Value chain programmes to integrate competitiveness, economic growth and poverty reduction

Value chain development for rural poverty reduction: a reality check and a warning

“…A review of value-chain methodologies and case studies (see, for example, Kula, Downing, and Field 2006;Tanburn and Sen 2011) shows that the poverty-reduction potential of VCD is often based on the assumption that poor households (1) have sufficient resources to effectively participate in VCD, (2) do not face substantial trade-offs when using these resources, and (3) are able to assume higher risks when reinvesting capital and labor. In reality, however, many poor households pursue diversified livelihood strategies by combining subsistence and market-oriented agriculture with off-farm labor and other nonagricultural income-generating activities.…”

“…It is principally from the latter perspective that many development agencies, donors, and governments have adopted VCD as a key element of their rural poverty-reduction strategies (see DFID and SDC 2008;Humphrey and Navas-Alemán 2010). In addition to targeting poor and vulnerable populations in the rural sector as primary beneficiaries, some value-chain initiatives seek to link to the macroeconomic environment by broadening their approach toward resource-constrained enterprises in the upstream segments of a value chain, and the promotion of changes in the political-legal, institutional, and regulatory frameworks (see Kula, Downing, and Field 2006).…”

Value chain development for rural poverty reduction: A reality check and a warning

“…A review of value chain methodologies and case studies (see, for example, Kula et al, 2006;Tanburn and Sen, 2011) shows that the poverty reduction potential of value chain development is often based on the assumption that poor households: 1) have sufficient resources to effectively participate in value chain development; 2) do not face substantial trade-offs when using these resources; and 3) are able to assume higher risks when reinvesting capital and labour. In reality, however, many poor households pursue diversified livelihood strategies by combining subsistence and market-oriented agriculture with off-farm labour and other non-agricultural income-generating activities.…”

“…It is principally from the latter perspective that many development agencies, donors, and governments have adopted value chain development as a key element of their rural poverty reduction strategies (see DFID and SDC, 2008;Humphrey and Navas-Alemán, 2010). In addition to targeting poor and vulnerable populations in the rural sector as primary beneficiaries, some value chain initiatives seek to link to the macroeconomic environment by broadening their approach towards resource-constrained enterprises in the upstream segments of a value chain, and the promotion of changes in the political-legal, institutional, and regulatory frameworks (see Kula et al, 2006).…”

Value Chains and Small Enterprise Development: Theory and Praxis

“…The core of the value chain approach is the recognition that, the strategies for enterprise development needs to focus on the entire value chain rather than focusing on a particular aspect of provision of credit or input supply. The value chain approach emphasizes on identifying the opportunities for and constraints to industrial growth by considering the value chain actors (firms), linkages among firms, supporting markets, end markets, and the business enabling environment at all levels [18]. The value chain approach also emphasizes on other factors that influence the chain's performance, including access to and the requirements of terminal markets, the legal, regulatory and policy environment, and the availability and quality of support services such as financial services, equipment manufacture and repair, business management services and information technology.…”