198
7.6 How Profit and Nonprofit Can Work Together
Very high levels of investments are needed to use agriculture to solve the issues of
malnutrition and rural poverty, but direct investments have been lacking. With limited government resources available, a new model of collaboration among governments, NGOs, and corporations is being sought to improve agricultural productivity
and food access. Governments eager to show progress on social programs have
encouraged private sector companies through incentives and taxation breaks to
enter program investments. Public-private partnerships (PPPs) were utilized in
developing countries to solve large infrastructure issues related to the energy and
water sectors. In many cases these PPPs were focused on concessions on contracts
and leases and independent energy producers. Many communities and NGOs are
skeptical about the true intent of PPP initiatives and whether they were just another
means to ultimately privatize public infrastructure. In agriculture, PPPs must operate differently than the water or energy sector since the participants are often independent farmers rather than utilities or infrastructure projects. Agricultural PPP
programs, while successful, have had to face several hurdles (FAO 2016):
1. Access to specialists in agriculture, land use, and technology. These usually are
supplied by the private sector, but for ongoing success, these skills must be transferred to the community.
2. Access to capital and credit. Often this is the role that the government can play
or financial institution with micro loans and farmer credit.
3. Poor infrastructure will inhibit the transportation and storage of food items.
Basic road and storage systems must be considered before the program can start.
4. Land rights are often not well understood in many developing nations. Land
acquisition and land leasing must be part of the program.
PPP contract relationships are more complex in this sector as farming communities
are much more fragmented and lack a unified voice, requiring more community
involvement and communications.
While many examples of public-private partnerships exist, they are not as simple
as they may seem. For private companies to work with NGOs, they need a knowledge transfer framework, financing, resource availability, and the ability to navigate
through local regulatory and government rules. Governments must make the process more navigable by redesigning tax incentives, financing rules, regulatory
requirements, and access to public resources.
Typically, the roles of the public agency and/or NGO in the PPP programs are as
follows:
• Creating a supportive regulatory environment with appropriate incentives for private sector investment and inclusion of smallholders
• Developing program concepts in alignment with national socioeconomic and
sector development priorities
• Designing detailed program guidelines and transparent partner selection criteria
• Promoting the incorporation of risk sharing/mitigation in the design process
D. Donnan
7.6 How Profit and Nonprofit Can Work Together
Very high levels of investments are needed to use agriculture to solve the issues of
malnutrition and rural poverty, but direct investments have been lacking. With limited government resources available, a new model of collaboration among governments, NGOs, and corporations is being sought to improve agricultural productivity
and food access. Governments eager to show progress on social programs have
encouraged private sector companies through incentives and taxation breaks to
enter program investments. Public-private partnerships (PPPs) were utilized in
developing countries to solve large infrastructure issues related to the energy and
water sectors. In many cases these PPPs were focused on concessions on contracts
and leases and independent energy producers. Many communities and NGOs are
skeptical about the true intent of PPP initiatives and whether they were just another
means to ultimately privatize public infrastructure. In agriculture, PPPs must operate differently than the water or energy sector since the participants are often independent farmers rather than utilities or infrastructure projects. Agricultural PPP
programs, while successful, have had to face several hurdles (FAO 2016):
1. Access to specialists in agriculture, land use, and technology. These usually are
supplied by the private sector, but for ongoing success, these skills must be transferred to the community.
2. Access to capital and credit. Often this is the role that the government can play
or financial institution with micro loans and farmer credit.
3. Poor infrastructure will inhibit the transportation and storage of food items.
Basic road and storage systems must be considered before the program can start.
4. Land rights are often not well understood in many developing nations. Land
acquisition and land leasing must be part of the program.
PPP contract relationships are more complex in this sector as farming communities
are much more fragmented and lack a unified voice, requiring more community
involvement and communications.
While many examples of public-private partnerships exist, they are not as simple
as they may seem. For private companies to work with NGOs, they need a knowledge transfer framework, financing, resource availability, and the ability to navigate
through local regulatory and government rules. Governments must make the process more navigable by redesigning tax incentives, financing rules, regulatory
requirements, and access to public resources.
Typically, the roles of the public agency and/or NGO in the PPP programs are as
follows:
• Creating a supportive regulatory environment with appropriate incentives for private sector investment and inclusion of smallholders
• Developing program concepts in alignment with national socioeconomic and
sector development priorities
• Designing detailed program guidelines and transparent partner selection criteria
• Promoting the incorporation of risk sharing/mitigation in the design process
D. Donnan