Pro-Poor Value Chain Development - Capacity.org

and their actual or potential markets (Humphrey and Navas-Alemán, 2010). The
creation, and effective coordination of, market linkages is therefore at the core
of the value chain intervention logic. In practice, this approach implies working
with economic agents at the ‘middle’ of the value chain as well as with other
stakeholders that have the potential to contribute to a more enabling environment.
This willingness to work closely with the private sector - including transnational
corporations or large national enterprises (lead firms) - is a particularly significant
element in the paradigmatic shift being witnessed in international development
policy and practice.
Assisting entrepreneurs to leverage their comparative advantages to compete
in globalised markets requires a holistic approach in addressing constraints and
opportunities along the supply chain and the broader enabling environment in
which value chains operate. In its influential 2010 report on the future of Dutch
development cooperation policy, 3 the Netherlands Scientific Council for Development
Cooperation (WRR) affirmed the need for a holistic approach by stating that
development support only makes sense as a long term, programmatic investment
providing an interlinked package of interventions that are implemented jointly
with local institutions and economic agents. With its focus on the private sector as
an engine for pro-poor growth, BOAM’s value chain development approach thus
resonated well with the shift in Dutch development cooperation policy from a focus
on ‘social’ to ‘economic’ sectors. 4
The BOAM Programme
Through its Business Organisations and their Access to Markets (BOAM) programme,
SNV has been an active contributor to value chain development in Ethiopia since
2005. The main development objective of BOAM was to introduce innovative
approaches aimed at improving business-to-business (B2B) relations in selected
value chains, and scaling up where possible. The expectation was that if the
programme was successful in demonstrating clear results relating to improved
linkages in the selected value chains, it would ultimately benefit poor smallholder
farmers in Ethiopia by enabling them to adapt their production in line with demand
and to access profitable market outlets for their produce.
The first step was to select the value chains on which BOAM would focus its
interventions. A total of 29 agricultural sub-sectors were analysed, with the final
selection based on the following criteria:
• Macro economic: clear market potential, market accessibility and market
stability formed the starting point for any sub-sector or value chain intervention
in order to ensure that the investments made were based on real market
opportunities;
• Micro economic: this set of criteria examined the capacity and readiness of
private sector actors to cooperate with the programme and add value to the
selected commodities;
• Alignment to pro-poor development priorities: as a development programme,
BOAM’s ultimate objective was to expand opportunities for poor smallholder
farmers to increase their income by linking them to a better functioning - and
more market-oriented and competitive - value chain. Key indicators used
included the potential of the intervention to contribute to job creation and
enhanced linkages with smallholders.
Based on these criteria, BOAM chose to focus on the following agricultural subsectors:
honey, oilseeds, dairy and fruits.
3 WRR (2010) Less pretention more ambition: Development aid that makes a difference
4 Focusbrief Ontwikkelingssamenwerking, Parliamentary briefing note by the Dutch Minister of Foreign
Affairs, March 18, 2011
Introduction
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