Do green finance and digital technology matter for sustainable agricultural development? Insights from sub-Saharan Africa

Abstract

Sustainable agricultural progress is one of the world’s greatest challenges in the twenty-first century as the global population is estimated to rise to over nine billion by 2050. Over the years, the Food and Agricultural Organization (FAO) and the African Union (AU) have sought prosperous African Policies based on sustainable agriculture and inclusive growth. Additionally, the AU has adopted the Comprehensive African Agricultural Development Programme (CAADP) policy framework. Given the growing need for innovative policies and studies to reduce the negative environmental effects of agricultural development in Africa, this paper investigates the significance of green finance and digital technologies on green agricultural growth in sub-Saharan Africa (SSA) from 2003 to 2018. Analysis of panel co-integration estimates indicates all variables are integrated. Using the panel-corrected standard errors estimator for long-run equilibrium co-integration assessment, the outcomes indicate mitigated green finance (MGF), internet and mobile phone use (IMU), as well as sustainable energy utilization (RE), individually and collectively exert a positive effect on agriculture, forestry and fishing value added (AVA). Additionally, panel causality estimates indicate (i) a bi-directional causality between MGF and AVA. (ii) A uni-directional causality running from IMU towards AVA without any rebound effect. For policy insights, the AU could urge member states to implement macro-policies to increase agricultural green credit to sustain food production and employment generation. Similarly, the FAO and AU could provide technical support in digital agricultural research and value chains towards ensuring sustainable agriculture development in SSA.