Making markets work in fragile settings

Oxfam OPT’s Economic Justice team shares four lessons learned from their market system development (MSD) work with small-scale farmers in the Occupied Palestinian Territory (OPT).

Israel’s occupation of the Palestinian Territory affects 4.8 million Palestinians, nearly a quarter of whom live below the poverty line. Among other threats, at least 1.9 million Palestinians experience – or are at risk of – conflict and violence, displacement and denial of access to livelihoods. There are limited opportunities for job creation and a stubbornly high unemployment rate; hitting young people and women particularly hard.

The crisis is protracted, and small-scale farmers in the OPT have limited access to resources and markets. Whilst working to address the root causes of market constraints and failures – principally the Israeli occupation and blockade – Oxfam and other organisations have been using a market system development approach to address underlying constraints in agriculture, and find sustainable ways to improve the local economy.

Two projects are currently being implemented with funding from Sweden and the Australian Government. These adopt the market system development approach by designing and implementing intervention strategies that engage market actors and various stakeholders. This approach supports entrepreneurship among producers, helps develop skills, and reduces barriers by addressing social restrictions; which creates lasting benefits for local producers.

Here are four key lessons learnt from our work in OPT, which are illustrated further in Oxfam’s Economic Justice program learning case studies:

1. Improve the capacity of local organizations to adapt to market-based roles

Transforming from service delivery to a market-based approach is a challenging process for local organizations in the OPT. It requires a fundamental shift in the organization’s structure and mandate. Changing the role of civil society organizations (CSOs) requires a measured approach that considers how to make best use of their capacities. This is done through the provision of training on the market system development approach and subsidies to facilitate interventions between the private sector and small-scale producers.

The social investment case study focuses on the experience of a civil society organization as it changed from being a service provider to becoming a facilitator of market system development interventions.

2. Identify and address key constraints in value chains

Oxfam’s interventions seek to identify key constraints in selected value chains that hinder small-scale producers’ capacity  to increase their income and improve their access to local and international markets. This is achieved by fostering partnerships between various market actors (including input suppliers, traders, agricultural extension agents, and private sector companies) in order to contribute to strengthening local market systems.

A packing house is a crucial component in the agricultural value chain. Strengthening this can provide work, and help farmers to get better prices by improving simple services like grading, packing and storage.

The packing house case study shows how small scale farmers were supported to identify gaps in the fruit and vegetable market system.

3. Empower women both socially and economically

Women who are dependent on agriculture are more vulnerable than men due to an imbalance of power in markets, lack of social acceptance in being self-employed, and limitations within accepted social norms in an unregulated, informal sector. Women face difficulties in accessing their rights and making use of resources including land and property.

Supporting women to work in small and medium enterprises (SMEs) helps develop their confidence, and attracts others to join in. Consumer awareness of women entrepreneurs can open opportunities for women in markets.

The Women’s Economic Empowerment case study describes how Oxfam’s Economic Justice projects supported women to establish small businesses. They learned new skills, including how to increase their processing capacity, and established links with the private sector to increase profits.

4. Generate opportunities for young people

Agriculture is a major sector in the Palestinian economy, but increasingly, young people are disinterested in it. With high unemployment rates, this trend has put further pressure on the local economy. One factor is that the formal education system does not provide the necessary knowledge and technical skills for young people to start their own agribusiness.

Oxfam supported young women to become entrepreneurs, by providing training in agriculture extension services. The technical training was a turning point in accessing other support and services. The youth case study shows how providing young people with opportunities improves their prospects. Traditional agriculture might not be attractive to young people, but they are certainly interested in agribusiness, which in turn boosts agricultural production and market services.

Challenges in the shift can be managed by innovative, new business models.

These case studies show how a market system development approach can work in a fragile and conflict-affected setting like OPT. CSOs and others involved need to learn new skills and adapt to different roles that are market-based and sustainable. Challenges in the shift can be managed by innovative, new business models that build capacity, use technology, strengthen local businesses and focus on women and young people.

Read the case studies written by Nabila El-Ahmed and Nada Nabris:

1. From Service Delivery to Social Investment: the shifting role of civil society
2. The Importance of Packing House Management in Vegetable and Fruit Value Chains
3. Women’s Economic Empowerment: supporting women-led business
4. Bringing Young People Into the Agricultural Sector

Oxfam OPT’s Economic Justice Program would like to thank all those who contributed to the case studies.

Author

Shekhar Anand