The UN is conducting a Summit this week (Sept 25 – 27, 2015) to adopt the post-2015 Sustainable Development Goals (SDGs). These are meant to shape national level strategies for development and poverty alleviation for the next 15 years. The 17 goals include items like: ensuring gender equality, achieving food security, combating climate change, conserving forests and oceans; and much more.
The SDGs replace the Millennium Development Goals (MDGs), which were crafted and approved in year 2000, before the internet gained any real traction as a tool for development and the emergence of mobile money (in 2007) and the blockchain (in 2009). From this perspective it will be worthwhile to pause and consider how the SDGs will open business opportunities for serving the base of the economic pyramid – and others – in developing countries.
As part of the Summit there is a Sept 26 sub-meeting “Digitizing Payments and Inclusive Finance to Achieve the Sustainable Development Goals“. There are numerous explicit and implicit mentions of improving financial service delivery and using financial technologies in the areas of: agriculture/food security (Goal 2), access to health services (Goal 3), inclusive and equitable education (Goal 4), gender equality (Goal 5), economic growth (Goal 8), innovative business models (Goal 9), reduced inequality (Goal 10), and strengthening global public/private partnerships (Goal 17).
Given its impact on national GDP and the provision of employment/livelihoods for the 1.5 billion smallholder farmers worldwide, the agriculture sector has resonance with many of the other goals in addition to Goal 2. The UN’s Food and Agriculture Organization (FAO) and International Telecommunications Union (ITU), the Technical Centre for Agriculture and Rural Cooperation (CTA) and www.e-agriculture.org recently drafted a policy brief on “National e-Agriculture Strategies,” which will inform the Sept 26 sub-meeting as well as the overall Sept 25-27 Summit.
This policy brief accommodates the potential of mobile money and, by extension, the blockchain to have significant impact on targeted agriculture value chains where farmers live and work in off-grid rural communities. It seems clear the Sustainable Development Goals will create, at national policy levels, an enabling environment that will mitigate the political risks of any mobile money and blockchain related direct investments.
According to the GSMA, the apex organization for 850+ mobile network operators worldwide, there are more than 265 mobile money platforms worldwide. These platforms have saturated, or will soon saturate, the large urban city centers. The industry is now looking to expand into more agricultural and rural areas in pursuit of nationwide penetration, as well as achieve greater ROI. As such agriculture mobile money and related business model innovations are rapidly gaining traction, as has been documented by CTA’s recent research report.
Meanwhile, the specific SDG 10.7.c goal is to “reduce to less than 3 per cent the transaction costs of migrant remittances and eliminate remittance corridors with costs higher than 5 per cent, by 2030.” This goal seems a custom fit for blockchain-enabled international remittances by diaspora communities that the World Bank forecasts will be $700 billion by 2016.
The existing base of 265+ mobile money platforms in the large urban centers as well as the emergence of agriculture mobile money in rural areas presents the potential for a maximum scale out of blockchain-enabled international remittances that may then be converted into electronic fiat currencies and deposited into recipient mobile wallets. This business opportunity is discussed in closer detail in chapter 3 of CTA’s recent report as well as this blog about the blockchain and mobile money in developing countries.
The SDG’s will set the development agenda at national policy levels for the next 15 years. For those interested in doing business beyond Western Europe and North America, a close eye on this week’s UN Summit and the specific goals will inform any subsequent strategic business directions. Meanwhile, mobile money and the blockchain provide technological solution sets and business model innovations that can help improve the lives and livelihoods of the 4+ billion people at the base of the economic pyramid.