digital farming

Click Here to Develop: How IT Can Help Low-Income Countries

22 marzo 2020 -

Ideas are expensive. They are generated by brilliant minds, who do not simply appear out of nowhere. You need a stable and favourable economic and financial environment.[1] You need social awareness about the importance of breakthrough innovations. And last but by no means least, you need luck.

 

Unfortunately, not every country has a world-class education system, Silicon Valley nor Wallstreet lookalikes. Fortunately for emerging markets, ideas can be borrowed rather than generated, which is much cheaper. Put properly, countries can adopt ready-made advanced technologies and skip the costly early stages of discovery, design, test and adjustment. To grasp how technology can help developing countries in their everyday struggles, we need to take a closer look.

 

Take the food shortage. According to the FAO, more than 800 million people did not have enough food in 2018.[2] You might be tempted to think that the reasons behind this number lie in the imbalance between growing populations and insufficient availability of food. However, what really makes an impact is food waste: global hunger could be ended by saving just one-fourth[3] of the food that is squandered along the food chain in poor countries every year.

 

Two key problems associated with food waste are inefficient supply chain and need for precision agriculture.
In this context, digital technology plays a key role in improving food production and delivery systems.

 

“Why does a banana cost more in Nairobi than it does in London?” asked Peter Njonjo, who left his job as President of the Coca-Cola’s West African business unit to dedicate himself to his new smart start-up, Twiga Foods. They cost so much because the supply chain is disrupted. In fact, farmers produce without precisely knowing the demands of vendors (who will, in turn, sell fruit and vegetables on street markets) and, given substandard refrigeration technologies, food gets spoiled when not sold.

 

Twiga Foods’solution to this problem is simply a smartphone app. On the platform, buyers order the right amount of food they need. Then, Twiga buys produce from farmers and delivers it. Moreover, it also strategically arranges various warehouses to increase logistic capacity. The first result is that demand and price are much more stable and fairer. Twiga Foods managed to reduce the typical post-harvest losses from 30% to 4% in Kenya.[4] The effectiveness of the business model is further proven by the amount of funds from international investors successfully raised by the firm.

 

Supply chains issues are just one side of the story. Farmers also need to update their farming techniques. Put simply, if they want to increase yields, they cannot rely upon expanding arable land anymore, rather, they must increase productivity. Сomputing devices can be embedded in everyday agricultural tools or positioned in specific physical areas. Thus, precision technology helps develop a network where data can be exchanged via the Internet. Farmers would, therefore, be able to avoid food waste and plants damage by actively monitoring the crops health and the ripening of fruits and vegetables directly from their smartphones or tablets.

 

Therefore, smartphone apps are a clear example of how developing countries can take advantage of the latest technological tools coming from the developed world, thus leapfrogging costly infrastructure investments for long-distance communication (e.g. landlines). Besides, smartphones are much cheaper and easier to get than computers.

 

Farming is just one example of how digital technology can be applied to assist developing countries. Many enterprises, NGOs and international organizations are trying to update and digitalize fishing, education, health, community-building. Smart technology and start-ups bring upon a promising model for development. This is further enhanced by a progressive shift of attention of the financial markets to least developed regions. Fund managers must respond to the needs of new generations of investors who want their money to have a social impact. This, together with the high returns on investment that local innovative start-ups have proven to the markets,[5] is likely to spur a relevant migration of global capital towards south-east: at the end of the story, profits play a significant role in driving change.

 

 

 

[1] Douglass C. North, (1990), “Institutions, Institutional Change and Economic Performance”, New York: Cambridge University Press

[2] http://www.fao.org/state-of-food-security-nutrition/en/

[3] http://www.fao.org/in-action/seeking-end-to-loss-and-waste-of-food-along-production-chain/en/

[4] https://techcrunch.com/2019/10/28/kenyas-twiga-foods-eyes-west-africa-after-30m-raise-led-by-goldman/

[5] https://www.gsb.stanford.edu/insights/how-startup-culture-can-thrive-developing-worlds