Changing Mindsets: Small producer agency in globalised markets

1. Changing Mindsets: Small producer agency in globalised markets One–stop shopping Agri-ProFocus 28th September 2012 BishwadeepGhose Knowledge Officer, Green Entrepreneurship Programme , Hivos

2. The Knowledge Programme process Better informed policies & practices in small scale agriculture in the face of globalisation & rapid rural change, through.. • An agency perspective • Stirring debate, challenge assumptions • Co-learning, across stakes (business, research, civil society, farmer organisations) & regions (L America, Africa, Asia) • Globalisation of insight: new knowledge, reframing the debate • Focus on where rural households are and how they make choices, rather than as beneficiaries of external interventions • A series of ‘Provocations’ • A global Learning Network • Focus on where rural households are & how they make choices, rather than as beneficiaries of external interventions • A series of ‘Provocations’ • A global Learning Network

3. Small-scale farmers and globalizing markets:Conflicting calls for small farmer empowerment Globalisation can and must be reversed Claim rights to protect small-scale farming from globalisation Small-scale farmers are an anachronism Small-scale farmers are the future Join labour market, farm and non-farm work Cooperate to compete in value chains and niche markets Globalisation is inevitable and incontrovertible After Murphy, 2010

4. Small-scale farmers and globalizing markets:Conflicting calls for small farmer empowerment

5. High expectations from the private sector as a partner in smallholder agriculture Globalisation can and must be reversed Claim rights to protect small-scale farming from globalisation Small-scale farmers are an anachronism Small-scale farmers are the future Join labour market, farm and non-farm work Cooperate to compete in value chains and niche markets Globalisation is inevitable and incontrovertible

6. Small producers & Markets Can we help companies source down a level ? Can we help farmers move up a level ?

7. Current Debate • Modernity comes with increasing formality, & policies should promote formalization. • Small producers are encouraged to get into Value Chains and modern markets, especially global value chains, as “high value” markets. • The modern private sector is encouraged to make their business ‘inclusive’ of small producers to secure supply in highly competitive agrifood markets, & contribute to poverty reduction • Many governments see traditional & informal markets as untidy, un-modern, unhygienic, tax-avoiding. Either try to remove it or ignore it.

8. New Debate: Limited Potential of Modern “Formal” Market to Include Small Producers • Small producers can make it in Value Chains but the approach has limited potential except for producers with better assets (land, water, capital, organisation), access to roads. • Small producers are exerting their agency in the markets. They are not powerless when faced with globalization & modernisation. • They find markets in the spaces outside the formal economy – the informal markets within countries and across borders – which in contrast to much of the globalisation narrative, are dynamic & may be dominant. • The modern markets often have informal ‘feet’ to be competitive in the formal sector. Small producers be able to use informal/local markets as a base to reach outward. • Agency may involve controlling [economic] spaces & territories rather than success with a single commodity sector. These markets link the local poor as producers and local consumers – markets of the poor 4. Market participation may be associated with small producers plural activity & diverse strategies on farm and off farm. This can look like inconsistency from a single-chain perspective.

9. New Debate: Implication for Policy 5. To support the 90% of small producers who will never be in modern value chains: • Need to understand local &informal provisioning better – market of the poor. • Focus more on horizontal strategies to raise the performance of sectors & territories, rather than vertical strategies to improve the working of value chains. • Reduce the cost of formalisation (taxation, regulation) to allow for inclusive formalisation. • Focus attention on improving food safety in the informal sector. Major challenge when food safety becomes a national priority, and drives rapid market formalisation

10. In policies: Current debate Economic empowerment is given priority over political empowerment Small-scale farmers are excluded or not well represented in the policy debate. Many a times they are considered to be small versions of large-scale farmers. Their interests are often presented by their ‘advocates’ in highly polarized terms.

11. Reshapingthe debate Space & effectiveness of small-scale producers in the policy process Urgent need for the knowledge-based advocacy Complementary nature of political & economic agency. Small-scale producers as active economic actors when faced with globalization The inter-relation between small farmers agency & informality Work out the policy implications with careful attention to both political & economic agency.

12. Small farmers as active economic agents • Top 2-10% can compete in modern markets • Successes in cooperatives. • Successes in policy • Informal sector remains major link between smallholders and consumers • Majority not formally organisedin the market. Much organisation is trader-driven Smallholders in markets Smallholders in organisations Smallholders in policy

13. A call to business, policymakers and service providers • We focus on how small farmers &their organisations can be ‘included’ in value chains & ‘empowered’ in markets as ‘beneficiaries’ of external initiatives • We expect multiple wins -- poverty reduction, food security, security of supply, ecosystem services, rural development -- from single tools, such as linking smallholders to new markets • Those wins are often elusive -- scale &inclusiveness • Our Knowledge Programme has pointed to the very low level of attention that is paid to small-scale farmers as active economic agents, making choices in the face of new opportunities, new power structures &powerful external agendas.. • Those choices (the “art of survival under extreme conditions”) may often lead away from formal markets, formal organisations or state policies and institutions. Avoiding elitism in development interventions requires an understanding of this • For example, upgrading small-scale producers chain by chain – ‘islands’ of inclusion -- may need to give way to more effective action across an entire agricultural sector

14. For more information : www.hivos.net Thanks