Dubai, one of the world’s largest trading hubs, has linked up with IBM to launch a scheme using blockchain computing technology to process transactions and keep track of goods being shipped, IBM said on Tuesday.
The initiative will provide real-time information about the state of goods and the status of their shipment to Dubai’s customs and trade agencies and companies involved in the trade process, IBM said, reports Reuters.
Dubai, which registered 647 billion dirhams ($176 billion) of non-oil trade in the first half of 2016, has cemented itself as one of the largest re-export centers for goods flowing between Asia and the Middle East and Africa.
A woman passes by the IBM offices in New York City
IBM said it was also working with companies including du, a United Arab Emirates-based telecommunications firm, Dubai’s largest bank Emirates NBD, Spanish lender Banco Santander, Dubai-based logistics firm Aramex and an unidentified airline on the scheme.
Blockchain, which originates from digital currency bitcoin, works as an electronic transaction processing and record keeping system that allows all parties to track information through a secure network, with no need for third-party verification.
Proponents think it could make transactions faster and safer, and have a wide range of applications. The Dubai deal follows a plan announced in February 2016 by the government there to become a center of blockchain.
IBM said the two banks taking part in the project would use blockchain for trade finance transactions involved in the scheme.
Both banks already have links with the technology. Emirates NBD said in October it was working with India’s ICICI on a pilot project to use blockchain for global remittances and trade finance.
Banco Santander has been involved in various blockchain projects, but in November opted out of the latest fund-raising for blockchain consortium R3 CEV after being an original participant in the consortium.