MARKET BASED APPROACHES CAPABILITY STATEMENT
Context Smallholder farmers in sub-Saharan Africa number around 33 million, represent 80% of all farms in the region, and contribute up to 90% of food production in some sub-Saharan African countries. They are often net buyers of food and very vulnerable to food price increases and spikes. Across the globe agriculture is a catalyst for growth and the development of essential infrastructure - helping smallholder farmers step up t o farming as a business and growing market opportunities of rural areas is key to our strategy. The poor are dependent on markets for their livelihoods and their participation in markets depends on value chains (VC). They are also largely disadvantaged by the way that most market systems operate. An improved market system offers more opportunities and sustainable benefits to the poor by enabling them to find their own way out of poverty. All smallholder farmers are dependent on market systems for their livelihoods, including often complex regional, local, subsistence and bartering markets. Farmers are often forced to trade within market systems that, as individual farmers, they have very little power to influence. Poorer farmers are particularly disadvantaged within market systems because of their very low level of bargaining power. Our agricultural work analyses the markets that smallholder farmers work within, so that farmers themselves can understand how they can benefit more from the markets they sell or trade within. We work with farmers, their organisations and other value chain actors to enable systemic change. This is a sustainable way to work with farmers, enabling them to find their own way out of poverty. Markets, and agricultural product value chains, are complex systems, involving multiple actors and incentives, constantly changing due to internal and external factors. Market systems approaches must therefore engage with a range of actors; from large-scale business investors to small businesses and informal sector actors.
Impact in West Africa (2017-2018) 67,885 farmers with increased yields 41,978 people that have established or improved their business with UP’s support 87,372 people with increased cash incomes 154 women’s garden groups (17,650 women) in the Gambia have increased capacity in nutritious cooking, production and processing.
7020 smallholders trained in farm enterprise management in Ghana
Where we work in West Africa
Our approach UP works in partnership with smallholders, civil society, private sector, government agencies and other actors across West Africa to implement impactful market based initiatives with the aim of increasing the resilience and improving livelihoods of some of the most marginalised communities in our target countries. We take a respectful, community and partner led approach that combines intelligent development with innovative ideas and approaches. UP recognises that a key weakness of many development initiatives is the unsustainability of the traditional three-year project, often subsidy oriented and that often does not integrate institutional or behavioural change or enable systemic changes to the market system concerned . The results is that often short term gains of project are not sustained.
Defining the interventions Market systems are complex and a unique tailored approach is needed for each intervention. Intensive M&E is required to ensure interventions are working and make adjustments as required. Some examples of our intervention points are given below: MARKET SYSTEM COMPONENT UNDERSTAND THE MARKET SYSTEM STRATEGIC FRAMEWORKS AND POLICY
EXAMPLES OF HOW IT WORKS A first step in a market systems approach is to understand the system and tackle underlying causes of market failures rather than symptoms. In Guinea we use the Market Analysis and Development approach (see below), a framework for participatory analysis that involves local actors combined with Making Markets work for the Poor (m4P) The regulatory environment for markets often disadvantages smallholders and the poor. in Ghana we advocate at District Assembly level for improved standardisation of weights and measures in maize and cassava value chains. Smallholders are often disadvantaged by
VALUE CHAIN PLATFORMS
ACCESS TO INFORMATION
CAPACITY BUILDING IN ENTERPRISE DEVELOPMENT.
