Conference: Value Chains for broad-based development

Results of the International conference, Berlin, 30 – 31 May 2007

The German Development Cooperation (BMZ and GTZ), the Swiss Development Cooperation (SDC and SECO) and the Technical Centre for Agricultural and Rural Cooperation (CTA) called an international conference on ”Value Chains for Broad-based Development” that was held in Berlin on May 30-31. Around 200 specialists and practitioners of value chain promotion participated.

Promoting value chains has become an important field of economic cooperation in recent years. Hence, the first objective of the conference was to take stock of the practical experience. Indeed, the development projects present at the conference showed an impressive record of successful initiatives. The documented know-how demonstrates that value chain promotion has been established as a solid, widely used concept.

The second objective of the conference presented a much greater challenge – finding answers to the question how value chain work can become more socially inclusive benefiting a greater number of poor and securing their position in the market.

The idea was to identify directions for the further development of the value chain approach. The arguments can be clustered into a few key statements:

– The value chain approach contributes to reducing poverty if it is employed strategically and concentrates on targeting the poverty problem. We have to overcome the bias towards the better off by consciously using the full range of options available to support the poor in value chains. This includes fostering associations, skills development and learning, facilitating contract arrangements and supporting information and service delivery. Often, it is necessary to combine value chain promotion with a livelihoods perspective, with local economic development or with vocational training so as to enable the poor to enter (and stay in) commercial markets. However, we need much better monitoring tools to guide pro-poor value chain promotion.

– Choosing the right market and determining an appropriate market development strategy are strategic tasks of great importance, both in terms of scale and in terms of avoiding a race to the bottom. Development agencies need to promote the innovation of products and of business models.

– The cooperation between development agencies and the private sector is a precondition sine qua non. Companies are needed as development partners for several tasks – reaching out to a large number of small suppliers, investing in technology and productive capacity, promoting policy change, supporting the introduction of social and ecological standards and innovating products.

– The greatest outreach could be achieved by supporting an active economic policy for the industries and value chains most relevant to the poor. Governments should be advised in using the value chain perspective to remove administrative barriers, conceive support policies and make targeted investments. Broad-based industry policies also include the introduction of social and ecological standards.

– Donors have to cooperate more intensively to improve their efficiency and impact. The services and contributions of development agencies complement and reinforce each other.

The proceedings of the conference will be published on http://www.value-links.de/documentation.html

See the Report by Tillmann Ellisen in D+C June 2007:
http://www.inwent.org/ez/articles/055346/index.en.shtml

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