An economic program with stronger focus, coherence and impact: that is ICCO’s target in Central America. The Regional Office (RO) contacted FSAS consultants Marjoleine Motz and Jochem Schneemann to review the program in Nicaragua, Honduras and Guatemala, and to advise how to reach above goal.
A first recommendation was to use the Making Markets Work for the Poor (M4P) approach as this methodology is gaining ground. M4P is not a substitute of the value chain development approach, but builds on it. Just as within the VCD approach, key principle is to facilitate systemic change, rather than being an actor in the value chain or business supporter. Interventions in market systems are most sustainable and reach the greatest scale when they are pursued by market actors, not development actors. FSAS used the M4P thinking in the assessment and in the final program advice.
The work started with looking at ICCO’s current project portfolio and it became clear that there are interesting and relevant partners and projects in it, but complementarities and interlinkages could be improved to reach its full impact potential. Together with ICCO staff the consultants discussed if working in less value chains and create a more specialized role for ICCO would add more value. Identifying with whom best to cooperate (both private sector and support organisations) leading to above mentioned goal was therefore also part of the assignment.
FSAS used its value chain selection tool (used also earlier in West Africa) and assessed ten value chains in total. The tool assesses and scores them against a set of criteria which determines their economic and social inclusion potential. The outcome was a set of three value chains showing most potential for ICCO to work on. A fourth option, being coffee, came up as well but as this value chain already has quite some players supporting it, the chance that ICCO can add more value was considered limited.
The assessment indicated for instance high potential for fresh vegetables to export to US and EU as the region can deliver vegetables in the US and EU off season. Furthermore, it involves tens of thousands of small producers which is a priority target group for ICCO. In Guatemala FSAS ‘identified’ a few large vegetable trading companies with a strong CSR profile that are interested in cooperating with ICCO. They already provide support to the growers on agricultural practices, seed supply etcetera, but indicated that specific support, e.g. on certification, organization of the sector and development of more accurate financial services is needed to strengthen the position of their growers/suppliers and of the value chain as a whole. Therefore FSAS advised ICCO on potential partnerships with suppliers and buyers and how to include more small vegetable growers in these chains.
The assignment was carried out with the support of two Guatemalan consultants. Next to the desk research there were also field visits and work sessions with ICCO staff. At the end of the assignment Jochem Schneemann indicated:“I did not expect such good potential for small producers to access the market. The good examples and cases we have seen can be expanded and serve as an example for other chain actors and other companies that also have the ambition to undertake responsible business with a solid Corporate Social Responsibility (CSR) profile. A great opportunity for ICCO to increase the impact of their program“.