Boosting agricultural value chains to increase food security

11 July 2013
ITC News
Development of the agricultural and food-manufacturing sectors of developing countries improves food security

Governments need to focus on building up the agricultural sectors of developing countries by training farmers and food manufacturers to better understand technical requirements and meet international standards, said panellists at a morning meeting on the second day of the Global Review of Aid for Trade event at World Trade Organization (WTO) headquarters in Geneva.

According to the panellists, the first step in ensuring food security in developing countries is to educate farmers so that they can access and understand standards and regulations of export markets. The training can be provided through seminars, hands-on workshops and publications, which enable exporters to more easily overcome technical barriers to trade.

The panel on 9 July, which was moderated by Virginia Cram-Martos, Director, Trade and Sustainable Land Management, United Nations Economic Commission for Europe (UNECE), included Khemraj Ramful, Senior Adviser, Export Quality Management, ITC; Joern Rieken, Team Leader of Aid for Trade, Poverty Practice, United Nations Development Programme (UNDP) Europe and the Commonwealth of Independent States, Bratislava Regional Centre, Slovakia; and Ulrich Hoffmann, Senior Trade Policy Adviser, Office of the Director, Division on International Trade in Goods and Services and Commodities, United Nations Conference on Trade and Development (UNCTAD).

The panellists focused their discussion around ‘agricultural value chains and food security in transition economies’, looking at the challenges posed by weak productive capabilities of agricultural and food-manufacturing sectors in developing countries, as well as strategies to overcome those challenges.

An important step to achieving food security is the training of small and medium-sized enterprises (SMEs) in sanitary and phytosanitary (SPS) measures, also known as animal and plant health measures, Mr Ramful said during his presentation.

‘Addressing food safety and quality in agricultural value chains requires an efficient and effective quality and SPS infrastructure which needs long-term planning and involvement with stakeholders,’ he said. This involves strengthening the capacity of TSIs to provide training on the different quality standards while also providing assistance to SMEs to remain competitive in global markets.

In particular, Mr Ramful said, TSIs will need to provide SMEs with training on implementing the Hazard Analysis and Critical Control Points (HACCP) system, an internationally recognized way of managing food safety, and ISO 22000, an international food-safety management system. This type of TSI-led technical assistance will enable producers to manufacture products that meet the quality standards of buyers around the world.

Delivering food security

Governments will also have to play a major role in delivering food security, which could involve offering price incentives for environmentally friendly goods and services, cooperative marketing and export subsidies, among other forms of support, said Mr Rieken of the UNDP. The aim is to create an environment that is supportive of agricultural or food-manufacturing businesses.

Mr Rieken gave the example of Uzbekistan, which put in place an import ban on cherries from other countries for several years in order to temporarily raise the prices of domestic cherries. The introduction of irrigation and pesticide treatments – as well as increased storage capacities – boosted production of domestic cherries. Once local production was sustainable, imports from other countries, such as China, were slowly allowed back in. By then, domestic producers had developed the skills to provide products that could compete with imported cherries. In addition, consumers could profit from more competitive prices and more options.

The long-term goal is not only to be competitive in the domestic market, but to become an exporter competitive in global markets, Mr Rieken said. Governments will need to ensure appropriate conditions for increasing the productivity of labour, capital and land.

Government and TSI support of SMEs is crucial to ensuring food security in transition economies because 40% to 80% of the developing world is involved in agriculture, and the bulk of the food is produced by smallholders, Mr Hoffmann of UNCTAD said.

‘Why are we talking so little about agriculture?’ he asked participants at the event. ‘Agriculture in this century will be a threat to global security. In the last few decades, [the food security question] has remained unsolved.’

Voluntary sustainability standards

Mr Hoffmann stressed the importance of the role of voluntary sustainability standards (VSS), often used to govern international agri-food supply chains, in market entry and sustainable development. VSS are used to reduce liability risk, assure high quality of products and reduce costs. They can also promote competitiveness and sustainable production methods, as well as mitigate economic, food, climate and water crises, when properly addressed.

The challenge of VSS, Mr Hoffmann said, is to ensure that VSS do not reinforce marginalization of smallholders and less developed countries. Development opportunities exist for sustainably produced products at the enterprise, national and international levels when VSS are implemented correctly.