Agriculture Value Chains Strategy Presentation Southern Africa: Zambia, Malawi EWB National Conference Thulasy Balasubramaniam Hans Hesse Ka-Hay Law

Objectives Understand ‘value chain’, ‘market facilitation’ Understand the change EWB is aiming for and our strategy for creating this Relate to OVS work Make your brain hurt! Get excited!

Outline Get to know each other! Part 1: SA AVC Strategy Presentation Part 2: Case study: OVS Thulasy Balasubramaniam and staff capacity building at IDE

Part 1: Strategy

The Goal Meet Harrison Growing A prosperous rural livelihoods sector where smallholder farmers are participating productive in value chains and able to leverage agriculture for improved income Prosperous rural livelihoods sector where Dorothy benefits from participation

The situation Harrison works HARD…but he has: Limited access to inputs Poor quality output market Insufficient farm management practices In the past, agriculture projects targeted Harrison and NGOs tried to meet his needs. however, the challenges are systemic, and overall, markets are not functioning to benefit Harrison

What vision do we have?? Prosperous rural livelihoods sector where Harrison (and Dorothy) can improve his/her benefits from agriculture Government Private Sector: Agriculture industries Civil Society/ development sector

The situation Prosperous rural livelihoods sector where Dorothy benefits from participation Dorothy unable to leverage agriculture effectively for improved livelihood EWB’s AVC Focus Government Private Sector: Agriculture industries Civil Society/ development sector Government Under resourced Limited effectiveness (ex. 1:600 farmer:extension staff in Zambia) Private Sector Limited market relationships with smallholders, high transaction costs Does not see smallholders as viable market Civil Society/ development sector Intervening to help overcome market failure Important but we are not focusing on this at this point in time

Value Chains 101 Harrison: Vegetables Inputs: seeds, fertilizer Processor Wholesaler Finance ICT Useful Terms Market linkages Vertical ( different functions) Horizontal (same function) Support Services Ex. Transport ICT Finance Enabling Environment ‘rules’ formal or informal that govern behaviour Transport Enabling Environment

Value Chains 101 Harrison: Vegetables Inputs: seeds, fertilizer Processor Wholesaler Finance ICT Challenges: Market linkages are weak or non existent as communities are distant and poorly organised driving up transaction cost Smallholders not seen as viable market by private enterprises Smallholders not managing for economic benefits Limited support services Enabling Environment not set up to promote increased engagement with SH. Transport Enabling Environment

Market or “Value Chain Facilitation Harrison: Vegetables Inputs: seeds, fertilizer Processor Wholesaler Finance ICT Challenges: Market linkages are weak or non existent Smallholders not seen as viable market Smallholders not managing for economic benefits Limited support services Enabling Environment not set up to promote increased investment with SH Transport Enabling Environment MARKET FACILITATION Intervening NGO can help overcome these market failures but does not become part of it. Ex. convincing firms there is a SH market Providing strategic $ to reduce risk Almost like a dating service…!

Levels of Change Market/Value Chain Facilitation

Challenge: Organisational Capacity Increase in funding but capacity lagging Key issues: Knowledge of market facilitation Low field staff capacity * Requires high management capacity Knowledge management to adjust interventions Culture of learning/innovation

Traditional Agriculture ProjectMarket Value Chain Facilitation Approach ‘Known’ context (e.g., production, farmer and community level environment) Complex and dynamic system Limited ability to predict outcomes Activities are more like service delivery Linear set of activities Activities need to address overall systemic constraints Adjust to dynamic nature of market Organization needs to focused on learning and adjust activities Farmer focused Neutral position and catalyzing adoption and ownership within value chain players but not becoming part of it Relies heavily on agronomy knowledge Also needs business acumen

EWB: Improving Org Capacity Our model of capacity building: Long term High trust Focus on understanding field and implementation challenges Can bridge multiple levels of org

Part 2: Case Study

Private Enterprises Ex. Forest Fruits, Mzuzu Coffee Improvements on operations for direct impact on farmers Understand challenges of enterprises and opportunities for NGOs to engage more effectively

Focus for Refine and innovate on support ‘Proof of Concept 2. Understand and test 3. Continue to deepen understanding

Priorities for Organizational Capacity: Proof of concept – Field staff development – IDE, CARE, PROFIT, CU M&E systems – PROFIT, Mzuzu, CU, CNFA Innovate new approaches for support 2. Understand implications of project design and donor relationship pressures 3. Deepen understanding of field level realities (ex. farmer level behaviour, responses of interventions 4. Articulate challenges and successes

Summary Value chains important Capacity challenges of implementing organizations EWB’s focus on building capacity Come join us in Southern Africa!