The private sector has the potential to generate both much-needed investment in agriculture and food systems and to ensure responsible supply chains that benefit small-scale producers, workers and consumers. However, irresponsible business and financial sector operations can undermine this potential.
Last week’s 2020 Annual General Assembly addressed the role of the private sector under the theme of “Pathways for Food Systems Transformation” at a panel discussion hosted by the Global Donor Platform for Rural Development. The discussion highlighted a number of related topics and observations. These included methods for boosting responsible private sector investments in food systems transformation and how global public goods and donor support can aid in enhancing responsible private sector investment to that end.
A participant in the panel, Chea Serey, director-general of the National Bank of Cambodia, said that addressing issues in food system transformation will require a multiple stakeholder approach.
She explained that a multiple stakeholder approach brings people working directly with farmers together so that those providing farmers with training and education on cultivation, the use of fertiliser and financing all work in collaborative cooperation.
Serey added that digitalisation will play a significant role in areas such as payment as well as other functions. She underlined that what is needed is to aggregate everything onto the same platform.
Serey added that no single company or sector can do all of this and that it will require cooperation between government, donors and private companies to be realised. She also emphasised that encouraging and enabling the adoption of innovation is the key to maintaining pace with the rapid rate of change in industry.
“Historically a farmer only needed to be concerned with cultivating, harvesting and then selling his product directly. Now there are many more requirements and processes in food production and phytosanitation, so innovation has to come in. Access to financing is equally important because it transforms great ideas into practical innovation,” Serey added.
Kann Kunthy, managing director of the Cambodian Agriculture Cooperative Cooperation (CACC), said food system transformation will rely on the attraction of more responsible businesses and that the government needs to seriously review and encourage 4P (Public-Private Producer Partnership) and 3P (Public-Private Partnership) arrangements. He agreed that multiple stakeholder approaches are needed.
“What is most urgently needed to foster these partnerships is government support in the areas of policy, subsidies, tax incentives and financial support and, of course, that infrastructure including water, road, energy and other basic business needs are in place. They are a must for manufacturing and SME [small and medium enterprises] clusters to flourish and take hold.”, he added.
Kunthy added that the role of the private sector in food systems transformation is to create added-value added within the fragmented supply chain, buying and market links. “These incentives and encouragement will outweigh the benefits of people and organisations conducting their business irresponsibly,” he added.
This article was first published in Khmer Times. All contents and images are copyright to their respective owners and sources.