Module 1 - Ecuador: Commodity Chain Consultative Councils for Policy Formulation

Benefits and Impacts

The project financed the 2002 Ecuadorian Agricultural Census, which has provided abundant data on the agricultural sector and various commodity subsectors. As part of the process of analyzing and interpreting these data, the Ministry facilitated the formation of Consultative Councils for eleven subsectors (coffee, banana, potato, dairy, and others). Each Consultative Council is composed of producers, traders, input suppliers, exporters or processors, and key ministry officials.

 

The Councils met originally to review data from the census. The census information was a critical motivating factor in forming the councils, because it filled a void where there had been little hard data on the size and characteristics of the subsectors. Much of the census data were originally controversial, as the data conflicted with prior views and assumptions on the sector. The Councils helped to verify and interpret census information and to promote awareness and use of the data. Councils continue to meet to discuss and seek solutions to subsector problems and to represent subsector interests with the government.

 

The main contribution of the Councils has been to facilitate dialogue between the government and the various actors in the production chain (producers, marketers, processors, exporters, and importers). Use of up-to-date, reliable information has enabled these groups to agree to manage the production chains in a rational and efficient way. Agreements have been reached on milk prices and imports, maize prices, soybean imports, and various other commodities.

The major factor contributing to the success of the 14 Councils has been their ability to discuss policy options based on factual data. The formation of the Councils was not defined in the project design but was introduced later and seen as an opportunity to make better use of and to confirm the validity of census data.

 

Lessons Learned and Issues for Wider Applicability

The Councils provide a mechanism for intervening to address problems, as all participants in the subsector are represented. This broad representation in some cases enables the Council to negotiate or initiate action to address a problem, whereas the government acting alone—with its limited capacity¾would be unable to intervene effectively.

 

The Councils will continue with the active encouragement of the government, which will consider promoting the formation of Consultative Councils for other subsectors as needed. Future modifications of the Consultative Council structure will likely increase the representation of smaller farmers.

 

Consultative Councils based on commodity market chains and industry clusters would be useful in most countries as a mechanism for consultation between the public and private sectors, and between different private sector stakeholders in a commodity production and marketing chain. Linking such Councils with data from an Agricultural Census or other analytical work on a subsector may be useful to encourage participation and provide coherence for initial Council meetings.