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Agricultural investment funds for development

Descriptive analysis and lessons learned from fund management, performance and private–public collaboration











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    Book (stand-alone)
    International Investments in Agriculture in the Near East
    Evidence from Egypt, Morocco and Sudan
    2011
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    The food crisis of 2007- 2008 sparked an increase in investment flows to agriculture in the Near East, particularly to countries rich in water and land resources, such as Sudan. These investments have continued to increase during 2009 - 2010, as food prices continue to remain high. This publication was motivated by this surge in international investments in agriculture. and the-. need to answer some key policy questions, through and a brief review of international investments in the region, and an exploratory analysis of the issues and challenges in the policy arena. Three case studies in Egypt, Morocco and Sudan were commissioned by the FAO Regional Office for the Near East. The purpose was to (i) identify past and current investment trends in terms of the actors involved, modalities, size and impact (to the extent that information is available), (ii) assess these investments in the context of the region and its food security challenges, and (iii) identify areas to be addressed by pol icy makers to ensure food security in the long run and provide a starting point to evaluate investments for timely and targeted policy measures. While information on international investments in agriculture is not readily available, the case studies provide an overall picture of agriculture investments, specifically focusing on foreign direct investments. The share of international investments to agriculture has traditionally been very low in the region. With a an average share of 1- 2% of total FDI, this investment is mostly concentrated in sectors other than primary agriculture. In the past few years, investments in agriculture have grown remarkably; however, information on their allocation and impact is incomplete and fast changing. Impacts of agricultural investments in the past have been mixed and concentrated in capital and resource intensive activities which are largely supported by the public sector. Sudan has attracted resource seeking investments, whereas Morocco and Egypt co ntinue to be investment destinations for market seeking investments, in the food processing and fruit and vegetable production sectors. The involvement of the private sector in investment in agriculture is growing but there is still a strong government presence in supporting these investments, often through direct and indirect subsidies in most countries. The historical experience of the region is instructive in terms of improving the efficiency of future investments in agriculture as well as en suring sustainable outcomes. Some of the salient features of international investments in agriculture can be summarized as follows: • Intra-regional investment in agriculture constitutes the bulk of the international investment in agriculture in the Near East. • Countries such as Egypt and Sudan are the largest recipients of recent international investments in food and agriculture, mostly from the Gulf States but also from other countries such as China and South Korea. Other countries in the reg ion are also heavily investing in agriculture and food sectors overseas, and beyond the Near East, including in Asia and Latin America. • Whether investor or host country, the common driving factor for international investments in agriculture in the region is food security concerns. The investment policies of most countries in the region are geared toward attracting investments. They are therefore relatively open and do not differentiate between the different sectors or the different types of ac tivities within agriculture. Agriculture, as an investment category, has been growing rapidly in the last three years, and most countries (especially the poorest) have not yet had the time to align their investment strategies with their national food security objectives. Given the rapid growth in agricultural investment, caution needs to be exercised by investor and host country governments, as well as private investors, to develop sustainable solutions and incorporate a long term perspective to support healthy and profitable investments. Given the diverse national and household food security concerns and resource availabilities, a regional focus on food security may be needed to better formulate and harmonize policies as well as tap into opportunities. The potential capacity for staple food production has its limits, but income generating opportunities are ample. A mix of investments geared at food processing, food service, and other sectors linked to agriculture, could also provide a lternative income opportunities for rural people, as well as increased employment opportunities in urban areas. Within this context, regional initiatives could be very promising in promoting food security in the longer term.
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    Book (stand-alone)
    Expert meeting on international investment in the agricultural sector of developing countries
    Report
    2011
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    An expert meeting on international investment in the agricultural sector of developing countries was held at FAO’s headquarters on 22-23 November 2011. The objectives were to review the current state of knowledge including recent case studies, identify good practices, determine the areas where further research is needed and plan the next steps. 42 experts analyzing investment in agriculture participated in the meeting. Recommendations for further research were given including: more evidence on t he impacts on food security, environmental impacts and gender-disaggregated analysis of investments; development of a common typology using business model as an entry point; more meta-analysis; considerations of time frames and geographical scales; analysis of the interrelationships between various forms of investments; and the need of more regular interaction among researchers and analysts. The meeting provided recommendations to organizations that provide support to actors involved in agricult ural investments including: analyze the needs in terms of capacity building, policy advice and technical support; provide guidance in analyzing investment proposals and making informed choices; help governments formulate policies that orient FDI in directions that enhance smallholder investments and livelihoods and national food security; strengthen the capacity of local communities, farmer groups and others to analyze and negotiate projects; support inclusive negotiation processes; assist gover nments in developing agricultural development strategies that focus on sustainable food security; identify schemes that reconcile the development objectives of host countries and local communities with the commercial objectives of investors; raise the awareness of investors on the importance of a responsible investment to their own business interests; engage them in the development and implementation of guidance tools such as the principles for responsible agricultural investment.
