menu of policy options for coffee value chain

7/30/2019 Menu of Policy Options for Coffee Value Chain

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The following summarizes (1) possible actions that governments can take (vertical axis) that will influence (2) outputs that contribute to the

achievement of high-level objectives such as job creation, poverty reduction, increased exports (horizontal axis). Agricultural production and

related inputs are included in the Product Quality Improvement column.

Note that to actually implement some or all of the final policy actions, capacity building may be needed for targeted government institutions

implicated in strategy implementation.

Possible

Government

Actions

Outputs that Yield Achievement of Objectives

Attract

New Investment

in Coffee Value Chain

Technology Adaptation

and Innovation

in Coffee Value Chaintry

Coffee Quality

Improvement

(Fwd and Bckwd Linkages)

Increase Sales

Reform of Rules

/ Laws /

Regulations /

Policies

Maintain a conducivemacroeconomicenvironment.

Contractenforcement.

Zoning laws insecondary towns and

enterprise zones.

Foreign investmentlaws / policies.

Foreign ownershiplaws.

Competition policiesand licensing laws.

Franchising laws. Reductions in the

costs of establishing

and doing business

(including tax

incentives).

Maintain a conducivemacroeconomicenvironment.

Restrictive policies suchas local-content

requirement imposed on

foreign producers.

Intellectual propertyrights regime.

Contract enforcement. Environmental

regulations that

encourage processing of

by-products.

Land Policies, including taxingland, titling, land as collateral,and encouragement of (larger

scale) commercial farming.

Contract enforcement. Seed import laws. Sanitary/Phytosanitary laws

and regulation.

Grades/standards/packaginglaws.

Seed testing/approval/certification laws.

Environmental regulations foragro-chemical production/

storage/distribution.

Veterinary products laws andregulations.

Fertilizer trade and marketingpolicies.

Nutrition requirements.

Trade policies.

Warehousing laws. Regional

harmonization of

policies and

administrative

standards and

procedures.

Contract enforcement. Favorable exchange

rate valuation.

Transport policy. Open competition

among domestic firms,

and between domestic

and international

firms.


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Law of association. Cooperative laws. Transport policies. Environmental pollution

policies.Incentives and

Tax Policies

Tax holidays,reductions or

deferrals.

Funding for feasibilitystudies.

Incentives to attractanchor firms.

Business to businessfacilitation.

Restrictive policies suchas tariffs and bans on

imports, taxes on

exporters of raw

materials.

Provide lucrativepackages to induce

diaspora to return.

Funding for feasibilitystudies.

Fund demonstrationpilots (with exit strategy).

VAT exemptions for domestictransactions destined for

export.

Price policy Restrictive policies

such as tariffs and

bans on imports, taxes

on exporters of raw

materials.

VAT exemptions forexport.

Business to businessfacilitation.

Education /

Skills

Development

Training grants. Support university-

industry

relationships.

Support university-industry relationships.

Support education intargeted areas.

Externships / Intentionalstudent exchange / Study

tours.

Investments inmanagement or business

education.

Establish / support smallbusiness incubators.

Analysis and training onappropriate technologies

for micro and small-scale

processing.

Support university-industryrelationships.

Support education in targetedareas.

Investments inmanagement or

business education.


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Private Sector

Capacity-

building

Strengthen farmer/commodity/industry

associations.

Publicly fund research tocomplement privateR&D.

Develop industry-specificlearning and research

institutes in which to

adapt existing

technologies.

Encourage technologytransfer agreements and

joint ventures.

Supply chain managementtraining.

Management systems forcontract farming.

Agricultural extension.

Marketing extension servicesfor farmers.

Strengthen farmer/commodity/industry

associations.

Availability of high qualityinputs through technical

assistance to input distribution

companies.

HACCP and other qualitycontrol system training.

Traceability / identitypreservation training.

Publicly fund research tocomplement private R&D.

Improve market informationdissemination systems.

Improve value-chain linkages. Foster a business perspective

among producers organizations

and cooperatives.

Work with lead firms toimprove the supply chain.

Market development. Market intelligence

training.

Commercializinginnovation andtechnology.

Improve quality andstandards or product.

Improve buyer-supplier relationships.

Infrastructure

Investments

[Explore PPP

arrangements

for all

Establish free tradezones

Establish industrialzones

Establish science andtechnology parks /

Establish exportprocessing zones.

Establish science andtechnology parks /

industrial parks.

[Corridor] road and/or railconstruction, rehab/

maintenance.

Coffee Washing Stations Warehouse construction and

lease. Professionalize

Marketplacerehab/management

(domestic sales).

Establish/rehabwholesale markets.

Port rehab and


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infrastructure

investments.]

industrial parks.

Adequate access toroads, electricity and

water.

warehouse management to be

managed as a business.

Electricity construction orfortification.

Irrigation infrastructure.

Watershed managementstructures.

management.

Logistics centers. Dry port development. Port and airport

freight storage andhandling facilities and

management.

Access to

Finance

Investment credit. SME credit. Venture capital. Credit information. Catalyst (jump-start)

funds.

Co-investment funds.

Technical assistance tofinancial service firms to

develop new / improved

products that support

industry development.

Investment credit (suchas from IFC).

SME credit. Seasonal and medium-

term credit.

Royalty-based credit. Venture capital funds to

seed firms with new

technologies.

Risk management andmitigation.

Catalyst (jump-start)funds.

Co-investment funds.

Technical assistance to financialservice firms to develop new /

improved products that

support industry development.

Agricultural production credit. Warehouse receipt guarantees. Value-chain credit. Microfinance and savings

facilities.

Medium-term credit. Co-finance cooperative supply

arrangements.

Contract farming creditguarantees.

Regional tradefinancing and

clearinghouse

mechanisms.

Royalty-based credit.

Investment

Promotion

Focus efforts andknowledge on priority

(competitive) sectors.

Actively court anchorfirms.

Targeting of value-chain investments.

Develop internal and

Tailor programs tospecifically attract

innovation and

technology.

Negotiating with MNCsto maximize technology

transfer.

Facilitating acquisition

Regional trade/investment forjoint venture match-making.

Targeting of value-chaininvestments.


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external systems to

ensure that the

investor gets good

service and

response.

Demonstrateprofessionalism in

everything the IPI

does.

Fast approvals anddelegated authorities

to permit rapid

responses to investor

needs.

Quick, flexibleresponses to investor

needs.

Follow-up untilinvestor is satisfied.

Promote replicablebusiness models.

Promote licensing.

and dissemination of

technologies.

Organize activitiesaround industrial

clusters.

Targeting of value-chaininvestments.

Export

Promotion

Collect, analyze andoperationalize market

intelligence.

Feedback mechanisms. Improve buyer-supplier

information exchange.

Collect, analyze andoperationalize market

intelligence.

Market development. Branding of product

from country.

Promote exportsabroad.

Sponsor participationin International Trade

Shows as a key source

of market intelligence,


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market linkages.

Support IndustryAlliances as a means

for disseminating

market intelligence,

analysis of

opportunities and

strengthening market

linkages.

Training in sales clientrelationship

management.

Informationdissemination on

customs procedures.

Regionalharmonization of

trade policies /

procedures.

menu of policy options for coffee value chain

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