Donor Approaches to Supporting Pro-Poor Value Chains, Altenburg / Donor Committee, 2006
|Implementing agency(ies)||Donor Committee for Enterprise Development|
|Date completed||January 2007|
|Issues/challenges||Donor organizations increasingly focus on value chain promotion as a key element of their private sector development strategies. Given the growing relevance of value chains for private sector development there is a need for developing country governments and donor agencies to better understand the dynamics of value chain integration, to assess its risks and opportunities especially for poor persons in developing countries and design appropriate strategies for socially inclusive competitiveness strategies.|
- to discuss the analytical foundations of the concept, help to clarify terminology and discuss areas of overlap as well as conceptual distinctions between 'value chain' and 'linkage' approaches and related concepts in the field of private sector development;
- to examine the implications of the increasing coordination and globalization of value chains for pro-poor growth in developing countries;
- to identify strategies and interventions for value chain development in ways that contribute to economic growth and poverty reduction; and
- to identify questions for further discussion among the donor agencies involved.
This study was commissioned by the Linkages and Value Chains Working Group of the Donor Committee for Enterprise Development (see link, above). It serves several purposes, namely:
Chapter 2 examines the relevance of the value-chain concept for pro-poor growth, identifying opportunities and threats for developing countries and pointing to the multiple trade-offs between policy objectives. Chapter 3 then elaborates on the interests of different stakeholders involved in value chain activities and analyzes to what extent interests coincide or diverge. In Chapter 4 different methodologies for value chain analysis and procedures to design intervention strategies are presented. Comprehensive planning approaches are contrasted with less meticulous participatory tools and grant schemes which encourage private sector-led solutions.
Chapter 5 presents an overview of the major policy options to influence value chains in the desired way. It distinguishes between general private sector development policies and their potential impact on the structure and development impact of value chains and specific value chain policies aimed at building linkages and improving their development impact. Subsequently, chapter 6 discusses the issue of impact assessment. The last part makes out relevant problems and trade-offs with regard to value chain development and identifies areas for future discussion among the members of the Donor Committee (chapter 7).
Methods for info gathering
Academic literature as well as unpublished agency reports were reviewed, and a number of donor agencies and academic institutions were consulted, either in person or by telephone or email.