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Industry 4.0: Africa’s Pathway to Poverty Reduction

Industry 4.0
As the global community steps firmly into the era of Industry 4.0, defined by groundbreaking smart technologies, sophisticated automation and intricate interconnected systems, Africa is poised for transformative change. Historically sidelined during earlier industrial revolutions, Africa now has a golden chance to use the Fourth Industrial Revolution as a driving force to significantly mitigate poverty.

This article delves into how Industry 4.0 stands to revolutionize three pivotal sectors in Africa: agriculture, infrastructure and energy, and entrepreneurship-driven job creation.

1. Agriculture: Embracing Tech for a Greener Tomorrow

Agriculture has long been the linchpin of numerous African economies, comprising more than 60% of its workforce. Yet, this vital sector grapples with a myriad of challenges, from dwindling productivity and the looming specter of climate change to substantial post-harvest losses.

Enter the promise of smart farming. Enriched by Internet of Things (IoT) devices, this approach can help surmount existing barriers. It promises enhanced yields, predictive equipment maintenance and adept resource management. A shining example of this shift is Nigeria’s Hello Tractor, a novel start-up that not only bridges farmers with tractor owners via a mobile application but also harnesses crucial data on soil health, weather patterns and crop outputs. By morphing traditional farming methods into lucrative enterprises, such innovations can elevate food security and amplify income streams across the continent.

2. Infrastructure and Energy: Building a Brighter Future

Economic growth and societal well-being are inextricably tied to robust infrastructure and energy frameworks. Yet, Africa grapples with a yawning infrastructure deficit, demanding an annual infusion of a staggering $130–170 billion. Coupled with this, an alarming 640 million Africans find themselves in the dark, sans electricity. 

The solution lies in smart grids that optimize energy distribution, coupled with 3D printing technologies that herald a new era of rapid, cost-efficient infrastructure development. A testament to this is Tanzania’s Zola Electric, which brings solar-powered smart grids to remote communities, offering them a lifeline of reliable and affordable energy. In a similar vein, Kenya’s 3D Homes leverages 3D printing to construct affordable housing within a mere 12 hours, addressing housing deficits while simultaneously spurring local employment.

3. Entrepreneurship and Job Creation: Unlocking Boundless Potential

Entrepreneurial ventures and job opportunities are the cornerstones for uplifting communities out of poverty and fostering inclusive growth. Yet, a multitude of African entrepreneurs are shackled by hurdles, including limited financial avenues, restricted market access and skill gaps.

The digital realm offers a panacea. Platforms like Jumia are democratizing market access, linking local vendors to a sprawling African consumer base, while also offering auxiliary services to bolster these nascent businesses. On the educational front, Andela stands out as a hub, training African software enthusiasts and linking them to international firms, all while cultivating a nurturing community for enhanced learning and collaboration. 

Industry 4.0 and the Future of Africa

The Fourth Industrial Revolution is not just another buzzword for Africa — it is a clarion call for a brighter, more prosperous future. Yet, harnessing its full potential demands meticulous investments in digital frameworks, nurturing human capital and fostering innovative ecosystems. Equally paramount is the need for robust governance and regulation, ensuring that the benefits of Industry 4.0 are widespread, ethical and sustainable. With visionary leadership and concerted action, Africa can metamorphose its latent potential into tangible, transformative outcomes.

– Yudi Zhang
Photo: Flickr

Uber for Tractors: Transforming the Agricultural Sector in Africa

Agricultural Sector in Africa
Within sub-Saharan Africa, about 220 million smallholder farmers live on $2 per day. As a result of a lack of financing, farmers do not have access to mechanization tools that increase productivity across the agricultural sector in Africa. The majority of the poor earn their source of income on farms and 80% of households in sub-Saharan Africa rely on agriculture to live.

Inadequate Mechanization in the Agriculture Sector in Africa

Since farmers lack the utilities to cultivate their land fully and efficiently, they lose out on potential yields and profit, which detrimentally impacts Africa’s agricultural sector. In fact, about half of Africa’s yield gap arises from a lack of agricultural equipment.

“Less than 1% of commercial lending goes to agriculture in Africa – conveying that this sector is grossly under-invested despite the crucial role that it plays in the long-term development of most African countries,” Hello Tractor says. Reasons include hefty requirements that smallholders simply cannot meet, especially in sub-Saharan Africa, which accounted for two-thirds of the world’s extreme poor in 2018, the World Bank says.

