Action Research for Value Chain Devolution
Worldwide the number of farmers is decreasing rapidly, while the number of urban consumers is growing at an even faster pace. We better take care of our farmers if we want them to feed 10 billion consumers by the end of the century. Yet, 500 million small-scale farmers from developing countries are still failing to generate enough revenues to lift themselves out of poverty. Large manufacturers and retailers are capturing most of the added-value to agricultural production. And since farmers cannot compete with corporations for value addition, their incomes need to be subsidized (in developed countries) or are otherwise squeezed (in developing countries).
Cooperation between farmers and corporations appears to be more feasible as a way forward. This requires the intervention of the public sector, including both governmental and non governmental organizations, which need to promote and facilitate the integration of farmers into value chains, through investments in Business Development Services (BDS). As farmers gain access to emerging and profitable markets, they can gradually take over the ownership and control of BDS, allowing the public sector to phase out. Such an investment and devolution strategy is expected to produce a new generation of professionally managed and vertically integrated cooperatives, helping farmers to increase the efficiency, quality, volume and value of their production.
This kind of public-private partnerships (PPPs) for linking smallholders to agri-food value chain is becoming mainstream in the context of developing countries. However, the impact of these partnerships on rural livelihoods is still unclear and uncertain, and new and successful cooperative agribusiness models remain scarce. This is because is farmers’ leaders and BDS managers are not adequately trained and coached to envision the rise of a new generation of cooperative enterprises, and thus they fail to anticipate and evade the problems and frictions associated with this complex re-organizational process. The goal of the EDC initiative is thus to work with public and private stakeholders to enable the rise of a new generation of cooperative enterprises in rural Africa, through:
- research – impact evaluations of interventions for linking smallholders to agri-food value chains; and organizational diagnostics for improving cooperative agribusiness models.
- outreach – training, coaching and knowledge exchanges for farmers’ leaders, agribusiness managers, rural development officers and University students.
- networking – strategic, multi-stakeholders debates and consultations to promote and facilitate PPPs for impact investments and ownership devolution in agri-food value chains.
“The cooperative business model can be very powerful, if it is understood”
Prof. Michael Cook (University of Missouri)