WEF FB NewVisionAgriculture HappeningTransformation Report 2012

7/31/2019 WEF FB NewVisionAgriculture HappeningTransformation Report 2012

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Putting the New Vision orAgriculture into Action:

A Transormation IsHappening

Prepared in collaboration with McKinsey & Company

A report by the World Economic Forums New Vision or Agriculture initiative


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1Putting the New Vision or Agriculture into Action: A Transormation is Happening

2 Executive Summary

5 Realizing the Goals o the New

Vision or Agriculture: MeasuringProgress and Seeking Balance

9 Setting in Motion the Virtuous Cycle:The Six Elements o AgricultureTransormation

19 Building National Partnerships:It Begins with a Dialogue o Leaders

23 Appendix

24 Acknowledgements

Contents Preace

The World Economic Forum is proud to present this actionagenda, Putting the New Vision or Agriculture into Action: ATransormation is Happening. It was developed in response to

the growing global demand or a set o concrete actions globaland regional stakeholders can take to achieve the goals o theNew Vision: to simultaneously advance economic growth,global ood security and environmental sustainability throughmarket-based approaches.

At the World Economic Forum Annual Meeting 2012 in Davos-Klosters, we launched a Roadmap or Stakeholders, outlining aramework or action to achieve the New Vision or Agriculture,and the role o the private sector working in partnership withother stakeholders in helping to achieve that. Given thewidespread adoption o this New Vision in 2011, weproceeded to look more deeply at how to achieve the Vision in

both strategic and operational terms.

The New Vision or Agriculture initiative is led by 26 globalPartner companies that span the ull ood value chain andbeyond, including: AgCo, Archer Daniels Midland, BASF, BayerCropScience, Bunge, The Coca-Cola Company, Diageo,DuPont, General Mills, Heineken, Krat Foods, Metro, MonsantoCompany, Maersk, Mosaic, Nestl, PepsiCo, RabobankInternational, SABMiller, Swiss Re, Syngenta, Teck Resources,Unilever, Vodaone, Wal-Mart Stores and Yara International.Each o these companies has contributed tremendousleadership and technical expertise through a project board andworking group whose members are listed in the

Acknowledgements.

McKinsey & Company serves as project adviser or the initiative,contributing substantial time and analysis through a dedicatedteam o experts. The initiatives knowledge partners the Foodand Agriculture Organization o the United Nations (FAO), theHarvard Kennedy Schools Corporate Social ResponsibilityInitiative and the International Food Policy Research Institute have provided continued thought partnership to this report andto the initiatives broader global discussions. The WorldEconomic Forums Global Agenda Council on Food Security, ahigh-level multi-stakeholder group, provided guidance in anadvisory role. Many other experts and practitioners leading

eorts to implement the New Vision also contributed to thisreport. They too are listed in the Acknowledgements.

A transormation o the global ood system has begun,representing tremendous potential to improve livelihoods andecosystems worldwide. To harness this momentum, we havemapped out what it will take to achieve the goals o the NewVision in terms o both global-scale shits and concrete country-level action. We hope this report will provide concrete tools toenable leaders around the globe to accelerate and expandcollaboration to achieve our shared goals or a sustainableuture.

Sarita NayyarManaging Director,Head o ConsumerIndustries

Lisa DreierDirector, FoodSecurity andDevelopmentInitiatives


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1 FAO, How to Feed the World in 2050

Putting the New Vision or Agriculture into Action: A Transormation is Happening

Executive Summary

FOOD SECURITYENVIRONMENTAL

SUSTAINABILITY

ECONOMIC OPPORTUNITY

The Food System: A Major Economic Development

Opportunity at a Time o Crisis

In the coming decades, a growing and increasingly auentglobal population will demand a greater quantity, variety andnutritional value o ood than the world has ever producedbeore. Meeting this demand will require a 70% increase in oodproduction, challenging a natural resource base that is alreadyunder signifcant strain. It will also require major increases ininvestment by up to 50% or developing countries alone inan era o economic crisis and austerity.1

Addressing these challenges eectively will require a NewVision or Agriculture one which leverages available resourcesto deliver economic growth and opportunity, improved oodsecurity and nutrition, and environmental sustainability through

a renewed agriculture sector. The need or such an approach isbroadly recognized; implementing it is now the imperative.

Putting the New Vision or Agriculture into action is challenging,but easible. It requires a substantially new approach in whichactors in the ood system collaborate to develop new solutionsand leverage investments or maximum impact. This reportoutlines how that can be achieved in strategic and operationalterms.

The New Vision has the potential to deliver increasedemployment, expanded access to nutritious and aordableood, and sustainable resource use. The result can reinvigorate

rural economies, providing sustainable livelihoods or severalhundred million smallholder armers and a resilient source oeconomic growth or countries around the globe.

Realizing the Goals o the New Vision or Agriculture:

Measuring Progress and Seeking Balance

The New Vision or Agriculture sets goals o 20% improvementper decade on each o its three goals: economic growth andopportunity, ood security and nutrition, and environmentalsustainability. Realizing these goals on a global level will requirethe right combination o actions, balancing agriculture-sectorgrowth with sustainability.

Progress towards the goals will be driven by: Signifcant advances in productivity on smallholder arms and

sustained productivity improvement on large-scale arms Increased value added on smallholder arms A reduction in emissions rom soil practices, livestock and

deorestation or agriculture

Improved efciency o water application Considerable reduction o waste throughout the ood valuechain

Tracking global progress towards the goals, using measurableindicators, will be essential to ensure we are on the right path. To assess whether we are generating greater economic

growth and opportunity, we will track rural income percapita

To assess the state o ood security, we will look to globalood production and malnutrition prevalence

To assess our progress towards environmentalsustainability, we will track greenhouse gas emissions and

water used per tonne o agricultural production, while alsorecognizing impacts at the watershed level

At the country level, more locally applicable indicators such as obesity prevalence or gender equity may be used

depending on the regional context. For instance, the role owomen and their productivity in contributing to broader

community economic development and nutrition couldmerit specifc attention and monitoring.


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Building Transormational Partnerships through New

Models o Collaboration

Partnerships that engage the ull spectrum o stakeholdersprovide a powerul platorm rom which to orchestrateagricultural transormation, creating a step change inagriculture-sector investment, productivity and sustainability.

In a number o cases, leaders in government and privateindustry have joined with other partners to defne shared goals,then coordinate and intensiy eorts to achieve them. Together,these stakeholders defne the initiatives and investments thatwill uel growth in the agriculture sector and the broader oodsystem, combine and leverage capacity in new ways, and holdone another accountable through monitoring and reportingprogress.

Such collaborative eorts represent a new way o doingbusiness or all stakeholders. They pose new challenges inrequiring coordinating diverse actors and navigating complexissues along the way. However, they present an opportunity orcombined and sustained impact that is essential to achievingthe New Vision or Agriculture.

2 Stakeholders include those involved directly in the ood value chain and inits broader environment, including: government, industr y, public andprivate-sector fnanciers, civil society, armers and armers organizations

Leadership &alignment

Investment &entrepreneurship

pipeline

Finance & riskmanagement

Strategy &priorities

Hard & softinfrastructure

Eff

ectiv

edir

ection D

eliv

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ats

cale

Delivery &implementation

mechanisms


Investment &entrepreneurship

pipeline




Eff

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mechanisms

Setting in Motion the Virtuous Cycle: The Six Elements o

Agriculture Transormation

Achieving the kind o transormative change required to realizethe New Vision will require sparking a virtuous cycle oincreasing skill and investment in the ood system to improveagricultural productivity, sustainability and prosperity.

A number o pioneering cases are showing how suchtransormative change can be achieved through multi-stakeholder partnerships. These experiences highlight sixelements that are essential stepping stones toward success ina large-scale transormation eort.