This urgency of strengthening the livelihoods of smallholder farmers submerged in poverty through digital technology has fostered a desire for entrepreneurs to develop innovative methods to boost agricultural mechanization.

What is Hello Tractor?

African American investment banker, founder and CEO, Jehiel Oliver, established Hello Tractor in Nigeria in 2014 to increase access to mechanization. The Hello Tractor platform, nicknamed ‘Uber for Tractors,’ runs a pay-as-you-go (PAYG) program to allow for collaborative consumption, facilitating access for smallholder farmers to rent tractors on demand.

Booking agents receive these rental requests and provide the services smallholder farmers yearn for. Now, farmers are readily equipped with the tools to liberate themselves from poverty because they reap the benefits of accessing low-cost tractors they do not own. The Hello Tractor app acts as a digital hub for business owners, such as tractor owners, to network with farmers in need of their services.

The Uber analogy relates to the fact that farmers can easily book available tractor services near them at the tap of a button. A GPS tracking device is fitted onto equipment and synced to the mobile app, allowing tractor owners to view details about the tractor, such as the distance their tractor has traveled, acres cultivated and fuel levels.

Impacts of Hello Tractor

Smallholder farmers now have access to formerly unattainable agricultural machinery. The cost of tractor access equates to a third of the amount paid for manual labor and can be as much as “40 times more efficient.” By the end of 2020, Hello Tractor had assisted 41,000 farmers in Kenya with these services. The company had fitted its technology in more than 2,500 tractors and assisted more than 500,000 farmers by 2020.

According to a World Food Programme (WFP) article from 2020, Hello Tractor’s strategic objectives in Nigeria within five years will bring 10,000 tractors to the market through a partnership with John Deere, which will result in 9 million hectares of arable land, 37 million metric tons of crops for food and more than 2 million employment opportunities.

The Future of the Agricultural Sector in Africa

Overall, Hello Tractor has drastically transformed the agricultural sector in Africa. The introduction of digital technology is revolutionizing agriculture in Africa. Improvements in productivity, food insecurity and income insecurity improve overall livelihood and provide hope for a promising future. Hello Tractor’s services allow the opportunity for smallholder farmers to break intergenerational cycles of poverty.

Jehiel Oliver has harnessed digital technology to create a model that empowers smallholder farmers with the tools to rise out of poverty. These innovative development projects help to galvanize systemic change and eliminate global poverty overall.

– Dami Kalejaiye
Photo: Flickr

Boosting the Agricultural Sector in Africa

Agricultural Sector in Africa
The 2022 Global Report on Food Crises 2022 Mid-Year Update estimates that acute food insecurity affects 140 million individuals in Africa. Agriculture has a significant social and economic impact on Africa — according to a McKinsey&Company analysis in 2019, smallholder farmers account for more than 60% of sub-Saharan Africa’s population and agriculture accounts for around 23% of the region’s GDP. The analysis also determines that Africa has the potential to multiply its cereal and grain output threefold. Nonetheless, most of Africa’s agricultural potential remains unexplored. However, realizing the full agricultural ability of Africa will require investments in fertilizers, irrigation, storage, infrastructure and more. Hello Tractor seeks to advance agricultural productivity in Africa.

Agriculture in Africa constitutes one of the primary sources of income as roughly two-thirds of Africa’s people work in the agricultural sector in Africa. Rural farmers have found it difficult to increase their productivity and their capacity to generate more food because of the “cost of mechanizing agriculture,” the World Economic Forum says.

Hello Tractor’s Solution

Jehiel Oliver, the founder of Hello Tractor, tells Forbes that African smallholder farmers typically lack access to the agricultural equipment necessary to expand cultivation and increase yields due to the high costs and no access to financing.

“I realized, if farmers have access to a tractor, that’s as good as owning one,” Oliver tells Forbes. He then started Hello Tractor in 2014, initially in Nigeria, where, via a digital app, one can establish a link between the tractor owner and the farmers, where the latter can rent the tractor to farmers to increase agricultural production and generate greater profits.

