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Many countries struggle to fund large infrastructure projects such as bridges, dams, and rail networks, while their best and brightest citizens go and live elsewhere, their only contribution to their home country now the monthly cheques they send back home.
If you know anyone who sends money to their family in another country, then you have encountered the world of remittances. Although made up of small sums, it amounts to a huge well of money. Whole nations are kept afloat in this way, with remittances accounting for well over 30% of GDP in some cases.
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‘This means, for the first time in the 21st century, foreign workers abroad are sending money back home in amounts greater than all the investment coming from countries and corporations into those lower and middle-income countries – as well as the total amount of official aid.’
Yet that huge sum of money, much needed as it is, can only do so much good back home. ‘The government is unable to pool all that capital and put it towards big infrastructure projects that might benefit wider sections of the population,’
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Imagine a way of harnessing these funds so that they make the biggest impact where they are needed. A way that could actually raise the standard of living in the target country, and potentially stem the ‘brain drain’ of talented people from poorer to richer countries.
Countries typically fund infrastructure projects by issuing debt – sovereign bonds, as they are known.
When a bond is issued by a sovereign nation, banks often form syndicates to buy up the entire issue. They want it for themselves because sovereign debt provides a fixed income at a low risk.
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We just had to find a partner to bring this “real fi” product to the Cardano blockchain. It had to be a company with expertise in capital markets and blockchain, and with all the right regulatory permissions in place.
He added that as well as providing greater access to the sovereign bond market for small investors – ‘the citizenry and diaspora of these countries’ – the initiative would provide ‘efficiencies and cost savings’ to the issuing governments.
Lavecchia described the Oasis Pro approach as ‘digital cash for digital securities’
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