Devex: VEGA Member CNFA’s Model of Supporting Agribusinesses Gains Government Attention

By , Promoting Prosperity Worldwide

This article was originally written by Jennifer Ehidiamen for Devex and can be found here.

Supporting local agribusiness has been at the center of the work Cultivating New Frontiers in Agriculture, or CNFA, an international development organization, has been doing in Georgia in an effort to improve farmer livelihoods, and now the Georgian government has taken notice.

CNFA has worked to support agribusiness through a variety of programs that helped reduce risk, improve mechanization and boost farmer skills. To date, the organization estimates it has assisted more than 430 Georgian agribusinesses.

The model has caught the attention of the Georgian government. Levan Davitashvili, Georgia’s minister of agriculture said that the ministry would “apply CNFA’s focus on agricultural entrepreneurship and its competitive matching grant model to future state programs led by the Ministry of Agriculture,” according to a statement released by the organization.

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CNFA has facilitated the establishment of more than 40 Farm Service Centers across Georgia. FSCs provide a range of agricultural inputs (crop protection materials, fertilizers and seeds), machinery services, veterinary services and products, marketing assistance for agricultural outputs, and access to credit. Photo by: CNFA

“New skills and approaches can be taught but entrepreneurship — and the initiative that comes with it — is the key to the success of the Georgian agriculture sector,” he said in the statement.

Devex caught up with Bauka Namicheishvili, CNFA chief of party of Restoring Efficiency to Agriculture Production, by email to learn more the $19.5 million REAP enterprise development program aimed at increasing rural employment and income and its effort to boost women in agribusiness.

What were some of the challenges you faced in developing and implementing these initiatives?

While implementing programs, there are always number of challenges related to operational aspects, but the main challenge is to identify a proper beneficiary to ensure maximum result and successful outcome of our interventions. Precisely defining selection criteria will help you engage the suitable group of beneficiaries in the program increasing chances of success.

The second important challenge for any development program is time limitation associated with the lifetime of the project. Therefore it is important to identify the group of beneficiaries early in the project, especially when it concerns grant recipients, and start the implementation of the program so you can well utilize the remaining time of the project to address unforeseen challenges that arise over the course of implementation of the program and also to have flexibility in adjusting approaches as necessary ensuring the sustainability of achieved results.

So how do you select those who benefit from these programs?

Our main criteria in selecting the beneficiary companies is to what extent they are benefiting smallholder farmers — through providing affordable inputs, supplies, trainings and services or providing additional cash markets to smallholder farmers through purchasing raw materials for the processing. Through our programs, we have facilitated establishment of more than 40 farm service centers that all contain aspects of extension services and through technical assistance we are able to strengthen their embedded services.

Nearly half of the world’s farmers are women, according to the United Nations Food and Agriculture Organization, but they tend to have less access to inputs, training and machines for processing. How have you worked to ensure women are included in your programs?

In the beginning of the project implementation, a co-match of a minimum 70 percent of total cash investment, one of requirements of REAP’s Competitive Matching Grant Program, was identified as a potential barrier to having a considerable pool of women-owned agribusinesses as grantees. Therefore, in spring 2014 REAP designed a pilot gender initiative called “Facilitate the Development of Women-owned Agribusinesses” aimed at supporting the development of women-owned agribusinesses through selecting local business service providers in order to identify high potential women agribusiness entrepreneurs, train them in developing bankable business plans, select the best resulting business plans for USAID/REAP grant consideration, assist successful grant applicants in applying for commercial loans, and assist the remaining participants in improving their business plans for further grant or bank loan consideration.

Through this gender initiative, 81 women agricultural entrepreneurs were trained, 44 of them applied for REAP’s Grant Solicitation open only to FDWA trainees. Utilizing this innovative approach allowed REAP to award more than $950,000 to 15 women-owned enterprises — 10 mobilized through the gender initiative and 5 joining from other solicitations — making 21 percent in terms of number of grants and 16 percent of the value of entire REAP’s grant portfolio.

From your experience working in Georgia [or other countries], what are some of the barriers hindering women in rural communities from embracing programs that might increase their capacities as “agri-preneurs”?

Overall, it could be said that in Georgia there are same barriers as in other countries — access to capital. While there is some certain access to capital, for women it is more limited sometimes due to their lack of access to the ownership of land, livelihood assets and other resources. Or sometimes economic development programming does not properly focus on women.

How can stakeholders in the global development communities eliminate these barriers?

Barriers mentioned above can be eliminated by designing proper and long-term interventions and through pro-gender multistakeholder involvement. As it was mentioned, REAP is involved in enterprise development programming and targets women-owned agribusinesses and women agricultural entrepreneurs. We believe this type of program and our approach is utterly important for proper women’s economic empowerment as it is more sustainable to give a catalyst woman-entrepreneur an opportunity to build a business structure and to illustrate which skills and abilities she needs to develop further.

What would be your recommendation to international organizations looking to initiate agricultural programs or similar initiatives as a means of boosting the economy of rural communities?

The main recommendation will be to keep the focus on a private sector, encourage and stimulate entrepreneurial thinking and support and strengthen SME development, since this is the segment that drives the economy in all and especially in transitioning and developing societies, in terms of creating jobs, ensuring sustainable economic development and generating economic prosperity. CNFA’s experience in Georgia proves the success of the mentioned approach, how the relatively minor support (30 percent of the total investment) can stimulate private investments leading to upgrading technologies, increasing production, creating new jobs and benefiting smallholder farmers.

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