Global Forum on Food Security and Nutrition (FSN Forum)

Do you believe that governments should make efforts to promote migrants’ and returnees’ investments in agribusinesses in rural areas with high labour out-migration rates? What should be the role of other stakeholders (NGOs, academia, international organizations, donors, etc.) in promoting such investments?

Despite the inherent ramification and complications within the framework of such financing especially in Africa, I still believe if well-coordinated its effect could be extremely relevant in the current African Agricultural environment. One thing that remains recurrent in these systems is the presence of multiple causations which prevents the capability to function of most rural smallholders. In context these causations are in the form of basic infrastructure amenities which are required to encourage production and notwithstanding the unavailability of operational finances which is needed for both expansionary and to maintain current production capacity. Intrinsically the aforementioned challenges extend from basic infrastructure to availability of financial solutions which can assist these farmers transcend from smallholders to medium size farm operators. Among the ills of such a system of challenges the most deleterious effect remains the chain effect it has on investors willing to invest in African Agribusiness. I believe that Matching grant programmes provide a perfect complimentary funding source to current government within the agribusiness sector as it could fill in where government fail especially if they are preferably used in the development of infrastructure, preliminary services and frameworks like warehouses, cold stores, preliminary decentralized processing units which can convert highly perishable farm produce into semi-finished less perishable agricultural produce. The investment require in order to make agricultural agribusinesses self-sustaining is Himalayan and cannot be accomplished only by any government single handily. Furthermore, the value of migrant and returnees’ remains capital especially within such a global era given that taste and preferences have all mixed; there is massive need for farmers of the south to get educated on current world trends within markets. Without such investments, farmers might continue being less profitable though being productive within their farm holding thus rendering them stagnant within the vicious poverty cycle. In my opinion for the sake of a unified goal [creating a self-sustaining African Agribusiness framework] all the aforementioned stakeholders need to constitute more of a multi-stakeholder taskforce which will enable a proper understanding of the realities on the ground as expressed from academic and NGO stand point. At the bases in Cameroon, it is evident that most local NGO’s remain the task forces on the ground for implementation of most projects and thus implying they have the best image of the realities of the rural people. On the other hand, academics ought to create awareness to both donors and international organizations of the well appraised realities partly appraised and complemented by those from NGOs. Departing from this reasoning point, it is evident that for an effective program these stakeholders must think of forming more multi-stakeholder working environment. With this in place, finances no matter how small will become more effective and more sustainable as it is deployed objectively and its outcome shall be more impactful. In resume this means of funding could be both a blessing and a curse depending on the implementation mode employed within rural communities

According to you, what are the pros and cons of matching grant programmes? What should be taken into consideration for their promotion and deployment?

Matching grants are typically used to finance social and economic infrastructure, productive assets and income generating and livelihood-diversification activities by groups, and sometimes by individuals. Within rural and agricultural business development projects, they are used to develop agricultural value chains, promote innovation and technology, enhance access to extension and support services, and support farm diversification. They can be classified by purpose (type of goods and services financed), by the public or private nature of these goods and services, by type of recipient, by allocation mechanism and by type of resources provided Promoting non-viable or non-feasible enterprises or business activities • Substituting savings with external grants • Crowding out financial institutions • Crowding out private investment • Misallocating scarce resources • Supporting asset creation among groups of people, instead of individuals, which may lead to lack of care and maintenance of the assets received or failure to achieve satisfactory levels of profit.

What other models or approaches would you recommend to promote the investment of remittances in agriculture and agribusinesses? Do you think these are preferable over matching grant programmes, and if so, why?

