Agri-business for Trade Competitiveness Project (ATC-P), branded as Katalyst which is considered as a pioneer market systems development project in Bangladesh. Over the last 15 years, the project has contributed to increase the income of poor men and women in rural and urban areas.The project has facilitated changes in services, inputs and product markets, which in turn increases the competitiveness of farmers and small enterprises. Phase 1 and Phase 2 of the project sustained from 2002-2013. The current Phase 3 started from March 2014 and continues till March 2018. Katalyst is co-funded by the Swiss Agency for Development and Cooperation (SDC), the UK Government, and the Danish International Development Agency (Danida). It is implemented by Swisscontact under the umbrella of the Ministry of Commerce, Government of Bangladesh.
M4P stands for ‘making markets work for the poor’. It is a development approach that works indirectly with local partners (including business, public associations, universities). This approach addresses key constraints of a sector, leading towards more inclusive business practices aimed at bringing about sustainable change.
Katalyst’s approach is based on the premise that enhanced private and public sector business services, coupled with an improved enabling environment, leads to more competitive enterprises, sustainable economic growth, and poverty reduction. The livelihoods of poor people depend on market systems in which they are involved as laborers, producers, entrepreneurs and consumers. Often however, the poor are systematically excluded from the markets. Katalyst uses the approach of Market Systems Development (MSD) to break this vicious cycle of poverty. MSD identifies the barriers/root causes that prevent poor people’s participation in the markets and finds innovative solutions to overcome them in partnership with the public and private sectors. It partners with wide range of private companies so as to include the poor into their business models. It benefits both - private companies and the poor. As the private companies start catering more to the needs of poor people, the poor gets involved more in the market systems and increasingly gets access to better inputs, services, knowledge and products. Empowering the poor to participate successfully in the markets thus enables the companies to increase their sales which in turn increase their income. Katalyst follows a rigorous monitoring and impact assessment system which feeds information so as to better design future interventions.
An intervention is a set of activities specifically designed to address the constraints identified by Katalyst in each sector in which it works. It aimed at improving the services needed by the sector, to support the enterprises in that sector, to increase their competitiveness and gain increased income as a result.
Katalyst works with private companies and business associations with an interest, commitment and mandate to work in a given sector. It also works with other development agencies relevant government agencies and ministries academic institutions and the media.
Katalyst identifies private sector partners and collaborates with them to ensure that they have the right incentives and capacity to increase the positive economic impact they have on the poor.
Katalyst’s focus in Phase 3 is the consolidation of its sector portfolio, the deepening and widening of its pro-poor impact, capitalisation of the knowledge and experience gained since the project began in 2002, influencing key stakeholders and improving monitoring and measurement results.
Katalyst’s direct beneficiaries are a) poor, marginal farmers and b) small and medium enterprises. However, Katalyst also has indirect beneficiaries: other farmers and enterprises that are not directly covered by one of the project interventions but that still benefit indirectly by copying or adopting the practices introduced by Katalyst to its direct beneficiaries.
The common constraints faced by Bangladeshi farmers are lack of access to quality inputs and relevant information, and inadequate links to markets and distribution channels.
Systemic change is change which happens to the existing market system (or to the people who are involved in that market system) as a result of one or a series of activities. Systemic changes instigated by Katalyst’s work are aimed at improving the market system by ‘correcting’ the functions and rules that shape businesses that involve the poor at the core of the market.
A market system is a sub-set of the wider system of a sector, where the poor are involved as entrepreneurs, workers, or consumers.
Katalyst facilitates change to the business practices of its partners to improve the market environment in order to benefit the poor. With systemic constraints addressed by Katalyst, the market system responds to the needs of the poor, enabling them to have access to opportunities that were previously unavailable to them.
Katalyst’s major achievements during Phase 2 were: Maize: Katalyst assisted in the development of contract farming of maize and introduced it in the chars and the Chittagong Hill Tracts. Farmers in these areas now have access to quality inputs and knowledge, a buy-back guarantee from the contractor, and the assurance of a fair price for their produce. Vegetable and Seed: Katalyst promoted integrated pest management technology and judicious pesticide use to vegetable farmers. Through a combination of multifaceted interventions, including research and development, Katalyst improved distribution concepts and introduced mini-packs of quality seed. These were sold in millions and mean that small farmers can now get better quality seed at an affordable price. Fish: Katalyst promoted the nationwide cultivation of high-value fish species such as tilapia, pangas and koi, and helped to strengthen links between farmers, hatcheries and input companies to improve access to quality inputs, including broodstock. Improving Local Government Services (ILGS): Katalyst initiated a public-private mechanism whereby business membership organisations identified farmer groups, voiced the farmers’ needs to government extension workers, and arranged training and other information dissemination events for farmers. Information and Communication Technology (ICT) and Media: Katalyst worked with local telecom operators to a) introduce ICT services (helplines) appropriate for farmers and small businesses, and b) increase ICT-enabled services for farmers. Katalyst also achieved a better integration of business information in Bangladesh’s print media, supported by improved and more focused training for business journalists.
From the start, Katalyst has worked to integrate women into its core rural sectors (maize, vegetable and farmed fish) through activities that encourage their engagement and advancement. In Phase 3, it has begun to do this by engaging private actors who will take the lead in focusing women in a rural context. WEE will work in selected value chains (poultry, dairy and handicrafts) to facilitate the development and promotion of appropriate service packages, distribution mechanisms and improved market access targeting women farmers and entrepreneurs.
Innovation is one of the driving forces in development. However, innovation can be expensive and at times risky, which often prevents or delays the emergence of important new ideas. That is why Katalyst has launched the Innovation Fund initiative, a grant delivery mechanism to spur and encourage innovations in Bangladesh’s agri-business sector that ultimately benefit poor farmers across Bangladesh: Targeted at a broad range of actors such as private sector companies, NGOs, associations, think-tanks and consultancy firms, the Innovation Fund is supporting new, creative solutions that will help poor farmers to realize their full potential by increasing their economic involvement in the markets.
Katalyst defines forward market as “all functions, actors and policies involved in the transfer of agro produces from the point of production to the point of consumption”. Forward market provides an essential link between the producer and the consumer. Scope of forward market begins with a decision to produce a saleable farm commodity and ends with the purchase of that commodity by the ultimate consumer. Forward Market, thus involves a diverse range of pre-and post-harvest functions e.g. assembling, grading, sorting, storage, transportation, distribution, credit support etc. Various actors and institutions involved in the agro forward market value chain include farmers, agro traders and wholesalers (e.g. arotdars, beparis, forias etc.), processors, importers, exporters, marketing cooperatives, regulated market committees and private agro procurement companies/retailers. Public policies and programs relating to the pricing, handling, and purchase and sale of farm inputs and agricultural products also fall under the purview of forward market.