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Table 4-13 – Agri-Processing and Manufacturing Action Plan
While the Makueni Processing Plant has demonstrated the viability of the agri-processing sector in the County, including buyers in Ethiopia and Egypt, stakeholder engagement suggested that surpluses still remain high during the mango and orange season. Middlemen often take advantage of the situation and buy the fruits from farmers at a lower cost. To address such issues, the Sector Action Plan (outlined in Table 4-13) should be viewed as a practical sequence of actions to support the development of the agri-processing and manufacturing sector, taking account of the Municipality’s existing strengths and weaknesses. The individual actions are presented in detail at each stage, including several best practice case studies to exemplify how these schemes can be implemented effectively within Wote Municipality.
The Plan commences with the soft initiatives, training and capacity-building interventions (Section 4.3.2) recommended to best position the emerging sector to benefit from the inclusive and climate resilient infrastructure proposals (Section 4.3.4) and the anchor project Agri-Processing in Kalamba, which are proposed to enable sector growth across the County. The VC opportunity of juice bottling/canning is presented as a potential pilot scheme for the sector to catalyse climate-smart development (Section 4.3.3). Crucially, Makueni County is endowed with a diverse selection of agro-ecological zones, which support a range of agricultural production. As such, there is scope for development of several new VCs, which would likely reduce post-harvest losses and in turn support key livelihoods and increase resilience to climate change.
Due to the inherently interrelated nature of the identified key economic sectors of Agriculture and Livestock and Trade and Services with the Agri-Processing and Industry Sector, the interventions outlined are also likely to have significant potential for specific benefits for the other sectors and vice versa.
Table 4-13 – Agri-Processing and Manufacturing Action Plan
Economic ambitions
› Enhanced value addition and commercialisation of agricultural / livestock produce › Improved access to finance and focused technical support › Inclusion of SIGs, particularly youth, women and PWD
Source: Atkins analysis
Actions
4.3.1. Soft initiatives, training and capacity-building
A7: Establish a strategic plan of contract farming to ensure a reliable supply of inputs for agriprocessing and manufacturing
A8: Develop a joined-up education and training strategy tailored to the sector
A9: Provide enhanced access to local entrepreneurs and the local labour force
A10: Promote an inclusive approach to the development of agri-processing and manufacturing
A11: Undertake a market study and increase marketing of products through an Export Board
4.3.2. Wote Value Addition
4.3.3. Value chain opportunity: Juice Bottling/Canning
4.3.4. Climate resilient infrastructure projects
Project 5: Industrial Access Road Upgrade: Road Upgrade and Junction Improvements
Project 6: Improved Water, Wastewater and Drainage for Agri-processing at Kalamba
Project 7: Solar Power for Agri-processing at Kalamba
This section outlines the soft initiatives, training and capacity building interventions proposed to enhance the productivity and resilience of the sector, improve inclusion of excluded groups and increase the value addition and commercialisation of produce. Ultimately, the aim of these initiatives is to position the sector so that it can maximise the potential benefits of the recommended climate resilient infrastructure projects (Section 4.3.4), the anchor project Agri-Processing at Kalamba, and the identified VC opportunity of juice bottling/canning (Section 4.3.3). While not a definitive roadmap, the initiatives are presented in a logical sequence for implementation, starting with actions that can be introduced immediately and following through to longer-term interventions.
In order to develop a commercially viable agri-processing sector in Wote Municipality, there needs to be a continuous and reliable supply of agricultural produce to existing and future agri-processing facilities. In addition, the local farming community will require evidence of guaranteed demand and a consistent market to diversify their production to include more resilient crops or livestock varieties. As a result, an initial step to driving sector growth should be to establish a strategic plan to ensure inputs of an appropriate quality and quantity can be delivered on a regular basis, in turn facilitating the production of a stable and commercially viable volume of output from Wote’s agri-processors. One intervention could involve agri-processers and manufacturers establishing contracts and partnerships with local farmers. There is significant potential for the development of contract farming arrangements, whereby a buyer (for instance, an agri-processor or agri-industrial company) engages in a fixed long-term agreement with a farmer to purchase a set quantity of product at a specific price, thus establishing a steady level of supply-demand21. Farmers are therefore provided with a guaranteed long-term buyer for their produce at a stable price, in turn reducing produce waste. Contract farming will ensure a stable and timely supply of inputs to the agri-processing and manufacturing sector through the proposed aggregation network (Section 4.2.1), with the required quantity and quality of inputs produced. However, compliance can present a significant constraint for contract farming, largely due to the inadequate existing legal framework22. Therefore, creation of a County-level compliance framework would ensure trust from both parties, including exhibiting legal and institutional support for farmers, thus supporting them to engage in contract farming in future.