Personally I will subscribe to a more controlled approach for remittances given that without any necessary control or overseeing body, it becomes very difficult to identify the right actors who may yield potentially more impact within communities or communities with higher impact. In most cases returnees in Cameroon face a major stumbling block at the level of finding to only the right project to invest in but also the right person to confer such project to. From these bases it becomes wise to channel such funding into structuring/ reorganizing vital services like financial, extension services and other support systems that will enable returnees the liaise remittance funding to national financial institutions and banks who can provide the appropriate follow-ups and can best choose the most impactful project. At the moment within the Agricultural ecosystem in General, 80% of the loans are mostly operational finance with little available for capital investment and asset accumulation oif which raising asset accumulation directly makes operators more eligible to bigger loans and to access more opportunities to grow their business. With such a synergy, it becomes essential for banks to use such remittance funding to create new products which will provide investment capital and infrastructure backed loans given that their operational finances are some worth not at risk. With this in place, agribusiness operators will get the ability not only to adopt the right machinery but also they will be raising their asset levels thus making them eligible for future loans of bigger values. Furthermore, it this approach reduces the risk of fatal loses in the process and utter discouragement from these returnees who seek to do justice to their home land but every now and then get embarrassed by mistrust and theft. I bet with a process like this, the impact shall be felt and the ripple effect shall translate to all other returnees. In special cases, these groups can decide to become partners within such financial institutions so as to facilitate their reintegration into their home land. And in other cases, they might get to integrate their know how in refining current existing products and services within agribusiness lines given that most funding happening in Cameroon this days rarely materializes without a training program to enable a swifter adaptation.

Do you know about matching grant programmes - meeting the inclusion criteria outlined below - that have been implemented to channelize remittances into agribusiness development? If yes, please provide the name and country where the programme was implemented and sources of complementary information, such as studies, mid-term or impact evaluations, links to relevant websites, etc.

Integrating matching grants and bank lending: The case of the Rural Enterprise Programme in Ghana sponsored by IFAD was reported to be a huge success.

Rural Investment Facility 2 is a grant programme under the Rwandan Ministry of Agriculture and Animal Resources, originally administered by the National Bank of Rwanda and later transferred to a specialized fund manager. By mid-2011, fund management was transferred to a subsidiary of a government-owned development bank that took over the management of most grant and guarantee programmes in Rwanda. You can find out of the facility, terms and conditions see: http://amis.minagri.gov.rw/content/rural-investment-facility-rif-2 and http://www.bdf.rw/matching_grant.php

According to the Ministry of Labor, Social Welfare and Migration in the Kyrgyz Republic about 900, 000 Kyrgyz citizens are working abroad and most of them send remittances back to the country, which is accounted for 30 % of the country’s GDP. The biggest portion of the remittances is channeled from the Russian Federation. Unfortunately, due to the recent Russia-Ukraine conflict, there will definitely affect the national economy of the country. It is also estimated, that sanctions against Russia provoke the return of some of the migrants due to loss of jobs or decreased salaries in the country of destination. According to the World Bank’s projection, due to the implications of conflict and sanctions, remittances to Kyrgyzstan are estimated to decline by 25 %.

Therefore, I would like to highlight that the returning migrants should be considered not from the perspective of creating challenge or burden for the public social protection system, but also as an additional asset: it is an opportunity to use them for social-economic reintegration that can bring their investments and new quality of social capital (knowledge, experience, networking contact). It is important also to create trust amongst returning migrants, who may have felt disillusioned with and alienated from their communities and local authorities. Teaching and applying new approaches and modern technology to agriculture by applying matching grants scheme to leverage remittances of returning migrants is one of the options to consider. This approach helps to increase agricultural investments in rural areas and to support the promotion of sustainable agriculture, food production, and improving access to better nutrition.

Lastly, the engagement of returning migrants in agriculture-related business initiatives through the application of climate-smart agriculture, resource-saving technologies, and practices will provide a positive economic and social impact on local food security, improve nutrition, prevention of migration, promotion in generating income, and build a new level of partnership between local authorities and returning migrants.

English translation below

Bonjour à tous 

Je remercie d'abord la FAO pour tous ce quelle fait pour la sécurité alimentaire et nutritionnelle dans le monde à traver ces differentes services et Divisions. 

