OXFAM CASE STUDY OCTOBER 2016

IFAD / Dino Hrustanovic

NETWORKING FOR BETTER

VALUE CHAIN INCLUSION
Reflections on Oxfams work in the raspberry value chain in
Bosnia and Herzegovina
Bosnia and Herzegovina is one of the worlds largest producers of
raspberries. Oxfam has implemented pilot and follow-projects that
demonstrate the benefits of including poor smallholder farmers in
raspberry production. This case study explains Oxfams networking
approach in a multi-stakeholder environment within the raspberry value
chain, and discusses how the project benefited poor farmers, enhanced
the entire value chain, and influenced the government, municipal and
private sector actors to adopt an approach that favours the poorest
people.

www.oxfam.org
1 INTRODUCTION
Bosnia and Herzegovina is a middle-income country in South-Eastern
Europe, with a population of 3.8 million and GDP per capita of about $4,000.
The country is still suffering politically and economically from the
consequences of the 19921995 war. Employment opportunities are limited;
the official unemployment rate is over 40 percent1 with youth
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unemployment at 60 percent and one in five people lives in poverty . With
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around 60 percent of the population living in rural areas, agriculture and
rural development projects have an important role to play in overcoming
unemployment and poverty.

In autumn 2014, Oxfam was selected by the International Fund for

Agricultural Development (IFAD) to implement the Pro-Poor Value Chain
Development pilot project. IFAD has been active in Bosnia and Herzegovina
since 1996, supporting rural communities through the (re)building of rural
infrastructure and providing livestock and other assistance to individual
households. Recently, IFAD has focused on ensuring poor people are
included in and benefit from existing value chains.

The primary objective of the project was to develop a methodology to enable

poor farmers to successfully participate in value chains producing and
marketing raspberries, through their involvement in farmer organizations
(FOs). The project also aimed to build the capacity of local government
actors most importantly the Project Coordination Unit (PCU) under the
Ministry of Agriculture, Water Management and Forestry to ensure that
changes resulting from the project are sustainable and can be scaled up. A
relatively small budget of 100,000 was originally set by the PCU to support
value chain investments.

This paper will discuss the networking approach taken by Oxfam in the multi-
stakeholder environment and present some of the lessons learned: both
positive and negative, and regarding the influencing of key stakeholders.

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2 ABOUT OXFAMS
PROGRAMME
The project target area comprised the three municipalities of Maglaj,
Zavidovii and epe, which all have very high levels of poverty and
unemployment. Project activities were implemented as follows:

1. A stakeholder analysis was carried out

Project activities began with a thorough stakeholder analysis to identify value
chain participants and assess their relationships. The raspberry value chain
was found to be very dynamic in the target region, with numerous
participants at all levels: input suppliers, FOs, processors/exporters, private
and public service providers, and local, regional, and national authorities. The
analysis also revealed major differences between stakeholders in terms of
their size, capacity and levels of activity; and identified gaps in terms of
growers access to inputs (seedlings suppliers) and advisory services.

2. A networking approach was adopted from the

start
Oxfam took a networking approach from the outset, involving of all
stakeholders in each step of project implementation. For example, at the
municipal level, we teamed up with the responsible municipal agricultural
advisor to identify representatives of the social security centre, presidents of
local communities and directors of active FOs. Thus in a short time we were
able to set up teams of 2030 individuals in each municipality. These teams
helped identify the target communities, FOs and individual beneficiaries.

This collaborative approach enabled us to conduct a comprehensive field

analysis and to gain in-depth knowledge at community level. It also enabled
us to continuously monitor the different steps of the pilot initiative at
community level, despite limited human resources. At the same time, the
participation of a wide range of stakeholders meant the project could:
Empower and sensitize key actors in local development on relevant
aspects of pro-poor inclusion.
Improve interactions at local and regional level, providing evidence that
including poor people in the local economy is possible, and offers
opportunities and benefits for the wider value chain and economy.

3. Local facilitators were identified

The team also identified a local development agency from each of the target
municipalities to act as a local facilitator. This agency provided us with a
team of local professionals with excellent knowledge of local stakeholders
and of previous interventions in the field. This improved the networking
dynamics, and helped to quickly bring everyone to the table.

