Linking Farmers to Markets
Agro-Enterprise as a Concept for the Development of Agriculture - Based Regions

Why promote Agro-enterprise?
More than two third of the World's poor population live in rural areas, most of them trying to make a living in agriculture. Increasing income expectations of the younger generation speed up structural change in agriculture. All over the world people are on the move to have access to cash income. It is understood that off-farm employment is a basic condition to economic development. Food security can only be reached if adequate purchasing power is available to rural people. Farmers need to interlink more efficiently with those who trade, process or consume their products. And they need access to a competitive market to buy the inputs required.
During the last decade the political conditions of public intervention in development have changed dramatically. The focus on poverty reduction has been complemented by the objective to promote and stabilise political change processes towards more democracy and decentralisation. Sustained economic growth and income distribution are the gateway to reduce poverty and to assure an adequate supply of food for all.
Changing market trends create new demands for food crops, for exotic fruits and organic raw materials produced in labour-intensive production systems. Globalisation offers new chances to those who act fast and efficiently. The Agro-enterprise approach is the conceptual answer to these challenges and new chances.

A shift in perspective
Agro-enterprise is not a new issue but a shift in the
approach to the development of rural areas. It
proposes that development planners and managers
take a more holistic perspective on sustainable
economic development in agriculture-based
regions.

Based on the principles of sustainable
development, the Agro-enterprise approach contributes
· to poverty reduction by facilitating the development of income-generating activities and the creation of on-farm and off-farm employment
· to make sustainable agricultural production systems economically feasible by improving market opportunities for food and non-food products
· to sustainable economic growth in regions where agriculture is a predominant sector
· to increased food security.



The Agro-enterprise approach provides a concept for the promotion of rural development. In a systems approach, it combines classical tools of technical cooperation on national, regional and local level with new and innovative elements such as the Private-Public-Partnership approach.
How to promote Agro-enterprise?
To make maximum use of potentials to add value to products, intervention in Agro-enterprise focuses
· on frame conditions such as import-export policies, price policy, credit and banking regulations, access to market information systems, legislation with regard to capital assets and land etc.
Substantial investments in Agro-enterprise can be expected once they are economically reasonable. Therefore, frame conditions in national economies and on regional and world market level have to be improved. This means to support Government and business representatives to actively defend their cause in rule-setting mechanisms in national and international decision-making bodies. New markets outlets for farm produce are essential for creating jobs to the rural non-agricultural population.

· on the efficient and effective linkage of groups of private actors
Different groups of private actors (producers, traders and processors of agricultural products and inputs, service providers) in the regional economic system have to interlink more efficiently. Their co-operation is to be strengthened by promoting
1. adequate communication channels for rapid information exchange
2. analysis of chain performance and development of organisational and technical innovations to open up bottlenecks, based on joint learning processes and self-organisation.

· on the efficiency and effectiveness of each group of actors.
Technical aspects of food production, post-harvest management, processing and distribution are important to increase quantities and to assure the requested qualities of agricultural products. To add more value to products, options have to be identified
1. to improve processes of production, handling and collection of produce on farm, village and local level and the distribution of produce within the market system
2. to support farmers, rural traders and other partners to co-operate efficiently and organise themselves in professional associations
3. to increase the competitiveness of markets by developing market information systems accessible to farmers and traders in rural areas.



Technical co-operation in Agro-enterprise follows the general principles of participatory innovation development and client-centred consultancy. Participatory learning processes, improvement of communication & feed back channels and capacity building for self-organisation and self-evaluation are the methodological cornerstones of cooperation with agricultural producers, traders and processors. Professional associations and private or state-owned service providers are partners in Agro-enterprise promotion.