Agribusiness and Agro- Industries: Investment Programme Priorities. Doyle Baker Rural Infrastructure and Agro-Industries Division FAO
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1 Agribusiness and Agro- Industries: Investment Programme Priorities Doyle Baker Rural Infrastructure and Agro-Industries Division FAO
2 FAO Dialogue on Priorities Committee on Agriculture 2007 Global Agro-Industries Forum (GAIF) RAIF Latin America RAIF Asia and Pacific High Level Conference on African Agribusiness and Agro-Industries Development (HLC 3AD)
3 Committee on Agriculture Rome, 2007 Challenges of Agribusiness and Agro- Industries Development
4 COAG 2007 Global Challenges Identified Concentration in food manufacturing and retail Specialized procurement channels Sourcing from few high volume supply markets Proliferation of public and industry standards Globalization of voluntary standard schemes Competition among developing and recently industrialized countries Prices for raw materials, staple foods, energy Pressure to achieve efficiency in logistics
5 COAG 2007 Institutional Responses Review institutional mandates for private investment in agribusiness and agro-industry Strengthen public sector cooperation with the private sector and civil society organizations Commodity, location, industry and/or profession based associations International information exchange and dialogue on legal and institutional frameworks, policies, and support services
6 COAG 2007 Proactive Capacity Building Strengthen farmers management practices and technologies Facilitate and support farmer organizations and producer alliances Reinforce business services to small farmers and processors Reinforce capacities of chain participants to innovate, diversify or exit as markets change Training and dialogue to improve the impacts and fairness of industry standards
7 COAG 2007 Support Value Chains Development Help ensure that progress being made in one part of a value chain is not negated by poor performance in other parts of the chain Mobilize - or leverage - private sector capacities and resources Help ensure fair governance in value chains Help ensure that management competencies and technical expertise of the private sector are directed at benefiting smallholders Increase incentives for upgrading value chains targeting domestic markets
8 Global Agro-Industries Forum New Delhi, 2008 New Delhi, April 2008
9 Global Priorities Identified Basic Enablers Infrastructure Safety & Qual 0 Linkages Technology Sup Chain Mng Producer Org PPC Finance Enabling Env Innovation Linkages and Value Chains -1.5 Differentiation -2 Clusters Industry support -2.5
10 Regional top priorities Latin America Infrastructure Human resources Safety and quality Market research Africa Enabling environment Finance Public private cooperation Infrastructure Export markets access Asia Supply chain management Infrastructure Finance Safety and quality Cost of doing business Competitive supply of quality products
11 Regional Agro industries Forum in Latin-America Lima, Peru - October 2009
12 Regional priorities Enabling Focusing on actors and sectors where there is potential Improving food quality and safety Strengthening applied research and technological development Coordinating mechanisms and productive alliances among actors (including PPPs)
13 Regional priorities SME support Differentiating policies for SMES and large companies Promoting formalization of SMEs considering financial, technological & managerial capacities Developing business and market services targeted to SMEs
14 Regional Agro industries Forum Asia and the Pacific Yangling, China - November 2009
15 Regional priorities South Asia Linking smallholders to markets and capacity building China Enabling environment and modernization of the agrifood sector Pacific and island nations Meeting the challenge of market access Improving quality Increasing cooperation and collective action between the nations
16 High Level Conference on African Agribusiness and Agro-Industries Development Abuja, Nigeria March 2010
17 3ADI Programme Framework Four areas of support Value chain skills and technologies Post-production institutions and services Enabling policies and public goods Financing and risk mitigation mechanisms
18 3ADI Programme Framework Four areas of support Value chain skills and technologies Post-production institutions and services Enabling policies and public goods Financing and risk mitigation mechanisms Producer and commodity associations Agribusiness linkage facilitation Producer and SME skill building Technology development and transfer Market information Vocational and business training
19 3ADI Programme Framework Four areas of support Value chain skills and technologies Post-production institutions and services Enabling policies and public goods Financing and risk mitigation mechanisms Contract farming & outgrower schemes Business incubators, hubs and clusters Product labeling, certification schemes Food safety regulations/standards Commodity exchanges
