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Commodity Development Strategies in Commodity Development Strategies in the Integrated Frameworkthe Integrated Framework
A quick presentation of work done by CSEND A quick presentation of work done by CSEND in cooperation with UNDPin cooperation with UNDP
Global Commodity Forum – Side Event Global Commodity Forum – Side Event Geneva, 23rd March 2010 Geneva, 23rd March 2010
(finalised on 10th April 2010) (finalised on 10th April 2010)
Lichia YiuLichia YiuPresident, CSENDPresident, CSEND
Overview of the presentationOverview of the presentation
1.1. Integrated Framework and DTISIntegrated Framework and DTIS2.2. CSEND’s DTIS Analysis CSEND’s DTIS Analysis
((Raymond Saner, Lichia Yiu, Alka Bhatia)3.3. FindingsFindings
Csend 2009 finalised 10th April 2010
Integrated Framework (IF)Integrated Framework (IF)
Partnership of six agencies, donors and LDCsPartnership of six agencies, donors and LDCs
Aims to: Aims to: • ““mainstream” trade into national development mainstream” trade into national development
plans;plans;• help coordinate trade-related technical help coordinate trade-related technical
assistance;assistance;• promote integration of LDCs into the global promote integration of LDCs into the global
economyeconomyCsend 2009 finalised 10th April 2010
Integrated FrameworkIntegrated Framework
The systematic approach to trade capacity The systematic approach to trade capacity building, it’s primary tool: building, it’s primary tool:
‘‘Diagnostic Trade Integration Study’ (DTIS)Diagnostic Trade Integration Study’ (DTIS)
DTIS addresses trade development and seeks to DTIS addresses trade development and seeks to improve linkages between trade and poverty improve linkages between trade and poverty reduction strategiesreduction strategies
Not designed only for development of Not designed only for development of commoditiescommodities
Csend 2009 finalised 10th April 2010
Commodity Problématique
Primary commodities • Major source of income and employment, especially
for LDCs• Countries dependent solely on primary agricultural
commodities rank low on the Human Development Index (HDI)
• Volatility of prices, changes in demand• High demand – gains not evenly distributed
Csend 2009 finalised 10th April 2010
Commodity Problématique
Primary commodities• Potential for poverty reduction, esp. of small farm
producers and women• Poverty reduction through development of commodity
sector and transition up the production ladder• Commodity development strategy – address supply
side and value chain issues and inadequate diversification of production
• In the past - emphasis on trade in primary commodities at the cost of industrial development
Csend 2009 finalised 10th April 2010
CSEND’s DTIS Analysis -CSEND’s DTIS Analysis - Scope
Analysis of existing DTISs of the IF with reference to commodity diversification, value addition and industrial development.
National focus.
Global trade issues such as market access not examined.
Csend 2009 finalised 10th April 2010
CSEND’s DTIS Analysis - CSEND’s DTIS Analysis - MethodologyMethodology
Assess Assess supply side constraintssupply side constraints, diversification, , diversification, value chain creation and forward and backward value chain creation and forward and backward linkages for industrial development in existing linkages for industrial development in existing DTISs.DTISs.•Analyse different stages of commodity value and Analyse different stages of commodity value and supply chain supply chain •Focus on actors at each stage: Focus on actors at each stage: policy makers, policy makers, institutions and entrepreneursinstitutions and entrepreneurs•Identify areas for further actionIdentify areas for further action
Csend 2009 finalised 10th April 2010
CSEND Analysis – Methodology 2
Set of criteria developed spanning supply side (domestic
production capacities) and value chain (trading capacities) issues.
Csend 2009 finalised 10th April 2010
CSEND Analysis – Methodology 3
Criteria of supply-chain analysis: • Infrastructure issues:
• warehousing and storage (cold chains)• electricity• IT and telecom• transportation
• Production of primary commodity inputs: productivity improvements, technology inputs, management know-how, skills development of workforce, gender particpation
Csend 2009 finalised 10th April 2010
CSEND Analysis – Methodology 4Criteria of value-chain analysis:• Processing production inputs
(primary and secondary)• Standard setting
(creating, adopting, implementing)• Quality culture
(general awareness and demand for quality products)• Quality infrastructure
(laboratories, accrediation facilities, personnel training)• Distribution system
(including marketing- and export-promotion services)• Business linkages
(availability and conditions for joint ventures, franchising, credits, financial serives)
• Pricing mechanisms (existence of commodity boards, futures trading)
• Investment climate (regulations on competition rules, repatriation of profits)
• Social and environmental sustainabilityCsend 2009 finalised 10th April 2010
Analysis – Methodology 5
• Criteria integrated into a Commodity Development process
• Matrix in which relevant information from each DTIS recorded and analyzed.
