Trade and markets strategy officer at the Global Mechanism of the United Nations Convention to combat desertification (UNCCD)
Eleonora Canigiani talks about regional integration beyond cost effectiveness in its complex dynamic and explains how the CAADP regional trade and infrastructure joint action group is different from similar mechanisms. She names strengthening the position of the agriculture sector and pointing out the need for including intra-Africa trade of agriculture-intensive products as the specific aims of the group and highlights its efforts to engage the private sector.
CAADP regional trade and infrastructure joint action group
Trade and markets strategy officer at the Global Mechanism of the United Nations Convention to combat desertification (UNCCD) Eleonora Canigiani
Online, 29 Nov 2013. The Comprehensive Africa Agriculture Development Programme (CAADP) aims to improve coordination among various players for the development of agriculture strategies. To strengthen planning capacity across sectors and private sector initiatives, two complementary platforms have been established. One of them is the joint action group on regional trade and infrastructure (JAG-RTI). It aims to mobilise coordinated support for the development and implementation of regional CAADP compacts and investment plans. Trade and markets strategy officer at the Global Mechanism of the United Nations Convention to combat desertification (UNCCD), Eleonora Canigiani talks about the JAG's efforts in in pointing out priority interventions for strengthening regional agriculture markets and improving dialogue with trade institutions.
// Looking at regional integration
Secretariat: Eleonora, you work for the Global Mechanism of the UNCCD. This body works with governments of countries that have signed the convention to combat desertification, to look at the enabling conditions for better land management, and primarily you scrutinize financial tools. The requests for financing seem to proliferate into all directions. I am sure that the GM is busy pruning its budgets to see where to put its money and support, but in the past, why did the GM look at regional integration in Africa and put some emphasis into that direction?
Eleonora: Let me point it out: we are facing budget cuts everywhere. Governments are in fact heavily cutting on budgets and , regional integration is a response to the need of being more cost-effective. So the GM has also aligned with this trend.
Regional integration, however, goes much beyond cost effectiveness. It is also about building synergies, building on economies of scale, increasing coordination, harmonisation and so on. In terms of the donor's perspective (those who are financing development programmes), working at the regional level is a way also to build a multiplier effect. So with smaller budgets you are able to address issues and to cover a larger number of the countries.
From the perspective of the beneficiary countries, working at the regional level is a way of opening new opportunities for financing their development, in particular through trade and investment. In fact, regional integration is generally driven by commercial interests, so it is about creating free trade areas where countries can minimize their internal competition and maximize the complementarities, so they build a kind of a block against the outside whereby they can be more competitive in terms of exports, and of attracting private investments.
Given this background and given that the Global Mechanism is looking at recent mobilization, obviously working at the regional level is an opportunity.
Secretariat: But it seems like, Eleonora, that promoting regional integration and infrastructure in that sense is a no-brainer. It is very obvious that it should be working very well; it boosts the trade and everything. Now when it comes to us, we saw obviously why does it not happen. We know that border posts are mini-economies with interests vested and so forth, so there are struggles. What do you think is the added value to try to overcome this?
Eleonora: Well, regional integration is based on a complex dynamic.
First of all, there are two main aspects to regional integration. There is a hard ware dimension which is obviously the building of infrastructure (like roads, ports, warehouses, etc) so whatever is needed to integrate the countries, improve communications and facilitate the flow of goods across borders – physical integration.
Then there is a software component of regional integration, which consists more of creating rules, procedures and support services to facilitate the flow of goods across borders. In this case, we are talking about trade facilitation (i.e. all the procedures for clearing goods at the border), we standards, sanitary and phytosanitary measures, and trade finance.
The ability to address this complexity will depend on a change in paradigm in terms of how sustainable development (agricultural and rural development in this specific case) is going to work, and especially will depend on more cooperation between the sectors (i.e. trade and agriculture). There are so many issues around regional integration, which are very much trade specific, and there are institutions specialised in dealing with these issues outside the agriculture and rural development community. Therefore it is imperative that agriculture and trade institutions learn to work more closely together.
// JAG to strengthen position of the agriculture sector
Secretariat: That brings me to the point that you are also part of a CAADP joint action group. JAG, they are called the JAG for regional trade and infrastructure development. Maybe you can tell us a little bit about what this JAG is doing and why we need this joint action group. What is it going to do differently from other coordination mechanisms from the side of the donors we have seen before?