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4. Targeting of poor farmers and selection of
farmer organizations
Targeting was carried out at several levels, as follows, but always with the
engagement of multiple stakeholders:
Selection of FOs: This began with consultation of municipal authorities,
active processors/exporters, and a local facilitator. The final selection of
FOs was based on score-card criteria developed by the project; an
extensive needs assessment was also conducted to inform project
interventions.
Focus on certain local communities (poverty pockets): Municipalities,
local communities, processors/exporters and FOs were involved in the
identification of villages with the highest unemployment rates, but also with
the right conditions for growing berries and in areas that could naturally be
covered by the existing FOs.
Targeting of poor households (maximizing inclusion of women and
youth): The project defined certain criteria for poverty categorization,
based on income per capita and land ownership. More importantly,
numerous value chain participants (municipal officers, FO representatives
and processors) were engaged to help identify possible project
beneficiaries at the farm level.

5. Investment and Action Plan agreed

An Investment and Action Plan (IAP) was then developed, which identified
the various activities and investments needed at farm, FO and processor
level. Compared to the budget originally set by the PCU/IFAD (of 100,000),
this plan already envisioned a much stronger investment in the region of
1,000,000, with a beneficiary contribution of 57 percent. The majority of the
investment was related to financing starter packages, which included the
seedlings, irrigation systems, plant protection, fertilizers, etc. to plant 0.1
hectares of raspberries. Other investments supported the construction of a
cold storage facility; small equipment and mechanization for FO
strengthening; and the provision of advisory services. Once the IAP was
approved by IFAD, Oxfam worked closely with all project stakeholders to
ensure that the investment was properly managed, with equal benefits for
poor households (including women and youth) and the different value chain
actors.

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3 WHAT DID WE ACHIEVE?
The pilot project earned the title of IFADs
Flagship Project
By the end of June 2015, the pilot project was largely complete. The pilot
activities not only produced effective methodology and helped to build the
capacity of PCU staff; they also resulted in an end investment of over 2m
and provided direct benefits to more than 300 poor households. These
results surpassed all expectations, and such was the pilot projects impact
that it earned the title of IFADs Flagship Project in 2015 for successfully
demonstrating inclusion of poor people in a value chain in a middle-income
country.

The project was scaled up to several more

municipalities
In late summer 2015, Oxfam was awarded another contract by the
PCU/IFAD, to organize autumn planting in the same value chain, in order to
test the methodology developed under the pilot and to scale up the approach
to 11 selected municipalities. The objective was to reach 750 direct
beneficiaries (poor households) in just three months. Despite the limited
timeframe, over 800 direct beneficiaries were supported and the
methodology was fine-tuned and will be used in the upcoming Rural
Business Development Project (RBDP) a three-year IFAD/PCU programme
which will target 27 municipalities and will offer opportunities for an even
larger scale-up.

The networking approach influenced key

stakeholders
In addition to the positive impact on beneficiaries, the networking approach
influenced the key stakeholders to start changing their approach to poverty
alleviation, as follows:
At national government level, the PCU praised the methodology
developed by Oxfam on numerous occasions, and in autumn 2015 it
successfully tested the methodology in four selected municipalities.
Various leveraging scenarios were tested, attracting financial support from
municipalities and processors/exporters in addition to PCU/IFAD grants.
As mentioned above, the same methodology will be used in the
forthcoming RBDP.
At the municipal level, local authorities have also changed their approach
as a result of this intervention. In the past, municipalities provided very
little support specifically for poor farmers equal subsidies were given to
all producers and the poorest families were entitled to social welfare.
Thanks to the projects joint economic analysis, municipalities realized that
it is much more cost-efficient for them to finance starter packages than to
give social welfare on a continuous basis.

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 At the FO level, the cooperatives and associations realized that their
organizations will benefit by helping poor families to join the value chain,
as a result of increased product quantities and reduced operational costs
per kilo. FOs became a strong advocate for the inclusion of these farmers
into the value chain. As well as welcoming the newcomers, FOs realized
that some of their existing members needed additional assistance to
improve their yields; some FOs therefore arranged in-kind loans for these
farmers and provided agricultural advisors for free.
The processors, in search of increased product volumes, also realized that
it makes sense to include new farmers in the value chain in the areas
where organized production already exists, rather than in brand new
production area. They therefore offered in-kind loans to the poor farmers,
together with long-term purchasing contracts.

