Harnessing digital innovations for climate action and market access: Opportunities and constraints in Central and West Asia and North Africa (CWANA)

  • From
    CGIAR Initiative on Fragility to Resilience in Central and West Asia and North Africa
  • Published on
    15.12.23

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This blog highlights some stylized patterns and unique features of the digital ecosystem in Central and West Asia and North Africa (CWANA). Despite the significant heterogeneity in the landscape of digital innovations in the CWANA countries, possibly due to different institutional and regulatory frameworks, we identify systemic demand-side and supply-side constraints facing the digital ecosystem in the region and highlight what it may take to make digital innovations transformative in CWANA.

Global optimism prevails about the potential of digital innovations to support climate action and transform agricultural markets. Digital innovations can help build resilience to climate change and other unprecedented shocks (for instance, COVID-19) and events mainly because they deliver various types of services and information in an efficient and timely manner. However, their use remains low and varied in many low and middle-income countries, and little work explores the landscape of digital innovations and their associated ecosystems, especially under climatic and market shocks. This is particularly the case in CWANA, even though this region remains a climate hotspot where extreme weather and water scarcity are threatening the sustainability of livelihoods. Despite the significant heterogeneity in the landscape of digital innovations in the CWANA countries, possibly due to different institutional and regulatory frameworks that guide demand and capacity, this blog highlights some stylized patterns and unique features of the digital ecosystem in the CWANA region. We then identify several demand-side and supply-side constraints facing the digital ecosystem in the region and highlight what it may take to make digital innovations transformative in CWANA.

Existing digital innovation typologies in the region provide various services, including, weather and climate services, agricultural finance services, energy, climate, and early warning system services, data and crowdsourcing services, market information services, extension and advisory information services, and supply chain coordination services such as services related to sourcing agricultural inputs. Some of these tools are currently hosted in a repository and these were collected and validated through workshops held with stakeholders working in the digital space and innovation support ecosystem in Egypt and Uzbekistan. However, the success rate in terms of scale up varies significantly across these services.

The digital ecosystem in the CWANA region is characterized by varying degrees of Internet connectivity and mobile subscription rates. Digital connectivity is highly regarded as important when it comes to facilitating transactions in agrifood systems. By comparing Internet connectivity and mobile subscription rates in the region, increasing trends in digital connectivity in all countries in the CWANA region is observed. Morocco and Egypt appear to have similar and relatively higher levels of digital connectivity. These varying levels of Internet and mobile phone connectivity, especially over time and countries, provide valuable insights into the digital innovations observed there.

Empirical evidence on the potential and impact of these digital innovations to transform markets and facilitate climate action in CWANA remains scarce. This pattern characterizes the evident gap between the hype on the potential and empirical evidence on the impact of digital innovations to transform agrifood systems in CWANA. Despite ambitious claims and aspirations, we have limited evidence of successful scaling as well as limited evidence on the impact of these technologies on peoples’ lives and livelihoods. This can be explained by the significant data needs, particularly on digital applications focused on climate change. The lack of data reflects a broader issue of little or no evaluation of some digital applications, which limits learning about their effectiveness. This makes it challenging to track progress and document successes and failures, creating unnecessary hindrances for upcoming application developers, who must learn by trial and error. Although some studies identify several reasons to remain optimistic, the prevailing disconnect between pilots and scale-ups merits further studies and scrutiny.

Gender gaps and digital divide persist: less than 40 percent of smallholder households have access to the internet, with such access increasing with farm size and women farmers have even less access to the internet and mobile phones. In most developing countries, mobile phone ownership and Internet access have been shown to vary with gender, income, age, and geographical location. Some of these digital gender gaps in CWANA may be driven by cultural barriers and existing stereotypes that can affect how women engage with digital technologies and innovations. And some digital applications require a fee, so farmers with limited resources may be excluded. If digitalization efforts are not properly addressing these gaps and barriers and inequalities, they could limit the positive impacts of digital innovations.

Several supply and demand-side bottlenecks constrain the use and scale-up of these digital innovations in the region. Supply-side constrains mainly include factors such as weak soft and hard digital infrastructure; insufficient digital investment; limited government support; skills, and education; low financial and institutional sustainability; lack of detailed needs assessments; and significant data needs. Demand-side constraints mainly include factors such as information asymmetry; (digital) literacy; digital tools complexity; geographical reach and inclusion; usability; gender gaps and a digital divide as well as suitability.

What will it take to accelerate the scale-up of transformative climate and market advisory digital innovations in the CWANA region?

Sustainability of agricultural digital applications relies heavily on addressing key bottlenecks obstructing digital agriculture. To successfully scale up various digital innovations in CWANA that address the core issues of climate change and integrating smallholder farmers into agricultural markets, it is important to address some of the key demand- and supply-side constraints facing smallholder farmers in CWANA in their pursuit of digital agricultural innovations. Our review and validation workshops identify several factors for successful adoption and use of these digital innovations in CWNA. Harnessing the full potential of digital technologies in CWANA require both the development, scale-up and utilization of tailored digital solutions at a meaningful scale. This requires:

  • Creating an enabling environment for the digital ecosystem: Given that most digital innovations are operated by the private sector as well as young entrepreneurs, it is crucial that governments create an enabling environment that is supportive of the ideas and plans of the private sector in leveraging digital innovations for the improved welfare and livelihood of smallholder farmers. This may also entail the introduction of dynamic policies and smart regulations that can spur digital innovations while also safeguarding competitive markets.
  • Increasing investments in digital and complementary infrastructure: Investing in both hard and soft infrastructure to increase Internet and mobile connectivity is crucial to harness the opportunities inherent in digital innovations in the region. In the long run, efforts should be made to extend broadband coverage to rural and remote areas. This may require greater public and private investment in complementary infrastructures.
  • Addressing human capital and development constraints: this may involve establishing decentralized digital incubation hubs and business incubators along with creating new training and capacity-building opportunities.
  • Investing in digital literacy of smallholders and other users. Enhancing digital literacy among smallholder farmers is crucial for fostering inclusivity and equal access to digital innovations.
  • Enhancing access to funding and credit to startups: Many digital applications in the CWANA region are promising but their growth and potential are halted by lack of financing, whether from bootstrapping, crowdfunding, bank loans, angel investors, venture funds, subsidies, or grants.

This blog is a product of the CGIAR Initiative on Fragility to Resilience in Central and West Asia and North Africa (F2R-CWANA). We would like to thank all funders who supported this research through their contributions to the CGIAR Trust Fund (www.cgiar.org/funders/). The views expressed in this blog are those of the authors: Martin Paul Jr Tabe-Ojong, World Bank; Yousra Salama, IFPRI; Kibrom A. Abay, IFPRI; Fatma Abdelaziz, IFPRI; Claudia Zaccari, ABC; Akmal Akramkhanov, ICARDA; Gianpiero Menza, ABC; Oyture Anarbekov, IWMI.

Photo caption: 45 innovators in 22 teams from 11 countries gathered in Tashkent for the AgriTech4Uzbekistan Bootcamp, providing support to teams in their ambitions for scalable and sustainable impact in the region’s agriculture priority areas. This project–part of CGIAR’s Regional Integrated Initiative F2R-CWANA–is powered by the CGIAR Accelerate for Impact Platform and co-designed by CGIAR centers, Alliance of Bioversity International and CIAT, ICARDA, and IWMI. ©CGIAR Accelerate for Impact Platform/Alliance of Bioversity International and CIAT.

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