How can M4P serve the poorest of the poor?

To begin with, we have to define the poorest. Who are they? People with very low income (below $1 per day), with no income generating assets (for example livestock, land), seasonal income, earning mostly from labor, depending highly on the government’s social safety net programs. These are the people who are highly vulnerable to social shocks (for example dowry), economic shocks (for example price hike of essentials), natural shocks (disasters, climate change), health shocks (for example death of the household head). These are systemic constraints restricting participation of the poorest in the market (if you are aware of the famous doughnut then you can find this on the rules and regulations part which also asks to discuss about social norms and conditions). But I hardly have found M4P projects that target the poorest of the poor but aim to solve these constraints on the surface or least discuss these constraints. Rather, our log frames are clogged with targets like ‘increasing knowledge,’ ‘creating awareness,’ ‘strengthening linkages’ with the expectation that these will eventually address the systemic constraints and lead the poorest out of poverty.  Eventually, when it comes to monitoring, we spend sleepless nights to find what happened to the poorest. So what’s going wrong?

Nothing is going wrong. In the short run, the typical interventions that we do, open up the market for those who are most ready to participate. These are not the poorest rather the poor who are still highly vulnerable but have the assets and have been participating in the market albeit with low benefit. As the market opens up further for them, they create more opportunities for the poorest in their neighborhood.  As a result we see increasing participation of the poorest as labors, traders, service providers and even as enterprises. For example, increase in yield and sales of tomato resulted increase in demand for baskets which in turn attracted the poorest in the community to produce baskets from bamboo supplied by some other of the poorest in the community.  Such examples are in plenty. But probably we are not doing a good job in telling the story right.

Now going back to those systemic constraints…much of these problems cannot be addressed without participation of the government, the civil society, NGOs, farmer groups, cooperatives etc.  Besides, it is often out of the scope of an M4P project to tackle much of the social, natural and economic shocks that restrict participation of the poorest in the market (how much can you do when you are given 5 years, of which you will have effectively 3.5 years to make some real impacts). This is where I say, do not push M4P so hard. ‘The egg laying wool milk pig’ never exists.

But I don’t mean to say we should give it up. We can still make some major shifts given the limited scope that we have. But that call for larger actions in the national forum rather than working together with 3-4 private sector lead firms and one or two associations in the market system of say for instance maize. The larger action means we need to work together with the government, the civil society, the NGOs and such other organizations (again, they belong to both support functions and the rules and regulations part of our famous doughnut). The government can come up with policies that help the poorest to accumulate the necessary resources with less risks and provide incentives to the private sector to work more with the bottom of the pyramid (not the bottom of the consumers but bottom of the producers).  The result is a much larger action and intervention (and hence scale and sustainability) reaching out to the poorest. 

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Promoting sustainable market led value chains

Address two questions…first ‘what do I need to know to develop the right strategy to promote sustainable, market-led value chains?’ And then we need to find out the ‘how to do it part.’ This is what I do for the projects that I consult: 

‘what do I need to know to develop the right strategy to promote sustainable, market-led value chains?’ 

1. Determine the opportunities for growth: I start by asking what opportunities exist in the local, national and international market which has triggered growth or can potentially trigger growth? 
2. Determine how the marginalized farmers or MSMEs (our target beneficiaries) could benefit from the growth: Once the opportunities are identified I try to check if the tagret beneficiaries can benefit from the growth. Not all market opportunities are pro-poor. 
3. Analyze what restrict the target beneficiaries from cashing on the market opportunity: If the opportunities exist why can’t the target beneficiaries participate in the market and join the growth curve? 
4. Determine what resources/ competencies in the value chain could have sustained participation of the target beneficiaries in the value chain: Value chain development is not about sustaining forward linkages or linking farmers with large buyers. Its about forward, backward and horizontal relationships and its about market systems (the deman and supply scenario, support services and the enabling environment in large) that dictate the competency and potential inclusion of the target beneficiaries. I do a market systems analysis in conjunction with the value chain analysis to determine the resources, capacities, competencies which if present will help the market players create and sustain and inclusive value chains. 

