Agribusiness development in sub-Saharan Africa : optimal strategies and structures -- final report

This report presents the results of case studies of opportunities and constraints facing indigenous small-and medium-scale enterprises (ISMEs) in the nontraditional agricultural export (NTAE) sector in six countries in the region: Tanzania, Zambia, Mozambique, Ghana, Malawi, and Kenya. The report then draws conclusions and makes recommendations about how donors might best go about enhancing ISME capacities to launch and develop NTAE-related activities. Major constraints common to the six countries are lack of market information and access to finance, poor infrastructure, poor research and development (R&D) and extension services, difficulties in procuring appropriate inputs, inappropriate land tenure arrangements, lack of clarity in institutional roles, slowness in exploiting entrepreneurial opportunities, lack of business knowledge, and burdensome government regulations. As a long-term strategy, the report recommends that ISMEs first develop their capacities to supply domestic markets in order to generate the savings and experience they need to succeed in the more demanding export arena. The report discusses the particular agricultural products (e.g. rainfed, nonperishable, and bulk-transported crops) and markets (e.g., niche, regional, and wholesale) on which ISMEs should focus, and ways in which they might achieve economies of scale (e.g., by joining demand-driven associations and developing linkages with larger firms). Donor interventions are recommended in the areas of infrastructure and policy, basic R&D, training, finance, and association development. Detailed observations of ISME activity in the NTAE sector in the six countries are reported in the individual chapters. Appendices include a review of the secondary literature, brief profiles of ISMEs in each of the study countries, and a bibliography.