Eleonora: This action group on regional trade and infrastructure is an initiative led by the African Union Commission, the NEPAD Planning and Coordination Agency, and the Regional Economic Communities in the context of the CAADP framework.
The African institutions are leading this process, and a number of development partners who are members of CAADP are supporting them to consolidate this group as a platform to develop a regional integration agenda under CAADP and therefore an agenda for the creation of regional input and output markets for agriculture and food products. On one end, the JAG is trying to contribute to the African Union Action Plan for Boosting Intra-Africa Trade (APBIAT).
In fact at the continental level in Africa there is already an umbrella framework for trade development, which is the APBIAT, that goes beyond agriculture and covers all sectors of the economy .The CAADP joint action group aims to especially strengthen the position of the agriculture sector in the APBIAT, and to point out the need for strengthening intra-Africa trade of agriculture products. The JAG is also trying to promote policy dialogue to increase investment in agriculture and trade-related infrastructure, and also to support projects on regional trade, which could be regional value chain projects or public private partnerships addressing bottlenecks along the regional corridors such as, trade facilitation, standards, sanitary and phytosanitary measures and so on.
The JAG has also another value in the context of the CAADP programme, which is to strengthen the participation and the engagement of the regional economic communities. There is an on-going process for the development of regional CAADP compacts and investment plans. Through this platform of the joint action group, it is expected that the regional economic communities will also have an instrument to take the lead in the definition of the regional integration agenda under CAADP.
Secretariat: Just quickly, can you give us a rundown of what the next steps are for the Abuja meeting of the joint action group? We have talked about preparations for the ministerial meeting, the ten years of CAADP, the family farming year or agriculture year within Africa.
Eleonora: The issue of RECs' engagement remains a top priority. So the RECs need to be supported to really start driving the agenda, and define what are the priorities for the development of regional markets for agriculture and food products. There will be more attention to this issue and also Africa Union Commission and NCPA are planning some meetings with the regional economic communities on this matter.
Another important step is to try to engage more the private sector in this group. Then, obviously, also identify ways, like for example indicators, to make sure the outcomes of the work of this group will remain attached to the broader CAADP process.
// Unlocking private investments
Secretariat: I wanted to ask you a maybe unfair, critical question on that when it comes to getting investment of the private sector. My impression from having been in Africa was, and correct me if I am wrong or if my impression is not based on anything, but the real entrepreneurs are staying away from government authority quite often. They feel like this is actually what is bogging them down. And if people coming with opportunities and you have to apply for funds… It is basically bureaucracy. How do you get out of this? Maybe you can give us your personal opinion of how realistic is it to say you can unlock investment from private sector if you go through these traditional channels where the messengers are the people they are trying to stay away from.
Eleonora: I totally agree. First of all we have to say there are already initiatives attached to CAADP on engaging the private sector, basically trying to get funding from private companies to finance agricultural development.
What the joint action group aims to do is not to replicate that, but to work in synergy with these private sector initiatives to create the enabling conditions for investment. Very often, the reason why companies are not investing is because there are a number of bottlenecks, from infrastructure to the normative framework that hinder the investment. Companies need a reliable legal framework; they need to have access to credit; they need to comply with standards and rules whether they export their products regionally or internationally. Otherwise, they simply cannot sell. If they do not sell, they do not make an income, and if they don't have a revenue, the business is not profitable, so it is not sustainable.
The culture in development cooperation is different. We are the good guys, we are financing these projects for poverty reduction, but very often, at least in the past, once the projects were ending, also the benefits were fading away. This happened mainly because sustainability is very often driven by the activation of markets since it is through markets that you create incomes and revenues. This is the same for individuals, like farmers, and also for companies. If we continue to work in this culture where there is a sectoral divide, it will always be a problem for companies to be able to invest. In fact, the framing conditions for enabling these investments are not in the agriculture sector. They are not driven by the agriculture ministries or by the research institutions who are working on new types of seeds or how to optimize production. They belong to a different group of institutions, like the trade ministries (often dealing also with investment and industry), investment promotion authorities, export promotion boards, etc.
So private sector investment can become realistic only if agriculture institutions improve their cooperation with economic and trade institutions, and if countries, both donors and beneficiaries, are able to make this shift in culture.
Secretariat: Thank you very much, Eleonora!
Eleonora: Thanks to you Pascal!
// Do you want to respond to this interview?
The interview was conducted by Pascal Corbé of the Platform secretariat.