Building Competitiveness in Africa's Agriculture : A Guide to Value Chain Concepts and Applications

The development and business communities involved in the African agriculture and agribusiness sectors have recently experienced a strong resurgence of interest in promoting value chains as an approach that can help design interventions geared to add value, lower transaction costs, diversify rural economies, and contribute to increasing rural household incomes in Sub-Saharan Africa (SSA) countries. Enhancing value chain competitiveness is increasingly recognized as an effective approach to generating growth and reducing the rural poverty prevalent in the region. This is a welcome development for practitioners who have long been convinced of the need to look differently at agriculture not just as a means of survival, but as smaller or larger commercial businesses linked to domestic and global markets and of the need to identify and tap into new sources of potential growth and value addition in the sector. Hopefully, renewed engagement will lead to a substantial increase in the flow of financial resources and technical assistance devoted to supporting market-driven, competitive agro-enterprises and agricultural value chains throughout the African continent. However, there is danger that this renewed engagement may not last, or may even backfire, if the high expectations placed on promoting value chains are not met. Because the development literature is not clear about the concepts and methods relating to value chains, there is risk that sooner or later the benefits of the value chain approach will be overshadowed by unmet expectations. That in turn could cause the approach to be discarded categorically. Although there is no single way to mitigate such risks, this guide aims to offer practical advice and tools to businessmen, policy makers, representatives of farmer or trade organizations, and others who are engaged in SSA agro-enterprise and agribusiness development. This guide is particularly designed for those who want to know more about value chain based approaches, and how to use them in ways that can contribute to sound operational decisions and results for enterprise and industry development, as well as for policy making with respect to doing business, stimulating investment, and enhancing trade in the context of African agriculture.