Hello Tractor implemented innovative digital tools with the purpose of connecting tractor owners, operators and farmers. The app includes several features. For instance, tractor owners can utilize GPS monitoring to oversee the movement of the tractor and find out information on the active and inactive hours and the number of trips made. Through the app, one can also monitor the fuel consumed by the tractor, the fuel prices and the scheduled activities for each tractor in the field.

“Hello Tractor technology makes fleet management easier and more profitable, supporting every aspect of your fleet from managing your tractor operators to your farmer customers,” its website says. Besides operating in 15 African countries, Hello Tractor also works in Bangladesh, Pakistan, Guatemala and Jamaica.

Pay-as-you-go Model

In January 2022, Hello Tractor launched the pay-as-you-go (PAYG) financing program for the agricultural sector in Africa, which “aims to significantly increase the number of tractors available to service farmers across sub-Saharan Africa by providing flexible financing to entrepreneurial youth and women who want to buy equipment to provide mechanization services to farmers in their network,” Ventures Africa says. The PAYG program is supplying $10 million in tractor loans, reaching more than 111,000 additional farmers. The program has the potential to generate at least 3,500 new jobs.

Hello Tractor is currently collaborating with the Nigerian Federal Ministry of Agriculture and Rural Development and John Deere on a five-year plan to deploy 10,000 tractors. Using the pay-as-you-go system, the government will implement a model that “allows tractors to be leased to new owners over a defined period of time, before being resold to them at a discount,” Oliver told Forbes, with Hello Tractor as an implementation partner.

By the end of five years, Hello Tractor predicts that the initiative will generate 2 million jobs and 37 million tonnes of food using 9 million hectares of agricultural land.

The Impact of Hello Tractor on Farmers

As of August 2022, Hello Tractor has provided tractor services to more than 500,000 farmers, with 55% of them obtaining their first mechanization services through the company. Approximately 87% of these farmers reported gains in profits as a result of mechanization access.

Through the services of Hello Tractor, farmers have the opportunity to gain greater and more precise information on the types of crops to produce, when to ideally cultivate the crops and even the worth of the final harvest. Smallholder farmers can also more easily qualify for bank loans and grow their businesses by providing the banks with projections “based on verifiable targets” from Hello Tractor.

Looking Ahead

In 2021, Fortune’s Change the World list featured Hello Tractor as one of 53 companies using innovation and creativity to address issues impacting communities.

Accessible and inexpensive tractor services for smallholder farmers through this game-changing technology has the potential to boost agricultural output and farmer revenue in the agricultural sector in Africa, resulting in a more secure food system and less poverty.

– Elena Luisetto
Photo: Flickr

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Tech Platforms Increasing Accessibility in India

accessibility in IndiaAs of 2020, 50% of people in India had access to the internet, a figure growing most quickly in rural regions. In 2019, there were 264 million internet users in rural India compared to the 310 million internet users in urban India. The rapid growth of internet adoption outside of Indian cities can be accredited in part to the initiatives of the Digital India campaign, including efforts to integrate the country’s cloud infrastructure, promote open data platforms, fill connectivity gaps and offer affordable data plans. Overall, internet penetration rates across the country have more than doubled over the last five years. Through the use of technology and the internet, platforms have been created to increase resource, service and opportunity accessibility in India.

The Digital Revolution Increases Accessibility

In a country where 80% of the impoverished live in rural areas, widespread internet availability is vital. More than just a source of entertainment, the internet increases accessibility of products and services that otherwise might not be affordable or available. Recognizing the potential for digital technologies to cut across geographic and economic barriers, numerous private and public organizations have developed platforms designed to increase accessibility in India. Whether connecting buyers to faraway sellers or simply helping individuals locate public toilets, these innovative tech platforms champion access and promote inclusion in India.

Google Toilet Locator

In 2012, more Indian households had a cellphone than a toilet. A lack of access to toilets leads to rampant open defecation with consequences ranging from water pollution to the spread of infectious diseases such as cholera. In a country where technology has grown faster than public services, the government turned to tech for assistance in its campaign to eradicate open defecation and improve waste management. In December 2016, India’s Ministry of Urban Development (MoUD) partnered with Google to introduce a Google Maps toilet finder tool as part of the Swachh Bharat (Clean India) Mission. As the government works to construct millions of toilets around the country, the Google Toilet Locator helps Indians to more easily find them. The app even allows users to leave ratings and reviews for public restrooms.

