concern universal appg contribution 12nov10

Concern Universal contribution to the APPG

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Concern Universal contribution to the APPG 12 November 2010

1. Summary 1.1 Concern Universal‟s submission to the inquiry is in response to the co-ordinator‟s call for „success

stories‟ demonstrating approaches to supporting smallholder farmers that could be scaled up. Specifically, Concern Universal is submitting evidence in response to the following questions: „What is it that small holder farmers and developing nations want from DFID and the UK?‟ and „How can small holder farmers participate in, and help define, an agricultural agenda that is more in accordance with their needs?‟

1.2 The agricultural value chain is key to the development of livelihoods amongst vulnerable smallholders in Africa and Asia and the achievement of the MDGs. In Africa, for example agriculture is main source of food and income for the 70 percent of African citizens living in rural areas, the majority of whom are subsistence farmers consuming most of what they produce. Commercial agriculture is also a significant source of income, representing 20 percent of GDP in some countries. Agriculture is also a catalyst for long-term growth and the development of essential infrastructure.

1.3 Concern Universal, and the smallholder farmers we represent and work with, believe that DFID and

other donors within the agricultural sector, need to give greater attention to four specific areas that will lead to the improvement of livelihoods within agriculture. These are: greater cross-sector collaboration; a better understanding, by communities and institutions, of how to scale-up successful initiatives; supporting small-holders to be involved across all stages of the agricultural value chain; and by strengthening the link between development and research, with a special emphasis on climate change adapted crops that can feed increasing populations.

1.4 Example 1: The „Gambia is Good‟ (GiG) initiative is a pro-poor horticulture marketing social-business

established in 2004 which links poor Gambian farmers to the lucrative market outlets of the country‟s tourism industry. GiG was developed, in partnership with UK company Haygrove, to combat low yields and lack of access to markets of subsistence farmers and the fact that The Gambia is importing most of its fruit and vegetables to service the tourism industry and domestic markets and is not taking advantage of a possible vital source of income potential for local farmers. GiG now purchases from nearly 1000 growers, 90% of whom are women. Its core suppliers have made the transition from subsistence agriculture to commercial enterprise. A recent independent evaluation states that over the last three years GiG growers have increased their income by an average of 500%.

1.5 Example 2: As another example of cross-sector collaboration in central, Malawi Concern Universal

has enabled 700 smallholders to supply potatoes to a leading crisp manufacturer. As a result the farmers have increased their annual income 20 fold. As well as having a direct impact on livelihoods the project has also led to an improvement in local infrastructure (small-scale irrigation schemes) and community organising (local groups to manage the production and supply process).

1.6 Example 3: Concern Universal is implementing an agricultural programme in rural Bangladesh which

has resulted in sustainable improvements in the livelihoods of 10,000 smallholder farmers in 500 villages in Jamalpur District. The approach, based on three main strategies, public-private service provision; improving farmers‟ marketing power; and direct income support, has reduced vulnerability within the targeted communities giving smallholders the ability to withstand negative food price shocks.


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2. Introduction “Before Gambia is Good the middleman took two thirds of the price and made my work difficult and less profitable. Now I am achieving much higher yields, a longer harvest period, and good farm gate prices”. - Ebrima Jawara, farmer, the Gambia

2.1 Agriculture is at the core of MDG 1 and underpins all other MDGs. As such, it is fundamental to the

achievement of not only a reduction in poverty but to both improved food and nutrition security, which in turn are essential to improved health and education, and gender equality. As well as strong partnerships with over 60 civil society organizations in 12 countries in Africa, Asia and Latin America, Concern Universal has also led a number of pieces of agricultural research, most notably the Africa Progress Panel work on agriculture and business (Imperial College/ SAID Business School), research in to cross-sector collaboration (as part of the University of Manchester research on business and development), and research in to the Gambia is Good programme. The views from farmers, our partners and our research are all key to our policy development.

2.2 Today, the most important hurdles to economic growth, agricultural development and the achievement of the MDGs are the direct and indirect effects of the global economic crisis, severe food insecurity, the lack of sufficient and reliable communication and access to information, transport and energy infrastructure, the low quality of governance and regulatory frameworks that denies basic human rights, the collapse of agriculture extension systems, the scarcity of available domestic and international capital, and climate change.

2.3 The relative lack of support from donors and national governments to the agricultural sector presents

one of the most serious limitations to reducing poverty in rural areas. This is felt most acutely in Africa where severe under-investment has left crop yields virtually stagnant since the 1960s, meaning that farm productivity in Africa is currently a mere 25 percent of the global average. Moreover, climate change which is already compounding existing challenges will increasingly do so in the future. Rising global temperatures will exacerbate smallholders vulnerability to disasters. Climate change will likely lead to changes in soil fertility that will render many areas unsuitable for crop cultivation and increase water scarcity across the continent.

