Improving resilience by developing value chains
Title: Improving resilience through the development of value chains in southern and south-eastern Madagascar
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ); European Union (EU)
Lead executing agency: Malagasy Ministry of Agriculture
Overall term: 2012 to 2017
The south and south-east of Madagascar are among the poorest regions of the country. Weak infrastructure means that agricultural produce from this area rarely makes it to market. There is also a lack of reliable information about market prices and current demand for these goods. Products are insufficiently commercialised, as many farmers have no contact with potential partner companies and have difficulty finding buyers.
This makes it challenging for companies to steer the quality and quantity of the products they handle. Farmers have no choice but to accept low prices for their produce. These circumstances are hindering the regions' economic development and contributing to the poverty of large sections of the population.
Food supplies are secured for the rural population in southern and south-eastern Madagascar, despite the effects of climate change. Yields from the production of castor oil, honey, beans and goat's meat have increased. Households managed by women have been integrated into the relevant value chains.
The project supports promising sectors, paving the way for agricultural potential to be exploited more effectively, and improves the prospects of farmers and businesses alike. Unlike traditional approaches to combating food insecurity, this project uses analysis of the final components in the value chain (consumption and sale of the final product) as the first step to boosting income.
Based on studies of different economic sectors and on proposals submitted by companies and farmers' associations, four value chains have been earmarked for promotion: castor oil, honey, beans and goat's meat.
The project organises regular meetings where the various stakeholders in a given sector can discuss their interests and better coordinate their activities. Initial business contacts are being established between farmers and companies that could potentially purchase their produce. Involving the regional authorities and all relevant stakeholders fully in drawing up development plans for the value chains is another success factor, allowing different visions to be harmonised and responsibilities to be agreed upon. The development plans define the various needs of individual economic groups and identify the measures needed to create a value chain.
For example, farmers have been trained in improved castor-oil and honey production methods, allowing them to adapt their production activities more effectively to the needs of companies, develop new sales opportunities as a result, and generate higher incomes from increased production volume and better product quality.