Tractors-as-a-Service

In September 2018, Aeris Communications partnered with Hello Tractor to launch “Tractors-as-a-Service” in India, The service provides on-demand tractor rentals to Indian farmers. In India, agriculture is an essential source of export earnings, employment and food. Tractors play a crucial role in increasing agricultural productivity but less than 30% of farmers utilize such expensive, high-capacity equipment. Hello Tractor’s software, which can be accessed through mobile and web applications, offers a “pay-as-you-use” model based on time in the field and area covered. The app enables small farmers to reap the benefits of commercial model tractors at lower costs while increasing the profits of tractor owners by allowing them to rent out their machines during idle times.

IndiaMART

IndiaMART is India’s largest online business-to-business marketplace, connecting buyers with suppliers of products and services ranging from pharmaceuticals to industrial machinery to wholesale foods. IndiaMART offers more than 67 million products and services to more than 100 million buyers. Importantly, the platform gives small and medium-sized enterprises in India a place to promote their business. There are about 60 million small and medium-sized businesses in India but only around 10 million of them have any web presence, according to the most recent data. IndiaMART allows these companies to expand their market reach and sell through the platform for a subscription fee.

A thriving e-commerce economy allows for goods and services to reach a consumer base that is less affluent and lives outside of traditional urban markets, thereby increasing market accessibility and enhancing the welfare of rural and lower-income populations.

Unified Payments Interface

In the financial sector, the National Payments Corporation of India developed the Unified Payments Interface (UPI), an instant real-time payment system regulated by the Reserve Bank of India. The platform allows users to access multiple bank accounts from even the most remote locations, routing funds and making payments under one seamless application. Digital finance platforms such as UPI are crucial in promoting financial inclusion and empowering individuals with tools such as loans and savings accounts.

Both private and public digital platforms have been deployed to increase accessibility in India and reach those who may otherwise be excluded from resources, services and opportunities.

– Margot Seidel
Photo: Flickr

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Bringing African Farmers into the Digital Revolution

digital inclusion for African farmersThe spread of mobile technology has granted developing nations access to the digital revolution. This is called digital inclusion. From the digital revolution, we have experienced one of the most innovative new business models, networking. Companies like Facebook and Instagram are involved in social networking. Uber and Lyft specialize in transportation networking. Go-puff, Grubhub, and Door Dash all focus on food delivery networking.

What makes these business models unique to networking is that their products are simply information. Food, cars and people’s personal information, provided by the users themselves, is the secret. Networking companies need only to provide intuitive transfer of this information over the internet.

New companies across Africa are taking advantage of the networking business model. With increased digital inclusion for African farmers, there are new ways for transactions to be streamlined.

Hello Tractor!

The mechanization of agriculture is an important innovation to spread into developing countries. Unfortunately, many farmers in these countries cannot afford to outright buy a tractor and maintain it. Hello Tractor! creates a network between tractor dealers, contractors and farmers that makes mechanization a reliable and affordable investment for all.

Based in Nigeria, Hello Tractor! targets the 36 percent of the Nigerian population that is employed in agriculture. The physical product of Hello Tractor! is a device that attaches to tractors and monitors them, sending GPS and maintenance data to the Hello Tractor! software.

Farmers use the software by downloading a mobile application, to book the dates in which they need tractors. Once contractors send out their tractors, they can use the app to see if the tractors are being used properly. Tractor dealers also have access to the information so that they may perform maintenance when required.

John Deere supplied 10,000 tractors to Nigeria’s Ministry of Agriculture in 2018 and they are all managed by the Hello Tractor! systems. Ultimately, digital inclusion for African farmers can build trust between stakeholders.

Agri-wallet

Selling produce is a more arduous task than many may think. As the market expands, this risky and tedious process only puts more pressure on farmers. Digital inclusion for African farmers can settle this issue.

Between the farmer and the consumer, there exists a distributor. However, unlike how we think of big business deals in America, these distributors can not put down payments on produce. They must take weeks to sell the products to consumers and bring back the returns to the farmers after.

A solution to this problem is in high demand as 70 percent of workers in Kenya are employed in agriculture.