2.4 According to recent estimates, only 20 percent of Africa‟s potential cultivable land is currently in use

Up to 40 percent of harvested crops in sub-Saharan Africa are lost to insects, rodents, and spoilage. To increase smallholder incomes donor and national government policy will need to focus on getting more land into sustainable production while continuing to increase the productivity of existing farmland. This will require dialogue on issues surrounding access to land, the availability and efficacy of agricultural inputs, micro- irrigation and information sharing (ie mobile phones and web-based portals like Cisco) to ensure the most sustainable approach possible.

2.5 Improving smallholder livelihoods depends upon appropriate training, fair access to land, adequate

finance, improved infrastructure and a regulatory/legislative environment that stresses the right to food. Interventions at all stages of the agricultural value chain, from production through to storage, trading, processing and retailing, need to be assessed and evaluated to consider their impact on livelihoods.

2.6 The agricultural value chain is key to the development of Africa and the achievement of the MDGs.

Agriculture represents the continent‟s main source of food and income for the 70 percent of African citizens living in rural areas, the majority of whom are subsistence farmers consuming most of what they produce. Commercial agriculture is also a significant source of income, representing as much as 20 percent of GDP in some countries. Agriculture is also a catalyst for long-term growth and the development of essential infrastructure and GDP growth from the sector raises the incomes of the poor 2-4 times more than GDP growth from other sectors.


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3. Four policy recommendations 3.1 Concern Universal believes that improvements in smallholder livelihoods can be achieved through:

greater cross-sector collaboration; a better understanding, by communities and NGOs, of how to scale-up successful initiatives; supporting small-holders to be involved across all stages of the agricultural value chain; and by strengthening the link between development and research.

3.2 Cross-sector collaboration: Concern Universal has developed alternative models of business and social development co-operation to improve smallholder livelihoods. These models have often involved partnerships between organisations within the profit (both in Africa and Europe) and not-for-profit sectors and community based groups. For example, Gambia is Good (GIG) enables smallholders to supply local markets more effectively by leveraging the knowledge of communities through the involvement of NGO/business partners. GIG emphasises social benefits rather than profits and therefore pursues financial sustainability alongside broader community-based objectives. Concern Universal‟s research, through the Africa Progress Panel, which including case studies such as SAB Miller‟s low-cost lager in East Africa that uses locally-produced sorghum and CU‟s experience of helping smallholders become potato suppliers to an international crisp manufacturer in Malawi (see details in success story below) confirm the view that successful engagement often combines elements of CSR, core business and advocacy activities.

3.3 How to scale-up successful initiatives: As diagram one below illustrates scaling-up depends on creativity, inspiration and collaboration between key actors. Within new development projects scale-up should be envisaged from the outset. This will only take place when stakeholders have not only been able to consider creative and innovative approaches but they are able to inspire others. As the Concern Universal examples, and other case studies have exemplified, sustainable scale-up of development initiatives is much more likely to occur when the project‟s involve a collaboration between state and non-state actors and are based on activities rooted in the communities they will serve and benefit. Diagram two shows that as well as the inspiration and innovation necessary for scale-up it is important to be aware of the local, regional and international frameworks that will impact on the project. For example, projects designed to improve the livelihoods of smallholders must take into account factors influencing both regional and international markets. Diagram 1


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Diagram 2

REGIONAL

COLLABORATION

LOCAL

ON-THE-GROUND ACTION

INTERNATIONAL FRAMEWORK

3.4 Smallholders need to be involved across the agricultural value chain: Smallholders will benefit

more from business when they are engaged across the value chain. Concern Universal‟s research with the Africa Progress Panel Business Advisory Group suggests communities will benefit more from business and development activities where the value created within communities can be retained there. SMEs are likely to be crucial to this process because of their central role in generating income and employment. Benefits for communities emerge when firms of all kinds and sizes engage together in a sustainable way. For example, Senge et al (2006) note the extent to which the development impact of large companies like Unilever is mediated through local suppliers.

3.5 Linking development and research: A key problem with agricultural research in the past has been that the ownership of the research has been held by government or other research bodies. In many cases, farmers have had no stake in the research that took place within their communities, and consequently dissemination and adoption are very low. NGOs and civil society are vital in playing a part in the absence of a vibrant government extension services of putting research in to practice and to root it in communities own experiences. Concern Universal would urge donors, including DFID, to ensure that research is relevant to the needs of smallholder farmers by involving them in research design, varietal selection, and data collection. Concern Universal plays a strong role in linking farmers with research and putting research in to the „real world‟.