Eective direction rom an early stage is critical to directeorts at high-return opportunities, including:

Leadership and alignment o stakeholders aroundshared goals2: Impetus and engagement o leaders,translated into joint commitments and practical workingarrangements

A clear strategy and priorities or implementing the

transormation: Defning the priorities o the transormationbased on the countrys comparative advantages andaccessible market opportunities

An investment and entrepreneurship pipeline:

Investment opportunities across the chain that drive armercompetitiveness and market linkages; populations oentrepreneurs, innovators and investors who can participatein the opportunities; and a transactional approach to

kick-start investment

Delivery at scale requires specifc means and methods,in particular: Enabling hard and sot inrastructure policies and

investments: Physical inrastructure, policy andregulations, and human and institutional capacitythat are critical enablers or the transormation

Catalytic fnancing and risk management

solutions: Mechanisms that will und theeort and mitigate risks to ensuresustained investment rom large andsmall private sector players

Robust mechanisms andinstitutions or delivery,

implementation and durability:

An empowered multi-stakeholder approach ordesigning, managing andmonitoring delivery andimplementation oactivities to drivechange at scale


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5

Realizing the Goals o theNew Vision or Agriculture:Measuring Progress andSeeking Balance

Agriculture is Pivotal to Sustainable Development

The New Vision or Agriculture is one that rerames our view othe agriculture sector. Agriculture is a crucial driver oeconomic development. In establishing ood security it raisesproductivity, incomes and employment, with broad eectsacross economic sectors.

The New Vision asserts that agriculture is a primary driver oeconomic growth, the planets largest source o potential orgreenhouse gas (GHG) emissions abatement and waterconservation, and the most critical actor in increasing globalood security, addressing specifc nutritional needs that lead tohigh rates o malnutrition.

This New Vision emphasizes the need to go beyond isolated

interventions to take a comprehensive, long-term approach toimproving whole ood systems. Transormations have begunwith new models or improving productivity, supported byavourable policy, inrastructure and market structure.

It represents a shit rom approaching agricultural developmentwith philanthropy to approaching it as a market investment,creating a system where stakeholders have the incentive toinnovate, resilience to endure risk and capital to invest in growth.

Measuring Progress towards the New Vision orAgriculture

The New Vision or Agriculture has committed to ambitiousgoals: to uel economic growth and improve ood security improving both the quantity and nutritional quality and balanceo ood while lessening agricultural impact on theenvironment. The intent o these 20/20/20 goals is to highlightthe stakes, stimulate initiative and assess progress in the globalood system, while acknowledging local issues and objectives.


FOOD SECURITYENVIRONMENTAL

SUSTAINABILITY

ECONOMIC OPPORTUNITY

Measuring progress on the three goals

Economic

Opportunity

Food Security

Environmental

Sustainability

Wealthdistribution

Farmer incomes

Undernutritionand overnutritionprevalence: Wasting Stunting Obesity

Food produced Undernutrition

prevalence: Wasting Stunting

Water quality

Sediment

Nutrients Bacteria

GHG emissions

productivity Water use

efficiency orcrop per drop

Proportion ofrural inhabitantsliving on lessthan $1.25/day

Tonnes % of children


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water-saving eects o increased land productivitythat is,measures that increase the yields o individual felds, osetting theneed or additional land and additional irrigation.

Some examples o ways arms can increase water productivityare through improved ertilizer balance, integrated pestmanagement, better drainage, plant breeding and intercroppingpractices4.

Achieving productivity gains alongside a reduction o theenvironmental ootprint o agriculture is a global challenge thatdemands local adaptation. Highly productive systems can ocuson reducing their environmental ootprint. Less productivesystems must ocus simultaneously on improving productivity andenvironmental sustainability to acilitate social and economicdevelopment in the short- and long-term.

Further expansion o land or arming may be required in some

regions. In the past, land expansion or agriculture has reliedheavily on deorestation, making it an undeniably large source oGHG emissions, and degradation in water quality and quantity, airquality and biodiversity. There are, however, large tracts o arableland that are not orested and can be brought into cultivation withminimal environmental impact, or example in South Sudan andnorthern Ghana. In addition, large tracts o degraded land can berehabilitated or agricultural use, in places such as EasternEurope.

For more inormation on the drivers aecting the New Visiongoals, see the Appendix.

Realizing the Goals o the New Vision or Agriculture: Measuring Progress and Seeking Balance

Global indicators for achieving the New Vision goals

To assess progress toward the Vision, a series o simple,

globally applicable and measurable indicators can be used in amajority o countries. They serve as proxies or each goal o theNew Vision or Agriculture.

This New Vision signifes a ood system that realizes 20%improvements each decade in economic growth andopportunity, agriculture productivity and nutrition, while inparallel reducing the environmental ootprint by 20%.

Local indicators for achieving regional impact

Stakeholders can use additional indicators depending on theirlocal goals, which may vary by region. For instance, oneenvironmental indicator o the New Vision is water quality

including ground water, aquatic and marine habitats, andagricultural basins which can serve as a proxy or non-terrestrialbiodiversity. Such indicators may vary widely based on localsocieties and ecosystems.

A call for global data and measurement tools

Many organizations have worked to defne meaningul indicatorsor agricultural sustainability.3 However, available indicators otenall short in representing the real complexity o the global oodsystem. There is still a shortage o timely, high-quality data andmeasurement tools to eectively measure progress. A globaleort is needed to improve the availability o data andmeasurement tools, particularly those related to nutritional status,

such as relevant nutritional value per tonne o productivity, andenvironmental sustainability, such as water quality, GHGemissions and biodiversity. Over the years, as more data becomeavailable, stakeholders pursuing the New Vision approach canadopt them to track their success.

The New Vision Goals: Achievable with a Balance o Drivers

Specifc improvements will drive progress towards the goals othe New Vision or Agriculture. The most crucial driver isimproving the productivity o all arms, small and large, whilebalancing their environmental ootprint. Smallholder productivity iscritical to improve economic opportunity and ood security.Large-scale arm productivity also drives ood security byincreasing overall ood supply, and it can provide some o thelargest gains in environmental sustainability when impacts areclosely monitored.

Increasing agricultural water productivity (crop per drop) involvesa mix o improved efciency o water application and net watergains through crop yield enhancement (both in irrigated andrain-ed lands). This implies both the need to capture greaterwater efciencies rom rain-ed and irrigated land (i.e., green andblue water), and a need to improve crop yields to minimizecultivated land area requiring irrigation.

For some irrigation-intensive countries such as India, up to 80% oimpending water scarcity could be addressed through measuresthat improve water productivity, both by reducing irrigation water

through improved application efciency, but also through the


3 Such as the SAI Platorm, the Keystone Centers Field to Market initiativeand AgBalance

4 Charting our Water Future: Economic Frameworks to Inorm Decision-making, 2030 Water Resources Group

* While frst adoption o new practices could increase the environmental ootprint osmallholder arms initially, with proper ocus and extension work, it can taper oover time

** Reduces the need or additional land and irrigation, captures greater waterefciencies, and enables more efcient input application

Agricultural drivers and their respective impacts on the

indicators o progress towards the New Vision

. . . will have different impacts our main goalsIncreasing these drivers . . .

Economic

OpportunityFood Security

Environmental

Sustainability

Sustainable farm practices Sustainable farm practices

Waste reduction Waste reduction

Value add per tonne ofoutput

Value add per tonne ofoutput

Water use efficiency Water use efficiency

Smallholder productivity * Smallholder productivity **

Large-scale farmproductivity

** Large-scale farmproductivity

****

Land expansion Land expansion


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The New Vision goals are ambitious, but within reach

Reaching 20% improvements per decade across each dimensionis easible given current projections and the remarkablesuccesses o national agriculture initiatives in Brazil and Morocco,or example, where many armers more than doubled their yieldswithin a ew years time.

Achieving the New Vision requires sustained commitment overmany decades, and to realize it on a global scale will require manycountries to undertake ambitious eorts to transorm theproductivity and sustainability o their agriculture sectors.Experience shows that such transormations are most eectivewhen they leverage investment and partnership rom allstakeholders. The ollowing section outlines the six commonelements o successul, collaborative, transormative eorts.

7

Realizing the Goals o the New Vision or Agriculture: Measuring Progress and Seeking Balance


Vietnam Growth: Primed or Private Sector Investment

Over the past two decades, the Government oVietnam has pursued a development strategythat prioritizes agricultural growth as a vitalcomponent to the nations economicdevelopment. This journey has producedremarkable results or the country in terms oincreased ood security and economic growth.From 1989 to 2009, the country more than

halved its rate o stunting and wasting5.It has since become globally competitive ina number o cash crops. For instance, in thattime, Vietnams coee industry has increasedits production over 20 times rom 50,000 to1.2 million tonnes to become the worldssecond largest producer o robusta coee.

