What are the essential pre-requisitesto enable the private sector to invest intoThe livestock value chain?Point of view of the implementersHow to contribute to poverty alleviation comes first.Consider how private sector fits into this comes second.
Clarification of: Who is private sector?Clarify what private sector means is a pre-requisite•There are different types of private actors.•Small farmer is private sector•Multinational company is private sectorFrom the point of view of implementers:•When can we talk about private sector involvement?•Which role do we want different types of private companies to play?Depends on the type and level of interactionDifferent interests according to size?•Small farmer is about survival•Multinational company is about profit making
Clarification of: Who is public sector?Producer organizations are also the public sector•Some are into advocacy activities•Some have commercial ambitionsEx: Dairy cooperatives in India•Initially public they became private dairy cooperatives by law andsubsidies where stoppedConsumers are the public opinion•livestock derived products•Quality and safety of the product
Does the private sector need the public sector?STATEMENT :The private sector does not need the public sector to engagePublic sector should not tell what the private sector is to do:•Public sector should not tell the private sector how to make profit and howmuch•The frustrations of the private sector with the public sector is over-regulation.
Needs of the private sectorBasic conditions:•Protect from police actions, legal protection•Protect from market distortions•Private partner wants to be involved from the beginning•Exempted from reporting, dealing with the donors, etcTowards other potential partners:•Scale of operation•Commitments•Policy environment: local variations will not be appreciated•Cross border access•Capacity to differentiate products•To know what partners want in terms of product marketingNeeds of the private sector towards the public sector:•Make sure business is done in a acceptable way (regulations)•Elaborate a public private policy strategy in the pastoral sector•Private sector needs to know the rules of the game (the regulatoryframework)•There needs to be a balance between regulations for the public goods(minimal level versus burdensome over-regulation)
Does the public sector need the private sector?STATEMENT :Private sector engagement in the agricultural and pastoral sector in Africaare doing what the donors ask them to do…The public sector is bringing in the private sector•Do they therefore have to set the rules?•Do we have to create an environment where private sector can maximizeprofits?Define the mode of operation/engagement:•The private investor is to make money but not too much money.•Don’t impose capitalist approaches to small livestock keepers•They should make sure the added value is made in the country of origin.•Promote the value chain approach: local SME have greaterdevelopmental impact compared to big companies because externalcompanies tend to take over the whole value chain (direct commerciallinks to sell their products)•We first look to private partners who can invest of attract finance + beable to make money.
IncentivesBUT It’s difficult to anticipate what the private sector wants.•You can’t dictate what the private sector is to do (or how much moneythey can make).•To come to a win-win regulations is about continuous negotiation•We should first ask them the question and see what we can offer from apublic sector perspective.Incentives:•Market access•Insurance•Access to potential consumers•Create an enabling environment for private sector to operate•Actors need training + capacity•GalvMed is a good example of how public funding encourages the privatesector to engage in the pastoral value chain