unregulated packaging/weighing processes that see them unable to ascertain whether they have received the appropriate price for the quantity of product sold. District assemblies are targeted as they have a key role to play in enforcing the use of weights and standards. By integrating policy change with other interventions we expect to increase beneficiary agribusinesses turnover to by at least 30%. In Gambia we worked with women producer groups to build their capacity to advocate for fairer loumo or local market prices and for more of the proceeds to be invested in basic market place infrastructure, strengthening links between women producer groups and a gender focal point in local government. Getting market and value chain actors to understand the constraints and opportunities for better smallholder participation can enable systemic changes. In Ghana, we established 7 Value Chain Platforms in Brong Ahafo region in maize, cassava and cashew. These value chain platforms offer a valuable opportunity for key stakeholders to discuss issues and potential solutions (with tangible action plans against them). Stakeholders have included farmers, transport and other service providers, Ministry Of Food and Agriculture officials, input providers, Agricultural Extension Agents, Off-takers and other buyers. Issues raised have included low levels of production, post-harvest losses, market access and maintenance of processing equipment. Next , we will support stakeholders to collectively and inclusively address issues presented through their solutions, and to continue to strengthen relationships so that they remain after the end of the project. In Gambia we are working with government, civil society, private sector and FAO to form a national food fortification alliance. Access to information is a common and significant challenge faced by smallholders and other value chain actors. When farmers lack information about the weather they may be unable to plan when to plant seeds, apply fertiliser or harvest their crop. When they do not know the current price of fertiliser, or of maize they may be overcharged for inputs or inadvertently undersell their produce. When they do not know the current price in markets they are not able to negotiate well with traders or make decisions on which market to sell. Poor quality and quantity of agricultural extension services in our target areas is also a barrier to increasing smallholders’ knowledge of improved agricultural practices, including climate smart adaptations. In Senegal, UP supports Jokalante, a social enterprise established in 2016. Jokalante uses ICT- enabled technologies to demonstrate the impact of a range of accessible low-cost agricultural inputs that have doubled crop yields for the poorest farmers in field trials, extending information about these practices to many more farmers. So far, over 12,000 farmers across 11 of 14 regions in Senegal have adopted the improved practices as a result of appropriate information campaigns. In a separate project in the Gambia, Jokalante works with UP and the Ministry of Agriculture and regional horticulture producer federations to enable vegetable producers (particularly women) to access regular, accurate market price information to their mobile phone in local language. This will enable 2,500 producers to plan and sell their vegetables more effectively, leading to improved incomes. Already there is evidence the information is being used to broker better prices with traders. Producer groups, cooperatives and other structures have great potential for enabling participation of the poor in markets that they cannot reach on their own. In Guinea, for example, we are recognised leaders in the Market Analysis and Development (MA&D) approach and were the first to apply the approach to the WASH and agriculture sectors in the country. UP worked to increase market shares and incomes for 1560 rural producers (1412 women) through enhanced business skills, organisations, advocacy and lobbying capacities. We also helped to reduce barriers to entry in Non-Timber Forest Product (NTFP) markets for poor rural traders through enhanced collaboration, exchange, networking and strategic partnerships along the NTFP value chain. We focused on building capacity in resource management, harvesting and domestication for target entrepreneurs leading to sustainable NTFP supply chains. By the end of the project we had supported 64 enterprise groups to develop business plans. All groups met or exceeded their financial projections and their income ranged between £236 and £551. All groups stated that they had
POWER IN NUMBERS
PARTNERSHIP
ENTERPRISE DEVELOPMENT
GENDER MAINSTREAMING
improved access to market information at the end of the project, and that they were able to sell their products in new markets. UP recognises the value of power in numbers; the communities we work with often feel marginalised, excluded from decision making, and exploited or lack negotiation skills to get better returns from private sector actors. Therefore, we help to strengthen associations, networks and groups to enable them to have a greater voice in issues that affect them, to facilitate aggregation, collective marketing/negotiation and sometimes community savings schemes. In the Gambia we are implementing a project that aims to increase and diversify production, strengthen value chains, improve market access and consumption of fortified and high micronutrient foods for 18,000 rural households in 5 regions of the Gambia. We aim to help establish and support 300 mothers clubs through the project. They are responsible for improved cooking demonstrations and nutrition education for mothers of under five children, lactating mothers and pregnant women. Women were invited to training on good governance and group management to help improve the groups’ running. They are also trained on the agronomy of the Orange Fleshed Sweet Potato, Pearl Millet and African Leafy Vegetables, while the project will also help the groups to develop business plans to operate pearl millet mills as a viable enterprise option. More widely the project included a gendered market survey into barriers and opportunities experienced by men and women through the value chain. Our initiatives establish and facilitate mutually beneficial partnerships between private and public sector, producers, service providers and buyers, recognising the key role played by each link in the chain in order to make markets work better for the poor. UP also works in partnership with other key actors, recognising the value of engaging affected stakeholders, drawing on varied expertise and taking a holistic approach. For example in Ghana we engage District Assemblies to ensure that they are involved in identifying key stakeholders, integrating their needs in planning processes, and involving them in problem identification and solutions. In the Gambia, marketing federations play a key role in building capacity of mother’s groups in nutrition, as well as marketing, project implementation and networking with government departments, private sector and other NGOs. In Guinea we engaged artisans, carpenters and a packaging company (Afripack) to improve NTFP market performance. This included building the capacity of artisans in manufacturing locus bean nut shellers, which previously did not exist in Guinea. 