Since 1980, the agriculture sectorscontribution to the economy in terms o realvalue add per capita has grown nearly 5%annually, one o the highest in the world,compared to a global average o 1.2%6.

With the agriculture industry primed or privatesector investment, in 2010 the Public-Private

Task Force on Sustainable Agricultural Growthin Vietnam was ormed to urther the goals othe Government o Vietnams agriculture plan.Co-led by government and industry, the taskorce works to develop and test agriculturalmodels in priority crops with the potential orrapid scaling.

5 World Bank World Development Indicators. Stunting, or height or

age (percent of children under 5), decreased rom 61.3% in 1989to 30.5% in 2008. Wasting, or weight or age (percent of childrenunder 5)decreased rom 40.7% in 1989 to 20.2% in 2009

6 IHS Global Insight, World Industry Service database

Given current projections, it is easible to achieve 20%

production improvement each decade until 2030

Billions of mt of productionProduction

from othersources (heldconstant)

Low-tech,smallholder,production

High-techlarge-scaleproduction

Current production

Sum of all cereal, coarse grain, oilseed andpulse production globally

Improved large-scale farm productivity

2/3 realization of opportunity to double yield inmajor commercial agriculture crops

Improved smallholder productivity

Doubling of yields by 50% of farmers throughtransformation initiatives in developing andtransition countries

Land expansion*

80 MM new hectares brought into production(based on historical rates of 3-5 MM ha/year) i.e. 3% of available arable land

2030 production goal 20% increase off of current production base

each decade 2010-30

0.6

0.6

4.0 1.5

1.3 1.5

5.5

0.3

4.01.2

* Reerring to arable lands with low environmental cost o converting intocultivable land

Source: FAO; FAOSTAT; McKinsey analysis


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The missing piece in Vietnam is public-

private cooperation. I we can set that up

to work, the problems o technology or

investment will be solved. People have the

incentive. With better cooperation, the

potential is huge

Dang Kim Son, Director-GeneralInstitute o Policy and Strategy or Agriculture and RuralDevelopment (IPSARD), Vietnam

Given the leadership, commitment and

eorts o the Government coupled with the

energy, experience, expertise as well as

the fnancial and technological strengths

o the private sector, plus the support o

our development partners, we should be

able to deliver on our aspirations

Jakaya Mrisho Kikwete, President

The United Republic o Tanzania

Putting the New Vision or Agriculture into Action: A Transormation is Happening8


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Setting in Motion the VirtuousCycle: the Six Elements oAgriculture Transormation

In examining large-scale agriculture transormations around theworld, we ound the most successul ones are ounded onmulti-stakeholder7 partnerships and have six elements incommon.

The ollowing is a synthesis o the experiences and bestpractices observed in both mature transormations, such as inMorocco and Brazil, and in more recent transormationsunderway in Vietnam, Indonesia, Mexico, and Tanzania. Theseare drawn rom interviews with a wide array o stakeholderswho have led and participated in these initiatives, highlightinglessons based on their experience.

There are many opportunities or smaller scale initiatives, aswell new point interventions (such as improved seeds, etc.) thatstrengthen specifc aspects o the value chain. However, the sixelements described below represent critical success actors inlarge-scale, systemic transormations.

Transormations are massive projects they require signifcantamounts o dialogue, strategic alignment, stakeholdercoordination, fnancing and implementation. To undertakethem, stakeholders need eective mechanisms to develop anddeliver such initiatives. Each o the six elements describedbelow is essential. I any one element is missing, the initiativerisks ailure. Together, they can transorm agriculture.

Element 1: Leadership andStakeholder AlignmentThe transormation must be led by senior policy shapers,with active participation by the private sector and civilsociety at a senior executive level.

Senior government leaders (such as the president or agricultureminister) play a central role in defning the vision and goals,engaging partners and leading the transormation process.Private sector investment, armer and civil society support, anddonor assistance will also be critical to success. Thereore, it iscritical to build joint ownership and commitment o thetransormation plan.


7 Stakeholders include all actors involved both directly in the ood valuechain and those impacting the broader ood system, including:government, ood and beverage companies; storage and processingfrms; shipping and transport providers; retailers; IT; inputs companies;banks; and donor organizations

Eective transormation leadership sometimes means a

major step change rom the way things were done beore


Investment &

entrepreneurshippipeline




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mechanisms


Investment &

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mechanisms

. . . toFrom . . . . . . toFrom . . .

Broadly implement individualinitiatives across entire country(e.g., fertilizer subsidies, extension,seed systems)

Holistic mini-transformations withenough change energy in a geographicregion or value chain then scale fromthere

Broadly implement individualinitiatives across entire country(e.g., fertilizer subsidies, extension,seed systems)

Holistic mini-transformations withenough change energy in a geographicregion or value chain then scale fromthere

Individual agendas for country,donors and private sector

Coordinated, multistakeholder planningprocess and execution management

Individual agendas for country,donors and private sector

Coordinated, multistakeholder planningprocess and execution management

Government-driven Market-driven, with government asenabler

Government-driven Market-driven, with government asenabler

Design programmes aroundtechnical and political considerations

Design for scalability Scalable private sector change

agents (e.g., nucleus farmers,warehouse aggregators) Focus on replicable contracts Transaction-focused approach

Design programmes aroundtechnical and political considerations

Design for scalability Scalable private sector change

agents (e.g., nucleus farmers,warehouse aggregators) Focus on replicable contracts Transaction-focused approach

Everything is a priority Explicitly sequence ones activitychoices, and explicitly choosenotto docertain things

Everything is a priority Explicitly sequence ones activitychoices, and explicitly choosenotto docertain things


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While each partner has clear sel-interest, they must haveexplicit shared aspirations to deliver win-win outcomes.

To align with one another, this group o leaders should worktogether to: Defne shared aspirations in a way that resonates with and

incentivizes all stakeholders to participate Defne in broad terms how each stakeholder group will

contribute to their collective success (e.g., investors will buildarms and outgrower schemes; government will acilitateaccess to land while protecting the rights o both localcommunity members and investors; civil society will monitorsocial inclusion and act as acilitator or progress)

Agree on concrete working arrangements, action plans andindicators o progress; and oversee implementation

Aligning the leadership o diverse stakeholder sectors is oten anew and unamiliar task. A series o dialogues, ideallyacilitated by a neutral party, can be a useul starting point,ollowed by building a shared knowledge base. This could bedone through study trips to observe transormations in othercountries or seminars to gain new perspectives on thetransormations potential.

Leadership must stay in continuous dialogue and

coordination throughout the course o the journey.

While many initiatives aspire to eective leadership, actualresults vary. Stakeholders can use objective tools or questionsto help evaluate the efcacy o their existing leadership: Is the transormation attracting great leaders? An eective

initiative will attract good leadership through its highaspirations and ongoing momentum. In Tanzania, thepresident has committed signifcant personal eort anddedicated senior government leadership; several seniorprivate sector leaders are playing meaningul roles; anddonors are putting strong leaders in place. A corollary test:Is there shared inuence across public sector, private sectorand civil society in key decisions, or is it dominated by onegroup?

Are there real resources and time being spent on aligningstakeholders? In Morocco, the King launched Plan Vertwith intensive involvement o many stakeholders over an18-month period to develop an aligned strategy andapproach to their transormation. During this time, this wasone o the top three priorities o the government, and therewas intense activity and engagement that helped gel theleadership team and vision. Whenever stakeholders spoke,they spoke rom a common vision, and whenever resourceswere needed, they were ound

Is there a plan or a transition rom leadership by smallergroup o champions to a broader set o institutionalstakeholders? It is critical to cascade the vision and plan toevery level o government. In Morocco, the frst phase o anational strategy and plan was ollowed by a one-year phaseo regional planning allowing the plans to be customized andowned by regional stakeholder groups. This phase wascritical to later implementation momentum


Element 2: A Clear Strategy

and PrioritiesLeaders should set realistic, quantifed and measurable

objectives across the three goals: economic growth and

opportunity, ood security and nutrition, and

environmental sustainability.

