1. Public Private Partnerships (PPPs): The Case of Agribusiness
Ekiti Economic & Development Summit
15th October, 2011, Ado-Ekiti
Ayo Akinola, Technical Advisor
GIZ-Sustainable Cocoa Business
Setting the context
With increased regional integration, the Dr. Fayemi-led administration sees
agriculture as a sector with major revenue generating potential which sadly has
not been tapped over the years.
Agriculture also has the potential to significantly impact on the state of
unemployment among young people in Ekiti State by providing avenues for
gainful employment.
Against this context, this paper will focus on generic agribusiness public-
private partnership (PPP) models with potentials for sustainable
implementation and the attainment of the agricultural transformation policy
with particular reference to capacity building in the cocoa value chain where
Ekiti State seeks to be a world leader!
"Reviving cocoa plantations to make Ekiti again a world leader in cocoa
production; agriculture to contribute 50% of internally generated revenue;
20,000 Ekiti youths trained and employed in mechanized agriculture by 2014."
Presentation outline
• Enabling landscape for PPPs
• What are agribusiness PPPs
• The shared value cascade
• The capacity building PPP “CBPPP” model
• The lesson points of the CBPPP model
• Rolling out the Ekiti State CBPPP model
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2. Enabling landscape for agric vision
• Mapping out the value chains on areas of comparative strength, market
potential, employment, income generation and the envisaged multiplier
impacts
• Sensitizing and getting the buy-in and ownership of the key actors,
service providers (including public agencies) and operators on the
selected value chains with particular reference to how their business
aspirations and fortunes will be enhanced
• Sensitizing and building awareness and community legitimacy across
the key growing destinations with a view to getting the buy-in of the
target producers, farmer originations and farmgate gatekeepers.
• Specific issues such as production targets, potential income generation,
access to services, market linkages and most importantly, bottom-up
farmgate feedback are key issues that will drive robust vision
ownership
• The translation of policy statements to specific income and
measurement benchmarks are critical not only to rein in community
loyalty, project uptake, social capital and collaboration but provides the
basis for project monitoring and evaluation.
• The policy dialogue and advocacy process must be deployed through a
very structured and institutionalized mechanism that brings all the
critical stakeholders to a common understanding of the benefits,
responsibilities and roles to achieve the agric vision for the specific
value chains
• This paper thus recommends a one-stop-shop “clearing house” that will
be responsible for PPP advocacy, facilitating PPPs and coordination
between the project initiating ministries, departments & agencies
(MDAs), private sector investors and development partners. It could be
tagged Ekiti State PPP Agency!
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3. What is Agribusiness PPPs?
• PPPs are collaborative projects that are jointly planned, financed and
implemented by public sector, private companies, civil society and
development agencies towards a common objective that combines
business interests with development policy goals.
• Each partner contributes what they do best in a very coherent manner
that benefits the interest of all sectors of the society. Public agencies
bring to the table the enabling environment, whilst their private
counterparts contribute their technology, innovation, capital and
expertise in a cost and risk sharing regime.
• Development and civil society partners undertake crosscutting pro-poor
and socially inclusive activities that ensure a working balance is
maintained between social and commercial objectives.
• Agribusiness PPPs range from the socially-inclusive outgrower
schemes, service contracts, management contracts, public lease
contracts to concessions and build-operate-transfer arrangements. Most
common in Nigeria are private-sector led outgrower schemes and
associated service contracts.
• With untapped endowments in cocoa, rice, cassava, cotton and yam,
Ekiti State stands well positioned to drive successful agribusiness PPPs
that will enjoy strong collaboration from the development community.
• A very successful PPP that requires close examination is the Sustainable
Tree Crop Program (STCP). It has demonstrated that by bringing
together government, the private sector, development agencies &
research institutions, towards a common goal, can benefit the value
chain, increase famer income, national economies and competitiveness
of global partners.
Shared value cascade with a common vision to enhance the circumstances of
West Africa Cocoa farmers, the STCP:-
• Spawned off the farmer field school (FFS) extension approach into
national consciousness,
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4. • Enhanced cocoa yield and quality
• Triggered higher farm gate prices & the strengthening of farmer
organizations disenfranchised from the collapse of the cocoa board;
• Compelled private sector investment in socially-inclusive and dedicated
supply chain arrangements with cocoa producing communities;
• Brought some credibility and order into the otherwise unregulated cocoa
value chain in Nigeria;
• Commanded public sector attention and in particular, was one of the key
factors that grew the Cross River cocoa economy; and provided the
platform for another PPP, the Cocoa Livelihoods Program (CLP), which
is sponsored by Bill & Melinda Gates Foundation, World Cocoa
Foundation & German Ministry of Economic Cooperation.