To ensure maximum production, it is vital that agricultural produce is transported to agri-processing facilities efficiently, and without being spoiled or damaged. This will be the role of the proposed network of local aggregation centres (Section 4.2.1) in collecting, packing and distributing produce on behalf of farmers. The collection centres would serve to aggregate several agricultural products and provide some pre-processing before delivery for further processing, for instance through grading, sorting, drying or fermenting. Crucially, a continuous supply of agricultural inputs is redundant if the supply is deemed to be of poor quality or unsuitable for processing. In line with this, the proposed Climate Smart Aggregation Centres could also contain an integrated quality control centre for assessing the agricultural inputs being transported through the centre.
The expansion and capacity building of agri-processing at Kalamba could also incorporate technical assistance services for agri-processing businesses, in particular relating to food safety and nutritional advice. This includes the potential for processors to utilise the facility to undertake a range of analytical services on their products, including nutritional analysis for labelling of products and determining shelf-life (see case study 4-11).
21 FAO, Contract Farming: Partnerships for Growth, FAO Agricultural Services Bulletin 145 (2001). 22 Federal Ministry for Economic Cooperation and Development, Contract Farming Handbook: A Practical Guide for Linking Small-Scale Producers and Buyers (2013).
The business consultation process in Wote identified that, despite expansion in access to education and training, enterprises in the agri-processing and manufacturing sector struggle to find a suitable workforce with the appropriate technical and core work skills, identifying a lack of a skilled labour force as a key constraint to growth. In particular, this related to a lack of training with regards to machine operation and maintenance. This presents an opportunity to strengthen and coordinate training initiatives through the proposed Climate Smart Aggregation Centres and Agri-Processing at Kalamba to ensure that the appropriate skills are developed to meet the requirements of Wote’s growing agri-processors and manufacturers.
The existing weak linkages between training providers and industry has resulted in poor work-based learnings and weak apprenticeship/internship programmes for trainees. Consequently, development of a joined-up education and training strategy for agri-processing would comprise a programme of initiatives that incorporates the Municipality’s key education and employment stakeholders – including training providers, education institutions, local agri-processing businesses and inclusive cooperatives like Makueni Fruit Processing Co-operative and Kaiti Dairy Co-operative, with the potential for support from national programmes such as NARIGP. Local agri-processing and manufacturing businesses should be actively involved during curriculum development and throughout the programmes to align the training with the required skillsets of the sector, including identifying gaps in the existing skills base to develop a suitable labour force for driving future growth.
Stakeholder engagement also suggested that insufficient practical orientation and hands-on competence among many of the County’s TVET trainers have contributed to a lower quality of agri-processing training. Therefore, prior to rolling out the training strategy, a Training of Trainers (ToT) programme should be developed to support and ensure a more demand-oriented and enhanced quality of Technical and Vocational Education and Training (TVET), in turn increasing the employability and job prospects of agri-processing trainees. The ToT programme should be devised in collaboration with local agri-processing businesses to focus on the required technical skills to drive the sector, as well as core business skills such as communication and teamwork.
The aim of the training and education strategy for agri-processing and manufacturing should be to:
> Design education and training programmes to align with the required skillsets of Makueni County’s agri-processing and manufacturing businesses. This will require training providers to work with local businesses within the industry to identify gaps in the existing skillsbase, in order to develop a suitable labour force for driving the sector’s growth; > Develop a Training of Trainers (ToT) programme to build the capacity of education providers with regards to relevant labour market skills and competencies, in collaboration with agri-processing businesses; > Increase accessibility of appropriate training for every member of the community, including vulnerable and marginalised groups; > Promote career opportunities to new applicants to encourage them to engage in training programmes that may be more likely to result in improved employment prospects, as they correspond to skills required within the sector; and > Actively involve local agri-processing businesses during curriculum development and throughout the programme, for instance through provision of apprenticeships and on-the-job training for students.
Development of a joined-up training strategy for the sector will offer benefits for local businesses, education providers and students alike. For instance, agri-processing businesses will be able to shape the training on offer to ensure suitable skillsets are being developed to support sector growth, enabling them to recruit directly from Wote’s local labour pool (as detailed in Action A9). Similarly, students will likely benefit from higher job prospects by developing desirable skills for the growing agri-processing sector. In line with this, career opportunities should be promoted to new applicants to encourage them to engage in training programmes that may be more likely to result in improved employment prospects. The training and education strategy should aim to increase accessibility of training for every member of the community, including vulnerable and marginalised groups.
