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Thursday Nov 07, 2024
Wednesday, 26 July 2017 00:10 - - {{hitsCtrl.values.hits}}
Introduction
Institutions are an integral part of value chains. Government institutes drive agricultural advisory services in most value chains. Advisory services can come from the Department of Agriculture, which is attached to the Central Government or they can come from provincial agriculture ministries.
These institutes invest time and money in developing capacities of their officers so that they can deliver a better service to farmers. Most of these agricultural instructors are well educated, either they hold a degree in agricultural science or a diploma. I have worked with both these groups and I have never seen a gap in knowledge. Therefore, in my opinion, given the right incentives to work, they will work tirelessly towards improving the agricultural value chains.
However, unplanned institutional decisions can break down the enthusiasm and motivation that these agricultural advisors have and can drive value chains towards failure. My reference is on the Good Agricultural Practices (GAP) value chain and let me first give some context to the issue.
The GAP value chain was started as a response to our agricultural exports getting banned from the European Union (EU). Condition was that, if our agricultural exports were to be accepted by the EU markets, adoption of GAP standards is essential. In response the Ministry of Agriculture introduced ‘Sri Lankan GAP’ standards in collaboration with the Sri Lanka Standards Institute (SLSI). Initial focus is on the cucurbits (snake gourds, bitter gourds, and luffa) value chains.
Special standards and cultivation practices, which were not known to farmers before, were involved in this value chain. Unless farmers achieved these practices and standards, the exporters and the quarantine did not accept their produce. Therefore a good agricultural advisory service and an audit system were needed.
In response the Department of Agriculture, through a competitive exam and an interview selected young agricultural advisors that can help and develop this GAP value chain. New recruits were called Council for Agribusiness (CAB) officers. Farmers simply called them GAP officers.
They were well trained on the GAP standards and the audit system. They were linked with the exporters so that they hold the full value chain together until it developed well and starts responding to market factors, demand supply and prices. Their involvement in the value chain is remarkably high, which at one point I argued against since it could well give them enough incentives to exploit. But at the same time I accept their involvement in the development stage of these value chains since these value chains are, in my opinion, very fragile.
These value chains operate without crop insurance, without direct linkages with exporters and knowledge on GAP process. Hence the involvement of agricultural advisors was essential. It’s been several years since the GAP program started therefore CAB officers have invested a lot in bringing farmers and other stakeholders together and slowly developing the value chain by expanding into many areas.
Because of their support GAP value chain has now expanded to many crops and districts. For example cucurbits are now being cultivated under the GAP program in Gampaha, Puttalam, Kandy, Kurunegala, Matale, and Anuradhapura Districts.
On average a CAB officer will visit a farmer at least two times per week. This is increased during land preparation, planting and harvesting times. Therefore overtime farmers have developed a deep relationship and trusts with the CAB officers. Some farmers have gone to the extent of trusting these CAB officers in price negotiations with exporters.
Looking at the expansion rate in terms of number of farmers, decreased number of rejections at the quarantine and export destinations and enthusiasm to provide agricultural advisory services by CAB officers, this can be concluded as a “success program”.
Recently a decision was made to introduce GAP program to provincial councils. As mentioned earlier, the Ministry of Agriculture appointed CAB officers and they were working under an Assistant Director attached to the Ministry. Their only focus was the GAP program and they were working independently to the provincial agricultural ministries. Introducing the GAP program to the provincial councils requires the involvement of their Agricultural Instructors (AI) officers in the GAP process and essentially removing the CAB officers from the value chain.
While I am for decentralisation of agricultural advisory services, this prompts the question whether this is the right move for GAP value chain. Concerns on this can be discussed from several areas. Therefore the objective of this article is to discuss in detail on some of these issues. The central question this article aims to address is whether the GAP value chain is ready for a drastic transition at this point of time.
The idea is to hand over the GAP program to the provincial councils. Thereafter provincial councils can implement their GAP programs with AIs of the provincial council. However AIs of the provincial councils need training on many aspects of the GAP value chain. This requires a serious, well-planned training program introducing every aspect of this value chain. Therefore the idea is to use the CAB officers to train the AI’s of the provincial councils on the GAP value chain.
I kept on mentioning that the GAP value chain is fragile. There are many ways it can go wrong, and CAB officers try their best to hold things together. This knowledge and skills now need to be transferred to AIs of the provincial councils. How to do this is not clear at all. Same knowledge has to be transferred while sharing lesson learnt as much as possible. Therefore individual CAB officers of the area should train AIs of provincial councils or whether the training should be a lesson sharing exercise involving all CAB officers is an important thing to consider.
In my experience GAP value chain has different characteristics based on where it is and the crop. For example farmers in Gampaha District are more active, knowledgeable and making larger profits since most of them directly and frequently works with the exporters and CAB officers. However farmers in Anuradhapura District are lagging behind. Most of their produce goes to exporters through a middleman and CAB officers’ face many challenges in terms of accessing farmers. Therefore every district is unique in their constraints and recommendations also have to be specific.