Using a robust act base, knowledge o the countrys startingpoint and the groups collective aspiration, the transormationleadership must set goals on what the transormation willachieve across each o the three goals o the New Vision. Thisrigour in goal-setting creates a sense o accountability amongthe leadership and serves as the benchmark against which the

success or ailure o the transormation will ultimately bemeasured. Progress towards the goals must be tracked andregularly reported using agreed indicators.

Prioritization should be based on comparative advantage

o key value chains and geographic basins and demand

rom destination markets.

Leadership will need to make clear choices that will determinethe activities o the transormation and clearly communicatethem with a rationale. It may involve making trade-os in orderto ocus available resources eectively. Priority should beplaced on value chains that have signifcant demand markets

rural, urban and export that can be competitivelyserved. That is, the region should have the capability to deliverthe expected quality at competitive costs across the chaingiven local agronomy, geographic position and other actors.

Leadership Alignment at the Highest Level:

Southern Agricultural Growth Corridor o Tanzania

(SAGCOT)

Government, industry and civil society achieved anunprecedented level o alignment by coordinating apublic-private partnership o investors, internationaldevelopment agencies, armer groups and government.Key individuals many o them on SAGCOTs ExecutiveCommittee were critical not only in bringing their ownorganizations on board, but also bringing partnerstogether, helping them build relationships o trust andostering a common vision. These individuals share acollaborative, entrepreneurial spirit; personalcommitment in addition to organizational mandate; and

impressive levels o energy. Beyond President Kikwetesactive and visible leadership, he has exhibited deeppersonal commitment to the projects success.He personally reached out to a number o bilateral andmultilateral donors and took the frst step himsel bycommitting US$ 1 million to the SAGCOT CatalyticFund, with the intention o it being an annualcommitment.

Setting in Motion the Virtuous Cycle: the Six Elements o Agriculture Transormation


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The transormation can rarely involve the entire country romthe outset, so regions must be prioritized and a rationaleprovided to explain the expected benefts o the approach.

Having chosen a ocal region, the next task is to analyse theeconomic, agronomic and competitive potential o the range opossible value chains to show which could oer the highestsustainable impact across the three goals o the New Vision.Crops should be chosen not only or their value, but or their

uture agronomic and nutritional potential. A soundunderstanding o the soil profle and water availability o theregion is paramount to selecting value chains that will besuccessul or many years to come.

Trade-os will be necessary one value chain may have a highimpact on economic opportunity or smallholders, whileanother may provide greater benefts to national ood security.Morocco made an explicit choice that the best way orsmallholders to escape poverty would be to transition to highvalue crops given the existence o good irrigated lands andaccess to the European markets. This was a big choice thatwas underpinned by a great deal o competitive analysis andleadership discussion.

The best approach or making these choices is to conduct atransparent and objective analytical exercise that examines thecosts and benefts o various options across regions and valuechains, and enables stakeholders to debate them in an openway. By undertaking this type o exercise, Ghana chose toocus on our breadbaskets and selected soy, maize and riceor its value chain ocus. Engaging stakeholders in co-creating the approach and communicating the rationalecreates a shared oundation upon which all stakeholders canbuild their plans.

Element 3: A ConcreteInvestment andEntrepreneurship Pipeline

A lasting agriculture transormation is one that is ultimately

supported by real market orces. Bringing new and existinginnovations into the system requires market stimulus toinduce potential entrepreneurs and investors to take on a

defned set o initiatives.

Transormation leaders need to defne bankable investmentopportunities across the chain, including their location, valueand size arms and nucleus arms, distribution, processing,inputs and supporting services, outgrower schemes, andaggregation mechanisms to drive armer competitivenessand link them to the market.

Best practice transormations engage the right groups and

organizations to participate in these opportunities, and theincentives to motivate them. Who would be the likely people ororganizations to drive breakthrough solutions? Who will be ourentrepreneurs, and how will they aggregate, leverage andempower the target regions smallholders in a air and efcient

One has to assess specifc value chains

and ask: What key constraints exist along

each part o the value chain? Which o

these are o public nature, and which ones

are o private nature? Then you can be

very clear about what interventions and

which actors are responsible or

implementing or a meaningul impact

to happen

Boaz Blackie Keizire, CAADP Technical AdviserArican Union, Addis Ababa

Clearly Articulating Choices: Rwanda

Rwandas Comprehensive Arica AgricultureDevelopment Programme (CAADP) investment planstands out as an exemplar or establishing clearpriorities and choices and provides the rationalebehind them. It specifes everything rom preciseinrastructure needs and value chain export targetsin metric tonnes, to how much private sectorinvestment it would like to attract in particularsectors and regions. As a result, donors andinvestors can clearly understand Rwandas prioritiesand where to ocus their activities. Rwanda has goneso ar as to grade its donor partners on the returnthe donors spending has generated and to rally its

donors around explicitly investing in particular partso the plan.



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Element 4: Enabling Hard andSot Inrastructure Policiesand Investments

Weak inrastructure creates a barrier between armers andconsumers, reducing market opportunities and incentives orinvesting in arm productivity.Agriculture transormationshave an imperative to leverage and shape inrastructure

developments as a game changer or agricultural

development.

Hard inrastructure includes physical structures that otenreect the highest impact points or agriculture and ruraldevelopment, such as roads, ports and terminals, power grids,

irrigation systems, and IT and telephony. Hard inrastructureneeds can be tackled in a way that has an immediate impact onood security through income. Vodaone estimates that a serieso telecom investments could increase armer incomes by 11%,a total value o U.S. $138 billion by 20208.

Further, efcient value chains are a undamental part o thesolution in terms o reducing ood waste, improving quality andcreating market access or smallholders. Improvedinrastructure along the entire supply chain such as moreefcient shipping, temperature-controlled distribution, improvedstorage and packaging can mean recapturing much o thepost-harvest loss that plagues the ood system today. A case

study o Indias banana exports reveals astounding potential orproductivity gains: critical upgrades in Indias cold chaindistribution inrastructure could ree up 25 million tonnes obanana produce or export rom the worlds largest producer obananas9.

way? Is it through individual entrepreneurs, co-ops or largecommercial arm investors?

This requires triggering a wave o transactions byidentiying incentives (such as access to land) as well asconditions or success (such as aggregating smallholders). Forexample, bidding rounds o lots or contracts are transactionalapproaches to kick-starting and accelerating investment.

Articulating the action plan or addressing this pipeline can alignexpectations and provide space to set targets or monitoringprogress. This could include setting operational goals tomeasure success, or instance, the number o entrepreneursand investments required, the number o smallholdersaggregated by the entrepreneurs, and the lit in smallholderincome o those who have been aggregated.


Vietnam Growth: Getting Property Rights Right

One o the catalysts o Vietnams 20 years o agriculturegrowth was modernizing the countrys land rightssystem. The decollectivization o agriculture and theintroduction o legal rights to land or virtually all

smallholder armers in the country at the beginning othis time period was an important investment in thecountrys sot inrastructure that allowed the agriculturalgrowth to happen.

We are learning rom this public-private

Task Force. We can convert our

experiences into government policy

Cao Duc Phat, Minister o Agriculture and Rural Developmento Vietnam

8 Connected Agriculture: The role o mobile in driving efciency andsustainability in the ood and agriculture value chain; Vodaone Group incollaboration with Accenture, 2011

9 Maersk Line


Innovation through Aggregation: Moroccos Nucleus

Farm/Outgrower Model

As part o its national Maroc Plan Vert agriculturaltransormation, Morocco decided to move rom wheattowards high-value crops on its irrigated land, yieldingmuch higher incomes to small armers. The challenge toimplementing this strategy was that high-value cropsrequire signifcant investment (e.g., in storage andconditioning equipment, inputs) and greater capabilities(e.g., growing techniques, quality control, access toEuropean markets) than what is usually available totraditional smallholder wheat armers.

