Mid-term Review of the Cambodia Export Diversification and Expansion Program (CEDEP II Cassava Component)

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Evaluation Plan:
2016-2018, Cambodia
Evaluation Type:
Mid Term Project
Planned End Date:
07/2017
Completion Date:
06/2017
Status:
Completed
Management Response:
Yes
Evaluation Budget(US $):
25,000

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Title Mid-term Review of the Cambodia Export Diversification and Expansion Program (CEDEP II Cassava Component)
Atlas Project Number: 00079996
Evaluation Plan: 2016-2018, Cambodia
Evaluation Type: Mid Term Project
Status: Completed
Completion Date: 06/2017
Planned End Date: 07/2017
Management Response: Yes
Focus Area:
  • 1. Poverty and MDG
  • 2. Crisis Prevention & Recovery
  • 3. Environment & Sustainable Development
  • 4. Cross-cutting Development Issue
  • 5. Others
Corporate Outcome and Output (UNDP Strategic Plan 2014-2017)
  • 1. Output 7.5 South-South and Triangular cooperation partnerships established and/or strengthened for development solutions
Evaluation Budget(US $): 25,000
Source of Funding:
Evaluation Expenditure(US $): 16,404
Joint Programme: No
Joint Evaluation: No
Evaluation Team members:
Name Title Email Nationality
Vincent Lefebvre Evaluation Consultant lefebvrevinc@gmail.com
GEF Evaluation: No
Key Stakeholders: Ministry of Commerce, Cassava associations, cassava sector stakeholders
Countries: CAMBODIA
Lessons
1.

Value chain sector support should not be limited to the production of studies and organisations of workshops: this is a first step that has to be followed-up with additional financial resources to make sure that key recommendations are actually being implemented.


2.

The private sector for cassava is very independent and less prone to cooperate with Government when investments are at stake; they lack intelligence in terms of marketing strategies and markets opportunities but once commercial openings are evidenced to them, they will be swift to react; while the domestic market was not on top of this project’s agenda, it would be worth exploring in the future (beverages in particular) given the ongoing dynamics of investments and business creation in Cambodia for the moment.


3.

With the above view in mind and the actual activities planned at formulation stage, the cassava component of CEDEP II has been very much underfunded; the assumption was that effective Core Team members relaying relevant information to committed Government staff would somehow follow-up project results.


4.

There is a lot of inertia to demand accelerated project review when external conditions make the implementation more difficult up to the point when activities’ relevance is questioned. This is most troublesome when several annual reports have been clearly identifying these issues (see as well 2.1.6).

Despite strong signals sent by the project team that rightfully identified key shortcomings of the project to the Steering Committee, the actual process to question the relevance of activities, review the project’s strategy and eventually take a decision was very slow, culminating in this evaluation (by official project’s closure date). An improved governance system should be sought – at least - by involving more Government in the daily implementation of activities and/or through another system of emergency meetings at steering committee level called upon by the project team.


5.

In technical terms, the project strategy to include all stakeholders has been highly relevant although financial resources could not follow up with all the issues at stake (which is why a pilot project – demonstrating proof of concept – might have also been a relevant project strategy given the limited funds available [< 1 million $]).


6.

As a sector characterised by its informality, sector structuring through the establishment of formal associations through a Ministry might not be the best approach; growers, in particular, lack entrepreneurial spirit and interviews have shown the lack of understanding of such organisation, its purpose and added value.

As such, more careful analysis how the sector is operating (its ‘culture’) is necessary to ensure that the right institutional mechanism is in place and accepted by the sector beneficiaries (see 2.4.1 and ‘logical framework analysis’): an alternative strategy to achieving sectoral structuring through associations could be to support champions first, then aggregated partners and finally turning these loose groups into formal associations through conditional support.


Findings
1.

Relevance and program design

The project was a direct response to the 2009 Trade SWAp policy by developing and strengthening the export capacity of priority crops that included cassava.

The cassava component of CEDEP II is funded by WTO under the EIF Tier 2 modality and implemented by UNDP under the Direct Implementation Modality in close collaboration with MoC.

The objective of the cassava component of CEDEP II was to develop products and export services through a better understanding of the cassava export sector and structuration of policy dialogue with the Government and to identify a group of cassava exporters, making them export-read for new markets.

The 2016 MTR rated the project as highly relevant in relation to the Trade SWAp and until this day, the project remained well aligned to the Trade SWAp policy. However, the cassava sector business environment has deteriorated substantially during the project’s implementation with lower selling prices on the international markets resulting in reduced competitiveness of most value chain stakeholders in relation to Thailand and Vietnam cassava value chain stakeholders and, in particular, the closure of a large number of starch plants and higher levels of indebtedness of cassava growers.

