Agrinatura and the European Commission/DG DEVCO replied to this question during a project lab on VCA4D in the framework of the European Development Days 2019, whose focus this year was on the topic of inequalities in all its forms and in different sectors, including agriculture.
Out of more than 20 analyses already performed by the VCA4D project, Agrinatura presented the results and lessons learned from three value chains, focusing on the opportunities that agricultural value chains can bring as well as on the risks that might derive from value chain development, especially for the most vulnerable actors involved in the chain.
Gideon Onumah (agricultural economist from NRI), Froukje Kruijssen (fisheries economist from KIT), and Catherine Allen (social expert) presented findings respectively from the value chain analyses of eggs in Zambia, aquaculture in Zambia, and green beans in Kenya.
They explained how value chain dynamics impact on inequalities (increasing or reducing them), providing some insights on the role of policies in improving inclusiveness and on the added value of the VCA4D methodology to analyse the issue of inequality from a multidisciplinary perspective.
The three cases showed contrasting results. In Zambia, both in aquaculture and in egg production, the value chains are developing towards large-scale production. In the case of aquaculture, small fish-producers are confined to a semi-subsistence low income activity and are poorly integrated in the markets, getting little benefit from improvements such as access to good quality feed and seed. In addition, the oligopolistic position of wholesalers / processors, dominated by one large company, (that also buys imported fish from Asia at low prices) pulls prices down generating a competition with the national production and an income distribution within the chain unfavorable to small-scale actors.
On the other hand, in the Zambian egg value chain, the intermediate wholesale and retail egg marketing sector has grown to benefit micro-enterprises, often women for retail, with a fair distribution of incomes. This permitted to increase egg consumption and protein intakes in poor rural and urban households. It has also led to a dynamism among soybean smallholder farmers, pulled by the growing demand for feed for laying hens and created job opportunities mainly for the youth in rural areas.
The green beans value chain in Kenya illustrates a mixed situation that demands to remain vigilant. Indeed, contracting with pack houses or canned factories has allowed small producers to improve their economic situation. However, their difficulty to guarantee the quality demanded by international markets pushes exporters to rather buy from large farmers. Many small producers find themselves employed in large farms with poor working conditions. Nevertheless, at downstream level, the chain also offers interesting job opportunities for vulnerable actors, especially women.
The findings from these three value chain analyses showcased the difficulty, especially for small-scale actors, to take advantage of various opportunities offered by the local or international markets, due to their constraints in accessing resources such as credit, inputs, information, infrastructure, training, services etc., in unfavourable macroeconomic contexts or in case of price volatility. They also showed the positive impact of coordination and of governance in reducing inequalities.
The representative from the European Commission, Regis Meritan, underlined the added value of the VCA4D project and stressed the need to keep investing in robust and evidence-based information. This allows policy makers to better understand the extent to which value chains contribute to an inclusive growth and are socially and environmentally sustainable. This knowledge is crucial to support policy dialogue with national partners, as well as investment decisions and project management.
These studies are particularly important for the EU Delegations. The EU Delegation to Kenya reported, for example, about the clearness and comprehensiveness of the VCA4D methodology, that shed light on some aspects that were little known. It appreciated the quality of the team and the complementarity of their skills. In particular, it welcomed the results of the environmental analysis, often neglected and/or not well treated in traditional analyses.
The VCD4D project lab attracted a large and interactive audience and exchanges were rich and stimulating. It demonstrated the mutual interest of researchers and policy makers to work together for a more effective, efficient and inclusive international cooperation in agriculture.
If you need more information, do not hesitate to contact the VCA4D team at VCA4D@agrinatura-eu.eu