Saudi Arabia has proposed a business passport built off of blockchain technology to help overcome trade finance challenges brought about by the pandemic, CoinDesk reported.
A “Global Value Chain” (GVC) passport would let companies that adhere to the financial rules in their own nations display their qualifications in other places. The GVC Passport would reportedly offer a distributed, up-to-the-moment and credible way for watchdogs to check out credential claims through the blockchain technology, the report stated.
Saudi Arabia reportedly proposed the idea to commerce officials from different parts of the world at a B20 summit.
Saudi Arabian business leaders think they have a solution to trade finance woes caused by COVID-19: a blockchain-based business passport to cut through red tape.
This “Global Value Chain” (GVC) passport would allow firms already following their host country’s financial rulebook to tout their credentials elsewhere, easing trade and increasing financial access globally, according to the Saudis’ Wednesday proposal before a group of G20 business leaders, developed in partnership with the OECD.
Blockchain technology would provide the GVC Passport a distributed, trusted, real-time source for global regulators to verify business’ accreditation claims, according to the Saudis’ accompanying white paper.
The result: a more efficient financial system with firms – especially small and midsize ones that normally lack a global presence – cut free from repetitive, redundant, cross-border regulatory burdens, the Saudis said.
“SMEs represent 90% of businesses and 50% of employment worldwide, and therefore hugely impacted by the events of the past nine months. Adoption of this policy initiative will help SMEs in the recovery phase,” said B20 Chair Yousef Al-Benyan in a press statement.
Saudis pitched their GVC Passport to global business leaders at a Wednesday B20 summit. They noted that it is a long-term proposal only possible with close international support, so they asked the business community and the G20 to get on board.