How tech can make Ethiopian coffee more competitive

Ethiopian tech companies are using drones, remote sensors and innovative funding schemes to change the way that farmers do business, under a four-year ITC programme launched at the African Technology Expo in Addis Ababa.

The tech entrepreneurs are now linking with coffee farmer groups through ITC’s Alliances for Action network. As the birthplace of coffee, that crop holds enormous economic and cultural significance.

“Coffee is at the heart of our culture and of our social fabric,” said Adugna Debela, who heads the Ethiopian Coffee and Tea Authority.

“It is the backbone of our economy, accounting for one quarter of our export earnings.  The country is the largest coffee producer in Africa and the fourth leading producer in the world,” he said.

ITC attaches so much importance to coffee in Ethiopia that it’s working on an Amharic transition of its Coffee Guide.

“This is a first in the history of the Coffee Guide and will be a milestone for Ethiopian coffee stakeholders, making a wealth of data, information and tools available and accessible to them,” Debela said.

Well-known constraints prevent Ethiopia from reaping from economic gains from coffee, but work has already begun under the Netherlands Trust Fund V to look for solutions. The project already plans to work more with farmers and cooperatives so that they can roast and grind beans locally, increasing the value of their exports.

All of this work aligns with Ethiopia’s own plans for growing its coffee industry.

“NTF V in a nutshell works to develop the tech sector and the coffee sector with a special focus on harnessing the power of digital to transform agribusiness,” said Robert Skidmore, who heads the ITC Sector and Enterprise Competitiveness Section.

Lersha, for example, receives support to improve its digital platform that allows farmers to access supplies or hire machinery. Anabi Agritech Solutions embed sensors in beehives to ensure the best conditions for making honey. And Debo Engineereing uses drones and mobile apps to watch for signs of diseases that could harm crops.

“The upside of using technology in agriculture is enormous, and the current global food price inflation is just making the need for innovation to scale agricultural production and transformation more acute,” Skidmore said.
 

Ethiopia’s opportunities to benefit from outsourcing

Holding the launch on 7 September to coincide with the expo gave space for the companies to discuss their work and look at ways of overcoming challenges like the cost of data. Satellite imagery is too expensive for many new companies.

And even cellular data costs can run too high for businesses to make a profit by connecting devices wirelessly across farms and networks.

Outsourcing also holds potential for Ethiopia, as the gig economy opens opportunities for local entrepreneurs to pick up jobs anywhere in the world. With the shift to remote work since the pandemic, Africa has become even more attractive for these jobs, given the availability of languages, a young population and some of the lowest labour costs globally. This is where the NTF V Ethiopia Tech project will put the emphasis, applying ITC’s FastTrackTech methodology to support the internationalisation of tech startups.

On the other hand, the programme’s approach in agribusiness runs from the bottom-up, building on the Alliances for Action ethos of forming ethical, climate-smart value chains support sustainable farming.

“It focuses on promoting sustainable practices at every step of the coffee value chain, from seed-to-cup,” Debela said. “It also promotes the use of digital applications amongst producers so they can scale up their operations, reach more partners and raise and diversify their incomes.”

Ethiopia’s government has laid out policies to support the country’s digital economy, which supports broader development goals.

“The government of Ethiopia launched its digital transformation strategy with the goal of leveraging digital technologies to foster development and growth for every citizen,” said Belete Molla, the minister of innovation and technology.

“The government has prioritized digitalization and is willing to go the full distance to its implementation.”

The Netherlands Trust Fund V (NTF) (July 2021 – June 2025) is based on a partnership between the Ministry of Foreign Affairs of The Netherlands and the International Trade Centre. The programme supports MSMEs in the digital technologies and agribusiness sectors. Its ambition is two-fold: to contribute to an inclusive and sustainable transformation of food systems, partially through digital solutions, and drive the internationalization of tech start-ups and export of IT&BPO companies in selected Sub-Saharan African countries.