m4p 26 november 2008, katalyst from agriculture to health care: applying m4p successfully in...

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From Agriculture to Health care:

Applying M4P successfully in differentmarket systems in Bangladesh

-- Peter Roggekamp,

Swisscontact - GTZ

26 November 2008

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The next 30 minutes:

Small intro The project cycle in Katalyst in agriculture in retailer information to

farmers in private health care

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Katalyst

Donors:

•DfID

•CIDA

•SDC

•RDE

Implementers:

•Swisscontact

•GTZ is

•Ministry of Commerce

Budget:

9 Million USD / year

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PSDPSDPSD

Economic growth is key to poverty

reduction

The private sector mainly enriches the

better off.

People are capable to

determine their own future

These poor people need help, they cannot do it on their own

Best solutions can often be achieved

by building on local system

People need protection from the system; better to design a parallel system

There are enough private sector

intermediaries to work with

Intermediaries exploit, have different interest or at best are too weak

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QUESTIONS LIKE:

o Where do I get good seeds ?

o Where to hire good labor ?

o How do I deal with diseases?

o Should I use fertilizer?

o Should I buy a maize sheller?

o What price can I get for my crop in the next village ?

o Why are my neighbors’ yield higher ?

o

o

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Where do I get good seeds ?

Hire good labor ?

How do I deal with diseases

What price can I get for my crop in the next village ?

Should I use fertilizer ?

Why are my neighbors yield higher ?

Should I buy a maize Sheller ?

3 key project decisions…..

1. Which value chains or markets should the project select ?

2. What is the growth and poverty reduction potential of the value chain or market and what need to change to unlock these potentials?

3. How to interact with the private and public sector to unlock these potentials ?

Market selection

Strategies

Facilitation

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Project cycle

Market selection

Strategies

Facilitation Monitoring

Understanding* Markets * Impact

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o Efficiency, ….

.. accepting the speed of the private sector,

o In a light touch way

o Risk,

o Unclear upfront where BIG HITS will be,

o Specific requirements from (4) donors.

Portfolio ManagementCriteriaGrowth potential

Pro-Poorness

Gender, Environment

Impact and outreach

Government policy

Urban and rural development balance

Synergies between the sectors,

Potential for innovation

High potential / high risk versus lower potential / lower risk

Internal capacity

Duration of interventions and Cost

Private sector partners and absorption capacity

Interest and capacity of implementing partners

Katalyst’s existing competences

SECTORSVegetables

Maize

Pond fish

Shrimps

Input markets

Poultry

Plastics

Furniture

Health care

Recycling

Media

ICT

Government services

Marketing

Distribution

Market selection

Strategies



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The strategies

sectorsector

Now. In 5 or 10 years time

?

Reducing systemic constraints,

Stimulating innovations.Market selection

Strategies



•Better irrigation,

•Trust,

•Availability of inputs,

•Product quality,

•Access to information.

?

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Improving market functioning

Market selection

Strategies



No direct support to farmers and SMEs Low reach not efficient and not fair. Support not sustainable

But mainly work with commercial or public intermediaries, for example: Associations Input suppliers Mold makers in plastics Nursery owners in pond fishery Seed producers Traders Soil testers ICT centers Media

Efficient

Sustainable

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Deal Making with intermediaries

StrategyStrategyKnows how to engage Knows how to engage Sector knowledgeSector knowledge

Katalyst

PO

VER

TY

PR

OFI

T

But where is the invisible hand ? “Externalities and Enabling Environment prohibits”

So why do you need

our support? Misuse of market power, Disadvantage groupsMarket selection

Strategies



Risk Catch 22Takes too longAccess to knowledge

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Principles of facilitation

• Competitiveness and its reincarnation productivity is the key to sector growth; is the key to poverty reduction

• We are not part of the private sector… …and only there temporarily,• We have to be as neutral as possible in the market,• We always demand cost sharing to assure

commitment,• Crowding in is a core part of market development,• Environment, Gender, Working conditions are

important.

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Market selection

Strategies



Monitoring and understanding impact

•Integral part of our approach,

•Work with impact logics for each intervention,

•Learning moments built in,

•Owned by staff and M&E specialists,

•90 % improving, 10% proving,

•Financial incentive for all staff,

•First system audit last month.

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BUT WHERE ARE THE POOR ?

Daily laborLandless rural and urban poor

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Incidence of poverty by main source of income (UPL/%)

Source: Poverty Monitoring Survey (2004)

Bangladesh Urban Rural

Wages & Salary 19.87 18.76 20.84

Agriculture (Self-employed) 38.71 48.69 38.10

Non-agriculture (Self-employed) 40.41 40.57 40.35

Agriculture (Daily Wage) 71.39 79.13 71.05

Non-agriculture (Daily Wage) 51.26 58.55 48.17

Pension 20.19 27.45 17.32

House rent and other rent 21.27 10.23 28.03

Donation, grant, charity and other 30.35 27.27 30.77

Daily Wage Earners

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BUT WHERE ARE THE POOR ?

