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A Heat Wave Grips India and Pakistan

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Fabio Domenico Vescovi is an Agronomist & Earth Observation Specialist. He is currently Senior Data Scientist & Technical Lead at Cropin. Fabio develops applications of satellite technologies in tropical countries for the insurance sector (drought and floods). He studies crop biophysical parameters to inform an index-based insurance system and develops AI algorithms based on DataCube and Machine Learning. Fabio has had an international career spanning Germany (Bonn University), Italy (OHB) and UK (Airbus). He has also been deeply involved in various African countries, working with different stakeholders to enable easier data-based access to micro-credit and micro-insurance for farmers. Fabio has a PhD in remote sensing applications in agriculture.

You are using satellite data to track droughts and floods to grow crops more efficiently. Which other companies are doing this globally?

At Cropin we use satellite data along with other types of data such as weather data, soil information, agro-climatic conditions, seed genetics, global crop sowing and harvesting patterns, agronomics etc. to create AI models that bring predictive intelligence to agriculture and make it more efficient, productive, and sustainable.

There are a host of organisations in this sector offering services which target this challenging area. We believe that the challenges faced by this sector are many and complex and not one player can solve them all and thus a thriving global agritech ecosystem is a great enabler to truly accelerate progress of the agriculture ecosystem. The industry itself is at an evolving phase and technology adoption in the global agriculture arena is still a long way to go. Arable land across the planet is estimated to be 1.4 billion hectares and in terms of being able to digitize and impact the planet’s agri-value chain, the agritech sector is still miles away, but we sure are headed in the right direction.

Why are you passionate about the agriculture sector? What has inspired you to be a part of this field?

My family and ancestors were all Italian farmers and despite growing up in an urban environment I always had a passion for environmental sciences, agriculture and the socio-cultural connections between our environment, our people and myself.

Tech-enabled services for farmers can be unaffordable for many farmers in a country like India. Do you think India can implement them at a mass scale?

We are very aware that farmers will face challenges to afford high-end digital and predictive intelligence solutions which brings a meaningful difference to their lives. This is the reason Cropin works via a B2B and B2G business model. We work with large food processing companies, food retailers, seed and agri-input manufacturers, agri-lenders and insurers, governments and development agencies who in turn work with huge numbers of farmers and large areas of farmlands. So, the cost of the technology is borne by our customers and the benefits of higher efficiency, improved yields, lower inputs costs and better sustainable operations benefit all the stakeholders including the farmer. Another important benefit of our B2B and B2G approach is that it also helps us create impact at scale in global agriculture vis-à-vis working directly with individual farmers.

What is Carbon farming? Which countries is it being implemented in?

Carbon farming is a new term but an old practice. I think that people practiced Carbon farming since the time agriculture was invented. One of the simplest examples of Carbon farming is the circulation of organic matter in the form of manure from the stall to the soil. In turn the soil provides food to the animals in the stall. There were many similar Carbon cycles and sub-cycles across people and cultures, where organic matter was recirculated and eventually regenerated.

Nowadays this circularity in Carbon has been slowly destroyed by a mixture of industrial and commercial processes, which though very productive, are not sustainable for the environment.  Just to give you a negative example, Europe is a strong importer of soya, sunflower, and cereals from Brazil, which is now clearing their forests and depleting their soil organic matter to farm these products. However, there is no process in place to return that Carbon from Europe to Brazil to the soil from where it was taken. Only money is returning. We were able to put in place a system which is perfect economically but unsustainable ecologically. Like in a bank, what the soil gives us is a loan, not a donation.

How can AI be used for sustainable agriculture?

Digitization and AI can be leveraged at scale to increase efficiency, productivity, and sustainability in farming. To leverage AI for farming, Cropin undertakes the complex process of ‘agri asset computation’ which brings together satellite imagery, historical and forecasted weather data, soil information, agro-climatic conditions, seed genetics, global crop sowing and harvesting patterns, agronomics, and other farming insights all under one umbrella to build knowledge graphs for hundreds of crops and crop varieties across the globe. This data is then used to build AI models for any farm plot, region, country, or crop in the shortest possible time. This provides insights and recommendations on various aspects of farming operations – from selecting the right crops and seeds, the right time for sowing and harvesting, the optimal use of water resources and adoption of the right farming practices etc. All this enables much more sustainable farming.