The use o a limited number o private sector nucleusarmers as the change agent in the transormation was acritical decision, and one that has proven to be verysuccessul. The government orchestrated a process osoliciting several hundred more sophisticated armers(larger Moroccan and Spanish armers and internationalcompanies) through long-term land leases o 50 hectareplots and other start-up assistance. In return, thenucleus arms have a contractual obligation to work withsmall armers in their vicinity to help transition them tohigher value crops (e.g., providing inputs on credit,provide extension, oering marketing services).

The role o government has moved rom direct extensionto oversight, ensuring that contracts are adhered to andthat market prices are available to small armers toprevent power imbalance.


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India: Improving Incomes through Hardand Sot Inrastructure

Indias National Rural Employment GuaranteeAct (NREGA) tackles fnancial exclusionthrough income-generating activities oragricultural workers. The programme paysagricultural labourers and others or up to100 days per adult to construct roads, drainlands and build other hard inrastructure.

While a programme o this scale does notcome without its trials in NREGAs case,allegations o unds leakages andmisdirected capacity it has enhanced thefnancial inclusion o many Indian armers andholds the potential to make urther strides ineconomic and agricultural development.

Focus on sot inrastructure has led tosuccesses in land rights issues. The easternstate o Odisha (ormerly Orissa) has hadrecent success in employing rural villageyouth to inventory land and assist landadministrators in regularizing the land rightso small armers, including those in tribaldistricts nor normally served by landadministrators.

13

Decisive action on critical sot inrastructure requirements

through a concrete legislative and administrative reorm

agenda is crucial to the long-term stability o the

agricultural sector. Many partner-ships cite it as a particularchallenge to translate government commitments into legislativeaction.

Leaders should seek to fnd an eective model to catalyse

development o hard and sot inrastructure.

Sub-strategies must be created around inrastructure

investments that explicitly tie them to the transormation.Leadership will need to work closely with their stakeholders toalign their activities to the transormation itsel. This is oten noteasy, as it can mean cutting back on some inrastructureactivities while building up others.

Such alignment can oten be achieved through catalyticprocesses such as the creation o special economic zones orpublic-private partnerships.

To measure the progress o inrastructure or the transormation,countries will set targets on concrete outcomes, including:kilometres o roads in the transormation zone; number oextension workers trained; and pragmatic policies created andimplemented in direct relation to the transormation. Thesetargets work best when established up ront.


Aligning Inrastructure Investments: South Sudans

Feeder Roads

With some o the lowest levels o physical inrastructurein Arica, eeder roads are a major priority o the SouthSudanese government to help unlock its economicpotential, especially in agriculture. But where should itbegin? By convening its core donors, national

government leaders and state leaders, the groupconducted a act-based exercise whereby each stateidentifed potential eeder road investments, and thenprioritized them using a set o flters and methodologiesthe group had previously agreed upon rom populationreached, to the likely economic value and impact. Thisthen allowed both government and donors to see in ahighly transparent way which eeder roads wouldreceive investments frst, and why. It ensuredcoordination across all stakeholders and maximumreturn on these big-ticket inrastructure investments.

Sot inrastructure includes elements that aect the

overall enabling environment, such as regulation, landtenure, inorm-ation services and extension systems.Improving regulatory rameworks, addressing landaccess and tenure issues, or strengthening armercapacity through extension systems are included in thiscategory. Sot inrastructure investment can catalysesignifcant progress in economic opportunity.



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Innovative Financing:

The Case o AgDevCo

Recognizing that agriculture fnance in Aricais difcult, risky and requires a long-termview, AgDevCo has developed a modelwhereby long-term fnancing is provided atconcessionary rates (oten by theinternational community) to partially und thecapital costs o agriculture inrastructure(e.g., irrigation, land preparation), with acorresponding transormation requirement.

In Ghana, AgDevCo is using this model tocreate a pool o patient capital to buildirrigation schemes or smallholders, whothen lease part o their unused land to acommercial arm investor, who in turn paysback the patient capital or the irrigationscheme on behal o the smallholders.The model is based on a successul pilot in

Zambia, which is now into its third growingseason.



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Element 5: Catalytic Financingand Risk ManagementSolutions

Financing and risk management are major drivers o thestrategy, business model and inrastructure investments in anyagricultural transormation, yet they are oten in short supply.The idea is to build a package o instruments grants,guarantees, patient capital and commercial money combined to fnance the capital costs o the transormation. The variousinstruments should be mutually enabling, or example, usingcrop insurance or fnancial guarantees as collateral to getbanks to lend money, or using donor unding and patientcapital to co-invest with private investors to improve a projects

access to capital through public private partnerships.

Financing

In much o Arica, investment in agriculture accounts or over30% o GDP but receives less than 5% o all lending10. This isunsurprising given the high risk o early-stage agribusiness.Patient equityis a more attractive long-term solution than debtfnancing.

Eective fnancing and risk management requires a broad seto innovative catalytic and patient capital fnancing

mechanisms as required by the long-term horizon o

agricultural development rom patient capital, donor grantsand commercial equity to working capital and concessionaryloans.

Risk management

Risks that could be shared among many armers, such asweather, are oten discouraging them especially smallholders

rom making productivity investments that are high return, butunbearable due to economic ragility. Risk managementinstruments (such as loan guarantees), and various orms o

insurance (such as crop insurance) catalyse urtherinvestment.A market or their productsandprivate sectorcontracts also reduce risk rom both the growers andfnancers point o view. Cooperatives can also help to sharefnancial risks or and among armers, as well as reduce risk orlenders.

Agriculture transormations necessitate long-term loans andunding commitments. To sustain urther agricultureinvestment, it requires interventions to develop and supporta strong agricultural fnance sector, addressing industrystructure, incentives, capabilities and regulation. Countriesneed to assess what fnancing and risk instruments theirtransormation will require and how to put the arrangements in

place. This exercise will allow the leadership to identiy thefnancial regulatory ramework and institutional capabilitybuilding the country will need.

Risk Management and Climate Change Resilience:

The Horn o Arica Risk Transer or Adaptation

(HARITA)

Weather-related risk is one o the greatest and oteninsurmountable concerns or smallholder armers. Thechanging climate only increases these risks, bothdirectly (uctuating yields due to changes in temperature

and rainall) and indirectly (due to changes in irrigationwater availability)11. To mitigate these risks in volatile,drought-stricken Ethiopia, Oxam America developedHARITA, an innovative crop insurance programme. Ituses the same method as the World Food Programmes(WFP) Food or Work programmes, which oer ood aspayment when people work on communityinrastructure projects. Similarly, HARITA buysmicroinsurance with their labour on agriculture-relatedprojects once the harvest is over. I the rainall ails,Oxam insures the armers.

HARITAs growth to serve over 1,300 households in

Ethiopia in 2010 has made scaling up an imperative12.Oxam America has joined orces with the WFP, globaland local insurers, and re-insurers to create R4, a ruralresilience initiative that aims to reduce climate-relatedrisks by oering a robust set o risk solutions. Itmanages risk in our major ways community riskreduction, productive risk taking, risk transer and riskreserves13.

10 AGRA; World Bank11 IFPRI Food Policy Report, Climate Change: Impact on Agriculture and

Costs o Adaptation, 200912 Oxam America. HARITA quarter ly report: January 2011 March 201113 Swiss Re

Beira Agricultural Growth Corridor Catalytic Fund

In Mozambique, the Beira Agricultural Corridor Catalytic

Fund was built by AgDevCo to fnance early-stageagricultural ventures. Capital is provided by both thegovernment and private sector donors. The undoperates on a co-investment basis, pairing up withnational sponsors to create investment opportunities toattract private investment.

Investment costs are recovered and reinvested intocreating additional investment-ready opportunities. Theund has developed monitoring and reporting metrics totrack perormance against explicit commercial anddevelopment targets.


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Element 6: Robust Mechanismsand Institutions or Delivery,Implementation and Durability

Successul agriculture transormations have a deliberate andadequately resourced approach to designing, managing andmonitoring implementation o activities to drive change at scale.It is the institutionalization o the partnership through aormal organization and governance setup to orchestratechange and monitor progress, either through explicitempowerment o existing actors or establishment o a deliveryunit. This delivery mechanism is arguably one o the mostimportant elements o the transormation.