For every district there are close to five officers under the GAP program. They have many experiences to share. Therefore in my opinion the best way to train the AIs of the provincial councils is to have training programs at individual council levels. Training itself is not enough and there has to be a proper transition. This is, in my opinion, the biggest challenge.
Farmers have established close relationships with the CAB officers over time. Though farmers might know the AIs of the provincial council through other initiatives, they might not be comfortable in working with them. Hence this transition has to be done smoothly without creating any friction. Please correct me if I am wrong but the popular complaint by farmers is that AIs of provincial councils are not that dedicated in providing agricultural advisory services. I have heard enough complaints from farmers how they would not visit farmers when there is a need and how hard it is access them except on “Wednesdays,” which is the public day and it is mandatory for officers to be at the office. Therefore in this transition it is important that the AIs of the provincial councils show enough enthusiasm and dedication towards the development of the value chain.
I would still beg the larger question whether CAB officers can be removed from this value chain that easily. Therefore I propose a collective effort. After working with the CAB officers, it is clear to me that they are overloaded with work. Sometimes, especially during harvest time, CAB officers have to visit many farmers on a given day. I have seen CAB officers visiting farmers till very late so that they can be in the fields when the harvesting is done. Therefore it is hard to imagine a model where CAB officers no longer exist.
At the same time one should remember that the work of AIs of the provincial councils is not limited to GAP value chain. While CAB officers were dedicated towards developing the GAP value chain, AIs of the provincial councils will not have that privilege. They need to look after other agricultural activities as well. Hence asking them to singlehandedly develop the GAP value chain will be a big mistake. Regardless of any training and smooth transition, they simply will not have enough time to dedicate themselves to the development of the GAP value chain. This will simply be another program for them.
One of the main activities of the CAB officer is to link the framer with the exporter. In the beginning of the GAP value chain there very few farmers and exporters had to search for produce. Exporters obtained lists of farmers from the Department of Agriculture and directly contacted them. However soon they realised that most these lists were not updated and up-to-date information on farmers and their produce is only available with the CAB officers. Hence exporters started linking up with CAB officers so that they could reduce the discovery cost and get good recommendations on whom to buy from. This in a way reduced the transaction cost to farmers since they no longer have to look for an exporter, the extension officer provided that service for them.
I could argue that this sort of an arrangement will give enough incentives for the CAB officer to exploit and look for rents in the value chain. However, even with the assumption that CAB officers are extracting rents, I would still propose that, for most farmers, especially the ones in areas like Anuradhapura and Matale finding exporters through the CAB officers is profitable. Therefore the question is “can this role be played by the AIs of provincial councils?” Because it will be the same function performed by the AI, the farmer might be indifferent between the CAB officer and AI in terms of who will link them up with the exporter. However the exporter might not feel the same.
We can assume that the exporter has developed a close relationship with the CAB officer where he might be comfortable in the CAB officer extracting rents. This can be partly justified by the uninterrupted quality supply that the exporter gets when needed. However whether the same exporter is willing to have that close relationship with AIs of the provincial councils is a question to be tested. My thinking is that it will take some time and personal recommendations/introductions by the CAB officers for the AI to develop a close relationship with the exporters.
Farmers who are already in this value chain are now quite knowledgeable on the GAP process and especially the diseases and applications against them. AI officers will not have this and will have to learn this from the CAB officer. Therefore in the eyes of the farmer, the AI of the provincial council will not have anything new to offer. This might very easily damage the relationship and AIs will have to work hard to prove themselves to framers that they are capable of providing correct advice. However GAP process needs close engagement of the agriculture advisory service since everything, starting from land preparation has to be certified by the agricultural advisor. This process might run in to trouble if framers develop doubts in the capacities of the AIs of the provincial councils.
Looking at all these aspects I stand by my suggestion that if GAP value chain to be managed by the provincial councils it has to run as a collaborative effort by the CAB officers and AIs of the provincial council. CAB officers still can train the AIs but they don’t necessary have to be removed from the operations. CAB officers are well knowledgeable on the limitations of their advisory services and AIs can effectively address those. I do not think that the GAP process had to be owned by one, neither the Central Government nor the Provincial Council, it has to be an effort to improve the value chain.
As of now the GAP program works on a common standard and a certification system, which is the “Sri Lanka GAP”. This uniform system has allowed us to have a minimum number of rejections at the quarantine and export destination. Once the proposed transition is made GAP program will be named under each provincial council. Hence there will be programs such as “Wayamba GAP, “Basnahira GAP”, and so on.
Now the question is whether the provincial GAP programs will cater to that particular locality and whether the standards would also be changed. If the standards were to be changed, then it has to be in collaboration with the SLSI and many criteria have to be looked at in doing so.