To maximise social inclusion benefits emerging from this action, it would be important to:
> Develop low-cost and accessible training options for out-ofschool youth, women and PWD with low literacy levels.
For example, business and marketing trainings should be available to support those who already own businesses and those who would like to start one regardless of their education levels. These alternatives will also benefit women and PWD in Wote who often face barriers to access these opportunities due to low literacy levels, domestic and community responsibilities, and lack of access to information; > Actively communicate about all business development opportunities in local media, universities and local education centres. Ensure communication formats and languages are accessible to all; > Engage with existing young producers and youth-owned businesses in the region to showcase the benefits of being involved and start agri-businesses and agri-processing.
This could contribute to youths seeing these activities as attractive and economically profitable; > Consider developing additional outreach training to facilitate access to remote communities and people with restricted mobility due to physical impairments or cultural norms.
Always prioritise locations and timings that are compatible with SIGs’ everyday lives and economic activities. Training materials should be accessible to all; > Liaise with, and inform local communities about, existing government opportunities and funds to support local entrepreneurs, start-ups or MSMEs. Aim particularly at targeting SIGs. This will help address the most common challenges faced by SIGs’-owned start-ups in Wote (limited access to capital); and > Promote internships and on-the-job training to support skills development of local students. It is recommended to set participation rates for PWD, youth, women, and vulnerable groups.
Case Study 4-11: National Food Technology Research Centre, Botswana
The National Food Technology Research Centre (NFTRC) is a research and development organisation funded by the Government of Botswana, in collaboration with Botswana University of Agriculture and Natural Resources, with the mandate to promote food security through commercially viable food processing technologies.
As part of its activities, NFTRC has established a vocational training programme to equip local entrepreneurs with agri-processing skills through its research and development outputs. The on-site training initiatives are promoted to the general public and existing businesses to stimulate growth in the agri-processing sector. Specialised training programmes are tailored to a range of different produce, delivered by qualified research professionals – including Meat Products, Fruit and Vegetables, Dairy Products and Honey. Specific topics taught in each processing course include: National Food Legislations, Hygiene and Sanitation, Good Manufacturing Practices, Product Manufacturing Equipment Requirements and Hazard Analysis.
In addition to training, NFTRC offers a range of technical assistance services for existing businesses relating to processing, food safety and nutritional advice. This includes the opportunity for processors to bring their product to the centre for a range of analytical services, such as: nutritional analysis (i.e. for labelling), determination of shelf-life and product quality/safety testing. A9: Provide enhanced access to local entrepreneurs and the local labour force
Development of the agri-processing and manufacturing sector provides significant potential to enhance the local economy in Wote through the creation of new jobs and offering opportunities to existing businesses and SMEs. In order to maximise these benefits for the local community, a proactive sector strategy will be required to ensure that local workers and entrepreneurs, especially those that may be otherwise marginalised, are provided with access to these new opportunities. In particular, this relates to the expansion and capacity building of the existing Makueni Fruit Processing Plant as an anchor project for the sector.
Provision of appropriate and inclusive training, defined in Action A8, will play a central role in improving access to work for the local community and marginalised groups. This should include gaining an understanding of the required technical skills to drive the agri-processing and manufacturing sector, such as machine operation and maintenance, as well as wider core skills to support processing activities like communication and adaptability. This could be supported by internships and on-site training by businesses to provide practical experience of agri-processing and manufacturing activities. In order to ensure social inclusion, target participation rates should be introduced for PWDs, youth, women and other excluded groups.
As outlined in Action A7, local farmers and businesses should be actively incorporated into the agri-processing and manufacturing supply chain. Development of new agri-processing facilities (for instance during the expansion of Makueni Fruit Processing Plant) will require various suppliers upstream and downstream, including raw agricultural produce, marketing, packaging and logistics. By actively promoting local businesses and workers, there will be increased opportunities for procurement within these new supply chains. This could include registration lists of local businesses and networking events, as well as incentives for agri-processors and manufacturers that utilise local businesses. Local workers should also be prioritised for contractual work within the Agri-Processing Zone, such as general maintenance or cleaning, including workers from the informal sector to generate new opportunities for income generation.
