TRENDS AND IMPACTS OF FOREIGN INVESTMENT IN DEVELOPING COUNTRY AGRICULTURE

and rural electrification (Agence Malienne pour
le Développement de l’Energie Domestique et
l’Electrification Rurale - AMADER), which is a
public administration body. AMADER’s primary
task is to manage and monitor domestic energy
consumption and develop access to electricity in
rural and peri-urban areas. AMADER runs a rural
electrification programme, through which it funds
and grants electrification concessions to private
operators. Many such operators have installed
generators and are now confronted with a rise
in diesel prices that cannot be passed on to rural
customers because of their low purchasing power
(Geres, 2007). AMADER is closely following
biofuel developments, but this is seen a long-term
solution that cannot be relied on to address the
short-term shortages faced by operators.
The Ministry of Agriculture leads a multiyear
programme known as the jatropha sector
support project (Projet d’Appui de la Filière
Pourghère - PADEP), which started in 2008.
Also, the Rural Economics Institute, which is
a public technological, scientific and cultural
institution run under the auspices of the Ministry
of Agriculture, provides services to the various
projects. This institute also carries out research on
jatropha.
Finally, a national biofuels development
agency (Agence nationale pour le développement
des biocarburants - ANADEB) was set up in March
2009 with the mandate of promoting biofuels.
Within this context of policy and institutional
support for the development of the biofuel sector,
and in the absence of significant public funding
to promote operational projects, several private
initiatives have been started, including both
development projects and business ventures. Mali
Biocarburant SA (MBSA) is a prime example of
the latter.
Origin of the initiative
MSBA is the result of a not entirely accidental
encounter between a private company and local
producers in Koulikoro Region who, against a
backdrop of energy crisis and renewed interest
in biofuels, were looking for a partnership.
Koulikoro is the second administrative region of
Mali, straddling the Sudanian and Sahelian agroclimatic
zones (Western Sahel). Millet, maize and
Part 4: Business models for agricultural
investment: Impacts on local development
sesame form the mainstay of its agro-pastoral
economy.
The project developer and MBSA manager,
a Dutch researcher and agro-economist, has
worked in Africa for a long time, initially in
East Africa (five years) and then in Mali (four
years), focusing on the development of value
chains. According to his own account, he has
always been interested in setting up a ‘win-win
enterprise’ in which both farmers and the investor
would benefit. This concern led him to study
various investment models adopted in both East
and South Africa. He found that none of these
models ensured genuine producer representation
or provided them with worthwhile benefits. He
concluded that only a model where producers
have an equity stake in the business and where
mechanisms exist to ensure a transparent
relationship between the parties can ensure such
a win-win.
This thinking fed directly into the concept of
MBSA. The Koulikoro Region of Mali appeared
promising, as the Dutch development agency SNV
had been working there for a while. Technical and
socio-economic studies were carried out, leading
to the establishment of MBSA as a company in
February 2007. According to the MBSA manager,
the studies found that the production of the main
staple crop, millet, in the Koulikoro Region did
not provide farmers with adequate income and
could not always even keep them fed all year
round (50 percent of the households covered
by the studies were unable to feed themselves
throughout the year). It was thought that,
because growing jatropha does not, in principle,
require great effort, combining it with food
crops could help to bridge the gap. The Malian
partners were initially the Koulikoro Chamber of
Agriculture, and then the local union of jatropha
producers’ cooperatives in Koulikoro (Union
Locale des Sociétés Coopératives de Producteurs
de Pourghère de Koulikoro, ULSPP).
While the Dutch developer was nurturing
these ideas, two farmer leaders in the region,
who were also teachers approaching retirement,
were wondering what activities they could
undertake once they left teaching. Having found
out about jatropha seed processing in other parts
of the country, they had begun trialling the crop.
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MALI