La consultation sur le Programme de subventions de contrepartie est un bon sujet de débat et d'orientation pour le monde de l'Agrobusiness. C'est un Programme d'actualité et très interessant pour aider la pupart des jeunes et autres qui veullent entreprendre dans le domaine de l'agrobusiness. Ce programme necessite un certains nombres de leviers.

En effet, le transfert de fonds  pour entreprendre dans l'agrobusiness necessite un  suivi lors la mise en oeuvre des activités car ces fonfs ne sont pas rembousable.

Un Exemple de telle Programme a été initié durant lequel les jeunes desirant entreprendre dans differents domaines dont celui de l'agrobusiness doivent élaborere des projets financièrement rentables. Mr X  a élaboré un projet d'aviculture (élevage des pintates associés à des poules) ayant recu un financement pour le demarrage des activités. Mais étant donnée qu'il n'y pas un mecanisme de suivi mis en place, le projet financé pour l'entreprenariat (élevage) n'a jamais  vu jour. C'est un programme très avantgeux mais son incovenient eside dans le fait qu'il ny a pas un cadre regelementaires et institutionnel d'octroi de fonds pour la tracabilité et le devenir de cette subvention. Il faut également un mecanisme  de suivi afin de de relever les defis perenniser les acivités.

Meilleures salutations à tous 

Hello to all 

First of all, I would like to thank FAO for all that it does for food and nutrition security in the world through its different services and divisions. 

The consultation on the Matching Grant Program is a good topic of debate and orientation for the Agribusiness world. It is a very timely and interesting program to help most young people and others who want to undertake agribusiness. This program requires a number of levers.

Indeed, the transfer of funds to undertake in agribusiness requires a follow-up during the implementation of activities because these funds are not refundable.

An example of such a program was initiated during which young people wishing to undertake in different fields including that of agribusiness must develop financially profitable projects. Mr. X elaborated a project of poultry farming (breeding of pintates associated with hens) having received a financing for the starting of the activities. But since there is no follow-up mechanism in place, the project financed for entrepreneurship (breeding) never saw the light of day. It is a very promising program, but its shortcoming is that there is no regulatory and institutional framework for the allocation of funds for the tracking of this grant. There is also a need for a monitoring mechanism to meet the challenges of sustaining the activities.

Best regards to all 

I believe that promoting the use of remittances for agribusiness is an option to strengthen rural development, especially if it is considered that, it is the area that needs more attention given the negative impact caused by the pandemic and also due to the increase in prices (with negative consequences for food security). The role of actors such as the academic sector, civil society and international cooperation is relevant, especially to identify challenges and make public policy recommendations to make better use of remittances and promote their productive use, having a positive multiplier effect.

Local organization, the institutional presence of the State in rural areas and other actors such as international cooperation should be considered in the implementation of programs like matching grant program. Knowledge of this type of experience in other countries with similar socioeconomic characteristics is also important.

In my opinion more focus should be concentrated on: 

1. Providing Climate Smart Agriculture Technology at minimal cost to the young agripreneurs to motivate them to carry on their projects.

2. For a sustainable agroecological system, focus should be concentrated on traditional agricultural practices done by tribals/ethnic groups and finance should be provided to them so that they will not migrate to other places in search of food/shelter.

3. Tribal agroecosystem and forest ecosystem should be should be conserved and promoted by modern technology with proper training to these groups so that Biodiversity Conservation will be carried out on real sense.

4. At the Government level more number of Agriclinics to be operated and with digital transformation each one involved in agribusiness should be aware about this, which will definitely lead to a successful Sustained Agroecosystem.

5. More findings to be given to women self help groups who are involved in agribusiness and their products must be labeled with the name tag of the women group with QR code, mentioning details of their area and modes of operation so that the business can be taken to the international level.

