Meet Ellen Olafsen, a programme coordinator with infoDev, a global partnership programme in the Financial and Private Sector Development Network of the World Bank Group, which supports entrepreneurs to secure early-stage financing and convene key stakeholders for dialogue and action. © World Bank
I read her interview with Spores which I found interesting and decided to share some key points she raised along with what her organisation is doing.
Supporting Growth Oriented Agribusiness in Africa
- A thriving and competitive agribusiness sector relies on good infrastructure, effective policies and regulations, and access to appropriate financing. Just as important are skills and know-how to successfully develop and apply innovative methods.
- The farmer’s fortune changes when they learn how to add value to the next link in the value chain, even by doing things they normally do but only better.
- Expertise, continuity of effort and finance are 3 essential factors needed to ignite competitive, domestic, agricultural processing businesses.
- A key reason that donor and publicly funded agribusiness project fail is the limited focus on first assessing the market opportunities. There is also insufficient engagement of industry and entrepreneurs in the project design process.
What InfoDev thinks is the solution
InfoDev is developing Agribusiness Innovation Centres (AIC) to support agro-processors in four main areas.
- Firstly, and most importantly, we are supporting the link to markets.
- Supporting entrepreneurs with business skills and technical development.
- Helping to access finance: each of the AICs will have a small seed fund to provide short-term financial support when this is absent in the chain.
- Providing some physical facilities, such as demonstration equipment or office space.
Each AIC will be privately managed, but will engage public and private actors, including farmers, in an effort to demonstrate that shared value can be realised.
According to InfoDev below are seven key requirements for a successful intervention:
- A chain needs to have some comparative advantage and be capable of scaling.
- There needs to be ‘growth’ entrepreneurs who can turn opportunity into reality.
- A local market for the product must be established before aiming at regional and international markets.
- There must be committed stakeholders that span the chain (farmer associations, financiers, processors, retailers, government etc.), and who can provide leverage.
- There must also be access to growth finance.
- The infrastructure of the country or region must be adequate to facilitate growth; this is often very weak in rural areas.
- Finally, industry leverage i.e. something already happening in the industry that facilitates smallholder involvement in the chain.
A committed government with committed champions is also invaluable! While they don’t advocate governments running AICs, their backing is critical to overcome bottlenecks in areas such as certification, logistics, land access, complicated business licensing procedures, high import tariffs on packaging materials through to a lack of technical training colleges or even infrastructure and in talking to donors.
Thanks for stopping by 🙂