Experts press digitalization of food chains in Asian cities

IF governments could raise their investments efforts in the digitalization of their food chains, experts from the Asian Development Bank (ADB) believe that food supply in cities will stabilize and incomes will increase in rural areas.

In an Asian Development Blog, ADB Director, Environment, Natural Resources, and Agriculture Division, East Asia Regional Department Qingfeng Zhang and Senior Natural Resources Economist, East Asia Department Jan Hinrichs said as digital technology role expands in society, efforts to digitize supply chains become imperative.

The authors said the raging pandemic has acted as a catalyst to increase the role of digital technology in improving and adapting the supply chain to the needs of the times.

“With social distancing and quarantine measures not likely to be going away any time soon, food supply chains require further digital innovations to be ready,” Zhang and Hinrichs said.

The authors said these investments should be made in public sector food safety and quality certification to service decentralized and digitally connected food value chains.

Zhang and Hinrichs also said investments are needed to make food processing supply chains more digitally connected with alternative logistics providers to ensure resilience.

“There is no doubt that digitization has helped improve existing supply chains and catalyzed supply chain restructuring. However, key enterprises and supportive government policies are the drivers for the evolution of food supply chains to be more robust to restrictions such as Covid-19,” they said. 

They noted that in the past few months, some farmers have been able to sell their products directly to consumers. However, these farmers only include those with online marketing skills and those who grow food products that do not require complex processing and packaging.

Zhang and Hinrichs said that unfortunately, based on a recent study, it was found that in Southeast Asia and East Asia, only a few farmers who have smartphones capable of harnessing e-commerce applications.

This means, they said, that small-scale farmers cannot be expected to attend to production management, or specialize in the online marketing of their food products.

The authors said giving farmers access to e-commerce is not that simple. Zhang and Hinrichs said this requires standardizing production, organizing farmers, and building logistics capacity in remote areas.

Currently, they said only the private sector has a comparative advantage in expanding and adapting e-commerce and other platforms into food supply chains.


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