121001 virtua lmmarketsystempptarmourrj

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121001 virtua lmmarketsystempptarmourrj

  1. 1. VIRTUAL mMARKET SYSTEM REDUCING TRANSACTIONS COSTS TO BRIDGE THE ECONOMIC DIVIDE Armour RJ, Bloemfontein jack.vslandbou@gmail.com
  2. 2. -Access to MarketsThe Problem: -Access to Finances -Access to Information• Dualistic Agricultural sector in South Africa National food security & 30 000 Commercial farmers International Trade (forex) Small Scale farmers 300 000 mostly former homelands Local food security? Household and backyard Household Food Security? 3 000 000 gardeners / Food Sovereignty?• Factors affecting Markets Access: – Transactions costs – Economies of scale – Gap between the formal and the informal markets
  3. 3. Literature Review:• Groenewald (2003) Conditions for successful Land Reform: “Complementary services and infrastructure are needed in the form of improved access to financial services, markets and inputs and also improved transport, health, communications and other infrastructure.”• Dr E. Gabre-Madhin (2006) AEASA Simon Brand Memorial Address, then Program Leader for Ethiopia’s Development Strategy and Governance, now CEO of Ethiopian Commodity Exchange, stated : “the 2nd revolution will be in markets: – “New exchanges” (self regulated) – “086 Ag-trade network”, – low cost V-SAT technology making rural entrepreneurs into knowledge brokers. – A warehouse / silo = a potential bank!”
  4. 4. WEF research 2009-11BostonConsultingGroup
  5. 5. “Mobile communications can help to meet the challenge of feeding an estimated 9.2 billion people by 2050.The 12 specific opportunities explored in this study could increase agricultural income by around US$138billion across 26 of Vodafone’s Markets in 2020.” - Sept 2011
  6. 6. ICT / services Gap• Grameen Foundation AppLab MTM Uganda case: – Google Earth has the GIS positioning Technology – Google Trader has the virtual trade platform – Google sms provides the extension platform – Grameen Bank - micro-finance (MPESA in Kenya)• OPPORTUNITY: – Integrated solution with central database, – Incentivizing NARYSEC & extension officers – Corporate social responsibility, – Targeted GeoTag Advertising
  7. 7. The proposedVIRTUAL mMARKET SYSTEM
  8. 8. CONCLUSIONThis paper is a plea to bridge the industry and digital divide: •Between farmers, agricultural & social development researchers, extension officers, Government officials and agri-business practitioners and the often very distant ICT applications programmers and developers.NAMC, the Meraka institute mLab and Mobile operators arekey stakeholders in SA.Working together as an integrated team and with thecorrect structures and systems in place, we could do farmore toward achieving Improved Livelihoods and FoodSecurity in South Africa and beyond.
  9. 9. Key ROLE-PLAYERS:Research Corporate Finance Supplier development fund
  10. 10. Thank You! Armour RJ, Bloemfonteinjack.vslandbou@gmail.com

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