By Hayden Aaronson and Mark Sevier, ACDI/VOCA
In this blog Hayden and Mark provide some very useful guidance for projects as they support market systems in their response to covid-19. While the advice does provide effective guidance to common emergent challenges, it is also useful to integrate good systems thinking. Maybe, most importantly, is to maintain an understanding that while covid-19 is a shock that is very problematic, it is also a disrupting force that could be harnessed to catalyze systemic change. As a result, it is important to think about how could any response do both address an immediate need, and catalyze/amplify a systemic change process. For example, as stated in the second strategy it is critical to improve the connectivity between government and the private sector, but it is also important to integrate into such efforts thinking on how the government and private sector should cooperate more effectively coming out of and beyond the covid-19 shock. Additionally, when engaging a market actor to help shift channels, it will be critical to also think about how support to that firm (as opposed to other firms) may have a greater effect on the competitive landscape during covid-19. Firms that come out of this shock in good financial shape will have a substantial competitive advantage giving them lots of influencing power. As a result, having a sense of how the competitive landscape could be improved coming out of covid-19 would be important when designing interventions to immediate weather this storm. From a systemic resilience perspective, it is important to consider both the immediate need to weather the storm, and the capacity of the system to identify, prioritize, and allocate resources in ways that more effectively neutralize and mitigate risks before they have to be absorbed.
COVID-19 is challenging the world to adapt, and, in doing so, causing two major problems in our food and agricultural systems:
1. Agricultural productivity and demand are shifting quickly and simultaneously. People are buying less because of lost jobs and lockdowns. Supply is also being disrupted by bottlenecks, closed marketplaces, and a lack of services, such as mechanization and transport. The result is unstable food prices, less access to nutritious food, lower incomes, and less long-term profitability.
2. Many consumers have poor access to health information and products. Amid this breakdown in connectivity, they face exploitation, a loss of trust, and potential health risks.
How do we fix these two seemingly disastrous problems? By adapting. At ACDI/VOCA, our inclusive market systems approach has always aimed to take on big, systemic problems and find ways to make markets work better for poor and marginalized people. Now, that approach is shifting to support the recovery of people and businesses affected by COVID-19.
1. Assess the Impact Of COVID-19
The first step many of our programs took was assessing the potential damage. For example, the USAID/Honduras Transforming Market Systems (TMS) Activity surveyed 1,178 enterprises from 16 of Honduras’s 18 departments and found that most businesses in Honduras will close within three months unless they receive emergency financial assistance. This data informed proposals collectively drafted by the Honduran government, National Tourism Reactivation Board, Chamber of Tourism, and National Institute of Tourism.
Other programs, like the USAID-funded Feed the Future Kenya Livestock Market Systems Activity, are supporting local partners, such as the Turkana Chamber of Commerce, to survey businesses and collect data of their own.
2. Collaborate with Governments on Recovery Policies
Rapid assessments can inform governments as they consider policies supporting COVID-19 recovery, like in Honduras, where the program’s assessment informed the government’s decision to pay employees suspended from their tourism-related jobs a monthly salary for six months.
In Bangladesh, the USAID-funded Feed the Future Bangladesh Rice and Diversified Crops (RDC) Activity team is working with the private sector to report bottlenecks in supply chains to policymakers. The team is also coaching businesses to lobby for the lifting of import restrictions on certain agricultural inputs and permits to allow them to transport inputs and commodities into areas under lockdown — both of which will help stabilize prices and markets.
3. Offer Financial and Technical Assistance
Many local enterprises will require grants to get back on their feet. But many will also need technical assistance to become resistant to ongoing shocks. The Feed the Future Ghana Agricultural Development and Value Chain Enhancement II Project, funded by USAID, is strengthening networks of outgrower businesses to organize the supply of inputs, such as fertilizers, and procurement of commodities.
4. Digitize Business Models
As people adapt to a socially distanced world, many businesses will rely on new distribution channels. In Bangladesh, the Feed the Future Bangladesh Livestock Production for Improved Nutrition Activity expanded the Android app Shurokkha, developed by its partner mPower Social Enterprises, to provide remote veterinary services to local livestock service providers.
The same program in Honduras is also helping enterprises diversify their distribution channels and move toward e-commerce.
5. Ease the Flow of Information through Existing Networks
Businesses have a moral and financial incentive to protect consumers’ health. To ensure consumers have access to health information and products, existing partnerships, supply chain infrastructures, and other pathways should be leveraged.
In Burkina Faso, a worsening security situation meant that the Victory against Malnutrition Plus (ViMPlus) Activity, funded by USAID’s Office of Food for Peace, already had a system for disseminating audio recordings in local languages to communes via telephone or mobile devices.
In Colombia, the USAID-funded Emergency Response in Arauca II Program is providing advice over the telephone about family protection and access to care, such as emergency aid programs implemented by the government and other agencies.
In Tanzania, the Feed the Future Tanzania Nafaka II Activity team is providing tablets preloaded with training materials on good agricultural practices to more than 50 of its most active and engaged participants.
Looking Toward the Future
COVID-19 has created a resilience stress test for food and market systems around the world. While the focus in many countries is still on the outbreak itself, market systems approaches that leverage business resources and incentives will aid the economic recovery phase that is sure to follow.
Hayden Aaronson is a senior technical director of market systems at ACDI/VOCA, where he leads the technical design of programs and supports Collaborating, Learning, and Adapting (CLA) strategies. He is a former chief of party in field offices and has worked in many technical areas, from economic development in the Balkans to post-conflict recovery in Northern Uganda.
The MSDHub Blog Series is authored by respected implementers and donors of market systems projects globally.