For years, public funding dispensed and monitored by central governments has been the norm in international development programs and particularly in agriculture. Foreign aid destined to carry out reforms came in the form of grants or long-term loans extended on concessionary terms.
In time however, it became clear that in funding farming in the Global South, centrally designed and managed development programs often led to misappropriation of foreign aid and to poor performance and little adequacy with fundamental needs of the populations especially in impoverished rural areas.
By excluding local communities from the policy making process, by concentrating programs on large farms, vast numbers of small farmers in rural areas have been neglected and left heavily dependent on government and foreign aids. With no access to private capital and in the absence of proper investment plan and opportunities, small farmers remain to-date out of the economic development dynamics.
Aid Agencies have now recognized the value and merit of supporting small and medium farming enterprises.
The new thinking in agriculture is precisely:
- To combine public and private investments learning from successful precedents,
- To foster capital availability to small farmers by guaranteeing locally structured small loans,
- To offer specific training for farmers determined to start or expand on existing operations.
So far, models applied in agricultural development in the global south are as follows:
- Humanitarian initiatives from bilateral agencies or multilaterals organizations such as the WFP.
- Aid from the same sources either monetary or in kind, or
- Public financing schemes via international financial institutions, or via bilateral sources.
These models have all been generally based on dogmatic options as in mono crop, large farm structures. Disregard to local farming, dietary and nutritional priorities, self-reliance or sustainability in a holistic, human development context.
The Stockholm Initiative strives to raise awareness to business model alternatives with emphasis on performance, monitoring and free enterprise combined with values such as sustainability, good governance, transparency, training in business savvy and technology transfer and use.
Debt-equity conversion mechanism in support of food security
Using it in the context of fighting hunger and promoting nutrition and food security may foster economic growth, increase food self reliance while alleviating the often intolerable and unsustainable debt burden.
Not only such a practice would help generate job opportunities, transfer technology and knowledge but also favor sustainable farming ^practices among local communities.
Implementing such mechanisms face the challenges often found in most African countries: lack of transparency, risks of misallocation of resources, accountability, lack of monitoring resulting in defeating the very purpose of fighting food security.
Our Value Added
We, at Stockholm Initiative for Food Security, view our contribution at three levels:
- Assisting central governments and local in Sub Saharan Africa Process applications for Funds, Funding Proposals and supporting discussions and negotiations among various parties for instance between central governments and national aid agencies and/or multilateral institutions.
- Ensuring monitoring and valuations of on-going programs and their impact on nutrition and food security metrics.
- Offering assistance in our capacity as a third party NGO in concrete phases in program implementation such as disbursements, checking progress reports and guaranteeing transparency and integrity in financial transactions relative to program lay out.
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