Local/Regional Economic Development in South ... - Value Chains

Impact
The projects are working across entities. Producers from
FBiH as well as from RS are making use of the services of
PMGs. Products are – to some extent – being marketed
under a uniform label. The exchange of goods and thus a
socio-economic exchange is being promoted between the
entities through the expansion of the approach into the
Mostar region. The results of the project work rest on:
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Further training measures with far-reaching effects
Consistent work with members of the cultivation
groups and businesses advised
Direct knowledge transfer, for which members are already
functioning as multipliers
Making official partners aware of the project approach
and its results and also
Concrete added value that directly results in increased
production
Increased employment of paid staff in horticultural
businesses and in PMG (creation of about 1,500–
1,600 new jobs, or basis of income for about 6,000–
7,000 people)
The living situation of these families is improved through
the provision of paid and secure jobs. The pressure to migrate
is curbed.
The technical and economic know-how disseminated
multiplies itself far beyond the direct beneficiaries and
leads to an adaptation of existing production procedures
to more efficient and more strongly market-oriented procedures
even outside the direct influence of the project.
The change in agricultural production and its integration
into the markets is being supported. This change becomes
visible through
• The clearly higher number and higher quality in the
local offering of goods in supermarkets and smaller
grocery stores compared to 2000
• The differentiation in product prices according to
qualities
• The conversion of existing orchards to newer varieties
and modern cultivating systems
• The expansion of vegetable-growing under plastic
• Dealing with or using pesticides in a sensitive manner
• The high demand for project brochures, advising and
checking of pest control devices
Varied contacts to local institutions and donor organizations
make it possible to exert influence on political decisions.
In this way, the project gives stimuli in the designing
of other projects and has an effect at a broader level.
This development can be observed in the development of
PMG Krajina, for example, which was initiated independently
from the project. It is structured and developed
according to the same model as that used in Gradačac. It
has been proven that decision-makers not involved in the
project are seeing the PMG model as attractive and full of
promise for the future, and it is being copied.
In the end, the growing economic exchange between the
entities together with the social activities in the youth
work are also contributing to reconciliation and securing
the peace in BiH.
Lessons learned
Approaches promoted by the project are still relatively
new for BiH, however they are increasingly finding consideration
in the strategies of agricultural ministries and
international donors. Acceptance and positive assessment
of approaches with regard to group organization and joint
production and marketing is rising and is also discernible
outside the direct influence area of the project. A brisk exchange
of experiences is being fostered, and to some extent
cooperation is occurring with projects in countries such as
Macedonia, Kosovo, Bulgaria and Romania, where similar
approaches are being promoted. It turns out that the
problems are very similar in all the countries:
• The need to improve business structures via business
mergers, producer cooperatives and other forms of
cooperation is fundamentally acknowledged and is
also being supported by the ministries.
• Individual businesses, however, are often still captive
to production-oriented thinking without considering
market dynamics. Adapting business management to
market requirements is difficult for many producers
and has not yet been completed in any country.
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It’s true the advantages of professional intermediate
structures (commerce) are acknowledged and accepted
as the link between producer and sales-side
market participants, at least theoretically. However,
practical implementation is being hindered by distrust
on the part of producers, insufficient loyalty to
the terms of a contract and less than ideal acceptance
of market guidelines.
Recommendations for similar projects
Against the backdrop described above, the problems occurring
in the development of PMGs are not to be seen
as only the problems of BiH, but rather are to be viewed
within the context of the centralist and production-oriented
economic system, long anchored in Eastern Europe.
It is similarly true for advisory programs. The advice is definitely
being absorbed by businesses. However, an independently
financed advisory system independent of state
offices or companies is almost non-existent.
As in all transition countries, entrepreneurial thinking in
many businesses and even for many academically educated
people in BiH is only developed to a limited extent.
At the same time, the importance of entrepreneurial
thinking and acting continues to increase since markets
and consumer demands are adapting much more quickly
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