Implications for scaling
There are possibilities of expanding the model to other commodities such as maize, soya, rice and other countries (note 2). It is a generic smallholder-agro enterprise model, with certain key features that enable (inclusive) scaling:
- The company ‘takes over’ the extension provision, since the services delivered by the government do not meet market demands. The company did so by investing in the quality of their own staff, and by extending the tasks of their staff.
- The model is in the direct interest of the company as well: they have higher profit margins due to lower costs, a higher and more stable supply of raw product, and more work for their staff which previously remained idle for a few months every year.
- Working with ethnic minorities involves special challenges. Not least of these is building trust between farmers and processing companies. This trust works in two ways. Farmers have to trust the company. In the case of Huong Hoa it has been possible to find bilingual staff in the communes who have acted as trusted intermediaries. To the extent that scaling up would continue to involve ethnic groups this practice would have to be replicated. On the other hand, the company has to trust farmers as well. Small holder farmers are often depicted as being conservative, but they are very willing to invest in better production and higher profit margins.
The programme has the following contextual features:
- There is a huge market for cassava starch in neighbouring countries which stimulates the company to invest in the market.
- The interest of senior staff in the starch company. Huong Hoa director has a dynamic vision of his factory at the centre of a closed circle of good practice. Not all factory managers are as enlightened. Of three starch factories approached by SNV in North-Central Vietnam, only two expressed an interest in participating in the programme.
- Lastly the programme connects well to government policy, and there was a lot of co- operation with the government, i.e. the department of planning and investment. Two, at first sight contradictory, policy lines were addressed; from an industrialisation viewpoint, the government wanted more business activity for processing enterprises. On the other hand, the traditional shifting cultivation of cassava production was to be restricted in terms of area, so it was necessary to make use of existing farm land in a more efficient and sustainable manner. The programme addressed both those issues, and therefore was able to receive great support from the government.
- But for further successful up-scaling a number of constraints need to be overcome. First, and foremost is the question of finance: who will fund SNV’s inputs? Cassava factories and local government do not have large reserves of cash. The Ford Foundation has been funding activities with Huong Hoa’s farmers. Other sources would have to be found to contribute towards the high initial cost of developing the extension services, particularly where the target beneficiaries are remote ethnic groups. We have also seen in Huong Hoa’s case that it is seeking concessionary funds to invest in organic fertiliser production as well.
Thus the potential for scaling-up and replication exist. However, it is clear that much work remains to be done in order to realise that potential.
(note 2) This has already successfully been done in Lao PDR. The ENRIP programme on rice millers executed by SNV and Helvetas in the Lao PDR has been based on this cassava model (see also the SNV case on rice millers in Lao PDR).