Themes Sessions: Enabling Policies for Inclusive

Business14:30 – 17:00 h

Roundtable, Inclusive Agribusiness23 Sept 2015

• Policies as enablers• “Essential” background

Scope

• Which policy domains are most important for creating direct and indirect incentives for more and more rewarding smallholder engagement in agricultural markets?

• What specific examples of policies influencing inclusive agribusiness can we draw on?

• What instruments do governments have at their disposal?

• What policy-informing and influencing processes are relevant for priority domains and instruments?

• What constructive next steps could Grow Asia take to support policy dialogue and better understanding of policy issues?

Policies as enablers: Focus questions

Enablers for Inclusiveness

Investment Financial Services

Technology and R&D Transfer and Distribution

Infrastructure Physical and Digital

Connectivity

Business Linkages Upstream and

downstream links

Labor Capacity Human Resource Development

Country-specific Political Environment

Business Climate Norms, Rules and

Regulations

Land Tenure and Property Rights

National and Regional Policies

Immediate Enablers

Useful Enablers

Necessary Conditions

Sufficient Conditions

Essential Enablers

Micro LevelEnablers specific to agri-food

sub-sectors

Macro LevelEnablers specific to country

or region

Enablers of Inclusive Agribusiness

Figure 2. Conceptual Framework for the Enablers of Inclusive Agribusiness

Scope of supportive policiesPolicies which foster social equity and inclusion of smallholder farmersPolicies which promote market access (“Free market”)Policies aimed at investment liberalizationPolicies which support good governancePolicies which incentivize companies to include smallholders

Essential Enablers at macro-level: Policy

A. Economic management Macroeconomic policy that is business-friendly Fiscal policy Debt policy

B. Structural Trade Financial Sector Business regulatory

Essential Enablers at macro-level: Policy

Types of policies

D. Social inclusion / equityGenderEquity (public resource)Building human resourcesSocial protectionSustainability of environmental institutions

B. Public sector management & institutionsProperty rights (rule based governance)Quality of budgetary & financial managementEfficiency of revenue mobilizationQuality of public administrationTransparency, accountability & corruption

Essential Enabler at macro-level: Policy

Types of policies

Governance indicators: ASEAN

Agribusiness models that enable inclusiveness

SupplyChain

Farming & Food Production

Processing & Post Harvest

Distribution, Wholesale & Retail

Marketing & Sales

Contract farming

(Nucleus estate & Multi partite schemes ++++

Contract farming between processing & manufacturing firms and small farmers ++++

Farmer-owned business links with agribiz ++

Upstream links between agribiz and smallholders ++++

Land concession

arrangements +++

Farmer-owner businesses & cooperatives’ links to agribusiness firms ++

Agribiz links with smallholder farmers ++++

Downstream links between agribbiz and smallholders ++

Management contracts

(Sharecropping) ++

“Inc

lusi

ve”

arra

ngem

ents

fo

r sm

all f

arm

ers

(Key: ++++ High adoption; +++ Moderate; ++ Low; + Infrequent)

Country Sector / Industry 1990 1995 2000 2005 2010 2011

Brunei Agriculture, hunting, forestry, fishing 0.97 1.16 1.02 0.95 0.76 0.64

Cambodia Agriculture, hunting, forestry, fishing 50.12 51.44 37.84 32.40 36.02 36.68

Indonesia Agriculture, hunting, forestry, fishing 17.55 15.36 15.61 13.13 15.34 14.72

Lao PDR Agriculture, hunting, forestry, fishing 45.06 41.81 43.48 36.25 29.72 28.37

Malaysia Agriculture, hunting, forestry, fishing 14.89 12.61 8.45 8.36 10.49 11.99

Myanmar Agriculture, hunting, forestry, fishing 57.26 59.99 57.24 46.69 36.36 38.24

Philippines Agriculture, hunting, forestry, fishing 19.14 18.89 13.97 12.66 12.31 12.78

Singapore Agriculture, hunting, forestry, fishing 0.34 0.16 0.10 0.05 0.03 0.03

Thailand Agriculture, hunting, forestry, fishing 10.01 9.10 8.52 9.23 10.86 11.63

Vietnam Agriculture, hunting, forestry, fishing 38.74 27.18 24.53 20.97 20.58 22.02

ASEAN Agriculture, hunting, forestry, fishing 14.85 13.07 11.54 10.80 12.68 13.08

Source: UNCTAD Stat (2013)

BACKDROPASEAN: The Structure of Economy by Industry (in percent to total GDP)

Top Agri-Food Players in ASEAN

1 Demographics –Population growth, Urbanization, Growing middle class (increased income)Declining & ageing farmer population

2 Diet changes 3 Declining performance of agriculture4 Environmental degradation/ Loss of land and water resources5 Climate change6 Increase in oil prices/biofuel expansion7 Rapid transformation of supply chains8 ASEAN Economic Community 20159 Urban and Peri-Urban Agriculture (UPA)10 Biotechnology11 Farmers as Entrepreneurs (away from subsistence)

Change agents in the agriculture-food security landscape

Country Urban population, % of total population

1990 2000 2012Brunei 68.6 71.2 76.0 (2011)

Cambodia - 16.0 22.0

Indonesia 30.9 42.1 49.8 (2010)

Lao PDR 15.4 22.0 34.2 (2011)

Malaysia 51.1 (1991) 62.0 72.4

Myanmar 24.8 29.1 30.8

Philippines 51.9 (1993) 48.0 48.9 (2011)

