Friday, 01 July 2022 04:41

Food Security, Ministry of Agriculture Encourages Agricultural Digitization and Rural Agriculture Financing

The threat of a food crisis and the Covid-19 pandemic over the past two years has changed the food logistics system in several countries. For this reason, cooperation between countries is needed in efforts to overcome hunger, achieve food security, improve nutrition and promote sustainable agriculture in accordance with the goal of Sustainable Development Goals (SDG) number 2. Various technologies and innovations are developed to increase food production and maintain national food security. One of them is through the application of agricultural digitization and rural agriculture financing in the food production chain to marketing (off-farm). “The threat of a food crisis is still a global concern after going through the Covid-19 pandemic and facing the conflict between Russia and Ukraine. So that the application of digital technology in agriculture plays an important role in improving agricultural performance," said the Secretary General, Ministry of Agriculture, Kasdi Subagyono as Chair of the Agricultural Working Group (AWG) when opening the Join Webinar "Enhancing Digital Agriculture and Rural Finance for Food Security" virtually, Tuesday, (28/6/2022). According to Kasdi, agricultural digitalization, which is currently being developed to address people's concerns, is widely used to increase food productivity in each country. A basic data system for rural areas as a facilitation of agricultural services and technology as well as access to finance and agricultural management is needed to support digital infrastructure. "The application of digital technology in rural finance is also increasing and plays an important role in rural transformation," said Kasdi.

Kasdi said that the application of digital technology also contributed to strengthening the economic recovery of the community from the Covid-19 pandemic, being more inclusive and collaborative. "The application of technology can create digital economic value so that the use of digital technology is more inclusive in accelerating economic recovery, especially for the development of MSMEs and financial inclusion," he said. In addition, according to Kasdi, the application of technology also has an impact on the development of digital literacy and skills that are more inclusive and productive. "Sectors that contribute as a source of new economic growth also accelerate economic recovery," he added. Furthermore, Kasdi explained, digital agriculture itself allows for increased productivity and production efficiency both in terms of supply chains and licensing in increasing market opportunities. "What is certain, participation of actors in the agricultural supply chain, including women and youth in the regions is mandatory,” he stressed.

To meet the right balance between economic growth, poverty reduction, and environmental sustainability, Kasdi said that the availability of capital resources needs to be managed properly. "Availability of financing to support rural development is highly recognized as the main requirement to encourage agricultural development in rural areas," he said. Meanwhile, the Deputy for Development Funding at Bappenas as Chair of the Development Working Group (DWG), Scenaider CH. Siahaan, revealed that there are two most challenging obstacles faced by small-scale farmers, especially in rural areas such as the importance of accelerating digital transformation and increasing catalytic investment, especially rural financing. “Living in this era, the potential of digital technology can no longer be ignored. Even so, it is still inaccessible and underutilized,” he said. Ten percent of rural people who have access to basic formal financial services, according to Scenaider also create a capital gap to reach the agricultural sector. “These two are some of the main challenges and will be seen as opportunities faced by farmers in developing countries,” added Sceneider.




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