Chapter Two

Smallholders and Rural People

Making Food System Value Chains Inclusive

Rob Vos and Andrea Cattaneo

Smallholders often struggle to connect with actors in the middle of the food supply chain as a result of limited access to land and inputs and lack of capacity to scale up or implement new practices.

KEY FINDINGS

Propelled by urbanization, rising incomes, and changing diets, food markets are expanding in Africa and South Asia, creating enormous potential for job and income opportunities along food supply chains.
Small and medium-sized enterprises have proliferated in storage, logistics, transportation, and wholesale and retail distribution to meet growing rural and urban food demands. This so-called quiet revolution appears to be taking place out of sight of policymakers, leaving much of the potential for inclusive value-chain development untapped.

Smallholders often struggle to connect with actors in the middle of the food supply chain as a result of limited access to land and inputs and lack of capacity to scale up or implement new practices to meet quality requirements.
Lack of infrastructure and skills is holding back the development of food supply chains in low-income Africa and Asia, especially where the potential is greatest: in small towns and intermediate cities near rural farmlands.

KEY RECOMMENDATIONS

Promote inclusive food supply chain development by leveraging the transformations already taking place in downstream food supply chains, particularly the expansion of small and medium-sized enterprises and growth of off-farm employment.
Catalyze investments that strengthen food supply links so that smallholders have greater market access and food transporters, distributors, processors, and retailers can thrive. Governments should create an enabling environment for agrifood businesses by providing basic infrastructure, creating the right market incentives, promoting inclusive agribusiness models, and supporting information and communications technology use that fosters inclusive value chains.

Enable smallholder engagement in dynamic food supply chains by addressing issues that hinder participation. Policies and regulatory frameworks should ensure land tenure security, access to credit, training and technical assistance, and resilience-enhancing social protection.
Make much greater investments in data collection and analysis across the entire food system, particularly for the “hidden middle,” to underpin policies for inclusive value chains.

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