30 carpenters were trained on how to make and use solar dryers and fermentation tanks. To compliment this, women received training on marketing and how to negotiate with Micro Finance Institutions to present their business models of using the new locally fabricated processing equipment and obtain credit. The smallholders we work with face the parallel challenges and opportunities of limited business management, financial and marketing skills, but also the significant potential of increased access to ‘pro-poor’ markets and a structured, smart approach to agri-business. Therefore, across our projects we integrate capacity building in enterprise development. As well as capacity building in business development, UP takes a holistic approach to building the capacities needed throughout the production, processing and selling process. For example in Ghana we work with established Village Savings and Loans Associations to build capacity in: improved agricultural productivity and production (including climate smart agriculture and integrated soil fertility management; cassava processing); farm enterprise management (including developing crop budgets, farm record keeping, farm business pans, collective marketing, contract management); aggregation centre management; how to access post-harvest management; agricultural standards and use of weights and measures; and participatory methods for use by district assemblies in planning legislation and budgets relevant to smallholders. We expect to build the capacity of 10,000 smallholder farmers and 500 agro entrepreneurs. UP’s West Africa Programmes are working to build on our existing gender mainstreaming approach to ensure that markets work for everyone, including women. We often target value chains in which women are dominant in the production and/or processing chain. For example, shea nuts and butter and cashews in Ghana, non-timber forest products and vegetables in Guinea and Senegal and horticulture in Gambia. We work
with men and women to improve women’s access to and control over resources (including financial services and credit, land, inputs and other assets). We also integrate opportunities for women to build skills, opportunities and confidence to participate in decision making, including through marketing federations in the Gambia, vegetable grower groups in Guinea and aggregation centres and parkland management committees in Ghana. We approach project design and evaluation in a participatory way, working to ensure that the specific needs of women are heard and acted on. Capacity for Gender mainstreaming is a key internal priority for West Africa over the coming years.
MA&D summary: MA&D includes several phases that guide entrepreneurs though a simple and clear process to plan and develop their enterprises. MA&D is a framework that can be adapted to various contexts and sectors. A key principle of the approach is that potential entrepreneurs must be the primary actors in planning and implementing their enterprises; UP assists and guides the potential entrepreneurs. MA&D pushes entrepreneurs to assess the sustainability of their whole business environment. Sustainability in the MA&D context refers to processes that increase economic benefits and improve livelihoods, without causing negative social or environmental impacts. Sustainability also refers to the resilience of entrepreneurs themselves – to their capacity to react and adjust to ever changing markets. Capacity development is also key in the process. Necessary expertise includes production or resource management, marketing, enterprise management, business plan development, financial strategy and management and engaging with technology or polic issues. It includes raising the capacity of entrepreneurs themselves but also other actors including government officials, suppliers, NGOs and service providers. Finally, facilitating strategic alliances to stimulate and facilitate improved links between small enterprises, markets, service providers and policy processes. A unique selling point of the approach is that it purposefully aims to benefit and include (“crowd in”) each of these actors.
Our Track Record COUNTRY PROJECT TITLE PROGRAMME GHANA Partnership for Accelerated Local Economic Development in Brong Ahafo GHANA Breaking the Poverty Chain through Selfsustaining, vibrant communities in Krachi Districts GHANA Northern Ghana Shea (NGS) GUINEA GUINEA GAMBIA
GAMBIA GAMBIA GAMBIA
SENEGAL
DONOR, VALUE, START/END DATES European Commission (EC) - € 882,433.91 16/1/2017 - 16/6/2020 Big Lottery Fund - £477,272.46 1/3/2015 - 28/2/2020
MCFEA (Mitsubishi) - £135,000 – ongoing. Social enterprise Développement de la Filière Maraîchère en EU, through G44 – total budget €605428 - 01/01/2017 – Basse et Haute Guinée (DEFMA) 31/06/2020 Building markets for the poor: sustainable tree Big Lottery Fund - £660,000 – products in Guinea 01/03/2014 – 28/02/2018 Building on Success: Scale-up Marketing Gambia Ministry of Information System for Horticultural Agriculture/Nema/IFAD Producers 4,905,274.83 Gambian Delasi 13/07/2017-12/07/2019 Improved Horticulture Irrigation for Market- Nema/Ministry of Agriculture /IFADOriented Enterprises 24,972,038.81 Gambian Delasi 13/07/2017 – 12/07/2020 Inclusive Business Opportunities for EU - €299,862 - 01/01/2018 – Economic and Social Empowerment of 31/12/2020 Women in URR Reducing micro nutrition deficiencies in EU - €2.647.983,75 01/02/2017Women and Children in the Gambia 31/01/2021 through sustainable and integrated approaches to food fortification (Biofortification) New Alliance ICT Extension Challenge Fund USAID - $1,698,019 - 25/03/2015 to in Senegal 24/03/2019