Recommendations or references classified separately at 3 levels of intervention by commodities:
• Policy • Institutional actors • Enterprise development
Csend 2009 finalised 10th April 2010
Country Commodity Development Strategy MapCountry Commodity Development Strategy Map
Csend 2009 finalised 10th April 2010
Cross-country Cross-country comparison comparison
Counting Counting references by references by country and chain country and chain componentscomponents
Csend 2009 finalised 10th April 2010
Analysis - FindingsAnalysis - Findings
DTISs have following characteristics:DTISs have following characteristics:1.1.InconsistentInconsistent in-country approach to in-country approach to commodity development, across commoditiescommodity development, across commodities
Csend 2009 finalised 10th April 2010
Analysis - FindingsAnalysis - FindingsAnalysis - FindingsAnalysis - Findings22. . Inconsistent between-country Inconsistent between-country approach to approach to
commodity developmentcommodity development3. 3. Policy oriented bias Policy oriented bias – long on policy – long on policy
recommendations and short on recommendations and short on implementable actionsimplementable actions
Csend 2009 finalised 10th April 2010
Analysis - FindingsAnalysis - Findings
• Insufficient attention to infrastructure• Supply-side issues lack in depth analysis • Processing of primary commodities not linked to
a comprehensive strategy for commodity development and diversification
• All DTISs directed towards increasing exports but factors of supply production not given adequate attention
Csend 2009 finalised 10th April 2010
Mapping of Variegation of Commodity Development Strategies by Country in the IF
Mapping of Variegation of Commodity Development Strategies by Country in the IF
Csend 2009 finalised 10th April 2010
Improvements NeededImprovements Needed
•Diversification•Regional Alliances•Skill Development
More effective use of
DTIS 2, EIF
Building a Data based monitoring system for aid mgmt
Csend 2009 finalised 10th April 2010
Specific RecommendationsSpecific RecommendationsSpecific RecommendationsSpecific RecommendationsPolicy recommendationsPolicy recommendations
• Sensitize relevant ministries in LDCs about the need to develop integrated Sensitize relevant ministries in LDCs about the need to develop integrated national policy frameworks for commodity-led growth strategiesnational policy frameworks for commodity-led growth strategies
• Implement policies to improve productivity, to create linkages between Implement policies to improve productivity, to create linkages between farming community, enterprises with universities and research entitiesfarming community, enterprises with universities and research entities
• Develop a viable programme for R&D to employ newer technologies to Develop a viable programme for R&D to employ newer technologies to build competitivenessbuild competitiveness
• Create policy framework to facilitate dev of backward and forward Create policy framework to facilitate dev of backward and forward linkages in production, processing, value addition and marketinglinkages in production, processing, value addition and marketing
• Support local economic development and cluster initiativesSupport local economic development and cluster initiatives
• Make quality a national priorityMake quality a national priority
• Create sustainable regional partnerships for economies of scale Create sustainable regional partnerships for economies of scale
Csend 2009 finalised 10th April 2010
Specific – Recommendations 2Specific – Recommendations 2Specific – Recommendations 2Specific – Recommendations 2
Recommendations on institutional arrangementsRecommendations on institutional arrangements• Need for supportive institutional framework Need for supportive institutional framework
comprising banks, commodity boards, donors comprising banks, commodity boards, donors and a dynamic public sectorand a dynamic public sector
• Development of cooperatives for economy of Development of cooperatives for economy of scalescale
• Development of functioning market information Development of functioning market information systemssystems
• Institutions in charge of competition policy, SME Institutions in charge of competition policy, SME development etcdevelopment etc
Csend 2009 finalised 10th April 2010
SpecificSpecific – Recommendations 3 – Recommendations 3SpecificSpecific – Recommendations 3 – Recommendations 3Recommendations on enterprise participationRecommendations on enterprise participation• Strengthen producer organizations, use them for Strengthen producer organizations, use them for
information disseminationinformation dissemination• Develop consultative strategies to inform GovernmentDevelop consultative strategies to inform Government• Mobilize enterprise inputs to identify areas of value Mobilize enterprise inputs to identify areas of value
additionaddition• Encourage participation of enterprises in policy Encourage participation of enterprises in policy
dialoguedialogue• Raise awareness of the enterprises of their social and Raise awareness of the enterprises of their social and
environmental impactenvironmental impact
Csend 2009 finalised 10th April 2010
Thank youThank you
[email protected]@csend.orghttp://www.csend.org/KnowledgePublications.aspx?http://www.csend.org/KnowledgePublications.aspx?
id=126id=126
http://www.undp.org/poverty/http://www.undp.org/poverty/http://www.undp.org/geneva/index.htmlhttp://www.undp.org/geneva/index.html