3.6 As our examples of success show, improving access to markets and ensuring smallholders are part

of the agriculture value chain will increase farmer incomes and can significantly reduce poverty in sub-Saharan Africa. Through support to marketing and product development, public-private partnerships, and direct training and income support Concern Universal has been able to directly improve the livelihoods of African smallholders.

4. Success story 1

Cross-sector collaboration in The Gambia

4.1 The „Gambia is Good‟ (GiG) initiative is a pro-poor horticulture marketing social-business established in 2004 which links poor Gambian farmers to the lucrative market outlets of the country‟s tourism industry. GiG was developed to combat two key problems faced by local producers; one, subsistence farmers suffer from low yields, poor quality produce, low incomes, and a lack of access to markets; and two, The Gambia imports most of its fruit and vegetables to service the tourism industry and domestic markets and is not taking advantage of a possible vital source of income potential for local farmers. „Gambia is Good‟ provides linkages between the rural areas and the tourist outlets through production and supply of high quality fruit and vegetables to hotels and restaurants. The Gambia is Good initiative was developed with Haygrove, a Herefordshire based horticultural company, and have developed a strategic partnership with the Travel Foundation.

Inspiration, innovation &

scale-up

Inspiration, innovation & scale-up


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4.2 GiG now purchases from nearly 1000 growers, 90% of whom are women. Its core suppliers have

made the transition from subsistence agriculture to commercial enterprise. The women with whom the project works had virtually no cash income before the project started and are now making up to £150 per month from selling fresh produce. A recent independent evaluation states that over the last three years GiG growers have increased their income by an average of 500%.

4.3 „Gambia is Good‟ has emerged as a successful, highly acclaimed initiative that provides linkages

between grass-roots areas and tourist outlets through the production and supply of high quality, locally produced fruits, vegetables, eggs, herbs, honey, juices, cashews and dairy products to hotels and restaurants; increasing incomes of local producers and entrepreneurs, raising awareness about sustainable and responsible tourism as well as diversifying the agricultural range grown by local producers in The Gambia. While not yet profitable, strategic funding has helped the project continue towards its goal of profitability and reaching the goal appears likely within the next two years.

4.4 The GiG model has been replicated by the World Bank and plays a key role in the horticulture

component of their Gambia Growth and Competitiveness Project. Collaboration is focused on increasing GiG‟s out-grower scheme. A market research study focusing on the possibilities of mango marketing and export has been conducted by the World Bank with intense consultation from GiG. The report revealed possibilities for the export of fresh produce and will continue to consult with Concern Universal about the potential to develop this market.

5. Success story 2 Public-private partnerships in Malawi

5.1 In central Malawi Concern Universal has enabled 700 smallholders to supply potatoes to a leading

crisp manufacturer. As a result the farmers have increased their annual income 20 fold. As well as having a direct impact on livelihoods the project has also led to an improvement in local infrastructure (small-scale irrigation schemes) and community organising (local groups to manage the production and supply process).

5.2 Concern Universal (CU) has supported communities in Dedza and Ntcheu districts in the central region of Malawi to increase food security. A tripartite partnership between the largest confectionary manufacturer in Malawi (Universal Industries Limited – UIL), a leading research institution (International Potato Centre, CIP) and CU is working with communities and the Government of Malawi field personnel to improve potato production and to bring about improved incomes of smallholder farmers.

5.3 UIL has the capacity to process up to 2000 metric tonnes of potatoes into crisps but currently

operates at about half that capacity due to lack of suitable potatoes found in the local market. UIL is playing a key role in the partnership by providing high quality seed, technical advice, and a guaranteed market for the potatoes. CIP has provided training to farmers in all aspects of production including seed selection and disease control. CU has supported leadership and agricultural training to farmers and organized smallholders organise into groups that are able to negotiate with UIL. As well as an emphasis on farmer-farmer extension and UIL training, the project also works with government agricultural extension services, who are reinforcing good agronomic practices.

5.4 During the pilot phase the partnership supported 32 farmers in the Dedza and Ntcheu districts to grow

high quality potato in the 2007/08 rainy season. These farmers were able to harvest 45 metric tonnes of potatoes that earned them MK1.4 million (£5400) after deducting the cost of seed. Some farmers achieved an income from sale of potatoes that was as much as 20 times higher than their annual subsistence farming income.

5.5 CU, UIL and CIP are hoping to scale up the cultivation of potatoes to a level that farmers can supply

the full requirements of UIL. CU is working with a further 700 farmers to develop new irrigation


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schemes and improve agricultural skills. While UIL will continue to multiply potato seed for distribution to contract farmers, support is being given to farmers to produce seed as well. Over the past year the project has faced challenges because the government has delayed the approval of the type of potato seed that farmers and UIL would like to use. Tests are still ongoing but CU hopes to get government approval for the seeds in the near future.