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    A preliminary value chain analysis of shark fisheries in Madagascar 2014
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    Madagascar’s extensive (~6,500 km) coastline comprises the most diverse and extensive shallow marine habitats in the Western Indian Ocean, supporting an estimated 123 shark and ray species. Sharks have featured in Madagascar’s fisheries for at least 100 years, with exports recorded as early as the 1920’s. Globally, shark fins are one of the most highly valued seafood items and represent a critical and significant source of cash for some of Madagascar’s isolated fishing communities. The global sh ark fin trade is estimated to be worth between US$400-500 million a year. Increases in the shark trade over the last two decades is closely linked to economic growth in China, where the market is concentrated, and the ripple effects of this increase in demand have been felt worldwide. Scientific estimates for the number of sharks killed annually can be up to 100 million individuals and sharks are on the whole overexploited. Today, thirty percent of all shark and ray species are now classified as ‘Threatened’ or ‘Near Threatened’ with extinction according to the IUCN Red List, although this number is likely to be higher given that the status of almost half (47%) of shark species cannot be scientifically assessed due to a lack of data. There is strong evidence that shark overexploitation occurs in Malagasy waters and that shark populations in the area are declining rapidly. Although reliable figures on Madagascar’s domestic shark fishery are sparse, anecdotal observations report declines in shark numbers within the last two decades. According to national studies based only on official export data, recorded shark fin exports stood at approximately 32 tonnes in 2010, a decrease from 65 tonnes in 1994. Lack of data on catches, particularly from artisanal fisheries, bycatch by licensed industrial vessels, and by illegal, unregulated and unreported (IUU) fishing by foreign industrial vessels, means these official export figures are likely to be gross underestimates of the actual pro duction. Madagascar’s shark fishery is comprised of three main fisheries according to Malagasy legislation: artisanal, traditional and industrial fisheries. Madagascar’s artisanal and traditional shark fisheries extend along the entire west coast, with the most important traditional fisheries along the southwest coast. Overfishing has led to fisher migration, spreading the fishery along the entire west coast and also much of the north. There is no established traditional shark fishery along the east coast due to adverse sea conditions, whilst the south is the least developed of all sites surveyed for this report. Throughout the country, surveyed fishers report catching shark for the purposes of income from selling fins (88%) and meat (77%), and as a source of food (31%), demonstrating the important link to the international shark fin trade. Shark fin exports reach the international market mostly through two principal buyers and exporters, namely the Sea Reine and Sin Hing, Chinese comp anies based in Antananarivo. The supply chain for shark fins is both complex and rather fluid with fishers selling either fresh (wet) or dried fins to collectors and fins graded in value according to size and quality. Some fishers bypass the local collectors and sell dried fins directly to main buyers in larger towns to obtain a better price, which can be a mark-up of 40% for high quality fins. The value of shark fins during the study period (2012) varies according to their condition (wet or dri ed), quality (four recognised grades) and their position in the supply chain. Robust data was collected for the first two levels of the supply chain but was lacking for the higher levels (main buyer to exporter). Guitarfish fins were on the whole, twice as valuable as shark fins and therefore both in demand and a fishing target. Since 2012 the average value of shark fins has dropped. Trade in shark meat is also well establishedin Madagascar, with meat sold into a supply chain that serves mainly local and national (provincial) markets but can also be exported to the Comoros. Shark meat does not fetch a high price compared to other fish or meats but can be an important supplementary source of income or nutrition in some cases. Generally fresh meat is sold and consumed locally whilst dried salted meat is bought by collectors and transported to inland urban markets in Madagascar. Some dried shark meat is also exported. ANGAP Association Nationale pour la Gestion des Aires Protégées ASH Aut orité Sanitaire Halieutique BAD Banque Africaine de Dévelopement CBD Convention on Biological Diversity CCPS Cellule de la Coordination de la Politique Sectorielle/MPRH CLB/VOI Communauté Locale de Base/Vondron’Olona Ifatony CITES Convention on International Trade in Endangered Species of Wild Fauna and Flora COI Commission de l’océan Indien COS Certificat d’Origine et de Salubrité CSP Centre de Surveillance des Pêches CMS Convention on Migratory Species DGRH Direction de la Gestion des Ressourc