The review of the project’s logical framework showed that several indicators are not SMART and one output no longer achievable, at least as initially contemplated. Within a recently depressed cassava sector, the strategy of the project is less clear with a large number of activities, still highly relevant as such – confirmed by numerous interviews –, but lacking coherence as to how they might contribute together to the initial objective. This is obvious for some activities that are now of less importance in relation to others as viewed by the value chain stakeholders themselves.

Several initiatives are complementary to this project on cassava (funded by CIRAD on sustainable cassava agriculture, DFAT on transformation of cassava productions, JICA on research and development). So these are opportunities to build linkages between the projects.

As of today, less than 50% of the budget had been spent; this is the result of putting on hold several activities pending a reassessment of their relevance (partly through this assignment) but also of a slow implementation with many delayed activities due to difficulties in consultant’s recruitments for several TA activities.

The formulation team rightfully identified a series of risks. Their probability of occurrence was not clearly estimated at the time of the project design. It is striking to see that a majority of these issues actually took place during the course of the project, putting a severe strain on the project team. Another issue seems to have been the lack of Government support in the sector which remains largely informal and highly competitive, which was not specifically addressed at the project formulation stage.

The project’s governance system was established through a steering committee, project manager, a ‘core team’ with staff from relevant ministries, which function has been to be an interface between the project unit and the Government for seeking support, coordination, and transmitting relevant information (e.g. studies, requests for support…).


2.

Effectiveness

The level of implementation of the project activities has not been high and not up to the initial expectations. There are two reasons for this: (i) the price of the cassava on the international market (raw, dried or even as starch) has decreased substantially, evidencing serious competitiveness issues of the country in relation to neighbouring countries, resulting in some activities no longer being a priority for value chain stakeholders, and (ii) despite regular exchange of information, the project was jeopardized by a somewhat weak involvement of Government to followup the project’s results.

The results are as follows:

On Outcome 1: ‘understanding the needs of the cassava export and sector structuration for policy dialogue with Government’: a ‘working group’ of value chain stakeholders and donors, through the support of Grow Asia, has been setup and is meeting on a regular basis to discuss issues affecting the value chain; however, its interaction with the Government remains limited. A comprehensive value chain study was carried out and transmitted to Government but has yet to result in the follow-up of actions. ICS standards review has been put on hold as it happened that it is no longer a top priority for value chain stakeholders. The production of an export manual remains also on hold, pending a reassessment of what kind of product should be supported by the project (raw / dried cassava, starch, others…). Cassava associations have been created to enhance the negotiating power of the value chain stakeholders (mainly farmers and silo owners); most of them are not well established and remain institutionally weak: the sector’s stakeholders see them as Government’s initiatives and they lack capacities and leadership. Despite regular meetings through the project, a formal ‘working group under the G-PSF platform’ has yet to be created through the framework of the TRADE-SWAp so the value chain working group above can merge into it as well. Interviews showed however that Government is willing to set up such a formal working group.

On Outcome 2: identification of a group of cassava processors, support to make them export-ready and in exporting to new markets’: a group of processors and collectors was identified. While the SPS survey has been put on hold pending the review of its relevance, a survey of environmental risks and mitigation needs was carried out for the pilot group of processors.

With recent price decreases of cassava on the international market, the weaknesses of the sector have been exposed and show that Cambodia’s competitiveness is systematically lower than its neighbouring competitors because of its geographical position and lack of infrastructures. This is most obvious when cassava price decreases just at profitability level while Thailand and Vietnam resist much better to price decreases because of better cassava sector structuring. The project team became aware of this issue very quickly but still, little action ensued from the steering committee but tacitly agree on holding back on activities that might need some minor/major adjustment until the end of the project.


3.

Efficiency and partnerships

Around 40% of the budget has been spent while the project is at an end. This is normal as several activities are yet to be implemented, pending an assessment of their relevance. In addition, there are also some issues associated with already implemented activities: late delivery of studies combined with a lack of project resources to follow-up mainstreaming/key recommendations within Government or stakeholders, weak functionality of most cassava associations despite attempts to initiate activities and cooperation with some of them, functional cassava value chain stakeholders’ working group but lacking domestic leadership.

M&E has been carried out by the project team, DICO and MoC. The project team rightfully identified the key implementation issues of the project and, in particular, the changing conditions of the cassava business environment.

