Development partnerships with the private sector promote innovation in the agricultural and food sector

Context

In developing countries, agricultural goods are mainly produced by smallholders. Their limited access to new knowledge, agricultural inputs and financing means they must use traditional farming methods. As a result, many countries are not fully leveraging their agricultural yield potential. 

At the same time, these smallholder enterprises’ low level of organisation and their tenuous links to stable marketing and sales structures make for serious losses along the value chain. This not only poses a challenge for the producers, but also for the companies that buy and process their products.

For this reason, Germany’s Federal Ministry for Economic Cooperation and Development (BMZ) is providing targeted support for projects designed to drive forward agricultural production in developing countries.

Objective

Innovative approaches coupled with partnerships between development cooperation actors and the private sector along agricultural value chains have the capacity to increase smallholder production and income.

Approach

Development partnerships pool the resources, know-how and capital of public and private sector partners.

Partnerships supported by the BMZ Special Initiative ‘Transformation of Agricultural and Food Systems’ are found in a range of different sectors where they target agriculturally relevant approaches. Amongst other things, they promote climate resilience in smallholder enterprises, work to reduce inequalities in the distribution of assets, resources or rights, and help make agricultural supply chains more efficient, fair and transparent.

Competitions are held regularly so that interested German, European and local enterprises can submit their project ideas. BMZ supports suitable initiatives technically and financially with up to EUR 2 million, whereby the company concerned is required to provide at least 50 per cent of the total costs.

Last update: March 2025