1. Benchmarking the Business of Agriculture
Using Indicators to inform better Agricultural Policies : an opportunity for a partnership between the WBG & and the UK Development Sector
Grahame Dixie
Agribusiness Adviser
World Bank
June 26th

2. Benchmarking the Business of Agriculture Components
Deep Dives Studies
BBA components
Doing Business in Agriculture
Agribusiness Indicators (ABI)
Doing Business

3. Results show strong convergence across economies since 2005
Doing Business Project
Results show strong convergence across economies since 2005

5. Benchmarking the Business of Agriculture (BBA) as part of the larger “Agricultural Transformation Index (ATI)
ATI
ATI
ATI
ATI
BBA
Productivity
Sustainability
Gender
Etc..

6. Overview of Benchmarking the Business of Agriculture (BBA)
Objective: “To inform & to leverage policy reforms which lead to a more modern agriculture sector, built primarily on the basis of commercially viable family farms”
Key elements
Focusing on 8 strategic areas: inputs, finance, transport, energy, communication, markets, land & water
Will benchmark countries on short term regulatory and implementation issues, plus longer term policy, investments & important metrics
Program will operate over a purposeful sample of 80 countries,
1st year pilot : will fine tune the process & indicators in 10 countries, prior to large scale roll out

7. What is Doing Business in Agriculture (DBA)?
Focuses on laws and regulations affecting the business of agriculture and their enforcement
Provides actionable indicators, which are consistent over time and comparable across economies
DBA indicators allow countries to benchmark their agricultural regulatory framework on the books and in practice
What are the Deep Dives?
Builds on the lessons from Agribusiness Indicators (ABI) project on productivity, market access, and policy environment for agriculture
Take a broader and longer term view , beyond regulatory items aim to shape future policies
Identify presence or absence of key policies and the policy setting process,
Generate key metrics which to enable policy makers to better understand, measure & benchmark their county’s position & tracks change over time
Highlight successful examples of positive policy induced change

8. Doing Business in Agriculture
Benchmarking Business of Agriculture - Transporting Agricultural Goods
Integrated
approach
Licensing of trucking operations
Restrictions on foreign transport competition
Legislative framework for rural road financing ….
Doing Business in Agriculture
Access to quality rural roads
Public expenditure on road maintenance
% of rural population within a certain number of hours to urban market ….
Deep Dives Studies
Synergies
new actionable indicators on rural transport

9. The agro-industry supply chain helps understand key drivers for a commercial agricultural sector in the future 1 2
LAND
MARKETS
Contract farming
Dist. Infrastructure
“Regional’ trade
INPUTS
Seeds
Fertilizers
Mechanization
PUBLIC GOODS
Water
Electrification
Roads
ENABLERS
Transportation
Finance
ICT

10. Facilitating access to Market Opportunities,
Project Plan
Policy Priorities:
Facilitating access to Market Opportunities,
Needs strong, competitive, professional, & market orientated farming base,
Effected by:
A country’s position on the path of transition from agriculturally based to urban based economies.

11. Country segmentation based on agriculture’s role in the national economy, provides deeper insights into the transformation of the agro-industry
Ag based
Trans. 1
Urbanizing
Developed
Trans. 2
agriculture role as an engine of growth& poverty reduction
Agriculture’s role direct producer/ agribusiness relationships & creating good jobs
Encourage growth in agriculture & the rural non-farm economy
WB Development Report 2008
Source WB, FAO CIA

12. Source; BBA team calculations
Regions are at very different stages of agro-industry transformation – SSA, and to a lesser extent EAP and SA, are at the earliest stages 9 14 19
Source; BBA team calculations

13. Source WB, ILO and FAO

14. Urban Pop Non Farming Rural Pop Farming Pop Growth in Agri-Industry
Static growth in Farming
Source: WB, USDA; NOTE: 2000 data

15. Global food demand on agro-industry supply chains will be shaped by urbanizing populations & richer diets in developing regions
Global Food Demand
~ +70%
2050 VS 2010
FAO

16. Urban food demand will be the predominant challenge for future agro-industry supply chains in developing regions
Source: BBA Team extrapolation of UN population and FAO per cap kcal forecasts

17. FAO, multiple research papers
Who will supply this demand: the need to segment Smallholder farmers as they are not a homogenous supply base, but when area farmed plus marketable surplus are overlaid, the large and medium scale small holders offer the greatest potential
80% +
10 -15%
30-50%
Marketable surplus
Large SHF
Medium SHF
Small SHF
FAO, multiple research papers 17

18. The urban food market provides an exciting opportunity but:
Without a strong & competitive supply base:
Producers increasingly distanced from urban demand:
Poverty will increasingly be an urban issue:
The key driver is outside the control of agriculture:

19. Key elements in the improving enabling policy environment
Capable and competitive farm base - credit for investment, access to improved inputs, greater skills, mechanisation
Market Insights - market knowledge, strengthened producers organisations,
Market access infrastructure – roads, distribution, market places
Land, water, energy availability - regulations to facilitate a secure & efficient land market, access to irrigation, electricity
Agribusiness capability - enabling business environment, access to finance, electricity, water, contractual relationship for raw material
International, regional market capability – facilitating trading across borders, harmonised quality standards,

