Africa is ripe for increased innovation in the farming supply chain, believes Abigail Thomson, a senior advisor for capacity development at FMO, the Dutch entrepreneurial development bank.
Such innovation includes digital marketplaces which Thomson describes as important in the transformation of African agriculture.
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“We are seeing how embedding financial services into these platforms can bring unbanked smallholder farmers to the formal financial system. This can help financially underserved communities start accessing a range of tailored, sophisticated, [and] advanced financial services that are vital to building economic resilience and succeeding in a modern economy.”
Thomson, who was recently featured on a high-level panel at AfricArena’s Grand Summit in Cape Town, says she was inspired by some of the technology solutions already in development by African founders.
“It was exciting to see some of the solutions under development that focus on addressing the challenges of climate change, particularly in the agriculture sector. We think the upstream side of agribusiness poses interesting potential for both climate adaptation – like the provision of the right inputs – and mitigation, such as training in GAP.”
Home to 60% of the world’s arable land, experts believe that Africa has the potential to meet not only its own food needs, but also those of the rest of the world. Agriculture remains one of the most important economic sectors for the continent, employing the majority of the population and accounting for 14% of GDP in sub-Saharan Africa.
Digital technology is transforming the agricultural sector through the application of innovative tools and new business models, says Aloysius Ordu, director of the Africa Growth Initiative.
He says, “For the first time, many people in the value chain, including smallholder farmers, have access to real-time data and computational power making possible more effective selection and timing of product-to-market decisions, provision of credit, and access to micro-insurance.”
Meanwhile, Thomson commended AfricArena, the leading tech accelerator behind the Grand Summit. “I found the event helpful in that it facilitated conversations with key stakeholders on the collaboration through the FMO Ventures Program and how we can keep adding value to the dynamic African early-stage venture capital ecosystem.”
The FMO Ventures Program focuses on early stage, tech-enabled direct investments alongside a lead investor and indirect investments with a more generalist focus in funds.
During the Grand Summit, attended by start-up founders and investors from across the globe, Thomson says she met with several existing and potential partners, industry leaders, and “impressive entrepreneurs building fascinating businesses.”
“I’m [also] excited about how AfricArena has created the AfricArise program to provide more entrepreneurs with a platform and connections to grow their businesses – culminating at the Grand Summit in Cape Town,” adds Thomson. “Through AfricArise, entrepreneurs are supported in engaging more relevant stakeholders, finding more investors, and building innovative solutions for positive impact on the continent.”