4 WHAT HAS OXFAM

LEARNED?
Overall, the networking approach can be considered a success. The
advantages and disadvantages are set out below.

WHAT WORKED WELL

Efficient targeting and successful inclusion of
poor people in value chains
Thanks to the engagement of multiple stakeholders, the project was able to
carefully select the poorest households in the targeted villages and to identify
farmers who were strongly engaged with the project as opposed to those
who mainly saw the activities as a donation. Without the engagement of the
local counterparts this would not have been possible, given that the project
supported over 1,100 poor farmers. The engagement of multiple
stakeholders in targeting also translated into more efficient project
interventions.

Stakeholder confidence led to investment and

leveraging
Another positive outcome of the networking approach was the high
investment levels accomplished over a very short period of time. Since all
stakeholders were involved from the very beginning, they were all familiar
with the project approach and the expected benefits. The fact that the
municipalities, processors and FOs were involved in the selection of the poor
farmers gave them confidence in the targeting, and encouraged them to
invest into value chain development.

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For example, the processors were willing to offer in-kind loans to the new
farmers, as they knew that these farmers have been carefully selected and
would be supported to succeed by the cooperatives and associations. One of
the processors also decided to invest a large amount of money into a local
cold-storage facility, as the number of new farmers will quickly translate into
larger quantities of berries for processing. The cooperatives also received
some support in small-scale mechanization and equipment, in order to
strengthen their capacity to absorb new members and greater product
quantities.

The municipalities also saw clear benefits in the new raspberry plantations,
which encouraged them to contribute 10 percent to the procurement of
starter packages, as a grant to small farmers. Some municipalities also
supported the FOs with new equipment and small-scale mechanization. All of
these examples translated into significant leverage, resulting in total
investment about five times higher than the funds spent by the PCU/IFAD.

Positive influence on mindset and practice of

municipal authorities
The intervention was well timed, as the countrys raspberry sector continues
to record strong growth. This helped to quickly generate stakeholders
interest and improve the channelling of the funds. Engaging the municipal
authorities from the very beginning resulted in a change in attitudes (at least
in some municipalities) and influenced them to reconsider their practices. At
the beginning of the intervention, most of the local stakeholders implied that
everyone is poor and suggested the assistance should have been
distributed to existing value chain members and whoever was willing to
apply. Through the value chain analysis, it became clear that major
differences do exist and that the focus on the precise criteria is very
important; municipalities were thus able to target specific assistance to the
poorest communities and households. The PCU was continuously involved in
the design of all the project implementation stages and weekly coordination
meetings were held. The benefits of Oxfams approach quickly became
visible, and will be adopted by PCU in upcoming interventions in various
value chains, as noted above.

Effective empowerment of the entire value chain

The networking approach had a positive impact on the entire value chain.
The volume of business has increased significantly in the different territories
as a result of improved confidence among stakeholders. More than 1,100
new farmers joined the value chain and together planted 117 hectares of
raspberries. Based on average expected yields and current prices, the new
plantations are expected to generate an income of around 2.9m per year
over the next 12 years. Thanks to the introduction of a new variety, product
quantities increased by almost 50 tonnes in the first season, translating into
income of around 80,000. Processing capacities increased by over 2,000
tonnes, boosting farmers confidence in the raspberry value chain. Through
the provision of advisory services, yields at smallholder level also increased.
Starter packages included irrigation systems (and in some cases, anti-hail
nets), helping to improve resilience to climate extremes.

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WHAT DIDNT WORK WELL
Pressure and challenges due to limited timeframe
As mentioned above, there was a very short timeframe for implementation of
both the pilot initiative and the autumn planting (nine and three months,
respectively). This created some challenges for the networking approach.
The presence of various stakeholders sometimes meant that more time was
needed for project implementation and time was simply not always
available.

There are two planting seasons per year in raspberry production (autumn
and spring) and different areas have different deadlines due to variations in
altitudes and micro-climates. In some cases, deadlines were not respected,
especially in the autumn planting. For example, in the process of selecting
the poorest local communities, a bottleneck was created at the municipal
level. Not all municipalities sent the required information on time to allow a
proper data analysis. In some cases, the selection of FOs was carried out too
quickly, without due diligence and based on the information provided by a
single source (a processor/exporter or municipal agricultural advisor).