It requires sufcient and dedicated resources to drive

operational development and deployment o initiatives untilthey achieve a sel-sustaining momentum. Without the rightpeople, skills and unding, and a structure that gives and clarifesthe authority to manage, the transormation can quickly all otrack.

To ensure mutual accountability, all stakeholders should agreeon transparently monitoring and regular reporting oprogress to the head o government through a high-leveldashboard.

The level o institutionalization and resourcing can vary, tailored

to the specifc acets o the transormation and country inquestion. Some countries, such as Ethiopia, have createdstand-alone delivery or transormation units reporting directlyto the change leader (e.g., a president or prime minister) thathave strong amounts o authority and sta to quicklytroubleshoot and execute on all aspects o the transormation,while others have created more lean-and-mean coordinatingsteering committees that provide a regular orum or allstakeholders to meet and track roll out.

Others have embedded a transormation unit within theiragriculture ministries, while still other countries have set up anoverarching programme management ofce to monitor progressand adjust plans without taking a direct role in implementation.

The design ultimately needs to incorporate targeted capacitybuilding and public sector pay to ensure the critical mass toimplement projects. Considerations may include: evaluatingthe countrys past and present perormance and its capacity ordelivering large transormations; establishing an appropriate

organizational set-up to drive and monitor perormance; andbuilding an irreversible results-oriented culture, continuallybuilding system capacity and communicating the deliverymessage so that all stakeholders know and what theexpectations are and why they are doing it.

Anchoring a transormation solely in the Ministry o Agriculturecan pose limitations, since many essential actions and solutionslie within the domain o other ministries (e.g., inrastructure andfnance). Cross-ministry coordination is thereore an importantelement o success.

The delivery unit mechanism has a very strong track record, asseen in nearly 20 country-sector transormations, and there is areal movement in many agricultural transormations towardsusing these same multi-stakeholder delivery units.14

Managing Complexities andControversiesAgriculture transormations can be complex and challenging.The examples described here all required signifcant timecommitments, even at the beginning phases. Most took up to12 months to arrive at national-level alignment, and an additional6-9 months to align local governments an eective plan. Theinvolvement o many diverse stakeholders strengthens theultimate outcome, but can slow initial progress o the initiative asconsensus and partnerships develop.

While the six elements described here are undamental to

systemic agricultural transormation, they do not presentsolutions to specifc policy issues that are actively debated in theood system today. As leaders address agriculture in their owncountries, they will need to navigate and fnd solutions tocomplex and sometimes controversial issues such as: Nutrition: Prioritizing nutrition interventions, and integrating

nutrition and health goals into agricultural programmes Soil management: Use o chemical ertilizer or other

techniques (e.g., conservation tillage, inoculants, crop andsoil rotations) to restore and maintain soil ertility

New land and large arms: Environmental impacts o landexpansion, ownership and transparency issues with large-scale land purchases, land rights or armers

Biotechnology: Utilization and regulation o geneticallymodifed seed varieties to increase productivity

Crop diversity: Overlapping increased productivity andincreased crop diversity reecting local cultural tastes andnutritional needs

Local politics:Aligning national and local governmentagendas and priorities

Focus and good aith are required by all parties to ensure thatcontroversies over these or other issues do not derail thebroader multistakeholder collaboration.

Partnerships can ensure progress by frmly anchoring theirmission around shared goals, and ocusing on collaboration andcontinuous dialogue to achieve practical progress towards those

goals.

The Task Forces success to date has

been based on the commitment and

entrepreneurship o individuals. To be

sustained or the long term, we need to

institutionalize the approach

Rashid Qureshi, Managing DirectorNestl Vietnam

14 E.g., Taiwans Joint Commission or Rural Reconstruction (JCRR),Ethiopias Agriculture Transormation Agency (ATA), the UnitedKingdoms Prime Ministers Delivery Unit (PMDU), Libyas ProgramCentral Bank Coordination Unit


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17

Business Unusual: Two Delivery

Mechanisms in Tanzanias Growth Corridor

SAGCOT is now launching a deliverymechanism intended to help partners dobusiness unusual. An independentcoordination body, the SAGCOT Centre, willidentiy investment opportunities and helpcoordinate the range o players that need to beinvolved in realizing each one, including thedierent branches o government. The Centrewill not do the players jobs or them, but rather

help them do their jobs better, in more targetedways. The Centre will also commissionresearch, monitor the business enablingenvironment and measure the impact o theinitiative over time activities that beneft allplayers.

The Range o Delivery Mechanisms:

Ethiopia and Tanzania

Delivery and implementation mechanisms cancome in many dierent orms, depending onwhat is most appropriate and impactul or acountry.

In Ethiopia, given the holistic and national scaleo its transormation, it set up an AgricultureTransormation Agency (ATA), reporting directlyto the prime minister, and given the authority tocoordinate across all stakeholders to execute on

its transormation strategy.In Tanzania, the transormation ocus has beenspecifcally on developing the southern corridor(SAGCOT), using a range o public-privatepartnerships. The President ormed anExecutive Committee involving the mainstakeholders to drive the development o anInvestment Blueprint and develop the structureso the SAGCOT Centre and Catalytic Fund.




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21/28

19

Initiating dialogue and collaboration

A multi-stakeholder eort begins when one or morestakeholders step orward to initiate action and open a dialoguewith the others.

Government leaders, as shapers o the national agriculturalagenda, are oten best placed to initiate the process. Anambitious vision or transormation should ideally be anchoredin and supported by a national plan or strategy. This or a globalramework, such as the New Vision or Agriculture can providea basis or dialogue.

Championship by a top government leader such as thepresident or senior ministers can establish a clear base osupport and provide the mandate or other stakeholdersengagement in the initiative, including the local and globalprivate sector.

Anchoring discussions in the governments plan can helpassure stakeholders that private investment is being engaged inthe national interest, and in a manner that leverages public-sector investments. Countries without a ormalized plan can

Building National Partnerships:It Begins with a Dialogue oLeaders

Transorming the ood system is a multi-year journey. The sixelements that comprise it take shape in stages, driven andimplemented by leaders and stakeholders in the agriculturesystem.Orchestrating a broad-based, systemic transormation can beextremely challenging. By defnition, an ambitioustransormation requires stakeholders to go beyond business asusual, acting outside o traditional roles and structures andcollaborating in new ways.

Multi-stakeholder initiatives oten operate rom a jointly-createdplatorm, such as a task orce or coordinating unit, whichcreates a neutral space in which to develop and enact theshared agenda. Such a structure engages leaders representingbroader stakeholder networks whose support is essential tothe initiatives success. The SAGCOT Executive Committee inTanzania engaging government, the private sector, donors,civil society and armer leaders is one example.

Creating such a platorm oten requires the involvement o aneutral acilitator to help stakeholders establish the goals andramework or collaboration. The World Economic Forum hasbeen invited to play such a role in a number o countries,providing support through the stages outlined below.

We got our inspiration rom other

countries. But now this initiative has

become our own. Everyone is committed

and we are learning by doing. The New

Vision is becoming our business model

Bayu Krishnamurthi, Vice-Minister o Trade o Indonesia

The New Vision or Agriculture Partnership Platorms:

How it Works


Coordinationstructures engageleaders in a taskforce, council orcommittee to workon a set of agreedaction priorities

Coordinationstructures engageleaders in a taskforce, council orcommittee to workon a set of agreedaction priorities

Principles:

Multi-stakeholder

Locally-led

Aligned with theNew Vision:sustainable andmarket-based

Principles:

Multi-stakeholder

Locally-led

Aligned with theNew Vision:sustainable andmarket-based

Identify shared priorities

Solidify leadership commitment

Establish a coordination structure

Drive transformation and delivery

Develop action plans (short-term/long-term)

Align investments and resources

Report progress and monitor efforts

Business

interest

Government

goals

Other

stakeholders

interestInitiate

dialogue

Establish

goals

Plan,

invest&

monitor


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Building National Partnerships: It Begins with a Dialogue o Leaders

use the dialogue process as a non-political, pre-competitivespace or exchanging ideas and developing strategy.

Through a process o acilitated dialogue, stakeholders candiscover their common interests, build trust and agree inprinciple to work together towards shared goals.