1) Do you believe that governments should make efforts to promote migrants’ and returnees’ investments in agribusinesses in rural areas with high labour out-migration rates? What should be the role of other stakeholders (NGOs, academia, international organizations, donors, etc.) in promoting such investments?

The theme is a bit complex. On the one hand, the theme is simple. Some governments have no or clear migrant integration policies. Within this framework of support for the programs of member countries, FAO and the other partners should support the respective governments in defining the overall strategy as well as the short and medium term strategic objectives. These strategies will, among other things, relieve congestion in densely populated rural areas and promote their integral development. Stakeholders and NGOs should make their potential contributions to the defined strategic framework: food security, infrastructures related to their fields in coordination with local authorities. The national partners will facilitate access to credit via the associations or cooperatives created.

2) According to you, what are the pros and cons of matching grant programmes? What should be taken into consideration for their promotion and deployment?

Matching grants allow groups to acquire grants that they could not have: guarantees and endorsement. On the other hand, if the counterparties do not guarantee access to credit, the latter will not meet the criteria for subsidies. 

3) What other models or approaches would you recommend to promote investment of remittances in agriculture and agribusiness? Do you think these are preferable to matching grant programs, and if so, why?

Grouping into cooperatives, access to land ownership, technical support for drafting funding requests adapted to the directives of institutions or funding bodies as well as preferential or promotional interest rates for the sectors to be promoted: agri-livestock, crafts, small trade.

This topic is timely, especially as the world faces a dilemma of climate change and Agenda 2030. Development partners and other stakeholders have recently raised funds to support various projects, particularly in the agribusiness sector. It is a commonplace that this sector needs substantial financial and other logistical support. A large part of the population, particularly in the developing world, depends on the industry for survival. However, all the efforts mentioned above are bound to fail for the following reasons:

1. The resources raised are never enough to equal the challenges facing the agribusiness sector;

2. In the case of the developing world, the monitoring and evaluation mechanisms are ineffective. In other words, the value-for-money is always never achieved;

3. The socio-political setup in most developing regions dictates the direction of the funding opportunities, which in most cases fall into the political other than socio-economic objectives;

4. Lastly, most developing partners wish to deal or transact business with the central government other than with other stakeholders such as NGOs, multilateral corporations, and other stakeholders.

This commentary highlights that, given the above, the agribusiness sector suffocates as it has to depend on the investment interests of the central authorities substantially. Thus, there is an urgent need to rethink the traditional approaches by the development partners such as FAO to diversify their policies, for instance, to start engaging with other players. This will substantially enhance the agility of investments in agribusiness and other sectors that the communities in the developing countries highly depend on for basic needs. At the same time, involving different stakeholders can bolster the agribusiness sector at the community level by supporting such businesses at that level other than starting at the national level, where bureaucracy tends to pull down the decision-making processes. Lastly, the need to invest more in capacity building at the local level is critical for an effective paradigm shift. 

Message from the facilitator

Dear members of the FSN Forum,



I am grateful for the time and knowledge shared through this consultation. The contributions received provide light on how FAO should support member countries to boost remittances investment in sustainable agribusiness development. We highlight the exposed need that these financial mechanisms must promote innovative and sustainable agricultural activities that provide health for everyone. Furthermore, they should be coupled with capacity development to promote the effectiveness of future programs and policies. Our team takes note of the challenges and possible solutions discussed in detail by the contributors. I encourage all participants to continue the discussion and new participants to share their experience based on the several questions listed above.



@ Claudio Schuftan



Dear Claudio,  

In the focus of our work our focus, agribusiness, also includes agroecology. One of the main causes of rural migration is the lack of investments in agriculture; under this program, the remittances are invested in the rural areas in everything from crops to services. The important issue is the business focus to incentive the local economy. If an agroecological farm activity is presented as a business, it will be co-financed within the scope of the program.

