Advancing joint strategies for inclusive Agri-Business in Kenya

The Food & Business Knowledge Platform (F&BKP) and the Netherlands Organisation for Scientific Research (NWO) recently organized a knowledge sharing meeting on inclusive agri-business (IAB) strategies in Nairobi, Kenya. The theme of the afternoon session was Connecting research with policy and practice.

The meeting took place on January 18, 2018, and was attended by members of the NWO-WOTRO Global Challenges Programme Call 2 international multi-stakeholder research projects that were in Kenya for their midterm review. They were joined by 40 Kenyan Food & Business stakeholders working in the field of agri-business, including research professionals, private and public sector representatives, local and international non-governmental organizations professionals (NGOs), and donors.

The goal of the mini-conference was to make recommendations on improved joint strategies for inclusive agri-business, driven by findings from the GCP-2 projects and experiences form Kenyan practices. Knowledge exchanged at the forum was based on plenary presentations, those multi-stakeholder research projects and on Kenyan agri-business practices. The aim of  the meeting was to enable participants to learn from the presentations and exchanges and be inspired and adopt knowledge to improve their work, Ms Vanessa Nigten, Knowledge Broker at the Food & Business Knowledge Platform and event organizer, said.

GCP and SNV findings on Inclusive Agri-Business Models

During the event, Inclusive Business Models (IBMs) were defined as sustainable business solutions that expand access to goods, services, and livelihood opportunities for low income communities including disadvantaged groups such as the poor, women and youth, in commercially viable ways.

The GCP projects were represented by Mr Guus van Westen of Utrecht University in the Netherlands and in three pitches by consortia members on main project lessons. The latter treated the role of public sector, bottom up vs top down approaches and the sustainability of inclusive business (research) projects. Van Westen in his presentation, Inclusive business and poverty in agri-development, stated that IBMs are a promising development strategy that could help business to develop and thereby lift people out of poverty. Yet they should not be mistaken for a sufficient strategy to combat poverty. That can only be realized when IBM strategies are combined with targeted poverty reduction policies. He explained that when businesses aim sustainably to include poor groups in core activities of companies in roles of supplier, worker or client, due to competitive selection there will always be weeding out, separating successful from less competitive players. For real “inclusive development” IBMs he thus concluded that they should be complemented by targeted poverty alleviation policies, e.g. social services (education, skills training, health care), social security net and food/nutrition schemes.

Following, to sketch the Kenyan practice, a presentation was given on the Kenyan Market-led Horticulture Programme (HortIMPACT), a project that focuses on fruits, vegetables, and potatoes and serves 50,000 SME farmers. Mr Klaas de Vries, Advisor of HortIMPACT at SNV Kenya, highlighted some of the key project milestones in his presentation. He explained that HortIMPACT had worked with Agventure and Unilever and learned from this experience that heavy initial investment by private companies is sometimes needed; different business cases call for different partnerships; factors like environment and political stability are crucial and a broader, coherent knowledge agenda essential for such programmes.

Multi-stakeholder panel on good practices of IBM knowledge activities

Hereafter a panel reflected on the GCP outcomes and Kenyan practices and how to jointly bring them further. Three panelists represented the public, private and research sector in Kenya: Ms. Sanne Willems, First Secretary, Food Security of the Netherlands Embassy; Ms. Nushin Ghassmi, Sustainability & Communications Manager of Industrial Promotion Services (IPS) and Dr. Catherine Kilelu, Coordinator, Robust, Resilient, Reliable (3R) Kenya from Aid to Sustainable Trade Project.

In her response to the question: “Would you say that you apply (knowledge on) IBM for companies you work with in agro-food value chains?” Ms. Ghassmi mentioned Kenyan vegetable processor Frigoken which she said is an example of how one could have an IBM that is inclusive and makes profit at the same time. Value addition, she said, is what helps in making something commercially viable. Through contract farming, Frigoken buys directly from smallholder farmers, thereby facilitating their inclusion in the value chain. On her part, Ms Sanne Willems said, for a knowledge base on IBMs, the Dutch government is partnering with local institutions, offering scholarships to the Netherlands, and developing customized trainings in inclusive agri-business. Additionally Dr Kilelu stated that, even as in this meeting, she has seen a shift where researchers had become more engaged in getting their findings to the right forums, and seeking engagement with different stakeholders. She added that the agenda of the research is increasingly being set by stakeholders.