Establishing shared goals and practical working

arrangements

A principal goal o the dialogue process is to discover specifcareas where government priorities and business interestsoverlap. The group can then establish a structure orcollaboration such as a task orce or council to coordinateeorts around these priorities.

For example, the Government o Vietnams 10-year planprioritized certain crops that were o strong interest to thebusiness community. A public-private task orce was ormed toengage business, government and local stakeholders inimproving productivity, quality and sustainability o fve keycommodities.

The collaboration accelerates progress towards shared goalsby aligning and ocusing stakeholder investments,programming and collaboration. Groups will unction best ithey engage leadership-level support as well as working-levelresources, and agree on clear roles and responsibilities. Forexample, most New Vision partnerships are co-chaired by aminister o agriculture and chie executive ofcer, withdesignated leaders coordinating public-private working groupson main ocus areas.

Acting on initiatives and investments

As groups begin to implement their action plans, they will needto engage and align eorts o multiple stakeholders. Thepartnership platorm can act as a orum or engaging newpartners, developing and exchanging innovations, reportingprogress and problem-solving specifc obstacles that areencountered.

To be eective, partners should set quantitative targets and usekey perormance indicators to monitor progress. Groups canmaintain momentum by using key milestones to drive progress

orward. The New Vision or Agriculture partnerships, orexample, have used the World Economic Forums high-levelconvening meetings as deadlines or achieving specifcoutcomes.

Driving transormation and delivery

As the transormation eort develops, multi-stakeholderleadership groups can play a key role in structuring andcreating buy-in to eective delivery mechanisms, steering thetransormation rom one phase to the next. In Tanzania, themulti-stakeholder Executive Committee delivered the SAGCOTinvestment blueprint, defned the need and helped establish the

SAGCOT Centre, and helped mobilize resources or andstructure the Catalytic Fund. Once the new institutionalstructures are completed, the Committee will be converted intoan Advisory Board or the SAGCOT Centre.

The leadership group, with the support o acilitatingorganizations, can play a key role in raising awareness andengaging additional partners or the transormation.

Through regular reporting to an engaged network o partners,urther momentum develops and new institutional capacity isput in place. With a virtuous cycle o increasing engagementand impact underway, the transormation will be in ull orce.

Making partnerships work: what stakeholders can do

Create an enabling environment for market-driven economicgrowth and investment

Present attractive investment options to the private sector anddonors

Demonstrate leadership in driving and coordinating initiativesacross ministries

Public

sector

should . . .

Adapt commercial models to fit the unique needs of developingcountry contexts

Demonstrate genuine commitment to a combined commercialandsocial value to earn trust and credibility

Private

sector

should . . .

Harness the value of entrepreneurship as a growth driver andprovider of livelihoods, whether undertaken by small or largescale enterprises

Develop new approaches to scale effective community-basedinterventions

Civil society

should . . .

Organize and demonstrate leadership in seeking betteropportunities from both the public and private sectors

Farmers

should . . .

Catalyse and enable private sector-driven growth by leveragingtheir funds for greater impact

Adapt lessons from companies about efficiency, scalability andimpact

Donors

should . . .




Public

sector

should . . .




Public

sector

should . . .



Private

sector

should . . .



Private

sector

should . . .



Civil society

should . . .



Civil society

should . . .

Organize and demonstrate leadership in seeking betteropportunities from both the public and private sectors

Farmers

should . . . Organize and demonstrate leadership in seeking better

opportunities from both the public and private sectorsFarmers

should . . .



Donors

should . . .



Donors

should . . .


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Building National Partnerships: It Begins with a Dialogue o Leaders

New Vision or Agriculture Partnership Platorms

The World Economic Forums New Vision or Agriculture

initiative has acilitated the ormation o partnership platorms tokick-start transormation initiatives in our countries. Theseplatorms engage global partners to support achievement olocal goals or sustainable agricultural growth. The vehicle hascreated signifcant momentum and helped to energizeleadership and ocus investments around a common cause.While each partnership sets and pursues its own diverse goals,they have ollowed a broadly similar process to engagepartners and implement action. Each has benefted directlyrom the momentum and interest generated through globalora. Through intensive engagement among and betweenpartnerships, the ollowing fve initiatives orm a learning

community that is testing and refning a potentially replicablemodel:

Tanzania

Through a series o dialogues, global and regional investorsagreed to join local stakeholders in a collaborative eort toaccelerate agriculture-sector growth. President Kikwete oTanzania recommended a ocus on the Southern AgriculturalGrowth Corridor (SAGCOT) and mandated an ExecutiveCommittee to deliver an investment blueprint or the corridor ineight months. The Committee co-led by the Minister oAgriculture and a vice-president o Unilever, and engaging

global and local companies, donor agencies, civil society andarmer leaders worked intensively to deliver a blueprint orgenerating US$ 1.2 billion in arming revenue and 420,000 newjobs in the corridor, largely or smallholders. The Committeehas since helped establish the SAGCOT Centre to coordinateand mobilize investment and partnerships in the corridor, and aCatalytic Fund to spur investments.

Vietnam

A dialogue series with global investors identifed a number ospecifc crops, prioritized by the governments 10-yearagriculture plan, which were the ocus o strong commercial

interest. The group has ormed a task orce, co-chaired by theMinister o Agriculture and Rural Development and the nationalchie executive ofcer o a global company, engaging 14 globalcompanies, three local companies, two provincialgovernments, ministry ofcials and the Institute o Policy andStrategy or Agriculture and Rural Development (IPSARD). Fiveworking groups were ormed each co-led by one private andone public sector leader to improve the productivity,sustainability and smallholder armer benefts o fve crops15.Stakeholder engagement has broadened and diversifed asgroups moved into action, partnering with provincialgovernments, armers groups, international organizations,fnancial institutions and NGOs. The fve commodity groups

have already demonstrated impact through increasedproduction, improved quality, armer capacity-building andincomes. Partners are now being engaged to developsmallholder armer fnancing mechanisms and help scaleprojects. The Ministry o Agriculture and Rural Developmenthas adopted the New Vision into its strategy.

Indonesia

The Government o Indonesia decided to seek private-sector

partnership to achieve the New Vision or Agriculture inIndonesia, particularly to improve ood security, environmentalsustainability and strengthen livelihoods o smallholder armers.13 global companies, a number o local companies, and otherstakeholders have joined with the vice-ministers o agriculture,trade and fnance and one provincial government to orm anational-level partnership dedicated to improving seven keycrops16. Working groups o companies, government leadersand other stakeholders, each led by a chie executive ofcer,are now refning action plans or each o the target crops.

Mexico

The Mexican Secretary o Agriculture brought the New Visionapproach to Mexico, with a goal o improving thecompetitiveness and sustainability o the sector whilestrengthening rural livelihoods. 17 global and 15 localcompanies joined the ministry, producers associations andother stakeholders in a national-level alliance. The group isocused on improving sustainable production o fve cropgroups17 while also addressing cross-cutting issues in Mexicosagriculture sector. The group has worked intensively to developand initiate action plans over a six-month period, engaginglarge networks o stakeholders in a dialogue about Mexicosagricultural uture in the process.

Grow Arica Task Force

At an Arica regional meeting in June 2011, leaders o theTanzanian SAGCOT initiative shared their experience withgovernment and business leaders rom six other countries whoexpressed interest in taking a similar public-private approach toaccelerating agricultural growth. The Grow Arica Task Forcewas ormed to support them, linking the Arican UnionCommission, NEPAD Agency and New Vision or Agriculturewith donor agencies, private sector partners and armerleaders. Task orce partners are combining their institutionalcapacities to support this frst wave o seven countries in

deepening private-sector investment and partnership toadvance progress towards national goals defned with thesupport o CAADP (the Comprehensive Arican AgriculturalDevelopment Programme).

15 Coee, tea, ruit and vegetables, commodities and fsheries16 Dairy, soya, corn, cocoa, coee, palm oil and rice17 Grains, oilseeds, ruits, coee and cacao and fsh


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22 Putting the New Vision or Agriculture into Action: A Transormation is Happening


25/28



** Dependent on scale and level o development o the countrySource: McKinsey & Company

What would drive a 20% increase in ood production?

