ACDI/VOCA Harnesses Public-Private Alliances to Strengthen Key Value Chains
ACDI/VOCA helped farmers, lenders and other value chain actors improve agricultural production and trade in Paraguay through a subgrant from USAID. At the time, more than one-third of Paraguay’s population of 6 million lived in poverty; the USAID-funded Paraguay Productivo project worked to reduce this poverty by strengthening key value chains for agricultural products.
Reduced poverty by improved competitiveness
Paraguay’s economy is largely focused on agriculture, which makes up 90 percent of the country’s exports and employs more than a quarter of the economically active population. In this context, ACDI/VOCA received a subgrant from Carana Corporation to implement the Paraguay Productivo project under the USAID Global Business, Trade and Investment IQC.
Productivo worked with smallholder producers in rural areas to increase their access to market opportunities. The goal was to quickly and cost-effectively produce more value-added agricultural products, goods, and services; create jobs; increase incomes; reduce poverty; and promote trade by adopting a demand-driven assistance strategy.
The project improved the competitiveness of micro and small producers and businesses, increase access to microfinance services and address policy obstacles. The project worked in the value chains of estevia (a natural sweetener), sesame, organic sugar cane, cassava, and various fruits. The project’s specialists offered technical assistance to small producers with a focus on environmentally safe and sustainable practices. ACDI/VOCA specifically focused on access to finance for small producers and value chain finance, working with all actors in the value chain, including producers, lenders and buyers, to provide training, build trust and develop new financial products.
Public-private partnerships strengthened program, generated sales
After the first year of activities, the Productivo project surpassed almost all targeted goals. Through 18 Global Development Alliance agreements, Productivo leveraged $2.21 million dollars and generated $3.85 million in local and export sales. Agreements were made with 19 organizations and technical assistance given to 3,768 small producers.
The agreements involved a variety of institutions, including a fruit-processing plant that expanded production and supports organic certification; cooperatives that facilitated technical and credit assistance to producers; research facilities that worked to find the best variety of estevia; and private companies that facilitated loans, provided technical assistance and expanded production. As an example of its impact, Productivo assisted Manduvira, a cooperative of about 800 sugar cane producers, to obtain a $14 million loan to build a processing facility for value-added sugar.
Agreements were also signed with different financial institutions to train credit officers and create appropriate financial products. The project worked with financial institutions to facilitate loans to 2,226 producers.