Many SDC projects in PSD take a sectoral approach, i.e. they focus on one or several sectors or value chains. The ultimate goal is to improve the income and employment situation of micro and small enterprises (MSEs) in these value chains. Often SDC targets agricultural value chains and thus farming (micro-) enterprises as final beneficiaries. However, SDC also supports income and employment opportunities in non-farm sectors, e.g. tourism, ICT, construction, etc. To achieve lasting improvements in value chains, it is crucial for SDC projects to take a systemic approach such as Market Systems Development (MSD) approach.
The Value Chain model supposes that by understanding the interactions within a value chain, it is possible for private and public agencies (including development agencies) to identify points of intervention to increase efficiency and thereby increase total generated value, and to improve the competence of intended actors to increase their share of the total generated value.
A product is rarely directly consumed at the place of its production. It is transformed, combined with other products, transported, packaged, displayed etc. until it reaches the final consumer. In this process the raw materials, intermediate products and final products are owned by various actors who are linked by trade and services, and each add value to the product. Various types of public and private services, like business development services, electricity, transport, financial services, etc., are as important as favourable framework conditions, i.e. laws, regulations and their enforcement.
In 2010 the IED network launched a series of three e-learning cycles on M4P and Value Chain Development. It focused on "planning, implementing and evaluating" projects and programs related to M4P and Value Chain Development (VCD). Find the synthesis papers here.