Informal business activities and the Jua Kali sector have historically been a core driver of the economy in Wote Municipality, with Makueni County particularly renowned for its work in carvings, basketry and pottery . In addition to the growth of formal activities within the manufacturing sector, there is a need for targeted interventions that enhance infrastructure provision to protect and develop the Municipality’s Jua Kali businesses. This could include provision of additional flexible workspaces, such as a community makerspace, with shared equipment and tools for members to use as needed, in addition to the redevelopment of the Jua Kali market (Section 4.4.3.1). This would allow Jua Kali workers to have access to specific tools when required and share best practice with others via a shared workspace.
A10: Promote an inclusive approach to the development of agri-processing and manufacturing
Ultimately, as discussed, the expansion of the agri-processing and manufacturing sector should offer equal all opportunities to all of Wote’s citizens, support local businesses and entrepreneurs, and improve education and training development. The construction of new processing facilities and associated infrastructure, particularly during the expansion and capacity building of the Makueni Fruit Processing Plant, will require a comprehensive and robust approach to planning and social management. Various different interventions could be incorporated by businesses during the sector’s growth to ensure an inclusive approach to its development, including:
> During the development of the sector and going forward, engage local workers, businesses and SIGs to align its activities with local issues such as post-harvest losses and to ensure all views have been taken into consideration regarding construction of new facilities and infrastructure; > Develop a strong and respectful relationship with the local community, include accessible communication platforms and programmes to address social issues in Wote and the wider region; > Working in partnership with education providers, deliver inclusive opportunities for skills development aligned with the requirements of agri-processors and manufacturers, particularly targeting SIGs and other marginalised community members (Action A8); > Maximise opportunities to implement circular economy practices. For example, where by-products are produced in the agricultural value chains, such as during processing, this could be used to generate animal feed to sell to livestock farmers. This will offer an economical alternative for livestock farmers, while creating a supplementary income source for agri-processors. > Offer support to local businesses and entrepreneurs, including the potential for creation of procurement targets and development of shared workspaces (Action A9); > Guarantee equal working opportunities for all members of society, particularly SIGs, and respect existent employment quotas; > Provide social infrastructure – such as accessible toilets, childcare services and mothers’ rooms – and abide by performance standards with regards to social inclusion, gender equality, labour conditions and community dialogue (see case study 4-12); and > Ensure adequate working conditions in line with national and local laws, including following health and safety laws in workspaces and undertaking regular audits.
Case Study 4-12: ALEAP Green Industrial Park, Telengana, India23
The Association of Lady Entrepreneurs of India (ALEAP), supported by the German Development Agency (GIZ), developed an 82.55 acre green industrial park which houses 170 female entrepreneurs. The master planning of the park accounted for the particular needs and desires of women entrepreneurs and workers. In order to identify their specific requirements, a series of workshops and field visits were held, with the site masterplan reviewed at various stages by stakeholders including the entrepreneurs and members of ALEAP. Along with environmental considerations, employees’ individual requests have been incorporated into the park’s development, including rest houses, crèches and accessible facilities.
This case study demonstrates a best practice example of how the agri-processing and manufacturing sector in Wote can accommodate all members of society in its development, including SIGs, through the provision of social infrastructure and accessible facilities for all..
23 United Nations Industrial Development Organisation (UNIDO), An International Framework for Eco-Industrial Parks (2021) Available at: https://openknowledge.worldbank.org/bitstream/ handle/10986/35110/156450.pdf?sequence=4&isAllowed=y (Accessed: 09/02/2022).
A11: Undertake a market study and increase marketing of products through an Export Board
Once a plan to ensure continuous inputs for agri-processing has been established, including development of processing facilities with access to modern technologies and an educated labour force, a market study should be undertaken to identify the variety and quantity of products in demand in both the domestic and international export markets. The business consultations undertaken in Wote suggested a lack of knowledge with regards to effective marketing techniques amongst existing local processing and manufacturing businesses, with the vast majority relying on word of mouth. As a result, there is an opportunity for the creation of an agri-processing and manufacturing business support platform within the Municipality, targeting aspects like marketing (focused on the products identified through the market study), accounting and business management.
The platform could be managed by cooperatives or community groups, in collaboration with the public and private sector, incorporating a range of agri-processing experts and technologists. The overarching objective of the platform would be to holistically develop the agriculture and agri-processing sectors in parallel, forming a symbiotic relationship that ensures productivity, sustainability and resilience are all maximised through enhanced access to information, knowledge and skills. In order to obtain knowledge on effective marketing and establish contacts in the industry, expeditions could be organised to nearby towns with an established agri-processing sector.
