This document discusses the roles and relationships between the private sector and public sector in investing in livestock value chains in Africa. It clarifies that the private sector includes both small farmers and multinational companies. The public sector includes government and producer organizations. While the private sector does not need the public sector to engage, the public sector brings in the private sector and aims to create an environment where both sectors can achieve their goals - profits for private sector and poverty alleviation for public sector. Both sectors need each other and there must be ongoing negotiation to develop balanced regulations and incentives.

1. What are the essential pre-requisites
to enable the private sector to invest into
The livestock value chain?
Point of view of the implementers
How to contribute to poverty alleviation comes first.
Consider how private sector fits into this comes second.

2. 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 sector
From 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 interaction
Different interests according to size?
•Small farmer is about survival
•Multinational company is about profit making

3. Clarification of: Who is public sector?
Producer organizations are also the public sector
•Some are into advocacy activities
•Some have commercial ambitions
Ex: Dairy cooperatives in India
•Initially public they became private dairy cooperatives by law and
subsidies where stopped
Consumers are the public opinion
•livestock derived products
•Quality and safety of the product

4. Does the private sector need the public sector?
STATEMENT :
The private sector does not need the public sector to engage
Public sector should not tell what the private sector is to do:
•Public sector should not tell the private sector how to make profit and how
much
•The frustrations of the private sector with the public sector is over-
regulation.

5. Needs of the private sector
Basic 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, etc
Towards 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 marketing
Needs 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 regulatory
framework)
•There needs to be a balance between regulations for the public goods
(minimal level versus burdensome over-regulation)

6. Does the public sector need the private sector?
STATEMENT :
Private sector engagement in the agricultural and pastoral sector in Africa
are 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 maximize
profits?
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 greater
developmental impact compared to big companies because external
companies tend to take over the whole value chain (direct commercial
links to sell their products)
•We first look to private partners who can invest of attract finance + be
able to make money.

7. Incentives
BUT It’s difficult to anticipate what the private sector wants.
•You can’t dictate what the private sector is to do (or how much money
they 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 a
public 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 private
sector to engage in the pastoral value chain