The 10th Anniversary ORSEA 2014 Annual
International Conference
Smallholders upgrading in local linkages: The
role of institutional framework in horticulturaltourism value chain in Zanzibar
BY: Winnie Nguni
University of Dar es Salaam Business School
Introduction
• Most value chain studies have significantly concentrated
on how value chain governance impacts smallholders
upgrading
• Very little has been discussed concerning the role of
institutional framework in determining upgrading
opportunities for local small firms
– Governance is defined as authority and power relations that
determine how financial, material and human resources are
allocated and flow within the chain
– Upgrading is defined as a process where small producers
improve their skills, knowledge and competence that enhance
them to gain access to high value markets and maintain their
position in them
Introduction
– institutional framework constitutes rules and norms in
which public and private organizations use in formulation
and provision of infrastructure that have some
implications in facilitating upgrading
In addition
• these studies have extensively discussed smallholders
upgrading in global linkages (global value chains),
• the knowledge pertaining to how local small producers
upgrade in value chains linking two or more sectors
within developing countries (local linkages) is still
underdeveloped.
Introduction
• Creating and strengthening ‘local linkages’ between
tourism and agriculture to minimizing substantial
tourism revenue ‘leakages’ to the external market to
source for agricultural goods that are also available in
local market, has been a central debate in the pro-poor
tourism literatures for the past two decades.
• To scientifically explain the persistent ‘poor’ linkages
between tourism and agriculture, it is necessary to
examine in depth how institutional framework facilitates
smallholders to enter and improve their ability to
compete in high value markets within their countries.
Introduction
• Using horticultural-tourism value chain as illustrative
case, this paper explores the linkage between fresh fruits
and vegetables (FFV) small farmers and tourist hotels in
Zanzibar, with specific attention to the role of
institutional framework in enhancing smallhoders
upgrading
Motivation
• High demand fro FFV by tourists,
• It is the greatest area of potential for creating and
strengthening local linkages in developing countries.
Literature Review
• Institutional framework (institutional arrangements,
institutional environment, institutions, institutional
capacity)
– Regulative institutional framework encompasses legislation
and government regulations and policies that companies can
use and/or have to comply with.
– Normative institutional framework is embedded in business
practices, business policies and ethical standards.
– Cognitive institutional framework reflects the way people
interpret and make sense of the world around them on the
basis of rules and schemata.
Literature Review
• Upgrading
– Smallholders upgrading in agro-food GVCs should be examined
through lenses of balance between rewards and risk structures
• Seven types of upgrading
–
–
–
–
–
–
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Process upgrading
Product upgrading
volume upgrading
functional upgrading
functional downgrading
improve value chain coordination
inter-chain upgrading
• This paper is concerned with examining the role of institutional
framework and its potential and barriers for FFV smallholders
upgrading and their access to tourist hotels’ market in Zanzibar.
and whether its influence in creating local linkages is increasing or
decreasing rewards for small producers in developing countries.
Methodology
• Qualitative approach.
• Purposive and snow ball sampling.
• In-depth interviews with hotels, intermediaries and
farmers in the value chain and focus group
discussions with other farmers.
• In additional a key informant from farmer
association and government agencies was
interviewed.
• Observation and audio recording of the
conversations
• Documentary review (secondary source of info.)
Findings and Conclusion
Findings and Conclusion
• Demand for FFV by tourist hotels is high but
there is weak institutional support to upgrade
small farmers to access the market
– Inefficiencies of farmers organisation
– Limited access to agric. extension services
– Limited access to financial market e.g banks,
insurance
– The input market is weakly regulated by the
government
– Policy for tourism development has failed to
stimulate agricultural development in the country.
Recommendation
• To improve efficiency of farmer organizations,
• To improve agric. Extension services,
• Government need to correct specific input and
output market failures and work together with
the private sector in the course of providing
appropriate expertise and support to small
farmers
• the overall master plan for tourism development
should be integrated with those of agricultural
development.
Recommendation
• Thanks!