“New” cash crops can end povertyTraditional small rice farmers

Skilled jobs in certain sectors

More local purchasing power

Jobs for daily laborLandless rural and urban poor

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Agricultural Value Added (BDT/acre, BDT/capita)

Cost Value added Value added

(per acre, incl. labor)

(per acre) ( per capita)

AGRICULTURE - - 9,643

Agriculture/Livestock - - 7,165

Oil seeds 4,000 1,456 987

Major cereals 8,000 2,523 1,777

Pulses 3,500 2,398 1,821

Minor cereals 7,000 2,957 2,124

Maize 10,125 3,205 2,283

Spices 22,121 5,177 3,381

Maize (contract farming) 12,565 10,000 7,124

Vegetables 20,800 13,008 8,203

Potato - 80,000 50,000

Fruits - 20,494 15,308

Poultry (commercial) - - 37,796

Forestry - - 25,268

Fishing/ Pisciculture - 50,506

NON-AGRICULTURE - 30,028Based on: Statistical Yearbook of Bangladesh (2004, 2005), Agricultural Sample Survey (2005), own data

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Cropping Patterns

Poverty status

Marginal Small Medium Large

Boro-None-Ropa Amon 1 1 4 4

Oil seeds-Ropa Aus-Ropa-Amon 1 1 4 4

Vegetables-Aus-Ropa Amon 1 4 4 4

Boro-None-None 1 1 1 3

Mastard Oil-Ropa Aus-Ropa Amon 1 1 4 4

Boro/Wheat-Dhaincha-Ropa Amon 1 1 4 4

Wheat-Vegetables-Ropa Amon 1 4 4 4

Potato-Ropa Aus-Ropa Amon 1 4 4 4

Banana-Banana-Banana 2 4 4 4

Mastard Oil-Boro-Ropa Amon 1 1 4 4

Potato-Aus-Ropa Amon 1 4 4 4

Oil seeds-Ropa Aus-Ropa-Amon 1 1 4 4

Maize-None-Ropa Amon 1 1 4 4

ST.Amon-maize 1 4 4 4

ST amon-potato-maize 1 4 4 4

Fisheries 1 4 4 4Source: Department of Agriculture, own data

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Market Development and Cash Crops

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Strategy for most of Agriculture

Market selection

Strategies



•Access to information on cultivation

•Better functioning input markets

Lead to:

•Increased productivity and profitability

•Less risk

Lead to:

•Increase income for existing farmers

•Cash crops more attractive for new farmers

•More jobs for landless

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Agriculture and Market Development the intermediaries

Retailers of Seeds

Fertilizer

pesticides

Traders processors

Extension workers from Government or NGO’s

Media

ICT centers

Sellers or lessors of equipment

Lessors of land

Market selection

Strategies



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Main Issues Intermediaries Support

Low Productivity, due to: Insufficient knowledgeDysfunctional input marketsLimited access to resources

o Embedded information through:

Retailers Nurseries

Training development Initial risk sharing Demonstration

o Rural ICT Centers: Testing the model Risk sharing Awareness creation Wider system development

o Services providers in market places

Improving availability and functioning of services

o Local Government on leasing of public water bodies

Changing government rules and improving implementation

o Compost fertilizer companies Technical support Improving Government regulations Development of distribution network

o Contract farming Developing models Adoption of the business model Risk sharing and Demonstration

o Seed companies on quality seeds

Quality and trust Improving wider systems Creating awareness Assisting in contract seed production

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Improving retailer – farmer relationsin the vegetables market

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Market selection: Vegetables

Market selection

Strategies



•One of the “out of poverty” cash crops,

•Outreach of potentially many millions,

•Great potential for job creation,

•Fits in Millennium Development Goals,

•In line with Government PRSP.

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Agriculture and Market Development the intermediaries

Retailers of Seeds

Fertilizer

pesticides

Traders processors

Extension workers from Government or NGO’s

Media

ICT centers

Sellers or lessors of equipment

Lessors of land

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Facilitation: Retailer training programs

Market selection

Strategies



Situation analysis in 2003:

Farmers:

Low productivity

Distrust and dislike retailers

Retailers:

Product knowledge

No cultivation knowledge

Distribution network:

No cultivation knowledge

Only focus on logistics

Large companies HQ:

Have cultivation knowledge

Some are concerned about reputation, ..

