looking to take part in one or several bidding processes.

Within the second contract, another then verifies the reputation of a participant based on the data of their previous bidding actions. After this, a fourth smart contract stores the important data, beginning from registration to the tenders results, and a fifth contract executes to evaluate the registered proposals requirements and awards the project to the winner.

Promoting trust

The project began at the Talent Land 2018 hackathon. Coordinator of the National Digital Strategy, Yolanda Martinez Mancilla, said, “The objective is to continue strengthening the prototype that was presented in April of this year, within the framework of Talent Land 2018, and to launch in August the model of governance of the public network.”

She added, “It is a joint action aimed at developing an open governance network where it does not cost users the development of applications and continue as a pioneer government in the inclusion of emerging technologies to improve public services.”

The project to increase transparency in public contracts has been in a matter of discussion since December of 2017 after a high-profile scandal involving a South American construction firm and the then-president Enrique Pena Nieto.

The Mexican government appears to have a reinvigorated interest in blockchain solutions and is beginning to ramp up efforts to improve its poorly-rated global blockchain ratings.


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