 

@ Luke Metelerkamp



Dear Luke,  

Your project sounds very interesting and I believe we have the same aim of increasing rural investments for smallholder agriculture. There are two goals within the program we are implementing: one is to invest remittances for rural development and the other one is to reduce migration. This is why we have the strong focus on remittances as the way of financing family agribusinesses.  I believe it is possible to include remittances with in the platform you are implementing, but I think it should be collective remittances from the diaspora. This has been tried with relative success in some countries although the impact has been limited because of the lack of an institutionalized migrant policy by municipalities, little interest, or mistrust from migrants to organize towards helping their communities of origin, and in some cases corruption, and politicization of the program. I will be interested in further exchanges.

 

Best regards,

 

Mauricio

English translation below

1. Без сомнения, правительства стран с высоким уровнем трудовой миграции необходимо прилагать усилия по направлению средств мигрантов (переводы) в постоянный источник дохода их оставшихся семей. В противном случае, возникают риски использования мигрантскими семьями данных средств на не нужные траты. К слову сказать, мигранты нередко контролируют характер и объемы использования данных средств их семьями, но находясь вдалеке и не обладая достоверной рыночной информацией, могут предлагать недостаточно эффективные решения. Да и сами оставшиеся семьи нередко принимают непродуманные решения по инвестированию средств, в т.ч., в агробизнес благодаря нехватке знаний в агро-производстве, а также нехватке учебно-консультативной поддержки, особенно в местах их проживания.

Местные структуры Министерства сельского хозяйства могли бы оказать поддержку в определении основных агро-проектов в том или ином районе, согласно приоритетам государственной и местной политики развития сельского хозяйства. 

В рамках выбранных приоритетных проектов научно-экспертные круги, международные организации, консалтинговые компании смогли бы обеспечить необходимым методическим обеспечением данные приоритетные агро-проекты (новые современные агротехнологии, агротехника и пр.). 

Местные компании, специализирующиеся на оказании агро-консультаций, могли бы решить вопрос с разработкой конкретных бизнес-планов по выбранным приоритетным агро-проектам в том или ином районе. 

Сформированный таким образом набор бизнес-планов по приоритетным агро-проектам (по районам), подкрепленные соответствующим грантовым финансированием, можно было бы предложить тем кандидатам (мигрантам/их семьям), которые, в свою очередь, прошли бы отбор согласно определенным критериям (предпринимательские способности, наличие своего вклада, имеющиеся агро-активы, физическая работоспособность и пр.).

2. К числу плюсов данной Программы можно отнести:

• Направленность Программы на увеличение благосостояния (питание, доходы и пр.) и воздействие на возможное сокращение миграции.
• Содействие в переходе к более активной социальной позиции мигрантских семей (от иждивенчества – к труду), появление новых жизненных стратегий
• Наличие грантового со-финансирования, увеличивающего потенциал будущего агропроекта.
• Развитие предпринимательских и агро- умений и знаний.
• Насыщение местного рынка агротоварами.
• Улучшение состояния развития сельского хозяйства.

К числу минусов:

• Равная доля грантового со-финансирования, возможно, схема (1 : 2), с большей долей грантов была бы эффективнее. 
• Приобретение агро-активов силами самих мигрантов/их семей грозит риском выбора недостаточно эффективных основных средств, которые могут не обладать необходимой производительностью.

3. Возможно, один их подходов связан с включением в данную модель грантового со-финансирования еще одного источника финансирования – банковского кредита, в частности, по государственной программе льготного кредитования агро-производителей. Это позволит повысить ответственность мигрантов/семей по более эффективному использованию получаемых средств, более тщательному планированию и контролю над средствами и пр.

1. There is no doubt that the Governments of countries with a high level of labor migration need to make efforts to channel migrants' funds (transfers) into a permanent source of income for their stayed at home families. Otherwise, there are risks of migrant families using these funds for unnecessary spending. By the way, migrants often control the nature and volume of the use of these funds by their stayed at home families, but being far away and not having reliable market information, they can offer insufficiently effective solutions. And the left at home families themselves often make not properly thought through decisions to invest funds, including in agribusiness, due to a lack of knowledge in agro-production, as well as a lack of educational and advisory support, especially in their places of residence.