Processors/exporters did not have the capacity to deliver large numbers of

starter packages in the limited time available. The rapid value chain
expansion also put additional pressure on input suppliers. The availability of
seedlings became an issue both in the spring and in the autumn planting,
resulting in very different delivery dates to farmers in different communities,
and very different first yields these ranged from 100kg to 700kg.

More supervision is required

During the initial networking conference in the autumn-planting project, PCU
and Oxfam presented the methodology and instruments to all project
stakeholders. Responsibilities were assigned and the work plan was jointly
agreed, leaving very little room for errors or delays.

However, in spite of the mutual agreement, in some cases stakeholders

implemented certain steps without consulting the project management. For
example, one of the processors/exporters widely promoted the project,
highlighting via radio commercials and posters that beneficiaries would
receive a 50 percent grant from the project plus a 30 percent in-kind loan
from the processor/exporter. However, the advertising failed to mention that
this assistance was targeting only poor people, so the number of applications
skyrocketed (from an expected 750 to an unmanageable 1,800).

This created a huge pressure on the monitoring process, both in terms of

time and resources needed to conduct the monitoring. Hundreds of
applicants were rejected as they did not fulfil the targeting criteria. The
municipalities could not cope with the high number of applicants, so the grant
was eventually reduced to 40 percent. The changes caused confusion and
anger among some farmers who fulfilled the project criteria, some of whom
left the project before receiving any support. As a result of the misleading

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communications, enormous energy was spent before the beneficiaries could
be settled on.

CONCLUSIONS AND NEXT

STEPS
To conclude, the networking approach taken by Oxfam in these two initiatives
in the raspberry sector in Bosnia and Herzegovina has delivered numerous
benefits. Poor farmers were successfully included in the value chain; the
entire value chain was empowered; and, most importantly, key stakeholders
were influenced to adopt an approach which better supports the poorest
people.

Learning and recommendations

Some stakeholders may need capacity building to efficiently fulfil their
roles.
If the networking approach is applied, more supervision is required to
avoid un-coordinated stakeholders initiatives. A Steering Committee
should be established whenever possible, and regular coordination
meetings should be held.
All agreements should be documented in advance to prevent unpleasant
surprises during project implementation.
The broader picture should also be considered in the planning process, to
avoid bottlenecks in the implementation of activities.
To further develop and for scaling up will be important to explore a wider
sectoral approach for identification and dissemination of best practices
especially at the level of the primary production to enhance long term
sustainability and resilience.

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NOTES
1
http://www.tradingeconomics.com/bosnia-and-herzegovina/unemployment-rate
2
http://www.worldbank.org/en/news/feature/2013/02/14/improving-opportunities-young-
people-Bosnia-Herzegovina
3
http://www.ruralpovertyportal.org/country/home/tags/bosnia_and_herzegovina
4 http://www.tradingeconomics.com/bosnia-and-herzegovina/rural-population-percent-of-
total-population-wb-data.html

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 Oxfam International October 2016

This case study was prepared by Fedja Begovic, Value Chain Expert, and
Stefano Baldini, Oxfam Country Director. It is part of a series of papers and
reports written to inform public debate on development and humanitarian policy
issues.

This publication is copyright but the text may be used free of charge for the
purposes of advocacy, campaigning, education, and research, provided that the
source is acknowledged in full. The copyright holder requests that all such use
be registered with them for impact assessment purposes. For copying in any
other circumstances, or for re-use in other publications, or for translation or
adaptation, permission must be secured and a fee may be charged. Email
[email protected].

The information in this publication is correct at the time of going to press.

Published by Oxfam GB for Oxfam International under

ISBN 978-0-85598-802-9 in October 2016.
Oxfam GB, Oxfam House, John Smith Drive, Cowley, Oxford, OX4 2JY, UK.

OXFAM
Oxfam is an international confederation of 20 organizations networked together
in more than 90 countries, as part of a global movement for change, to build a
future free from the injustice of poverty. Please write to any of the agencies for
further information, or visit www.oxfam.org.

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