20 3ADI Programme Framework Four areas of support Value chain skills and technologies Post-production institutions and services Enabling policies and public goods Financing and risk mitigation mechanisms Agro-industry strategies and plans Legal and regulatory frameworks Harmonization of grades and standards Farm-level capital development Markets and trade infrastructure and services Trade policies
21 3ADI Programme Framework Four areas of support Value chain skills and technologies Post-production institutions and services Enabling policies and public goods Financing and risk mitigation mechanisms Public-private partnerships Loan guarantees Investment funds Value chain financing Risk mitigation products
22 AGS Identified Priorities for Making Things Work Enablers for Agribusiness Development Supply Capacities and Efficiency Market Linkages and Value Chains
23 Enablers for Agribusiness Development Fiscal and trade policies Legal and regulatory frameworks Quality and safety systems Local services
24 Enablers for Agribusiness Development Fiscal and trade policies Taxes, subsidies, utility costs, fees, licenses Infrastructure development and services Roads, water, electricity, ports, bridges Import, export, investment restrictions Sound governance / reduced corruption
25 Enablers for Agribusiness Development Legal and regulatory frameworks Compliance with international standards & commitments Commodity exchanges and futures markets Contract negotiation, registration, conflict resolution, enforcement Product, branding, labeling and certification Competition rules of the game
26 Enablers for Agribusiness Development Incentives to mainstream quality assurance and management systems e.g. GAP, GMP, HACCP Harmonization of food quality systems with de facto benchmarks (GlobalGAP) Laboratory facilities and analysts Field inspectors Quality and safety systems
27 Enablers for Agribusiness Development Fiscal incentives and pilot projects to establish privatesector input distribution systems Regulation, guarantees and pilot projects to jumpstart innovation Risk management and sharing schemes Business support services, agri-clinics and agribusiness service centres Local services
28 Supply Capacity and Efficiency Technology introduction Technical skills Business management Supply chain management
29 Supply Capacity and Efficiency Technology introduction Production: seed production, storage Post harvest: grinding, grating, drying, etc. Novel processing and packaging techniques Cold chains and stores
30 Supply Capacity and Efficiency Technical skills Post-harvest operations Quality management, labeling, food safety Grading, certification and traceability Also materials and technology acquisition
31 Supply Capacity and Efficiency Business and financial plans Well defined value propositions Transition to contractual procurement Ensure base of reliable suppliers Inter-firm alliances and agreements Public-private partnerships Value chain financing High velocity for turnover of working capital Business management
32 Supply Capacity and Efficiency Production scheduling, collection and sale sites Management systems and ICT to increase reliability in order fulfillment and delivery Functional integration of operations management Reduction in aggregate chain inventories Investments in logistics management Supply chain management
33 Market Linkages and Value Chains Organized & empowered farmers Receptive business sector Facilitating policy sector Partnership facilitator
34 Market Linkages and Value Chains Organized & empowered farmers Management skills to develop and implement business plans Technical skills to supply specific quality products Capacity to meet monitoring and reporting requirements Organization for market power and economies of scale Access to business, marketing and financial services
35 Market Linkages and Value Chains Receptive business sector Upgraded mainstream procurement Affirmative procurement Base of the pyramid business models Alternative trade models - fair trade New market intermediaries Shared equity
36 Market Linkages and Value Chains Sector coordination to prevent free riding Risk management and sharing schemes Incentives for private sector services provision Protection of intellectual property rights Rules relating to employment and contracting Investments to support private sector innovation Facilitating policy sector
37 Foundations of Sustainable Linkages Procurement intermediation on volume and quality Farmer organization development and alliances Realistic and transparent appraisal of costs, benefits and contingencies Absorb transaction and information costs Help ensure fair governance in value chains Partnership facilitator
38 Thank you! Contact:
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