Business News of Sunday, 22 September 2019
Source: thebftonline.com
2019-09-22
Private sector investment in the sector is very limited
The digitisation of Africa’s agricultural sector has been left in the hands of donors, the 2019 Digitalisation of African Agriculture report has said.
The report, published by the Technical Centre for Agricultural and Rural Cooperation, noted that donors are increasingly making agricultural digitisation an important part of their portfolios, with an annual donor funding flows of €175million.
Private sector investment in the sector, the report noted, is very limited. In 2018, there was investment of approximately €47million into Africa-focused digitisation of agric enterprises, including both start-ups and larger-stage enterprises.
This investment, the report said, represented 3 to 6 percent of all Africa tech start-up investment.
“African economies are improving, and a handful of players are beginning to develop viable businesses with attractive financial models.
“We estimate that 70 percent of enterprises generate some revenue, and 80 percent of those revenue-generating enterprises maintain several revenue streams,” the report said.
The report further said efforts by digital agricultural services to become sustainable and scalable continue to face challenges, urging collaborations between enterprises, donors and investors; and governments must create an environment in which digital agricultural solutions can thrive and produce impacts.
The report however recommended governments to build partnerships between investors, private actors and technology providers in order to reduce technology and operational cost.
It also urged various African governments to increase funding for a more diverse set of business models, rather than just for those models that have already attracted funding.
Meanwhile, the African Green Revolution Forum (AGRF) has committed US$500million to developing agriculture opportunities for young Africans, and also to support the digital infrastructure so crucial for powering innovative farmer services.
