Agribusiness

Can smartly executed PPP help catalyze agri-business growth?

Farmers have improved incomes as they are producing better quality and higher volumes of vegetables and able to market these.

The European Union (EU) Head of Natural Resources Section, Mrs. Jenny Correia-Nunes, the Aga Khan Foundation (AKF) Program Director Biko Evarist and the Masasi District Executive Director Mr. Changwa M. Mkwazu has handed over an agriculture market and a post-harvest storage and processing facility to the district government and marketing association in Masasi, in the presence of the District Commissioner of Masasi, Selemani Mzee.

This facility has been constructed through a Public-Private Partnership (PPP) model in Chidya village in Masasi district, fostering the potential for business growth in the region. The initiative was implemented under the Horticulture Value Chain Development project implemented by Aga Khan Foundation and funded by the EU in Tanzania from 2014 to 2017. The project is part of the larger Trade and Agriculture Support Program (TASP) under the 10th European Development Fund a EUR 15 million (approximately TZS 35.4 billion) programme.

TASP focuses on key commodities offering opportunities for pro-poor trade in the horticulture, fisheries, and cotton, coffee and tea sectors. The objective is to increase smallholder farmers’ income through better access to national, regional and international markets, by enhancing quality and standards compliance along the value chain.

Chidya village is at a crossroads between three trade routes and the centre of connectivity between smallholder farmers and local traders but lack of a proper market and storage facility meant that transaction volumes remained much lower than potential. The storage facility provides a platform on which buyers and sellers can trade and producers can store horticulture commodities with much lower risk of post-harvest losses.

The market size can accommodate trade of up to 20 tons of vegetable produce per day and the cold room storage facility has the capacity to store up to 3 tons. To ensure sustainability, the facility is designed to run as a business enterprise with income-generating component within the facility, including 2 state-of the-art vegetable weighing scales, as well as an input supply shop to enable easy access to agro-inputs.

The PPP model is innovative as it is business-oriented and promotes collaboration between the community, marketing association, and district government authorities. In this arrangement, the community contributed the land in-kind, the district government authorities covered a percentage of the construction costs, and the project covered the remainder of the costs through co-financing. The facility promotes cohesive governance and management, and operations and maintenance will be covered by the marketing association through revenues generated by the facility.

Speaking during the ceremony the Head of the Natural Resources section at the EU Delegation to Tanzania, Mrs. Jenny Correia Nunes said that “the EU funded Aga Khan horticulture project in Mtwara demonstrated the high potential of the horticulture sector in Tanzania to create jobs and improve farmers’ incomes, by supporting the value chain in a holistic way and by engaging the private sector. The facility that we are handing over today is an excellent example of a Public-Private partnerships (PPP) that will ensure success and expansion of the horticulture sector in Tanzania.”

The District Executive Director for Masasi in the speech said that “We are proud to have contributed to the success of this significant facility and encourage other district administration to invest in long term development similarly through public private partnerships.”

AKF Program Director for Lindi and Mtwara Regions, Biko Evarist, stated, “This initial effort is to provide a foundation for the local government, village authorities, and marketing association to build upon and continue to invest, expand, and grow business opportunities for farmers in and around Chidya.”

The project implemented by Aga Khan Foundation has reached up to 6,000 smallholder farmers (20% women and 48% youth) in Lindi and Mtwara regions through value chain development of tomatoes, onions, leafy greens, bell peppers, and chilies.  Farmers have improved incomes as they are producing better quality and higher volumes of vegetables and able to market these.  Adoption of good agriculture practice and technologies (pedal irrigation pump, green house and drip irrigation) combined with improved access to packaging, storage and markets under the project is changing lives of smallholder farmers in this region.

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