For example, some geographical areas with their agro climatic conditions might welcome specific pests. These pests might need specific pesticides, which are not allowed under the “Sri Lanka GAP” standards. These sorts of changes will demand rigorous research and approval systems that might create larger transaction costs. A definite decision cannot be made unless a through Cost-Benefit analysis (CBA) is done.
While developing site-specific recommendations and standards is preferred, it might not be feasible in terms of transaction costs. Therefore what I would recommend is to keep the “Sri Lanka GAP” standards as it is. Farmers are well aware of the current standards and they have already being published and accepted by the EU region. The central argument is that “Export-oriented GAP program might not be feasible for all crops in all districts”. For example cucurbits would grow in Gampaha perfectly under GAP standards, but this is not practical in the Eastern Province. But mango grown under GAP standards works well in the Eastern Province compared to Gampaha.
Why this transition is proposed is something that is not fully known. Therefore there are many competing theories. One popular 
argument is that “AIs of provincial councils are not comfortable having CAB officers working in their territories”. This argument goes against the purpose of having any agricultural advisory service. Regardless of who provides, agricultural advisory services have to be timely, accurate and accessible. If CAB officers are providing advisory services properly and AIs of provincial councils might not be able to do that same, then there is no point of being against the services of CAB officers. Only hypothesis is that CAB officers are extracting rents that are not available for AIs.
The other popular argument is that “provincial agricultural ministries see this as a great opportunity to show their positive contributions towards development of agriculture if they can take it over”. I am more convinced by this argument. As I mentioned in the beginning of the article, GAP value chain is largely a success story. Most of this success is attributed towards the hard work put in by the CAB officers. It’s been several years and the value chain is now well developed. Farmers are well knowledgeable about the GAP standards and how to achieve them. Exporters are also familiar with the GAP process. GAP program is already being highlighted in the Government policy efforts and the Ministry of Agriculture is working towards making the GAP program applicable to all export-oriented agriculture crops.
I can remember few months’ back the Minister of Agriculture talked about promoting the GAP program to locally-consumed fruits and vegetables as well. All these factors show that the GAP program has a bigger potential. If this were to be taken over by the provincial councils, it will be a very attractive way to show their contribution to the development of the export value chains in their locality. I doubt the enthusiasm of the provincial councils if they were to develop the GAP program from the beginning. In my opinion the GAP program has become attractive since it is already well established.
Therefore, I believe this is something not necessary at this point of time. I have worked in this value chain long enough to justify that. There are obviously several drawbacks in this value chain especially the way it is set up. I have written about these deficiencies and made recommendations. However this particular move, and the way it is currently being implemented came at a surprise. It is true that CAB officers are overloaded. They might be attracting economic rents. Yet speaking to many farmers it is very clear that CAB officers are now an integral part of this value chain. Therefore in my opinion what should have been done is strengthen the agricultural advisory services by recruiting more CAB officers.
However, if provincial councils must have the opportunity to work in the GAP program, they could still do that. One way to be engaged is to promote GAP standards to locally-consumed fruits and vegetables. There are enough incentives for our producers to produce fruits and vegetables under the GAP standards. What is produced under the GAP program is not organic, but it will not have any excess chemicals. Whatever applied under the GAP program are recommended by the Department of Agriculture and accepted by EU. Hence the probability of the produce being harmful to consumer is very less. If locally-consumed fruits and vegetables can be grown under the GAP program provincial councils can drive that initiative and can help to market them as well.
One simple approach would look like this. Provincial council can register framers who would cultivate locally-consumed fruits and vegetables under the GAP program. They can drive the training programs on the GAP process. Then they can establish a business venture to market those goods. There are entrepreneurship-oriented program conducted under provincial councils. Some of these are targeting women, disabled or economically deprived.
Marketing of fruits and vegetables grown under GAP guidelines can be done through a collection or a farmer organisation that represents women, disabled and economically deprived. This way provincial councils and AIs will have the chance to develop the local value chain according to GAP standards and also help local farmers to sell their produce, promote local entrepreneurships and allow access to healthy fruits and vegetables.
The idea of removing CAB officers and giving their functionality to AIs of provincial councils is not practical at this point of time. In my view CAB officers’ functionality is hard to replace at this point of time and AIs of provincial councils have plenty on their plate already. Since CAB officers lack capacity in terms of number of officers, their capacity has to be strengthened in the short run by hiring more. At the same time provincial councils can be motivated to adopt GAP standards to locally-consumed fruits and vegetables.
AIs of provincial councils are already working in those local values chains and it will easy for them. At a later stage a thorough evaluation will justify whether AIs of provincial councils are ready to work on the export-oriented GAP value chain as well.
(The writer is an agriculture and environment economist. He can be reached at [email protected] and 94 77 986 7007.)