es Halieutiques/MPRH DPRH Direction de la Pêche et des Ressources Halieutiques/MPRH DRPR Direction Régionale de la Pêche et des Ressources Halieutiques FAO Food and Agricultural Organization of the United Nations RFMO Regional Fishery Management Organization GEF Global Environnement Facility GTZ Gesellschaft Für Technische Zusammenarbeit IPOA Sharks – International Plan of Action for the Conservation and Management of Sharks IOTC Indian Ocean Tuna Commission IUU Illegal, Unregulated and Unreport ed JICA Japan International Cooperation Agency, Agence Japonaise de Coopération Internationale MAEP Ministère de l’Agriculture, de l’Elevage et de la Pêche MGA Malgasy Ariary MNP Madagascar National Parks (previously ANGAP) MPRH Ministère de la Pêche et des Ressources Halieutiques NGO Non Governmental Organisations SWIOFP/OISO South West Indian Ocean Fisheries Project, Programme de l’Océan Indien Sud- Occidental UNGA United Nations General Assembly WIO Western Indian Ocean WWF World Wild Fund fo r Nature 6 A preliminary value chain analysis of shark fisheries in Madagascar 7 8 A preliminary value chain analysis of shark fisheries in Madagascar Foreign commercial fishing fleets have also been prevalent in Malagasy waters since at least the 1980’s and primarily target shark and larger pelagic fish, with significant shark bycatch for those fisheries not directly targeting sharks. Almost none of the sharks caught are landed in Madagascar. IUU fishing within Madagascar’s Exclusive Economic Zone (EEZ) is a well-established issue, with the shark fishery specifically targeted by both licensed and unlicenced vessels. Despite the significant pressures on Madagascar’s shark fishery and the enormous socio-ecological and economic value of the trade, the country has no coherent or functioning shark conservation strategy or legislation. The lack of a national strategy is largely due to deficiencies in data on fishing effort, catches, landings and discards in all commercial fisheries for sh ark. This is compounded by a paucity of information on shark ecology, fisheries status and the socioeconomic value of the trade throughout Madagascar. Furthermore, in isolated coastal areas with little infrastructure, the sale of high value dried shark fins has been one of the few ways local Malagasy fishermen can earn cash. In this context, the diverse and unconnected stakeholders have no basis or motivation to enact meaningful conservation measures, particularly when economic imperatives outwe igh any other consideration. In a country as poor as Madagascar, even minor poverty relief is important, leading fishers to continue shark fishing despite low catches and diminishing returns for fishing effort, further threatening the future of the fishery. There is an urgent need to actively and aggressively manage Madagascar’s shark fishery. The rapid decline of sharks is likely to have several negative socioeconomic and ecological impacts, including the loss of livelihoods and protein for tho se people who rely on them and potentially altering the trophic structure of marine and coastal ecosystems. However, putting in place conservation measures and enforcing regulations remains a formidable challenge. Much of Madagascar’s fishery takes place in remote fishing grounds scattered over thousands of kilometres of coastline; the fishers are highly mobile and move great distances to seek productive fishing grounds; the government lacks the means to monitor these fisheries and enforce regul ations; and the markets are informal and closed. Significant steps must be taken in order to effectively prevent the collapse of Madagascar’s shark fishery. A widespread campaign to regulate both international and local shark fishing must occur simultaneously for any significant positive change to occur. For this to take place scientifically robust data must be collected over the long term. For any national conservation strategies to be implemented effectively, they should be based on data colle cted through participative monitoring and implemented at the national level. Such strategies should apply to artisanal and traditional fisheries, as well as to international commercial fishing vessels operating within the EEZ. Madagascar’s existing locally-managed marine areas are a vehicle through which coastal shark management strategies could be implemented. However an increase in both technical and logistical capacity will be required for effective management at the local, regional and natio nal level, together with strong enforcement support to LMMAs. Although it is recommended that the government develops appropriate national legislation and put in place proper monitoring and export restrictions, the onus remains heavily on the international community, with global legislation driving the regulation or lack of regulation of the global shark trade. Particular attention needs to be paid to those countries with distant water fleets / vessels operating within Madagascar’s EEZ, both leg ally and illegally. Without proper regulation of their shark fishing effort, partly through RFMO’s, little progress can be made.

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