..all about market share

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Market selection

Strategies



Initial Activities:

• We offered support to all major companies

• Syngenta agreed to test with 480 retailers in 2004

3 days course about farming knowledge

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Market selection

Strategies



Katalyst SyngentaInitiated 100%

Training concepts Joint

Design of training Supported Lead

Organizing and executing trainings

- 100%

Cost of training 60% 40%

Gender specialist 100%

Monitoring 100% 100%

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Market selection

Strategies



Initial Activities:

• We offered support to all major companies

• Syngenta agreed to test with 480 retailers in 2004

3 days course about cultivation knowledge

Next level of Activities:

• Similar deals with Bayer Crop science and East West seeds: additional 900 retailers in 2005

•Deal with AR Malik, Lal teer, Mollika, Metal and United, more focused on seeds.

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Results

Market selection

Strategies



Service market change:• Completely different business model;

•High interaction between retailers and farmers

•Overall perceived as positive by all

•Retailers and organization all report increased revenue

• 2/3 of 1380 retailers are giving cultivation advice.

• Companies continue to invest in their retailer network.

Farm level change:• Improved practices for ca. 230.000 farmers directly.

• If crowding in is considered, probably more than 3 Million farmers affected

• Increased yield, but also increased quality higher income

• More new farmers in areas where training took place.

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Results, a retailer

Market selection

Strategies



Change after receiving training:

•Got knowledge on farming

•Understood importance of giving advice

•Worked on good relation with farmers

Md. Babul Akhtar, 38

2005 2006

No of clients 600 800

Total sales 2,308 USD 3,846 USD

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Results, farmers

Market selection

Strategies



2005 2006

Land used 16.5 dec 30 dec

Cost of seeds Used their own

1,500 BDT

Cost of pesticides

none 750 BDT

Cost of fertilizers none 750 BDT

Van cost 350 BDT none

Toll for selling at market

350 BDT none

Yield 1,000 pieces 2,000 pieces

Revenue 6,020 BDT 23,200 BDT

Profit 82 USD 311 USD

Monjuara (27) and Md. Kalam Sarkar (35)

Change after advice from retailer:

•Packaged seeds instead of own seeds

•Changed use of pesticides and fertilizer

They bought a cow

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Commercial Health care

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Market selection: Commercial Health care

Market selection

Strategies



• One of the biggest service markets,

• Excellent growth potential,

• Skilled jobs for women.

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Commercial Health care How does the sector looks

like? Market selection

Strategies



• 150 000 000 people need healthcare in Bangladesh,

• Doctors 1 – 10 000,

• 2/3 of healthcare paid directly by households,

• 500 000 individuals travel overseas for treatment annually,

• Government hospital occupation rate is > 100%,

• 80% of healthcare is from commercial providers,

• contribution to GNP in 2004 – 2005 :

•Private health care 2.33%

•Public healthcare 0.77%.

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Health care is special….

Market selection

Strategies



•Main access for poor people is private health care,

•Public and private delivery not separable,

•Large donor support for public, none for private,

•Ethics are different.

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Strategy: Commercial Health care

Market selection

Strategies



Quality improvements through:

oBetter medical workers:

Government regulations,

Capacity of commercial training institutes.

oChange in attitude of hospitals and diagnostic centers. FAILED

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Activities: Health CareKatalyst support:

Market selection

Strategies



Courses for Course duration

BSc nursing 4 years

Health technology 3 years

Medical assistant 3 years

Community health worker

1 year

Paramedics 1 year

Community paramedics

2 years

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Activities: BSc Nursing

Market selection

Strategies



If you do not address the quality and availability of nurses:

STAY OUT OF HEALTH CARE!

The situation:

•Ratio Doctors-Nurses 3 : 1, should be 1 : 3,

•No 4 year courses,

•Low status of nurses in hospitals and clinics,

•Law prohibited private universities to train.

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Activities: Health Care (2 but last slide)

Market selection

Strategies



Activities:

• We found a good implementing partner,

• We organized interested universities to lobby for change in regulations,

•We assisted universities to develop new curriculum,

•We assisted in demand creation.

Successful

Successful

Successful

Not required

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Initial results: Health Care(one but last slide)

Market selection

Strategies



•8 Universities have received a license for BSc Nursing,

•300 Students have enrolled in 2007 – 2008,

•15 Private institutions are in pipeline to obtain approval,

•Too early to say anything about change in the sector.

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Last slide:

• M4P can be very effective, also beyond the obvious sectors

• Projects will look different in different countries, but the basics remain valid.

• Is also applicable in remote, weak markets (see afternoon with Alwyn Chilver)

• It takes time, flexibility and good staff (See afternoon with Manish Pandey)

m4p 26 november 2008, katalyst from agriculture to health care: applying m4p successfully in...

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