Scrutinizing the adoption of smart contracts in the MENA Region’s Construction Industry

Abstract

ABSTRACT The construction industry embodies a paramount role in the economic growth of various nations, including the Middle East and North Africa (MENA) region. Despite its significance, the industry faces construction disputes and payment issues, inducing financial losses and project postponements. Consequently, the construction industry has mutated smart contracts to enhance operational efficiency, which automates contract management tasks and offers perks, including transparency and efficiency. However, the adoption of smart contracts in the MENA construction sector remains limited, and the region lacks thorough research on this topic. This study addresses this gap by examining the level of cognizance and apprehension of smart contracts among construction industry stakeholders in the MENA region. The research employs Structural Equation Modeling (SEM) to analyze the relative importance of implementing smart contracts within different project lifecycle phases and relevant practices and identify the hindrances impacting MENA’s smart contract deployment. A practical implementation of smart contract-based tendering employing the Trakti platform is paraded. The findings unveiled the infancy of smart contract adoption in the MENA construction sector. They revealed the substantial importance of implementing smart contracts in the Project Execution Phase, Project Closure, and Monitoring and Control Phase, attaining relative weights of 23.23%, 21.62%, and 20.50%, respectively.