UNCDF carried out an inception study to understand selected market systems of target sectors, to identify how to appropriately address underlying market constraints using digital interventions that lead to improved efficiency, effectiveness and sustainability.

In line with its strategy ‘leaving no one behind in the digital era’, UNCDF, with the support of Sweden, aims by 2024 to empower at least one million Ugandans in rural communities to use services that leverage innovation and technology to contribute to the achievement of the Sustainable Development Goals (SDGs). The strategy, focused on “building inclusive digital economies”, aims to harness the power of digital tools in building sustainable livelihoods for underserved communities.

In the first year of implementing this strategy (2019), we asked the key stakeholders and ourselves how we could help address some of the most challenging market dysfunctions in the agriculture, digital, education and health sectors.

To get more insight into this, UNCDF carried out an inception study to understand selected market systems of the target sectors, to identify how to appropriately address underlying market constraints using digital interventions that lead to improved efficiency, effectiveness and sustainability.

By using the Market Systems Development (MSD) approach, UNCDF seeks to:

• Leverage the role and behaviour of players in the marketplace while supporting them to innovate, and improve on their current initiatives.
• Strengthen systems and relationships among the various market actors. From the outset, UNCDF recognized that improving the lives of the poor – that is, stimulating growth and expanding access – means transforming the systems around them that restrict access and block growth. We were also cognizant of several pre-existing research studies and analyses on the programme target sectors on how digital innovation can create impact for vulnerable communities.

Beyond the insights gained into the market systems that influence the agriculture, education and health sectors in Uganda, this report also highlights the methodology used by UNCDF to identify key constraints in the access to and usage of digital platforms by underserved communities in various market systems in the country. The report provides insights on how market dysfunction and underlying constraints in the real economy sectors (i.e. production, purchase, and flow of goods and services within the general economy) are impacted by the digital economy.

This process has taught us one important lesson: that we cannot ignore the significance of using a coherent approach to understand and intervene in the right market systems with the right interventions to ensure that markets function more efficiently and sustainably for targeted segments of the population. Market diagnostic is an ongoing process in an MSD project, and the inception study is the first step in that direction.

To learn more, read full report HERE.