Lessons from participant exchanges

During a following round of thematic group discussions, participants form the GCP projects and Kenyan practices exchanged on challenges, best practices, solutions and ideas for (joint) follow-up actions in the field of IBMs. Conclusions were drawn around three main issues.

Related to the development impact of IBMs it was concluded that those models do promote value addition to farmers whereas cooperatives are success factors. On the other hand, co-ownership through shareholding within processing firms is considered as a tool to minimize side-selling. Examples where these models have been successful in Kenya are the Githunguri and Meru cooperatives. Those IBMs have also promoted scaling out into other counties/regions, and scaling up by venturing into value addition and export markets. Additionally it was mentioned that IBMs are often faced with challenges such as weak institutions, and price fluctuation. However, price fluctuation may be addressed through the mentioned processing and/or value addition.
A follow-up activity identified was exploring co-ownership throughout the value chain.

The second issue that came forward in the break-out groups was the need for multi-stakeholder collaborations to drive the pace and scale of IBM initiatives. It was concluded that integration initiated by a powerful lead such as a processor or another broker that brings people together for transactions. Challenges mentioned for multi-stakeholder collaborations were sustainability and power relations. These may be resolved through context-relevant produce; disentangling from relationships and adaption of new technologies; engaging different stakeholders such as government, banks, civil society; and having tailor-made research and financial products e.g. for the youth. Other approaches include developing a monitoring and evaluation framework; infrastructure – both hard (e.g. roads) and soft (e.g. technology); increasing land access and providing land tenure rights; and forming PPPs.

Thirdly enabling policies for the application of IBMs were discussed in the groups. Three Kenyan policies came forward as good examples: procurement, lowering of taxes for malted beer, and funding for youth and women through the Women Empowerment Fund and the Youth Empowerment Programme. The procurement policy reserves a 30 per cent quota for marginalized groups to afford them an opportunity to do business with government. Group cohesiveness, finance and capacity are some of the challenges experienced under this policy. Three proposed solutions were: capacity building and training; improvement in governance structure; and accountability in groups. Lowering taxation on malted beer has increased sorghum production. The challenges in this policy are that there is low impact because of pricing, bird infestation, low investment in input, and lack of collectiveness among farmers. It was brought forward that these problems could be resolved through improved farmer group governance structures, enforcement of legal systems within cooperative movements, adjustment of the cooperatives policy to reduce government interference, and improving access to financial services.

Recommendations

All in all from the afternoon exchanges it was determined that IBMs need to be paired with other pro-poor strategies in order to improve livelihoods. A number of specific recommendations were made in that regard:

• A multi-stakeholder approach is recommended, where effective collaboration between different actors such as public and private sectors and research can help promote inclusive business.
• Additionally, strategies for achieving sustainability and scalability in IBMs were proposed. They include capacity building and training programmes, knowledge sharing, creating shared value and building genuine partnerships.
• Thirdly, national and company policies need to be aligned to inclusiveness by finding creative ways to integrate marginalized groups in agri-business.
• Lastly, in line with the theme of the afternoon, research activities were identified as crucial in building an evidence base for inclusion.

During the afternoon participants got the opportunity to get to know each other and made various agreements on following up on this jointly.

Video impression

Please find here additionally a short video impression of the exchange afternoon.

Please download the full report (PDF) of the exchange afternoon.

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The public seminar took place in the context of the NWO-WOTRO Global Challenges Programme Call 2 international multi-stakeholder midterm meeting from January 15 till 19 in Kenya. Please find here the news item and full report of the GCP-2 projects midterm meeting.