Promoting Inclusive Markets and Financial Systems
SEEP would like the thank the Bill and Melinda Gates Foundation for their support of this project.
A business-enabling environment is a critical determinant of positive impacts in value chain development projects. No matter the country or sector context, support from government actors often dictates the extent to which businesses can thrive and grow or stagnate and collapse.
Supportive government relationships and services are especially important to small and micro enterprises. Yet these enterprises are often neglected in favor of “top-down” government policies that support medium and large businesses instead. As a result, smaller enterprises tend to remain informal and produce below their growth potential. Consequently, inclusive private-sector development requires government reforms that are more aware of and responsive to the needs of smaller, micro, and informal businesses throughout the market because the reforms take their perspectives into account. For organizations engaged in value chain development, understanding the role of government and ways to increase its participation and the quality of its support in such work is crucial to sustainable, positive impacts.
This paper analyzes the good practices of the four programs of the Value Initiative and identifies effective tips for engaging government in value chain development with a “bottom-up” approach. Through their work, these programs learned how to engage the government and attract the support of key government officials to aid their work and increase sustainability. As a result, from design to implementation, the pilot tests and activities of the Value Initiative programs broadly demonstrated to government actors a “proof of concept” with their successful interventions and strategies. In response, government officials recognized the value of these approaches, interventions, and activities and more actively engaged in and supported these methods.
The Value Initiative programs highlighted several challenges when engaging governments that value chain development organizations should pay greater attention to:
• Be prepared that effectively engaging government actors takes time.
• Recognize and fill gaps in knowledge and understanding between government and communities.
• Provide training or help if government actors are unfamiliar with value chain development approaches.
• Find shared priorities and incentives among market actors in the value chain.
• Introduce the mindset among government actors that the market can and should deliver public services.