What should we do ensure sustainable market led value chains: 

1. Avoid predetermined solutions: I have seen and consulted many projects struggling because of strict adherence to ‘solutions proposed in the project proposal’ which were done again by us consultants in just about a month’s time with little or no understanding of the field realities. 
2. Have short term and long term visions for growth and design your interventions accordingly: Markets are dynamic. In two years time it will not be as it is now. Therefore, interventions that are not dynamic and fail to fuse with the market’s changing dynamics will never sustain. The project can have intermediate goals fitting into long term growth. I use a ‘who does who pays analysis’ which is mostly discussed in the M4P approach. But this works wonder for a value chain development project as well. For the key market and value chain functions determine who is doing it now and who is paying for it. And then plot who will do it when the interventions are going on and who will pay for it. Finally, develop a vision about who will continue to do and pay once the project phases out. 
3. Be opportunistic: Since markets are dynamic we need to be opportunistic. The right partners and the right interventions are more often identified on the go. Just recently, I designed an intervention while waiting in the Lagos airport and was watching the Euro 2012 final. An advertisement was being repeatedly played which had huge implication on the interventions that we are doing for the Support to National Malaria Program in Nigeria. Next day, we had the intervention planned and reported. 
4. Partnership is key: The partners are the private sector, NGO, civil society, the government and other actors in the value chain and the market. They should be on the forefront of the development and not us. Ensuring that they understand the project’s goal, role and plans is essential. 
5. Know when to exit: We all know it but struggle to do it. Its more rewarding for us to do a little more than saying goodbye. Ensure that we exit at the right time which is not necessarily at the end of the project.

Is there any silver bullet for development?

In the last eight years I have assessed numerous basic services, agricultural and industrial   sectors, subsectors, value chains and markets! Note the different types. Ask my wife…these are all ‘industries’ to her. Ask my father..these are all ‘sectors’ to him. To a general person it doesn’t matter whether its an industry or a sector, subsector, value chain or a market. For us, the development practitioners, it does matter! Its a question of our identity. Did I say identity? Wait a little more. The identity is not created if I have not labelled myself. Take a quick look at my profile and identify my labels. Ok. Let me spare you the time. I specialize on value chains, M4P and have recently started to work on LED. These are my labels as a practitioner. These are what my identity in the field is made of.

Wait. If you are thinking this blog is about criticizing the highly fragmented field of development and the deliberate attempt for fragmentation then I regret. It is not meant for that. The labels are needed to differentiate the different types of development goals. For instance, the development goals can be creating income opportunities for the ultra poor through asset transfer, supporting enterprises to grow through private sector reform and development, increasing competitiveness of MSMEs through market development and value chain development, feeding the poor through social safety net programs, increasing regional competitiveness for economic development. To meet these objectives we deploy different methodologies and tools for assessment, intervention design and implementation. These methodologies and tools which we prefer to term as ‘approach’ and I am increasingly convinced to term as ‘development brands’ have similarities and dissimilarities and understandably so. Like any consumer product, the approaches were created to serve specific needs and demands. The utilities that can be derived are therefore different. I cannot expect to achieve the objectives of an asset based program by adopting M4P or value chain development. I cannot use LED to increase the competitiveness of the anti-malarial products in Nigeria which suffers heavily from conflicting and random deployment of development strategies. Ask my M&E team they will tell you how in many cases we are trying to get drunk with pints of coke!

I recently learnt from my colleague from mesopartner about the great German phrase die eierlegende Wollmilchsau or ‘egg laying wool milk pig’. Its a fictional animal that can do everything for you. Since we are not here to kill but to develop…I would rather use this phrase instead of the old school silver bullet from now on. Enough for now. Signing off in search of my ‘egg laying wool milk pig.’