• Shared Value Cascade & Partner Roles
• Public Sector Role:-
• Providing the enabling structures for coherent implementation
• Coordination between MDAs & other partners
• Co-funding technical assistance, training, skills, mentorship etc
• Assist with organizing smallholder farmers into producer groups
• Facilitate access to selected services (land clearing, tractor services, seed
gardens, government permits)
• Facilitate communication between NGO partners, farmer groups
• Private Sector Role:-
• Adoption of selected producer groups on cleanly defined parameters
• Co-funding technical assistance, training & mentorship
• Provide seeds, fertilizers, agrochemicals and in-kind credit facilities
• Organize farmgate procurement based on specific quality arrangements
and social services or projects to deserving communities
• Pay attractive prices from elimination of rent-seeking middlemen
• Shared Value Framework & Partner Roles
• Development Partner/Ngo Role:-
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5. • Facilitating market and private service provision (seeds, inputs,
agrochemicals, financial service providers) linkages
• Packaging products & services to give comfort to service providers
• Training of public sector frontline extension staff and community based
farmers on best practice delivery tools and mechanisms
• Training of community based input dealers and seed providers
• Facilitating baseline surveys, impact assessment surveys and
monitoring and evaluation activities
• Selection & capacity building and strengthening of producer groups to
deliver services to members and contractual responsibilities under the
supply chain arrangements
• Facilitates community based ground working and awareness creation
activities on behalf of public sector agencies
• Builds capacity of selected service providers and public sector agencies
to take on role for sustainability and upon exit
• Institutionalization of development competences in agribusiness coys
Benefits of Agribusiness PPPs Farmers
• Increased grassroots income, esteem and livelihoods
• Technical improvements and sustained access to pro-poor services
• Enhanced farmgate market power and transformation
Development Partners
• Successful delivery of program mandate
• transfer of tools, mechanisms and processes for sustainability
• Development of innovative and uptake of socially-inclusive products
and services
Private Sector
• Improvement of the supply chain arrangements
• Guaranteed access to quality commodity at favorable prices and just-in-
time delivery
• Enhancement of brand equity and government recognition
• Accomplishment of in socially responsible projects in a win-win manner
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6. Government
• Accomplishment of agric vision & internal generated revenue objectives
• Professionalization of public agricultural extension services
• Collateral impact on other agric and associated MDAs and strengthened
value chains
• Enhanced food security, social & political capital
• Ppreferred destination to replicate innovative PPP arrangements and
donor collaboration
• Capacity building PPP model
• Capacity building, which encompasses technical transfer, agric
extension, training, business skills acquisition and mentoring and is at
the heart of successful commodity value chains as evidenced in the
previous slides on the shared value cascade
• Capacity building can be thus be classified under service contact PPPs
arrangements, wherein the partner provides services but with the active
involvement of public sector agencies over a fixed but short term period.
• Under the framework of the Cocoa Livelihoods Program, GIZ works in
partnership with the ADPs to deliver business skills training to cocoa
households across Abia, Cross River, Edo, Ondo & Osun states. To date
over 4,500 business hungry farmers trained!
• To attract superior private sector and development community
partners, this paper recommends the CBPPP model to Ekiti State
• Lesson points of the CBPPP model
• The CLP capacity building regime churns out cocoa farmers that are
technical proficient (through the farmer field school (FFS); business
minded (through the farmer business school (FBS) and fiercely
committed to incubating groups (farmer strengthening component)
• Across the 5 states, the cocoa farmers are attracting the attention of the
big exporters for dedicated supply chain relationships, agro-input
companies and recently, the financial service providers on account of
the new agricultural finance products.
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7. • The technical partners GIZ, IITA/STCP & Socodevi (Canadian NGO)
work through frontline extension staff of the ADPs and cooperative
departments that have begun to adopt and institutionalize the capacity
building protocol
• The CLP is co-financed by the global cocoa and chocolate brands and
this arrangement may well provide an entry point for the local private
companies
• The frontline extension staff involved in the program has emerged very
professional, passionate about their work.
• Survey assessment suggests that they are clearly superior to their other
colleagues-this is clearly a strong benefit for public service extension
delivery, which is plagued by insufficient funding
• Given the increasing role of private sector in outgrower schemes the
CBPPP model will attract investments and support of discerning
agribusinesses
• The emergence of properly trained farmers and community based
training resource will accelerate the attainment of the agric vision. For
too long, agric polices have paid lip service to building farmgate
capacity. The unprecedented surge in the Cross River cocoa economy
can be attributed to this singular thrust.
Rolling Out the Ekiti CBPPP Model
• If Ekiti plans to double her cocoa output to say 40,000mt, not less than
8,000 farmgate cocoa entrepreneurs that will work on 40,000 ha of
diversified cocoa farming systems will have to be engaged
• Ekiti State should clearly define the capacity development spectrum of
the targeted producer groups that will drive its cocoa vision.
• Ekiti State should then ride on its robust donor pedigree to establish
credible international and local service PPP contracts that will
professionalize its extension delivery system and grow more a
sustainable community based training resource base
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8. • With a coherent business plan, the CBPPP model could attract the
attention of private sector investors that could enter buy-back
arrangements with specific farmer organizations
• Seed money would however be required from development partners to
trigger-off the process
Thanks for your attention!
…“to me, poor people are like bonsai trees. When you plant the best seed of
the tallest flower-pot, you get a replica of the tallest tree, only inches taller.
There is nothing wrong with the seed you planted; only the soil base that is
given to it, is too inadequate…”
Prof. Mohammed Yunus.
With a right dose of farmgate ownership & PPP arrangements, Ekiti State looks
well positioned to emerge inches taller than.…
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