5.6 UIL and CIP are cooperating to establish an aeroponics unit for mini tuber production, the first of its

kind in Africa. Through these efforts it is expected the shortage of available quality seed in Malawi will gradually diminish.

Success story 3 Farmer to farmer training and support in Bangladesh 6.1 Since 2004, Concern Universal has been implementing a model of public-private partnership in rural

Bangladesh which has resulted in sustainable improvements in the livelihoods of 10,000 smallholder farmers in 500 villages in Jamalpur District. The approach, based on three main strategies, public-private service provision; improving farmers‟ marketing power; and direct income support, has reduced vulnerability within the targeted communities giving smallholders the ability to withstand negative food price shocks.

6.2 The project is located in Jamalpur District, Bangladesh, which counts as one of the poorest districts in the country. Located on the banks of the Brahmaputra River, it is frequently ravaged by floods and suffers from increasing problems of river erosion and climate variability.

6.3 Concern Universal is working with District Agricultural Department staff and small and medium-sized

landholders to develop a knowledge network for agro-technical service provision and skills transfer in Bangladesh. The four stage training process begins with training for District Agricultural Department Extension (DAE) Officers, supplementing their government training. With support from Concern Universal the DAE Officers then provide agro-technical training sessions to local „advanced‟ farmers, building on their existing skills. The 'advanced' farmers are defined as farmers who have relatively large landholdings, use advanced (mechanical) technology and do not regularly engage in individual farm-gate sales but will most often sell to sub-district and district traders. „Advanced‟ farmers then provide instruction and operational support to smallholder farmers, enabling them to launch new technologies and build businesses. The 'advanced' farmers who participate in this project do not see the smallholders as direct competition and are happy for the extra income that they earn through the training. Local advanced farmers play a crucial role in knowledge transfer, operational support and after-sales services. The small-holder farmers pay the „advanced‟ farmers for the training (min. 100 Taka) because they have seen that the training leads to higher profits; a sustainable win-win situation. After the training start-up assets (seeds, tools) are distributed to smallholder farmers to enable them to apply new techniques immediately.

6.4 To improve marketing power and overcome marketing inefficiencies, Concern Universal encourages new initiatives for smallholder farmers by carrying out regular workshops and structured training modules on marketing. The workshops focus on developing understanding of consumer demand, developing an understanding of group marketing exercises (collective purchasing) of inputs, improving smallholder farm products (design, quality), the collection of market information by a Beneficiary Task Force, and new micro and Small Enterprise (MSE) Development.

6.5 The average income of a beneficiary smallholder family is approximately 105 Taka (£1) a day. Most

farmers will spend Tk100 per day (£0.95) and save Tk5 (£0.04). Concern Universal‟s private service provision and marketing interventions have increased average incomes by 24% to 130 Taka.

6.6 Concern Universal has also supported selected smallholder farmers with direct cash payments in

September/October enabling them to store their produce during the low-price period following the year‟s main harvest. Following price recovery, farmers can sell their produce at a relatively higher


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profit. The poorest and most vulnerable farmers are offered additional cash-for-work programmes during the “lean” growing period.

6.7 If long-term funding were in place it would be viable to scale up this initiative across the district and in

other districts in Bangladesh. This model has proved to be beneficial and sustainable to the most vulnerable smallholders in the district, as well as market actors, medium-sized farmers, and to local authority agriculture extension workers.

References Africa Progress Panel Report: http://www.concernuniversal.org/uploads/Doing-Good-Business-In-Africa-Full-Report.pdf NELSON J and PRESCOTT D. (2005) Partnering for success: Business perspectives on multistakeholder partnerships. (Geneva: World Economic Forum). ORGANIZATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT. (2004) Promoting SMEs for development: The enabling environment and trade and investment capacity building. (Washington: OECD) PRAHALAD C.K. (2005) The fortune at the bottom of the pyramid: Eradicating poverty through profits. (New Jersey: Wharton School Publishing). SCHUMACHER E. (1973) Small is beautiful: A study of economics as if people mattered. (London: Blond and Briggs). SENGE P, DOW M and NEATH G. (2006) Learning together: New partnerships for new times. Corporate Governance. 6(4): 420-430. WADHAM H. (Forthcoming) Talking across boundaries: Business and NGO perspectives on CSR, sustainable development and partnership. Journal of Corporate Citizenship. 34. WILLIAMS I. (2006) Strategic thinking and acting and the link with improved effectiveness. Paper presented at Centre for Charity Effectiveness Strategy Day, London, May. YUNUS M. (2007) Creating a world without poverty: Social business and the future of capitalism. (New York: Public Affairs).

concern universal appg contribution 12nov10

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