Establishing an Agriculture and Agri-Processing Export Board could also be beneficial in terms of increasing the marketing of the sector’s products to international markets. An Export Board would offer advice to agri-processing businesses on export promotion, negotiate shared deals with brokers and construct a branding strategy for the sector in Wote. The Board should be developed in collaboration with the public and private sector to include; local businesses, co-operatives such as the Makueni Fruit Processing Co-operative, representatives from the Chamber of Commerce and Makueni County Government trade and agriculture officials. This could involve working alongside the Fresh Produce Exporters Association Kenya (FPEAK), a national association formed to unite and promote the Kenyan horticultural industry in the global market with due regard to safety and sustainable agricultural practices, as well as social and ethical responsibilities24 .
As part of its operations, the expanded Makueni Fruit Processing Plant could provide agri-industry businesses with a community hub where they can obtain information on business certificates and other necessary documentation, as well as emerging technologies and international best practice. Critically, it will be imperative to ensure the hub offers information in languages and formats that remain accessible to everyone.
The GeSI assessment also indicated that SIGs engage in agri-processing activities. Hence, it would be important to include them and understand their needs when developing these measures. Further recommendations can be found in the GeSI assessment for the prioritised VCs and the GeSI study (Appendix C).
24 FPEAK, Our Vision and Mission Statements (2021) Available at: https://fpeak.org/about-us/ vision-mission/ (Accessed: 14/02/2022).
4.3.2 Wote Value Addition
4.3.2.1. Overview
Identifying the UEP value chain opportunities for Wote was a four-stage process:
> Long - list process: an extensive list of economic opportunities, reflecting government policies, VC studies, exports and imports assessment, inputs requirement, outputs and processes, linkages with key policies and programmes, and market linkages. > Diagnostics alignment: the long-list was assessed against the SWOT analysis and other factors identified in the Diagnostics stage. The resulting list was presented to stakeholders. > Evaluation: the SUED evaluation framework used to sift the opportunities, including criteria for the SUED principles (included within Appendix B). The PSG, the MB and other stakeholders identified the relative importance of each criteria for Wote, to provide weightings for final evaluation and identification. > UEP selection: six short-listed VCs were further assessed in detail, including their costs and revenues, competitiveness and land and infrastructure requirements, utilising the wider SUED assessments.
Following further discussions with stakeholders, two VCs were selected for taking forward:
> Juice processing: This VC project is for a mixed fruit juice and pulp facility, sourcing fresh produce across the County and neighbouring region and supplying both the bulks and retail markets. The VC would build on the mango processing factory at Kalamba, expanding the range of produce and developing the marketing and sales capabilities. > Municipal waste collection and processing: This VC is for the commercialisation of solid waste collection in
Wote, with sorting and separation, and sale of recyclates.
The VC would expand the current levels of collection in Wote, and the waste processing facility could take materials from other parts of the County. This VC is in line with one of the projects proposed by the Municipality as part of its SUED submission.
These VCs have been assessed against climate resilience and sustainability, both scoring highly. They have also been assessed to have a high level of readiness for investment, and as such are suitable as initial projects to spur further growth. The Technical Briefing Paper (Appendix B) included assessment for a further five shortlisted VC opportunities:
> Poultry sector development: This VC is aimed at tackling the issues in the sector by developing a fully integrated poultry industry that builds on the existing distribution and collection networks, farmers and processors, aims to fill in gaps in the value chain, and improve overall efficiency. > Processing of honey and related products: This VC is for the establishment of an apiculture centre that would process and market the full range of bee products and provide training and support to beekeepers in Makueni and neighbouring counties. > Milk processing and integration of the dairy sector:
This VC is aimed at supporting the development of the dairy sector under the umbrella of the MCCC, by investing in improvements in the supply chain (collection, processing, marketing and dispatch), additional value added, and improvements in animal husbandry and the dairy herd. > Production of interlocking construction blocks and other low-cost building materials: This VC is for a low-cost building materials centre that would produce blocks, roofing panels, etc., develop demonstration housing schemes and provide training to construction crews. > Feed mill: This VC is for a feed mill that combines these waste streams to produce formulated feeds targeting; poultry - from day-old chicks to layers and broilers; fish farming - from hatchling, fingerlings to mature fish; and cattle and goat: with a focus on zero-graze dairy. 4.3.2.2. Value Chain Cluster – wider opportunity
There are strong synergies between many of the shortlisted VCs and there are benefits to be gained from co-location, especially for the agri-processing VCs. Furthermore, many of the VCs would benefit from the proposed climate-smart aggregation network, with the potential for combined collections of produce and distribution of farming inputs.
The potential linkages between the VCs are shown in Figure 4-9.
