Innovative Mechanism for Open Agricultural Investment

Client: Asian Development Bank

Duration: 2017-2018

Location: PRC

Contract Value: USD 279,828

Catalogue: Agriculture

Project Description

This TA built on previous studies on agricultural modernization and foreign investment in the PRC, which found that the main constraints to agricultural investments were the lack of a partnership exchange platform and supporting policies. This TA built upon this previous work to study and propose pilot activities for innovative agricultural partnerships in the PRC, to stimulate agricultural investments and promote rural development. The design of the proposed TA assumed that the government was committed to pursuing the market economy approach and opening the agriculture sector to attract private investment and engage in partnerships, and therefore was willing to assess the role of the public sector as an important strategy to achieve agricultural modernization. To address the risk of limited government commitment, the TA project design included awareness raising and capacity building for government agencies to implement open investment and partnerships in agriculture.

Services Provided by NAREE

Agriculture sector diagnostic assessment – NAREE conducted a diagnostic assessment, covering (i) technical issues; (ii) legal, regulatory, and policy frameworks; (iii) institutional and capacity status; and (iv) commercial, financial, and economic issues. The diagnostic assessed the status quo and identified gaps and weaknesses in implementing agricultural partnerships. Stakeholder consultation was adopted as a key component of the diagnostic assessment.. The assessment allowed the government to evaluate its current environment for partnerships and will be the basis for determining what activities are required to promote agricultural partnerships.

Recommendations for the design and implementation of an open investment mechanism - Using the diagnostic assessment, NAREE developed a strategy to guide the direction for an investment road map. The strategy set out how proposed partnerships can help achieve sector goals and will describe the steps to be taken to prepare for and implement partnerships. The investment road map clarified the operating environment to private sector operators and the required commitment from the government. The final product will be the agricultural partnership road map.

Policy recommendations for open investment and partnerships in agriculture - NAREE assisted the creation of an enabling environment where policies and regulations are in place for supporting the implementation of the proposed open investment and partnerships . This output was an integral component of the road map and proposed recommendations for policy and regulatory requirements that would support the implementation of various partnerships to increase agricultural investments.

Awareness about and capacity to implement open investment and partnerships in agriculture - Stakeholder understanding, buy-in, and acceptance of various forms of partnerships, including PPPs, are crucial to implement partnerships successfully. NAREE organized a range of workshops to engage stakeholders, seek their input and feedback on analytical work, and introduced them to the role and benefits of various forms of agricultural partnerships. The findings of the TA research were also presented at a conference to raise awareness and build capacity, and were captured in a knowledge product report.