Local supply chains in the developing world
are often fragmented and inefficient,
resulting in higher prices, greater losses and
less access to food for the poorest.
Millions of small and medium-sized
businesses and smallholder farmers are made
poorer by the inability to access markets
and support themselves.
In fact, most smallholder farmers produce
barely enough to feed their families.
Difficult access to credit impedes
investment and lack of insurance means that
the loss of a harvest can push entire
communities into hunger.
Poor transport links hinder trade and drive
prices up.
Every year, the World Food Programme (WFP)
spends more than US$ 2 billion in locations
where we run operations.
As a large buyer of commodities and
services, our purchasing power allows us to
strengthen markets in a way that promotes
development and resilience to shocks, while
addressing the root causes of food
insecurity.
By contracting local businesses and working
with in-country partners, WFP contributes to
more sustainable food systems, more dynamic
retail sectors, and more robust transport
networks.
Combining our demand with that of the
private sector, we create stable,
predictable outlets for
smallholder farmers,
allowing them to
access markets beyond WFP.
We support smallholdings to become viable
businesses, by connecting them with local
banks that can grant loans, and with
providers of quality seeds, equipment and
storage units to protect their harvests.
To combat stunting and malnutrition and
develop a market for nutritious food, we have assisted more than 70 small and medium enterprises
in producing safe, affordable and
nutritious products in developing
countries.
WFP’s extensive experience in moving,
handling and delivering large quantities of
goods enables it to
support local transport companies in
increasing efficiency and reducing
costs. This includes providing them with
fleet management software that offers
cargo tracking, utilization rates, fuel
consumption and other key
indicators, and training on how to use it.
Strengthening national commercial
transporters to bring them into line with
best industry standards will drive transport
costs down, too.
Working with local
retailers through its
cash-based assistance
transfers, WFP is helping make
local commercial markets more
professional and efficient. Lower costs translate into lower prices,
giving vulnerable people the possibility to
have more money to meet their basic needs.
In Jordan,
WFP’s retail engagement strategy
changed the existing contractual arrangement
and has, so far,
boosted by 8% the purchasing power of
80,000 Syrian refugees
living in the sprawling Zaatari refugee
camp. By working with the camp’s shopkeepers
to use their store’s itemized sales data,
WFP is in the process of helping them make
their supply chains more efficient (sourcing
and delivery) with a potential to
further reduce selling prices
(thus further increase purchasing power) by
another 7-9%.
