Journal article

Linking Producers to Markets

Development, vol. 361, issue July (2004) p. April 29 Published by US Agency for International Development

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Executive Summary I n many developing countries, the agricultural sectors performance determines overall econom- ic growth, trade expansion, and increased income-earning opportunities. Increasingly, this per- formance is shaped by global, regional, and national trade standards, changing consumer preferences, and international advancements in science and tech- nology. To be successful, agricultural producers in these developing countries require training and infrastructure support, good governance and sound policies, and a solid and progressive institutional base that supports market participation. Conceptual Framework Good governance is an essential element of the enabling environment for science-based, market- led, sustainable agriculture. An emphasis on good governance in agricultural sector programming underscores the need for mutual responsibility, one of the key principles evoked at the U.N. Conference on Financing for Development in Monterrey, Mexico, in March 2002. In accordance with the Monterrey consensus on aid effectiveness principles, ideal partners for USAID-supported agricultural development efforts will be countries committed to the following: implementing policies that encourage greater agricultural productivity and sound natural resource management investing in infrastructure that enables markets to work efficiently building research institutions that ensure a flow of new and adapted technologies to producers and postharvest enterprises supporting the expansion of effective training, education, and communication systems that provide producers and those in agribusiness women and menwith information they need to be effective market participants Some transformational development countries are only beginning to put in place these conditions for successful agricultural-sector transformations. Agricultural development programs in these coun- tries will aim to help them become better partners by providing technical assistance and limited amounts of financial support. In countries considered fragile states, the objectives of U.S. assistance are stabilization, recovery, and reform. Determinations of agricultural develop- ment programs in fragile states will be based on their contribution to these objectives. Such pro- grams will focus on restoration or recovery to previous levels of production and productivity, support of near-term reform measures, and other immediate steps to promote stability and increase productivity. For strategic states, USAID will support programs consistent with foreign policy objectives and con- cerns. In many strategic states, resources will be programmed to either promote transformational development or contribute to overcoming fragility. In these cases, the approaches to and criteria for agricultural development programs will be consis- tent with the U.S. foreign policy goals and con- cerns that underlie the overall assistance program. Ensuring food security in emergencies is an impor- tant aspect of the provision of humanitarian assis- tance. In cases of chronic emergencies, humanitari- an assistance will be structured to address systemic failures. This often entails the use of humanitarian resources to improve agricultural production and productivity. A variety of interventionssuch as policy reform, food for work, cash distributions to vulnerable people, stabilization of food stocks, and market-based seed assistance for vulnerable farm- ersmay be the focus of efforts to diminish the number and depth of emergencies. Certain global or transnational issues, such as negotiations on the reduction of agricultural subsi- dies in the World Trade Organization or global USAID Agriculture Strategy Linking Producers to Markets 3 climate change, are linked to agricultural develop- ment. Strategic themes of the Agriculture Strategy will guide selective support for key global or transnational issues. Strengthening the capacity of countries and pro- ducers to increase their agricultural productivity under the Agriculture Strategy will require the commitment of many partners. In addition to USAIDs renewed commitment to agricultural development, U.S. business and cooperative sectors, international science and technology organizations, other U.S. Government agencies, U.S. colleges and universities, and NGOs must also commit fully to agricultural development when partnering with USAID. Four Strategic Themes Agricultural development is thus a strategic priority for USAID. The Agencys agricultural development efforts will focus on increasing agricultural produc- tivity and smallholder participation in markets through four strategic themes. 1. To expand trade opportunities and improve the trade capacity of producers and rural industries, USAID will support the development of sound policy environments; promote building institutions and good governance; expand rural finance; strengthen producers groups and other rural organ- izations; enhance access to production, storage, and processing technologies; and focus on higher-value nutritious foods benefiting producers and con- sumers. In particular, implementation of the Agriculture Strategy will be coordinated with the USAID Trade Capacity Building Strategy and focus on helping countries to meet sanitary and phy- tosanitary regulatory standards and attain higher levels of agriculture trade disciplines required for accession to the World Trade Organization. 2. To improve the social, economic, and environmen- tal sustainability of agriculture, USAID will work to restore the health of land, water, and forestry resources; develop sustainable and renewable energy sources; develop environmental assessment method- ologies that enable communities and implementing 4 USAID Agriculture Strategy Linking Producers to Markets partners to assess environmental risks and damage due to natural and conflict-related disasters; and strengthen local capacity for integrated manage- ment of agricultural and natural landscapes. The Agency will also improve analytical and economic frameworks linking agriculture and natural resource investments, find organisms endangered in nature and help protect them, and support the development of agriculture and natural resource policies that promote good governance and improve productivity. 3. To mobilize science and technology and foster capacity for innovation, USAID will assist countries and regions to formulate science policies, strategies, and governance systems; support technology devel- opment and application; expand public and private sector partnerships and collaborative networks of specialists; and foster innovation within and among developing countries so that they can generate, uti- lize, and direct new technologies in locally appro- priate directions. USAID and its partners will sup- port womens capacity to participate in national innovation systems and ensure investments in sci- ence and technologies are appropriate to specific national and regional conditions and systems. 4. To strengthen agricultural training and education, outreach, and adaptive research, USAID will support education and training tailored to reach women and girls; develop and extend innovative rural information and communication technology sys- tems; and improve problem-based, site-specific learning approaches. USAID recognizes that the ability to access and manage information is fast becoming a fundamental requirement for rural pro- ducers to participate effectively in an increasingly global food, feed, and fiber system, and will work to ensure that the smallholder agriculture sector receives training and support services necessary to fully participate. Implementation This Agency strategy serves as a benchmark for review and approval of new strategic plans and for triennial strategy reviews of operating unit pro- grams. The strategy will also be used in reviewing and analyzing bureau program budget submissions and constructing the Agency annual budget submis- sion. Operating units will monitor progress in overall agricultural development as well as specific programmatic results. While the weight given to a strategic theme will be situation-specific, a demand- driven, competitive economic framework for agri- culture should be the starting point in developing countries capable of transformational development. In fragile and strategic states, other criteria will be added. All USAID agricultural programming should con- form with this strategy, though the emphasis and articulation of specific objectives will respond to bureau and operating unit strategic plans, bureau mandates, and country circumstances. In some instances, national interest or other U.S. foreign policy objectives may cause a program to fall outside the strategic framework, but these few exceptions will be clearly linked to achieving the foreign policy objective in a specific country or circumstance. To implement the strategy, the Agency will link the Agriculture Strategy to the joint State- USAID Strategic Plan: Fiscal Years 20042009 and identify indicators for performance goals ensure that operating unit strategic plans and priorities reflect analyses and recommendations of ongoing external review bodies strengthen donor coordination in agricultural planning and activity implementation develop options to address the requirements of agricultural development under a variety of programmatic circumstances, including fragile, famine-prone, and food-insecure states develop a new approach to agricultural education and training in transformational development countries develop guidelines and tools for conducting agricultural sector assessments and design strategies and programs consistent with the new USAID business model strengthen professional capabilities to design and implement effective agricultural programs develop state-of-the-art courses on strategic agriculture issues provide adequate resources to agriculture from all budget sources

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