Forging transformative partnerships for success in rural poverty reduction

Written by Monica Romano

©IFAD/Flavio Ianniello
It is really the truth that “l’unione fa la forza” (meaning that if we are united, we are stronger), as a traditional saying in the Italian language states. This is what came to my mind during these days by attending the various panels and sessions that took place in conjunction with the Governing Council, all focusing on highlighting the power of partnerships in combating poverty and promoting rural development.

In particular, I “blocked” part of my afternoon at IFAD on Wednesday 13 February to follow carefully a high-level panel in which representatives from the private sector and research, under the facilitation of David Nabarro, Special Representative of the United Nations Secretary-General for Food Security and Nutrition and coordinator of the UN High Level Task Force on the Global Food Security Crisis hosted by IFAD, and with the participation of Kevin Cleaver, IFAD Associate Vice-President, Programmes. IFAD Governors intervened actively in the discussion, with comments and questions, but also success stories and challenges in building mutually-beneficial partnerships.

It is not so easy to establish successful partnerships. It takes time, requires money, and necessitates building trust among all parties - noted James Mwangi, CEO and Managing Director of Equity Bank in Kenya. Equity Bank offers inclusive, customer-focused financial services that aim to socially and economically empower people who are generally considered “unbankable”. The Bank was founded as Equity Building Society in 1984 and was originally a provider of mortgage financing for the majority of low-income customers. Over time, it was transformed into a microfinance institution and then into a commercial bank, with more than 8 million customers, thus becoming the largest bank in terms of customer base in Africa and having nearly half of bank accounts in Kenya. Mr. Mwangi indicated that partnerships can only succeed when responsibilities, investments, risks, and benefits are shared and when they are established through bottom-up processes. In a global context of limiting economic resources, investing in innovation, entrepreneurial skill development and capacity building – all key to sustainable development - cannot be afforded but through partnerships between different actors. This does not mean that everybody does everything. Each party has a specific role to play building on its comparative advantage: government in policy formulation and as an enabler of the institutional environment; donors in leveraging on their resources. There is need for “transformative” partnerships, echoed IFAD Governor from Nigeria, which could bring about change that individual organizations cannot achieve on their own.

The importance of “specialization” between partners in innovative partnerships for value chain development was highlighted by Estelle Biénable, an Agricultural Economist at the Agricultural Research Centre for International Development – CIRAD. Key factors to successful partnerships are the social capital – that is trained and organized farmers -, business orientation and development motivation, the specialization between different partners within the value chain (production, processing and marketing), and adequate attention to the institutional and organizational dimensions (including traditional institutions and the enabling environment).

The possible tension and the need to reach an equilibrium and foster dialogue between the public sector and the cooperatives were some of the key points raised by Odacir Klein, President of the Brazilian Biodiesel Union – UBRABIO, an association of producers and researchers of biofuels, which was founded in Brasilia in 2007. The issue of the relationship between government and cooperatives raised the interest of the Governors from Angola and Cote d’Ivoire. Mr. Klein noted that cooperatives have collective obligations towards their members, while the state should develop public policies to guarantee infrastructure development and provide stimulus for the cooperatives to represent their members and exercise collective responsibilities. The Governor from South Sudan pointed out that sometimes donors trust and support more the NGOs than the governments, even when these have not the required capacity or expertise to assist small farmers. The governments should have a clear policy to manage their relationship with NGOs.

I have to confess that I was mostly looking forward to hearing from Ingmar Streese, Director of Global Programmes and Partnerships at MARS, a private company doing cocoa production. I had been involved in the Mid-term review mission of the IFAD-supported Rural Empowerment and Agricultural Development (READ) project, which established a PPP linking smallholder farmers with MARS for cocoa production in Central Sulawesi, Indonesia (a story about READ’s experience with this PPP can be found here). Mr. Streese explained that there are estimated 5 million smallholder farmers producing cocoa globally, but they need to become entrepreneurs. Partnering between farmers and MARS has been proving successful in Indonesia. The ingredients for successful partnerships include trust, choice of the right partners, and building on the comparative advantage of each actor. Challenges are also there: working with big organizations is not always speedy and it takes time to find reliable partners. As the Governor from Rwanda stressed, for all actors to work together, there is need for the right institutional framework in place.

After remembering that last year the United Nations launched the International Year of Cooperatives, and summarizing the main points discussed and conclusions drawn - forming partnerships requires finance and time, science has a role to play, certifying the partnerships is needed to make sure that the principles are adhered to, donors organizations need to update their working methods and expertise – the floor was passed on to Mr. Cleaver to bring in IFAD’s perspective.

I liked particularly the first remark made by our Associate Vice-President: farmers cannot be considered any more as recipients. They are partners. Second strong point: IFAD, like many other organizations, has limited finance to have impact and scale. Partnerships are therefore a must. This has direct implications for IFAD’s business model and processes, which are not always suitable to work out optimally certain partnerships, especially with the private sector. In this regards, IFAD Member States can support us. And to say the truth, another key actor in the equation- the public sector – has often problems with the agility, flexibility and speed that private sector requires – Mr. Clever highlighted. Third consideration: there are also bad partnerships, as in some cases it is seen when the so called “land grabbing” occurs. Purchasing land is not bad per se. The question is whether the partnership requiring use of land is equal and the benefits accrue to private sector and governments only, leaving out the farmers. Public policy has a role to play. Donors like IFAD also have a role to play in empowering rural communities so that they can defend their interests and rights as well as in strengthening the capacity of governments to analyze and understand the implications, opportunities and threats of certain situations.

I left the room enriched by the debate. Despite challenges, it is promising that all expressed the desire and understand the need for working more closely together for rural poverty reduction. With farmers as partners, by supporting their organizations, building trust among all parties and leveraging on everybody’s comparative advantage. I guess these would really be transformative partnerships.