Local structures of the Ministry of Agriculture could provide support in determining the main agro-projects in a particular area, according to the priorities of state and local agricultural development policy. Within the framework of the selected priority projects, scientific and expert circles, international organizations, consulting companies could provide the necessary methodological support for these priority agro-projects (new modern agrotechnologies, farming techniques, etc.).

Local companies specialized in providing agro-consultations could solve the issue of developing specific business plans for selected priority agro-projects in a particular area.

A set of business plans formed in this way for priority agro-projects (by districts), supported by appropriate grant funding, could be offered to those candidates (migrants/their families) who, in turn, would be selected according to certain criteria (entrepreneurial abilities, the presence of their contribution, available agro-assets, physical performance, etc.).

2. The advantages of this Program include:

• The focus of the Program on increasing well-being (nutrition, income, etc.) and the impact on the possible reduction of migration.
• Assistance in the transition to a more active social position of migrant families (from dependency to work), the emergence of new life strategies
• Availability of grant co-financing that increases the potential of the future agricultural project.
• Development of entrepreneurial and agro-skills and knowledge.
• Saturation of the local market with agricultural products.
• Improvement of the state of agricultural development.

The disadvantages of this Program include:

• An equal share of grant co-financing, perhaps a scheme (1:2), with a larger share of grants would be more effective.
• The acquisition of agro-assets by migrants themselves/their families threatens the risk of choosing insufficiently effective fixed assets that may not have the necessary productivity.

3. Perhaps one of their approaches is connected with the inclusion in this model of grant co-financing of another source of financing – a bank loan, in particular, under the state program of preferential lending to agro-producers. This will increase the responsibility of migrants/families for more efficient use of the funds received, more careful planning and control over funds, etc.

Briefly went over this topic with the team here at "Monday Morning Meeting" and here are some added thoughts to consider. New PDF of the complete 1 & 2 below

Discussion points from 4/4/2022 Consolidation Talk:

For our group, many of these bullet points are redundant - however redundant in conversation it is not at all redundant in action and application.

The problem today is that people don't cherish good people anymore they try to use them. - Bob Marley

Household Routine Changes, Dynamic Perspective Considerations:

Households can offer individuals and families positions, doing small gardens even in five-gallon buckets on balconies. From composting to planting kitchen scraps and seeds, and working to do the same in other households in the area.

Considering that people are more sustainable in small groups of 6 to 90 persons and that land ownership is man-made, in actuality the world is our gift from God, with the only contract being that we don't kill it; we may even realize we can enhance it, and in so enhance greatly ourselves.

At the individual level, we must make big directional changes.

Take a vacation to a new place of beauty, nature, and nutrition to get into your best brain gear.

Independent households can provide positions for refugees, migrants,

Participating in natural life is about routine and ritual more than anything else.

It is the method, not the madness.

Table scraps and seeds and a time donation into community gardens from community members.

Those who can participate reap the rewards, and small gardens can really produce!

It starts with compost and soil.

What do we need?

A good space that will experience no-control-freak culture, and even and anti-control-freak culture with some good knowledge getting kicked around it seems a five to fifteen person and a logbook work great. Here in Panama, the lifestyle of living on-site for a small $600 a month in order to fulfill a list of minimum mandatory motions is acceptable to many and we ourselves stay on top of a large number of and size of farming installations.

Winners are with other winners or they are alone. There is always an army of losers who just don't get it. Join the winners club inhabit, and maybe you get in for real.

It's all about the rhythm, the routine, the ritual that sets the magic in motion.

We can spend years in the gym with awesome results to show, and some spend years in the gym with no results to show. It is the method to the madness.

You must have the right knowledge, through experimentation, wisdom, or teaching in order to get the results.