Introduction

In developing countries, the markets for agrifood products are changing at a pace that is unparalleled in modern history, becoming increasingly open and homogenized toward international standards. New distribution channels, dominated by larger firms, are imposing higher performance demands, including social and environmental standards, throughout the value chains. Traditional ways of doing business are often no longer adequate, resulting in new challenges for small and medium farms. Acquiring the technical know-how and financial resources to incorporate standards such as quality assurance, safety, and traceability is difficult and failure to do so marginalizes many small and medium farms and agroenterprises.

The public institutions that could traditionally provide such support to farmers have steadily eroded and are now often non-existent. Until the late 1980s, rural development was typically state-focused, with public institutions controlling the systems and infrastructure for agrimarket inputs and outputs. These institutions were, for the most part, unceremoniously scrapped as their shortcomings became evident, free-market theories became prominent, and structural adjustment took hold. Their role in supporting smaller, more marginalized or remote producers, however, was important in facilitating equitable access to information and markets. Consequently, their absence in poorer regions has exacerbated market failures and left a vacuum that is not often adequately filled by the private sector.

Through the lenses of value chain theory and institutional economics, we are beginning to better understand the interrelationship of private sector agricultural production and trade with the emerging processes of civil governance. From such understanding can emerge the necessary innovation and support required to provide sustainable solutions to the challenges of necessary capacity building or long-term financing required by smaller farmers and rural entrepreneurs who want to participate in the value chain. Without effective public and civic institutions, the ability of smaller farms and enterprises to participate is reduced.

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Comment(s)

There are [2] comment(s) for this entry. Post a comment.

1. Prof. J. George
   (posted 06 July 2008 / 07:56:18 PM)
   
   The authors, Giovannucci and Pursell needs to be complimented on this publication for putting together a business perspective to the application of standards in the food trade.
   
   The perspective of the book however could have been broadened if the production landscape in the region was brought to play a dominant role. The price discovery advantages are certainly not available to the producers. The cost burden, however, is surely an additionality for the producer in more than one ways. For instance, the AGORA experience in Bangladesh is being experienced in all the member countries in the region. This burden is magnified when the state governments either in collusion or in default setting withdraws due to the fiscal conditionalities.
   
   The publication could have immensely benefitted from a professional copyediting and/or critical peer review. But it is a useful addition to the discipline of food safety regulation.
2. Dr T. Tappani
   (posted 03 June 2008 / 05:47:56 AM)
   
   This ADBI paper: "Standards and Agricultural Trade in Asia" is quite a practical and useful look at the topic of trade and development. The authors, Giovannucci and Pursell, clearly have a sharp eye for the needs of business and the realities of farmers (mostly small in the region) and combine these to offer some practical solutions that the Asian Development Bank and governments would be wise to consider in their work.