At Cropin, we have already computed 0.2 billion acres of farmland in 12 countries, and we have an ambitious target to compute and build predictive intelligence “on-tap” for 1/3rd of the planet’s cultivable lands by 2025. By doing this, we are helping solve planet scale challenges such as food security, environmental sustainability and better livelihoods for farmers.

How can farmers be empowered globally?

Farmers are supposed to be the most empowered category in the world, they should dominate even kings, like for example in the American and French revolutions. But the world has become oblivious to this. People forget about farming and the role of farmers, especially the small holder ones. Nowadays if you ask a European child: “Where does this milk come from?”, the answer you may get is: “Well, from the fridge!”. So, milk is perceived as an industrial product and this is ironically not wrong, because the number of industrial processes occurring on every drop of milk from milking to drinking is overwhelming. So, behind a common farm or diary product, we do not see a natural environment anymore but rather a complex system of industrial procedures.

Farmers can be taken onboard of the political arena only if they speak the language of marketing, behave like industrial entrepreneurs, have the knowledge of engineers, act like politicians and talk like salesmen! How can we figure out the farmers role in a complex society which forgotten the importance of farming?

Even in climate change, the only ones empowered to make a significant change on millions of hectares are the small holder farmers. They can play a key role in agro-forestry and Carbon sequestration, much more than any other industrial process. But they are not aware of the processes and of their potentials, and neither is society. We need an educational process involving both agricultural and industrial sectors to raise awareness on their potential.

Finally, a personal question – Is doing a PhD and life as a researcher fulfilling?

It is, but I must accept that the academic context of a PhD and the lifestyle of a researcher moving across various countries to attend congresses are so different than the cultural context and environmental conditions of a farm. I can’t simply mix the lifestyle of a farmer and that of a researcher. Anyway, whenever I try to do so or I spend some few days in a family-run farm in an African context (e.g. currently I am writing from a small holder farm in Mwingi, a rural area in central Kenya, not even completely electrified) then I get the best results of my research and I grow in the knowledge of how the farming world really is, when we speak about farming, even Carbon faming. My lovely farmers and I dream to raise our common voice and bring awareness on the real role which farming and research can play together: my PhD is not a barrier, it is the way to open my mind to their culture and learn more.

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Inquiry on General Babangida’s Involvement in Conventional Banking despite Introduction of Islamic Finance in Nigeria

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Dear Editor,

I hope this letter finds you well. I am writing to express my curiosity and seek clarification on a matter that has caught my attention, specifically pertaining to General Babangida’s involvement in the conventional banking industry despite his role in introducing Islamic finance during the financial reforms of his military government in Nigeria. Vide your special article commemorating his 81st Birthday published in your esteemed news website: https://focus.afrief.org/trending/a-salutary-tribute-to-general-ibrahim-badamasi-babangida-architect-of-islamic-finance-in-nigeria/

It is indeed noteworthy that General Ibrahim Babangida played a pivotal role in shaping the economic landscape of Nigeria by introducing Islamic finance principles. It is fascinating to witness the implementation of Islamic finance in Nigeria, as it promotes principles that align with religious and ethical values. General Babangida’s efforts to introduce this form of finance were undoubtedly commendable, reflecting his commitment to establishing an alternative financial system that adheres to Islamic principles.

However, recent observations suggest his active participation in the conventional banking sector in Nigeria. Certainly, it is intriguing to see General Babangida’s continued involvement in the conventional banking industry, which operates under different principles. While some may argue that his involvement in both sectors is simply a matter of personal choice, it raises questions about the compatibility of his actions with the ideals and principles of Islamic finance. While the former is interest driven, the latter prohibits interest related transactions completely.