Singapore 100.0 100.0 100.0

Thailand 18.0 31.1 45.1

Vietnam 19.5 24.2 31.9

UrbanizationSource: ADB Key Indicators for Asia and the Pacific. 2013

Asia by 2050 will be >54% urban; ASEAN > 50% in 2013

Index 1DUPONT-Economist Intelligence Unit,

Global Food Security Index

Quality & Safety•Diet diversification•Nutritional standards•Micronutrient availability•Protein quality•Food safety

Availability•Sufficiency of supply•Public expenditure on agricultural R&D•Agricultural infrastructure•Volatility of agricultural production•Political stability risk•Corruption•Urban absorption capacity•Food loss

Affordability•Food consumption as % of household expenditure•% population under poverty line•GDP per capita @PPP•Agriculture import tariffs•Food safety net programmes•Access to financing for farmers

“Objective is to measure which countries are most and least vulnerable to food insecurity.”

Economist Intelligence Unit, Global Food Security Index

Country Rank GFSI Score Country Rank GFSI ScoreUSA 1 89.3 Indonesia 74 46.7

New Zealand 13 82.8 India 68 50.9

Australia 9 83.8 Myanmar 78 44.0Singapore 2 88.2 Pakistan 77 45.7

Japan 21 77.4 Bangladesh 89 37.4

S. Korea 24 74.8 Nepal 85 40.5

Malaysia 34 69.0 Cambodia 96 34.6

China 42 64.2Thailand 52 62.0

Sri Lanka 63 53.7 Canada 7 84.1

Vietnam 65 53.4 Brazil 36 67.4Philippines 72 49.4 Argentina 37 67.1

Congo (DR) 105 30.1

“Objective is to measure which countries are most and least vulnerable to food insecurity.”

2014 May 2015

Index 2: The “Rice Bowl Index” (RBI)

SYNGENTA & FRONTIER STRATEGY GROUP

RICE BOWL INDEX: Full Year Update 2012-2013Countries with relatively high Robustness (Score >50): Australia, Japan, New Zealand, Taiwan

Hungry people as an indicator of food insecurity

FAO 2014: State of Food Insecurity in the World 2013

1 in 10 people inASEAN is hungry!

How food secure are we?

Regional Programmes

ASEAN– ASEAN Integrated Food Security (AIFS) Framework – Strategic Plan of Action on Food Security in the ASEAN

Region (SPA-FS)– ASEAN Plus Three Emergency Rice Reserve (APTERR)– ASEAN Food Security Information System (AFSIS)

– ASEAN Multi-sectoral Framework on Climate Change: Agriculture and Forestry towards Food Security (AFCC)

– ASEAN+3 Comprehensive Strategy on Food Security and Bioenergy Development (APTCS-FSBD) Framework

– Strategic Plan of Action on Food and Energy Security (SPA-FES)

Structure of ASEAN Cooperation in Food, Agriculture and ForestryStructure of ASEAN Cooperation in Food, Agriculture and Forestry

ASEAN Ministers of Agriculture and Forestry (AMAF)

SOM-AMAF

AWG on Halal Food *

ASEAN Food

Security Reserve Board *

ASWG on Agric.

Training &

Extension

ASWG on Agric.

Coopera-tives

ASWG on Crops

ASWG onLivestock

ASWG on Fisheries

ASEAN Senior

Officials on Forestry(ASOF)

Joint Committee onASEAN Coop. & Joint Approaches in Agric. &

Forest ProductsPromotion Scheme

ACEDACBoard *

EWG on Harmonization

of Phyto-sanitary Measures

EWG onHarmonization

of MRLs of Pesticides

FCG on ASEAN-

SEAFDECCollaboration

AEG on Herbal and Medicinal

Plants

AEG on Forest Product

Development

AEG on CITES

NFPWG/ Industrial Clubs

CarrageenanCocoa

Coconut

Vegetable Oil

Forest Products

Coffee

Tea

Pepper

Peas & BeansTapioca

ASEAN Focal Point on

Veterinary Product

ATF on Codex

Note:SPS: Sanitary and PhytosanitaryARASFF: ASEAN Rapid Alert System for Food and FeedATF: ASEAN Task ForceAWG: ASEAN Working GroupASWG: ASEAN Sectoral Working GroupEWG: Experts Working GroupAEG: ASEAN Experts GroupNFPWG: National Focal Point Working GroupTEG : Technical Experts GroupAFP : ASEAN Focal PointsATWG : ASEAN Technical Working GroupATF : ASEAN Task ForceSOM : Senior Officer Meeting(*) : Supported by a dedicated secretariat

As of 19 February 2014

AWGon Pan ASEAN

Timber Certification

AEWG on International

Forest Policy Process

ATF onHPAI

ATWG on Agric.

Research &

Develop-ment

TF on ASEAN

Standards for Horticultural

Produce

ASEAN AVRDC

Regional Network

(AARNET) Steering

Committee *

ASEAN Social Forestry

Network *

ATF on Genetically

Modified Food

Testing Network *

ASEAN Wildlife Enforcement

Network (ASEAN WEN)*

Tuna

ASEAN Fisheries

Consultative Forum *

EWG on ASEAN

GAP

ASEAN Shrimp Alliance *

ASEAN SPS Contact Points

ACCAHZ Preparatory Committee

ad hoc groups:•ASEAN ad hoc

Veterinary Epidemiology

Group•ASEAN ad hoc Communication

Group for Livestock•ASEAN Laboratory

Directors Forum

ARASFF *

ATF on Organic

Agriculture