20. Refinement of indicators, additions, refocus,
Time Line :
Preparation
Field Work
Analysis
Expert Review
Dissemination
Feed back
July
Sept
Dec
March
June
Country selection,
Refinement of indicators, additions, refocus,
Local collection of information,
Creation of cadre of country respondents,
Capacity building program, use of indictors to inform policy & empirically based policy dialogue

21. And if you have been . . .
Thanks, for listening

22. Priority Policy Outcomes
Area
Priority Policy Outcomes
Access to Markets
Ability of farms & firms to respond to domestic urban demand growth  
Enablement of producer organizations to participate in domestic market supply
Maximization of regional trading opportunities
Land
Ability  for farm land consolidation & expansion
Certainty & enforcement of tenure security and rights
Access to Finance
Lender flexibility to serve small/medium farms &firms sufficient protection for loans
Increased collateral flexibility for small farms and SME agro-enterprises t
Increased availability of institutionalized credit support services
Transport
Access to quality rural and trunk road infrastructure
Efficient transport services for agricultural goods
Reduced transport prices and time-distance to markets
Water
Adequacy of farmer access to irrigation 
Efficient use and equitable affordability  of irrigation
Adequacy of industrial water supply
Electrification
Adequacy of farmer & agribusiness access to electricity
Efficient use and equitable affordability  of power supply
Reliable and consistent power supply

23. Priority Policy Outcomes ICT
Area
Priority Policy Outcomes
ICT
Communication
Expansion of ICT services to farmers & agro-enterprises
Increased innovation in ICT services & expanded applications for agriculture & agribusiness
Seeds
Systematic ‘refreshing’ of quality commercial seed varieties
Ability to source & access best commercial seeds from all potential supply sources (including foreign suppliers)
Favorable business environment conducive for private sector participation
Fertilizer
Affordable access to soil testing  
Adoption of appropriate nutrient programs , macro & micronutrients 
Sufficient; accessible and affordable  nutrient supply for all commercial farmers
Mechanization
Affordable, access to mechanization services for all farmers
Ability to sustainably achieve expected performance  
Increased innovation  in locally relevant mechanization

24. ASFG Pillars: Recommended Policy Focus - 1
Topic
Equitable free market agriculture
Smartly supported SHF agriculture
State defined agriculture
Sustainable agriculture
LAND
Land title, registration
Recognition of customs, international guidelines
Tenure security, esp.VGs*
Sustainable mgmt. of common property resources
WATER
Infrastructure $$
Water use policies
Governance of private water resources
‘Land grab’ implications on water rights
VG H2O rights protection
Development of on-farm water management and water harvesting technologies
INPUTS , CREDIT
Access by women farmers
Recognition of SHF voice
‘Smart’ SHF support (e.g. smart subsidies)
Parastatal access to inputs
SEEDS
Rights to access own seeds
Right to breed freely
Support to entrepreneurs
Access to ‘climate smart’ seeds
FERTILIZERS
Incentives for wide(st) fertilizer distribution and advisory services
ISFM R&D
ISFM supply incentives
Smart subsidies for agro- eco technologies
CREDIT
Incentives for innovative products (e.g. contracts as collateral)
Incentives for SHF financial literary training
Incentives for SHF friendly products (e.g. agricultural development banks)
* VGs – Vulnerable Groups – women, other disadvantaged

25. ASFG Pillars: Recommended Policy Focus - 2
Topic
Equitable free market agriculture
Smartly supported SHF agriculture
State defined agriculture
Sustainable agriculture
MARKETS
Boost local demand
Fair international trade (West’ subsidies, tariffs, production incentives)
Public extension service training on contracts, international markets participation
Preferential procurement of SHF output, especially VGs
R & D
% Ag budget for R&D
Incentives for private sector R&D
SHF recognition in R&D agenda
R&D for sustainable agriculture
EXTENSION SERVICES
Up to date extension curriculum, e.g. climate smart, gender, mkt access
Public extension service coverage, incentives for private alternatives
COLLECTIVE ACTION
Governance of producer organizations
Protection of ‘non-legal’ cooperatives’ rights
Recognition of VGs*
Incentives for SHF collaboration and collective action
Legal requirement and incentives to include VGs in producer organizations
Legal requirement to assess SHF impact of economic reforms
* VGs – Vulnerable Groups – women, other disadvantaged

26. Doing Business in Agriculture
Benchmarking the Business of Agriculture: integrated approach
Integrated
approach
benchmarks of regulatory environment 0n business of agriculture
Comparable across economies over time
Doing Business in Agriculture
In-depth metrics of a broader range of factors
Comparable across countries, but greater flexibility
Deep Dives Studies
Synergies
new actionable indicators for policy makers, public officials, and private sector investors; Leverages policy change

27. The urban food market provides an exciting opportunity but:
Without a strong & competitive supply base:
easily lost to imports ,
Agri-processing cannot establish without raw material suppliers,
Producers increasingly distanced from urban demand:
Market servicing becomes more important, & difficult,
Transport and post harvest gain greater significance,
As does quality, quality standards , food safety & changing demand ,
Market Knowledge is vital
Poverty will increasingly be an urban issue:
provision of staple foods at sensible prices ever more critical,
absolute need secure & stable supplies
The key driver is outside the control of agriculture:
The money in the system – growth in larger economy