Large-scale andsmallholder productivityyield/ha

Levers to increase productivity**:

Waste reduction through improved post-harvest practices, such asrefrigeration and packaging

Increase/optimize usage of agricultural inputs (e.g. nutrition, pestmanagement)

Plant higher yielding seeds

Improve farming approaches (e.g. precision farming/seed spacing)

Modernize farming technology (e.g. irrigation pumps)

Integrated pest management

Levers to improve enablers:

Extension services

Improved infrastructure to improve efficiencies such as irrigationpumps and reduce post-harvest losses (i.e. waste) such as silos

Drivers Examples of levers that make an impact

Land expansion*

Changes in land use Set aside lands in the U.S. and Europe (implies policy changes)

Improve access to non-forest lands in Ukraine, Africa, Brazil

Infrastructure

Controlled access to land (i.e. no land grabs; governmentprotection for social equity and environment)


** United Nations Collaborative Programme on Reducing Emissions romDeorestation and Forest Degradation in Developing Countries

Source: McKinsey & Company

What would drive a 20% decrease in GHG emissions

per tonne o production?

Large-scale andsmallholder productivity(yield/ha)

Increase yields (discussed under production drivers)Large-scale andsmallholder productivity(yield/ha)

Increase yields (discussed under production drivers)


Land expansion*

Changes in land use Decrease in deforestation and draining of wetlands

Increase yields per hectare

Effective REDD** deal and effective national laws and enforcement

Land expansion*

Changes in land use Decrease in deforestation and draining of wetlands

Increase yields per hectare

Effective REDD** deal and effective national laws and enforcement

GHG emissions/ha Practice alternative/no-tillage farming

Reduce over-fertilization

Increase nitrogen fixing via crop rotation

Interplant nitrogen fixing trees

Genetically modify seeds to self-fix nitrogen

GHG emissions/ha Practice alternative/no-tillage farming

Reduce over-fertilization

Increase nitrogen fixing via crop rotation

Interplant nitrogen fixing trees

Genetically modify seeds to self-fix nitrogen

Livestock Genetic varieties/animal feed formulations that reduce methane

Improved management techniques, such as herd composition,grazing practices, feed, methane capture and conversion

Livestock Genetic varieties/animal feed formulations that reduce methane

Improved management techniques, such as herd composition,grazing practices, feed, methane capture and conversion

Transport ation andprocessing

Improve efficiency of transportation vehiclesTransport ation andprocessing

Improve efficiency of transportation vehicles

What would drive a 20% increase in water productivity?

Source: 2030 Water Resources Group, Charting our Water Future: EconomicFrameworks to Inorm Decision-Making

Large-scale andsmallholder farmproductivity (yield/ha)



Irrigated water

cubic metres Reduce evaporation through reduced tillage

Optimal timing of water application

Improved readily available germplasm and plant breeding

Convert to more efficient technologies

Water pricing/policy (e.g. reduce river withdrawal, conservationincentives)

Amount of land

irrigatedhectares

Intensifying land area reduces land under irrigation

Large-scale andsmallholder farmproductivity (yield/ha)


Rain water

cubic metres Rain water harvest technology

Reduced tillage

Agroforestry and intercropping systems

In situ soil and water management techniques to conservegreen water

Irrigatedland

Rain-fedland

Levers that address undernutrition

Access to

foods

Improved storage and preservation to avoid hungry seasons

Stabilization of food prices

Gender equalization in society and food allocation

Access to

foods

Improved storage and preservation to avoid hungry seasons

Stabilization of food prices

Gender equalization in society and food allocation

Child-feeding

practices

Raising awareness of benefits and timing of breastfeeding,complementary feeding and the components of adiversified diet

Child-feeding

practices

Raising awareness of benefits and timing of breastfeeding,complementary feeding and the components of adiversified diet

Water/

sanitation

Improving access to water and water sanitation to reduceinfections, especially diarrhoea and malaria, which lead to lossof appetite and malnourishment

Water/

sanitation

Improving access to water and water sanitation to reduceinfections, especially diarrhoea and malaria, which lead to lossof appetite and malnourishment

Health

services

Improving access to health services toTreat children for malaria and diarrhoea

Educate new mothers on child feeding

Health

services

Improving access to health services toTreat children for malaria and diarrhoea

Educate new mothers on child feeding

Secure land

tenure

Secure rights to land to encourage households to meet theirnutritional needs, planting of diverse crops (e.g. fruit trees),constructing poultry sheds and raising small livestock

Training and access to appropriate seed stocks

Secure land

tenure

Secure rights to land to encourage households to meet theirnutritional needs, planting of diverse crops (e.g. fruit trees),constructing poultry sheds and raising small livestock

Training and access to appropriate seed stocks

Examples of levers that make an impact

Fortification

Fortifying crops, dairy, and other foods to improvemicronutrient intakeFortification

Fortifying crops, dairy, and other foods to improvemicronutrient intake

Drivers and levers o the New Vision or Agriculture

Appendix

What would drive a 20% increase in armer incomes?

Smallholder

productivity

yield/ha


Nutrient and integrated pest management to increase yields andlower input costs

Smallholder

productivity

yield/ha


Nutrient and integrated pest management to increase yields andlower input costs


Value add per tonne of

produce

Selection of products that meet consumer needs

Quality of crops

Competitive market structure (vs. local middlemen extracting rents)

Development of urban demand for higher value products

Value add per tonne of

produce

Selection of products that meet consumer needs

Quality of crops

Competitive market structure (vs. local middlemen extracting rents)

Development of urban demand for higher value products

Waste reduction

percent Infrastructure improvements

Organization and efficiency of supply chain

Improved storage, processing and packaging

Waste reduction

percent Infrastructure improvements

Organization and efficiency of supply chain

Improved storage, processing and packaging

Source: McKinsey & Company


26/28


Project Board Members

Co-Chairs

Robert Berendes, Head Business Development, SyngentaInternational, Switzerland

Perry Yeatman, Senior Vice-President, Corporate Aairs, KratFoods, USA

Ernesto A. Brovelli, Global Director, Sustainable Agriculture,Environment and Water Resources, The Coca-Cola Company, USA

Sean de Cleene,Vice-President, Global Business Initiatives, YaraInternational, Belgium

Shannon S. Herzeld,Vice-President, Government Relations, ArcherDaniels Midland (ADM), USA

Douglas Horswill, Senior Vice-President, Sustainability and ExternalAairs, Teck Resources, Canada

Gerry van den Houten,Technical, Supply Chain & EnterpriseDevelopment Director, SABMiller, South Arica

Hans Jhr, Corporate Head o Agriculture, Nestl, Switzerland

Elizabeth Keck, Senior Director, International Sustainability, Wal-MartStores, USA

Matthew Kirk, Group Director, External Aairs and Member o theExecutive Committee, Vodaone Group, United Kingdom

Willem Jan Laan, Director, Global External Aairs, Unilever,Netherlands

Chris Lambe, Director, Social Responsibility, Mosaic, USA

Stewart Lindsay, Director, Global Corporate Aairs, Bunge, USA

Rik Miller, President, Dupont Crop Protection, DuPont, USA

Hubertus Mhlhuser, Senior Vice-President, Strategy & Integration

and General Manager, Eastern Europe & Asia, AGCO Corporation,USA

Soren Stig Nielsen, Senior Director, Head o Sustainability, MaerskLine, Denmark

Juergen Oldeweme, Senior Vice-President, Global Product Saetyand Registration, BASF, Germany

Michael Patten, Global Public Aairs Director, Diageo, Ireland

Nina von Radowitz, Head o Sustainability and Enviroment, MetroGroup, Germany

Jennier Ragland, Director, International Government Relations andPublic Aairs, The Coca-Cola Company, USA

Beth Sauerhat, Director, Global Environmental Sustainability,PepsiCo, USA

Zita Schellekens, Public Aairs Consultant, Heineken International,Netherlands

Joachim Schneider, Senior Vice-President, Strategy, BayerCropScience, Germany

Jerry Steiner, Executive Vice-President, Sustainability and CorporateAairs, Monsanto Company, USA

Theo Timmermans, Deputy G

WEF FB NewVisionAgriculture HappeningTransformation Report 2012

Documents

Transcript of WEF FB NewVisionAgriculture HappeningTransformation Report 2012