Agri-wallet fits nicely into a niche area between the Kenyan farmers and the market distributers. When farmers sell to their distributors, Agri-wallet pays up-front into the farmers’ banking app. Now, farmers can restock during this intermittent period of sales.

Convenient transactions and loans such as these would not be possible without the growing interconnectivity of mobile technology spreading into Africa.

Now, 4,000 farmers in Africa are benefitting from the services of Agri-wallet.

Farmer’s Pride

According to the Kenya Agricultural Research Institute, 3 quarters of Kenyan farmers have planted fake seeds at least once. Farmer’s Pride is a Kenyan company that will provide infrastructure and safe avenues for e-commerce among farmers and distributors.

A primary focus of Farmer’s Pride is “putting the area on the map” so that village-level farmers are more attached to society as a whole. Extra care for farmers, from digital access to insurance to local access to veterinary care for livestock, is what makes Farmer’s Pride such a promising franchise.

10,000 farmers have been connected through Farmer’s Pride, making an extra $2m income through their intervention.

These secure smartphone apps are promoting e-commerce, intelligent planning and proper resource management. When African farmers are given the opportunity to be included in the digital world, the entrepreneurial and economic prosperity we have enjoyed in America will become open to them.

– Nicholas Pihralla
Photo: Flickr

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Digital Technology is Improving Food Systems in Africa

Food systems in AfricaIn sub-Saharan Africa, most employment is in the food sector, with 60 percent being farmers. Food sector jobs are projected to be even more prevalent in Ethiopia, Malawi, Mozambique, Tanzania, Uganda and Zambia. However, the agricultural yield is low, and Africa’s staple crop is in a decline. Maize production will reduce 40 percent by 2050, and the population is expected to double to 2.5 billion. Digital technology can influence agriculture and help strengthen food systems in Africa.

Hello Tractor

Hello Tractor is a digital tractor sharing solution that has created a platform for smallholder farmers to afford agricultural technology. For every 100,000 square kilometers worldwide, there are 200 tractors available. There are only 13 tractors per 100,000 square kilometers in Africa. Hello Tractor has successfully reached five markets in Africa and influenced 75 percent of private commercial tractor profit in Nigeria.

Hello Tractor offers sub-Saharan African farmers more than just a tractor. The ag-tech solution includes a monitoring device installed in each machine that collects important data. Collected data is transmitted to a Hello Tractor Cloud and makes its way to the manufacturing industry. This shared information helps manufacturers to design personalized equipment for their select clientele.

Digital Green

Digital technology is also improving the documentation, which is good for African food systems. The World Bank has partnered with Digital Green to improve agricultural practices through the exchange of information. Researchers are educating farmers in Ethiopia, Ghana, Malawi and Niger and sharing knowledge through video content. The material highlights post-harvest and nutrition-related improvements.

Before implementing technological transformations, Digital Green assesses currently active systems in communities. Poor and struggling communities are persistent in their efforts to beat poverty. Companies like Digital Green facilitate this advancement and mobilizes farmers through video production training. This is a self-sustaining opportunity for developing communities. Feedback from local farmers makes the process more effective, but limited access to the internet and electricity calls for offline screening in addition to online sharing. Digital Greens is working with Connection Online Connection Offline to make that happen.

Connection Online Connection Offline

Connection Online Connection Offline (CoCo) is a data collection system that does not require software installation and is compatible with any device. CoCo’s database includes an analytics dashboard with instant statistics about operations, targets and metrics. This is how video programs are monitored and evaluated to improve food systems in Africa.

Another social platform within the agriculture community is 2KUZE. This Mastercard subsidiary connects farmers to buyers and agents in Kenya, Uganda and Tanzania via mobile commerce. Direct buyer access is advantageous for smallholder farmers seeking a larger percentage of the wholesale value of their goods. Moreover, mobile transactions save farmers valuable time that would be spent traveling hours to distant markets. The platform especially appeals to female farmers who may find themselves held back by family obligations.

Digital technology allows farmers better access to resources of higher capital. The exchange of data in farming communities can facilitate the restoration of agricultural production in Africa. E-commerce platforms enhance market price transparency and give farmers leverage to compete against larger producers, thus reducing poverty by improving food systems in Africa.

– Crystal Tabares
Photo: Flickr