I wonder if General Babangida has ever publicly addressed this matter or explained his reasoning behind being active in both sectors. It would be enlightening to hear his perspective on how he reconciles his involvement in conventional banking with his efforts towards promoting Islamic finance. This has raised questions in my mind and perhaps in the minds of others as well.

I am keen to understand the rationale behind General Babangida’s dual engagement in both Islamic finance and conventional banking. Does this reflect a strategic approach to diversify Nigeria’s financial sector, or are there specific reasons behind his involvement in conventional banking despite advocating for Islamic finance principles?

Additionally, it would be interesting to explore the potential impact of his dual involvement on the perception and growth of Islamic finance in Nigeria. Does his presence in the conventional banking industry hinder the progress of Islamic finance, or does it have the potential to bridge the gap between the two sectors?

I believe that delving into these questions could provide valuable insights and generate constructive discussions within the Islamic finance community in Nigeria. By shedding light on General Babangida’s dual involvement and the potential implications, we can further enhance our understanding of the challenges and opportunities faced by the Islamic economy in our country.

Thank you for considering my questions, and I look forward to reading more about this topic in your esteemed Focus on Islamic Economy.

Sincerely,

 

Abba Musa Mamman Lagos

Kaduna


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10 Megatrends Shaping the World in 2024

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The report, “Navigating Megatrends Shaping Our Future in 2024”, was launched during the first day of the World Governments Summit (WGS) 2024, being held under the theme “Shaping Future Governments” from 12th-14th February in Dubai. The report examines the indicators that shape these megatrends, supported by evidence from today as well as future expectations. These trends inform decision-makers and foresight experts about various sectors and the potential opportunities in each.

Khalfan Belhoul, CEO of Dubai Future Foundation, said, “This report has been launched in line with DFF’s efforts to identify and communicate those trends with the most potential to shape opportunities and strengthen local and international partnerships to overcome current and future challenges.”

“The challenges that face us on our journey to the future require that we are agile enough to be able to adapt to rapid change. It is vital we pay attention to the signals we detect – only then can we be prepared to overcome challenges and seize opportunities. The World Governments Summit provides a platform for discussing these challenges and exploring the opportunities.”

Materials revolution

New types of materials will create a shift in the industry, with solutions based on artificial intelligence (AI) such as biopolymers, biorefineries, and chemical recycling paving the way. These solutions will facilitate the development of new biological and novel materials that could rival plastics.

Boundless Multidimensional Data

Enabled by developments such as 5G and 6G in addition to advanced connectivity, the availability of raw data will vastly increase. The Internet of Things (IoT) will continue being deployed in healthcare, agriculture, and smart cities, especially in the Middle East.

Technological Vulnerabilities

The cybersecurity sector will boom amid a sharp rise in smart home devices and wearable tech. According to a report by Allianz, the annual cost of ransomware is projected to reach around $265 billion by 2031. Meanwhile, the debate on the future of decentralised finance will continue.

Energy Boundaries

Advances in tech and the growing demand for energy will drive the pursuit of alternative sources of energy. Novel materials and machine intelligence will enhance current sources of energy, including their distribution around the world – and in space.

Saving Ecosystems

Approaches to conservation will be more interdisciplinary and future-focused, taking into account both societal and environmental factors. Driven by resource scarcity, climate change, and shifts in social values, environmental impact management will become increasingly holistic.

Borderless World – Fluid Economies

The world is witnessing a rise in unmediated transactions in finance, health, education, trade, services, and even space, which are blurring boundaries and creating more cross-border communities. Advances in communications, computing, and advanced machine intelligence will accelerate the creation of a borderless world that will change the way we work, live, and connect.

Digital Realities

The spread of 5G and 6G networks will enhance the applications of autonomous technologies and IoT. As quantum technologies become scalable and reliable, immersive experiences will become even more realistic.

Living with Autonomous Robots and Automation

Robotics and automation will increasingly be deployed across industries beyond automotive, manufacturing and supply chain logistics. This will provide opportunities for efficiency and innovation, although there will also be ethical challenges to address.

Future Humanity

New workplace norms will emerge, with people needing to adapt to non-traditional skill sets in areas such as digital literacy, communications, culture and sustainability.

