Slides from a presentation @Inclusive Agribusiness Southeast Asia Roundtable September 23-24 2015, Ho Chi Minh City, Vietnam

1. Landscape:
Inclusive Agribusiness
in Southeast Asia
A Scoping Study
Roundtable on Inclusive Agribusiness in Southeast Asia
Ho Chi Minh, Vietnam, 23-25 September 2015
Dr. Nerlita M. Manalili
SEARCA Consultant
& Managing Director NEXUS
Agribusiness Solutions

2. A study commissioned by
Commonwealth Scientific and Industrial Research
Organization (CSIRO)
to
Southeast Asian Regional Center for Graduate Study and
Research in Agriculture (SEARCA)
for the
Roundtable on Inclusive Agribusiness in Southeast Asia

3. The Presentation
• A number of business models have emerged, mostly
private-led ones that engage the participation of
smallholder producers (inclusive ones) in the ASEAN
economies that provide a rich learning ground.
• This study looks into these emerging practices and
explored trends in the shape, function and success of
inclusive agribusinesses in the region. It is based on a
review of 111 agribusinesses across four countries
(Vietnam, Indonesia, Myanmar, the Philippines), it
provides an overview of the current landscape and
offers recommendations to support future action..

4. UNDERSTANDING THE
LANDSCAPE:
What does agribusiness
look like in ASEAN?

5. Why Inclusive Agribusiness?
"Small-scale agriculture
• Main source of food in the
developing world,
• Produces up to 80
percent of the food
consumed in many
developing countries”
FAO 2013
Inclusive Agribusiness (IA)
• Create business growth
opportunities for
smallholders and
companies alike
• There are 500 million
smallholder farms around
the world: represent both
home and livelihood for two
billion people
GIZ, 2013

6. Why Inclusive Agribusiness
in South East Asia?
• The ASEAN region (plus China and India) is
referred to as the Emerging Asia and is one of
the fast growing regions in the world.
• Investment in inclusive agribusiness will improve
not only the global food supply but reduce as well
the rural poor in the region
– As Asia (basically most of ASEAN) supply 50
percent of the world’s food requirement and
home to almost a third of the world’s poor

7. Why focus initially on Indonesia,
Myanmar, Philippines and Vietnam?
• All four countries are major agricultural
producers of staple crops, primarily rice
• Each country is world’s biggest supplier of at
least one major commodity:
– Indonesia: palm oil and coconut
– Myanmar: pulses and oil seeds
– Philippines: sea weeds, banana and coconut
(2nd
biggest)
– Vietnam: rice and coffee

8. Agricultural Development Path
Indonesia and Philippines
• Followed the self-sufficiency to
import substitution thrusts with
sources of agricultural
development growth mainly
due to area expansion.
• Later, comes the focus on
agro-industrialization, directing
investments in increasing food
crop production specifically
horticultural crops
• Trade liberalization for much
needed investment to come in
Vietnam and Myanmar
• Both emerging from closed
to isolated economies,
respectively and passed
through a series of reforms
– since the “Doi Moi” in 1986
for Vietnam and
– 1988 economic reform for
Myanmar
with both adopting a
market-oriented reform.

9. SNAPSHOT OF
INCLUSIVE
AGRIBUSINESS

10. 49 Initiatives
Reviewed Inclusive Agribusiness
Initiatives by Sector

11. Inclusive Agribusiness Initiatives by
Sector and by type of intermediaries:
Non Private Sector Private Sector
Farmer
Organizations
14%
Farmer
Organizations
7%

12. Reviewed Inclusive Agribusiness Initiatives
by Sector and by Areas of Interventions
Non Private Sector Private Sector
Total: 72
Multiple responses
Total: 50
Multiple responses
Marketing
12%
Environment
7% Production
29%
Manufacturing
3%
Food
Processing 3%
Marketing
12%
Environment
4%
Production
34%
Manufacturing
8%Food
Processing
8%

13. KEY FEATURES ACROSS
CASE STUDIES

14. Key Features Across Case Studies
 External support is critical for smallholders
to be partners in inclusive agribusiness
 Meeting market requirements is key
to sustained market access
 Successful case studies often have a training
component to increase product quality.

15. Key Features Across Case Studies
Adoption of inclusive agribusiness translates to
improved smallholder welfare, and to raw material
sourcing benefits to agribusiness firms.
Access to assets results in increased yield and
value benefits for smallholders.
Enabling environments is present but
fragmented

16. SUPPORTING SUCCESS

17. Supporting success of inclusive initiatives
 While New marketing approaches are an
increasing trend for inclusive agribusiness (e.g.
creating niche market based on product origin)
market related initiatives still are lagging behind
production initiatives,
- more of the former are needed.

18. Supporting Success: Country Level

19. Supporting Success: Country Level
All four countries
• fared low in terms of growth due to product
and geographic specialization.
– will be additional sources of growth if invested on
• relied heavily on servicing traditional products
to traditional markets, though starting to
diversify (with Philippines on the lead) by
targeting traditional markets with new product
– product and market diversification are strategies
that will broaden sources of growth and
competitiveness of countries under study.

20. Supporting success of inclusive initiatives
 Success with ICT has been patchy. Questions of
scale, adoption and relative benefit need to be
addressed to enhance benefit to smallholders
 Private sector, donors and NGOs are initiators
and also intermediaries. More study is needed
on relative success of intermediary-initiator
relationships.
 To be truly inclusive, also support other
stakeholders in the supply chain. They can help
achieve results and distribute gains.

21. Supporting success of inclusive initiatives
 Resource needs vary according to
smallholder type, location and commodity.
Tailoring interventions to specific needs will
support success.
 Multiple country investments bring
expanded opportunities and partnerships.
Border issues, land and water use issues
and mismatched production present risks to
success.

22. Supporting success of inclusive initiatives
 Multiple stakeholder partnerships are an
emerging model for inclusive agribusiness.
- Clear objectives, roles and responsibilities
will support success.
 Review and identify which national policies
help and which hinder development of
inclusive agribusiness.

23. Supporting success of inclusive initiatives
 Public sector activity lags behind activity
from private sector, development
organisations and civil society.
 Careful consideration is needed on where
public sector investment (eg infrastructure)
can be best targeted.
- Example: developing roads and bridges provide
greater impact than providing irrigation facilities
in some economies in the region

24. Supporting success of inclusive initiatives
 Investment in human and social capital is
beneficial. Greatest benefits result from
shared approaches to capacity building.
 Inclusive agribusiness requires multi-factor
consideration and multi-sector involvement,
on a foundation of multi-stakeholder decision
making.

25. Thank You!