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Assessing the impact of COVID-19 on agrifood manufacturing small and medium enterprises in sub-Saharan Africa

Recommendations for building back better










Oman, S., Kongongo, F., Kelly, S., Ilie, E. 2021. Assessing the impact of COVID-19 on agrifood manufacturing small and medium enterprises in sub-Saharan Africa – Recommendations for building back better. Rome, FAO and Vienna, UNIDO.




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    Small and medium-sized enterprises (SMEs) constitute the large majority of businesses both globally and in Asia and the Pacific. Despite their undeniable importance, the literature on SMEs in general, and agrifood SMEs in particular, is relatively limited. One specific area that deserves deeper consideration is the extent of digital engagement of agrifood SMEs along the agrifood value chain, from farm to retail and food services, in countries in Asia and the Pacific. The goal of this publication is to understand the current status of digitalization of agri-SMEs in Asia and the Pacific, what this process looks like and how to improve it. A value-chain approach was adopted to evaluate the digital maturity of all types of agri-SMEs across previously siloed categories – from farm to fork, and in the core and the extended value chain. The report analyses the benefits of digital transformation for agri-SMEs and the challenges they face in this process. Next, the report outlines practical and actionable measures that governments and other stakeholders may undertake to help agrifood SMEs stay ahead in the digital age. Special attention is given to the creation of a digital environment that enables agri-SMEs to increase the efficiency of their operations and allow them to grow. This is particularly important given that many agri-SMEs are located in rural agricultural areas, (where more than half of the population in Asia and the Pacific still resides), but where the environment is less favourable to digital transformation.
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    This study looks at the business models of small and medium sized rice processors in Kenya in order to better understand the policy and technical support they need to grow and fulfil their role in agrifood systems transformation. More specifically, by employing semi-structured interviews with Kenyan rice millers, the technical study identifies challenges in their day-to-day business activities, including procurement, inbound and outbound logistics, in-house operations, financing, and human resources management. Additionally, the publication looks at opportunities for improving the business enabling environment in which these enterprises operate, providing a set of policy options to foster their role. The methodology cross fertilises different disciplinary perspectives in order to gather evidence for formulating policy in a way that integrates several policy fields and cross-cutting issues such as food safety, quality and nutrition; farmer-market linkages; decent rural employment and gender equality; or rural investment. The paper showcases how small and medium agrifood manufacturers respond to the business enabling environment and also contribute to local development from multiple angles.
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    Bulgaria’s entry into the EU in 2007 will have a significant impact on the country’s small and medium sized enterprises (SMEs) operating in rural areas and the banking sector servicing them. EU standards and regulations related to specific sectors of industry (particularly food industry) coming in place in the next two years, as well as expected competition from the EU market, will change dramatically the scene in which rural SMEs operate. New investments are needed in order for this transition process to be successful. Commercial banks operating in rural areas have a vital role in realising this goal. This publication is part of report series published under the FAO Investment Centre/European Bank for Reconstruction and Development Cooperation Programme. The series presents sector reviews and studies undertaken in Central and Eastern Europe that cover development issues and innovative areas to increase investment in agriculture in the region. Bulgaria's entry into the European Union in 2007 will have a significant impact on the country's small and medium sized enterprises (SMEs) operating in rural areas. EBRD's Financial Institutions team, together with its Agribusiness team, has developed a Facility to mix EU grant and EBRD loans in favour of rural SMEs in EU accession countries. EBRD called upon FAO's expertise to review lending opportunities in Bulgaria's rural sector. This report was prepared to put forward recommendations to EBRD and local financial intermediarie s, on which clients the EU/EBRD Facility should focus and on the types of financial products required to serve these new clients. The analysis can be used by other local or international financial institutions interested in rural credit.

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