Advanced Health and Nutrition

Accelerated progress in advanced machine intelligence, nano- and biotechnology, additive manufacturing, and IoT will transform health and nutrition, improving health and wellbeing for people of all ages. Technology will reduce, if not eradicate, some communicable and non-communicable diseases and enhance the sustainable use of and access to water and food.


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Africa’s New Online Foreign Exchange System will Enable Cross-border Payments in Local Currencies – what you need to know

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The high cost of making cross border payments on the African continent has driven governments on the continent to seek options of settling trade and other transactions in local currencies. This has given birth to the Pan-African Payment and Settlement System which was formally launched in Accra, Ghana, in January 2022.  Development economist Christopher Adam, who has studied the exchange rate policies of African countries, answers some key questions.

Why are African countries exposed in the international currency market?

Three main reasons. First, African economies are small and as such are highly dependent on trade with the rest of the world. Their exports are dominated by primary commodities including oil and gas, minerals and cash crop agriculture. On the import side, they purchase a whole range of goods – from essential commodities not produced at home such as fooddrugs and medicines, to capital goods and energy. A large proportion of these are sourced from China and other major economies of the global north. But because African countries are small relative to their trading partners they rarely have the power to determine the prices of imports and exports. They are “price takers” in world markets. And with world prices being set in the major reserve currencies of the world (the US dollar, euro, yen and renminbi), African countries are exposed to movements in these world prices. Second, “intra-African” trade is still a relatively small proportion of the total trade of African countries.

Finally, since African countries’ currencies mostly can’t be directly exchanged in international transactions, the dollar remains the most widely used currency in trade, even between African countries.

What’s required for the system to get off the ground?

The basic idea of the system is to be able to settle trade between African countries without having to use the US dollar.  There are two major challenges with that. First, intra-African trade accounts for less than 15% of Africa’s exports at present (although supporters of the African Continental Free Trade Area expect this to grow significantly over the coming decades). The African payment system therefore does not eliminate the role of the dollar (or other foreign currencies) in trade settlement entirely.

The second issue is that trade is not balanced between African countries. For example, Kenya exports goods of higher total value to Ethiopia than it imports from Ethiopia. If Ethiopia paid in its own currency, Kenya would end up with Ethiopian currency that it didn’t need. Some form of settlement currency that is acceptable to all is required – most likely the US dollar.

What are the challenges and potential risks?

Since trade rarely occurs instantaneously, some institution in the trade financing chain carries the exchange rate risk. Because of the gap between placing an order for imports and receiving them to sell in the local economy, there is a risk that the value of local currency will change relative to the currency in which the import is denominated.

In the “old” system, this risk is borne by the trader because everything is priced in dollars. The local currency value of the income from exports or the local currency cost of imports will change with movements between the local currency and the dollar, but the banks and those counterparts pricing in the dollar are protected.

Under the new system the same allocation of risk will remain in “external trade”. This currency risk is also present for intra-African trade.

An important question for the new African payment system is: who bears the exchange risk if one African currency depreciates relative to another? Should the importer carry the risk, or the exporter? Can and should the African payment system bear this risk of exchange rate movements itself? Where both currencies are volatile, traders might still prefer the relative stability of settlement through the US dollar.

The success of this system also depends on scale. The more trade settlement is routed through it, the easier it will be to settle in local currencies. Large currency imbalances will be less common. But until the system achieves this scale, the African payment system will need a strong balance sheet so that traders and participants can have confidence that settlement will be swift and risk free. It is unclear at the moment how this is to be achieved.

What is the best case scenario?

If the system can address the trade imbalance problem, provide clarity on risk management and reach scale, it could be very successful. But this is all going to be driven by underlying economic performance. Improved settlement will help but what is really driving this is the structure of trade. The more the economies of Africa can develop intra-African trade and the less dependent they are on extra-African trade, the less will be dollar dependence in trade. This growth in trade depends to some degree on trade settlement and trade financing but much more on production, consumption, trade policy and fiscal policy.

Christopher Adam is a Professor of Development Economics, University of Oxford


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