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In June, 2011 AgBiz was extended for two years and the overall objective of the two-year cost extension is to increase incomes for all participants in selected Macedonian agricultural value chains by increasing sales (domestic and exports), improving productivity, enhancing the agricultural business environment, and increasing access to finance. AgBiz will build off of the existing capacity and expertise of Macedonian professionals and lead firms and farms to create a new understanding in the market for imbedded business development services and fee-based service delivery. The provision of the services will be delivered sustainably by local partners well beyond the anticipated graduation of the USAID Macedonia program. AgBiz Extension will focus on two value chains—fresh fruits and vegetables (FF&V) and processed vegetables (PV); emphasis will be on the lower levels of the value chains, with a view to increasing product quality and quantity to meet demand, and to raising the critical mass of stakeholders in the targeted value chains and increasing the use of service providers and the development of sustainable packages of services.
Implementation will contribute to the achievement of USAID/Macedonia’s Economic Growth Assistance Objective Three: Increasing Job Creating Private Sector Growth in Targeted Sectors and the Intermediate Results 3.1: Improved Business Environment in Critical Areas and 3.2: Key Private Sector Capacities Strengthened.
AgBiz Extension has three primary modifications versus AgBiz:

  • Focus only on the fresh fruits and vegetables, and processed vegetables value chains;
  • Place more emphasis on lower (production) levels within the value chains to increase the quality and quantity of production to satisfy current and anticipated demand; including increasing the number of participants in targeted value chains; and
  • Increase the use of local agricultural development service providers to manage entire AgBiz components
AgBiz Extension Components

Direct Value Chain Development Work

Five of the AgBiz components will be implemented through subcontracts with business service providers called Lead Facilitators. These are:

Increased productivity, competitiveness, and sales for fresh fruit and vegetables

The main objective under FF&V VC component is to work with FF&V value chain stakeholders to increase incomes for all participants in the supported VC from top to bottom using a broad-based approach that includes farmers, aggregators, input suppliers, cooling and packing facility owners and traders, processors, and exporters. This will be realized primarily by improving productivity and competitiveness at all levels of the value chain, strengthening market presence and by enhancing the business environment and improving access to finance. These enhancements achieved via sustainable linkages between Lead Actors and producers in the targeted VC will in turn increase domestic and/or international sales and increase purchases from smallholder producers, therefore increasing participants’ incomes.
In order to achieve improved productivity and competitiveness and better domestic and export sales for the FF VCs, LF will use an approach of directly involving the producers in the process of improvement of their end product, resulting in better quality and potentially quantity to be able to be sold on the market in accordance with specific market demands per product through immediate intervention to the supporting actors. Creating vertical Supply Chain Integration in the VCs’ is an essential aspect to be utilized in the implementation of the activities for achieving the overall objective.
EPICENTAR is responsible for implementation of this component under supervision of AgBiz team.
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Increased productivity, competitiveness, and sales for processed vegetables

The main objective under PV VC component is to work with PV value chain stakeholders to increase incomes for all participants in the supported VC from top to bottom using a broad-based approach that includes farmers, aggregators, input suppliers, cooling and packing facility owners and traders, processors, and exporters. This will be realized primarily by improving productivity and competitiveness at all levels of the value chain, strengthening market presence and by enhancing the business environment and improving access to finance. These enhancements achieved via sustainable linkages between Lead Actors and producers in the targeted VC will in turn increase domestic and/or international sales and increase purchases from smallholder producers, therefore increasing participants’ incomes.
The proposed activity package will generate a number of outcomes that are critical for achieving AgBiz program objectives, as well as the specific program firm-level performance indicators, such as increased sales from the supported PV VC, especially exports, increased purchase from the producers, increased number of new exporters, and new varieties of products produced and marketed.  By facilitating the adoption of an Integrated Supply Chain Concept, activities aim to address production quality, productivity and efficiency of the processors and primary vegetable producers; upgrade value chain services, improve management and production practices, strengthen horizontal and vertical linkages and increase competitiveness of the supported PV VC.  The planned activities will also support further association strengthening and directly contribute to enhanced market presence of PV products.
MCG is responsible for implementation of this component under supervision of AgBiz team.
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Enhanced access to finance

The overall objective of this AgBiz component is increased Access to Finance within the Agricultural sector, more specifically serving the needs of FF&V and PV value chain participants to access  adequate and favorable financing.
The NGO Innovation Center was selected to implement this component that will address issues of accessing finance by firms and farmers in the PV and FF&V Value Chains. This will be done through utilization of the Macedonia Competitiveness Project (MCP) pool of Financial Consultants, educational events and dissemination of AtF information tools.
Innovation Center is responsible for this component under supervision of the AgBiz team.
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Organizational capacity building for advocacy

The overall objective of this AgBiz component is to strengthen Public Private Dialogue and enhance the advocacy capacity of the AgBiz supported VCs. The Lead Facilitator will work with PV and FF&V value chain stakeholders, government bodies and other relevant entities to increase the organizational and advocacy capacity of private sector associations, and develop an effective methodology for efficient and effective public private dialogue, thus creating successful policy and institutional reform initiatives and measures that will reduce constraints to increased VC productivity and competitiveness.
CeProSARD is responsible for implementation of this component under supervision of AgBiz team.
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Development of value chain export strategies and plans

The overall objective is to establish a process and develop Export Marketing Plans for both VCs that will enable a more coordinated approach to export promotion and will enhance the capacity of Invest Macedonia to facilitate and gradually take over the managing of Export promotion. This should be done by involving the PV and FF&V value chain stakeholders, Invest Macedonia, government bodies and other relevant entities. The component will be managed by the AgBiz DCoP for Public Sector Liaison & Access to Finance.      
However, the work under this component is postponed until the GoM comes to some conclusions regarding reconstruction of Invest Macedonia and creates the necessary circumstances for cooperation with AgBiz.

Indirect Value Chain Development Work

The remaining three components will be managed by AgBiz staff with implementation of specific activities subcontracted out to local business service providers. These are:

Support for the Agency for Foreign Investment and Export Promotion (Invest Macedonia)

The planned support to Invest Macedonia for capacity building of its employees regarding export promotion depends on the recent developments of restructuring the agency and potential selection of agriculture as their priority. When this is clarified, AgBiz will include IM in its VC activities regarding Export Promotion and, in coordination with Investment Development and Export Advancement Support (IDEAS), Agbiz will develop suitable capacity building activities for the IM staff.

Policy and institutional reform needs identification, prioritization, and development

Both VC Lead Facilitators will have daily communication and close relations with the VC participants from all levels. They are expected to identify Policy and Institutional Reform Needs that obstruct the competitive development of the Value Chains. The identified PIRNs will be carefully reviewed and prioritized by AgBiz. The selected issues that are characterized as an obstacle for the current business operations will be addressed by engaging BSPs to analyze it, include all stakeholders and recommend solutions for improvement to the relevant institutions or policy makers. Other entities for identification of PIRNs are the non-VC LFs and AgBiz staff.

Support for Ministry of Agriculture, Forestry and Water Economy strategic planning and policy making

The support to the Ministry of Agriculture, Forestry and Water Economy will be executed by direct assistance to the Minister’s cabinet for updating and/or developing long term documents such as strategies, plans and assessments that are linked to enabling better business environment for the AgBiz supported VCs. The MAFWE proposed a set of activities that were discussed and coordinated with their departments and relevant experts. During AWPW the proposed activities were accepted.


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