The periodic reports were comprehensive and included an assessment of the cassava sector. The project team created a network of contacts including most development donors involved in cassava and cooperated to implement the same activities. This has had the potential to create synergies to increase the effectiveness of interventions in the sector. Meanwhile, the project’s private sector partnerships resulted in attempts to launch contract farming but its success was limited due to price drops on the international market and the fact that there was no product differentiation.


4.

Potential impact

To enhance the project’s impact, there needs to be another project approach taking into account (i) the need to raise the sector’s competitiveness, (ii) the need for a national policy on cassava to regulate the sector ad accompany the value chain stakeholders, (iii) support production and decrease cassava dependency for a large part of the population,

(iv) investigate more in detail cassava value addition through niche marketing and the domestic market to move away from being a premier supplier of raw materials for neighbouring countries.

At project level, the social and cultural impact can be seen through the signal given by the associations: the sector is remaining largely informal and getting together for a common purpose still received caution: although some associations are willing to engage with other value chain stakeholders, most seem to lack leadership and are de facto not-operational. It is too early to evidence an economic and financial impact of the project: some activities like trade fairs, exchange visits were conducted but others like an export manual have yet to be developed. What stakeholders seem to miss most is the creation of linkages between different value chains elements (e.g. volume consolidation for traders, starch plant). The project did not target directly the institutions but at a later stage the establishment of publicprivate sector dialogue: this is on-going with the strengthening of the cassava value chain stakeholders’ ‘working group’ and periodic discussions that have yet to result in the establishment of a Government st ructure to develop a policy at a later stage.

The environmental impact of the project has yet to bear fruit with only the development of an environmental assessment/study. This seems to be no longer a top priority in the sector with the closure of some starch plants.


5.

Elements of sustainability

The key to sustainability is the need to develop a national policy/framework for the cassava sector; this is included  in the project but as an activity amongst others. With a degraded trade environment for cassava, it is important for Government to support the sector through the development of an enabling environment. Interviews showed that MoC is ready to take the lead in this process.

As for the project, the associations remain institutionally weak and dependent on external aid; they seem to lack HR leadership. The economic and financial sustainability of the sector is key to the project: so far, the activities have been able to identify the competitiveness issues of the sector. Some solutions have been proposed but they seem to be individual actions that have not been subsumed in a larger sectoral strategy that is responding to the current concerns of the value chain stakeholders.

 


6.

CONCLUSIONS

The project has partly achieved its objectives for the following reasons:

(i) The competitiveness of the sector has been gradually eroded with decreasing prices over the past three years and most stakeholders are now breaking even at best while neighbouring countries with a betterstructured sector are resisting to price drops on the global market;

(ii) The project has focused its attention on the commercialisation (trading and export) side of the sector with less attention on the production side. In this newer environment, the production side is requiring substantial support as it bears the brunt of the price drops;

(iii) Several key activities resulted in a better understanding of the sector’s strengths and weaknesses. However, few resources were allocated to follow up actions based on their findings by Government or value chain stakeholders. In a sense, the project was underfunded;

(iv) The project’s institutional setup has not been conducive enough to create yet a dynamics of Governmental support to further support the sector. This may be because there have been few incentives for Government participation under DIM but support UNDP in coordination.


Recommendations
1

Evaluation Recommendation or Issue 1: The mid-term review suggests that the project needs to request for additional time to complete all its activities as planned.

2

Evaluation Recommendation or Issue 2:

Considering that the project is going to end soon, and the project resources is limited, the MTR suggests that the project budget needs to be used wisely to target areas where matter most for the sector and that is doable under the scope of the project. 5 scenarios are provided for consideration.

 

The project focuses its interventions using the combination of some scenarios provided under the MTR (as also conclude by the MTR in the recommendation parts): 1) support the sector policy development; 2) focus on wrapping up project activities namely the support to association; and 3) support using value chain approach to enhance access to more diversified market for more diversified (higher value added) Cambodia cassava product.

3

Evaluation Recommendation or Issue 3:

An exit strategy should be based on the following principles: build stakeholders’ capacity, design at a minimum a roadmap for a cassava policy formulation process, and ensure knowledge transmission and remanence given the valuable information produced by the project, keep networking lead stakeholders.

1. Recommendation:

Evaluation Recommendation or Issue 1: The mid-term review suggests that the project needs to request for additional time to complete all its activities as planned.

Management Response: [Added: 2017/09/18] [Last Updated: 2017/11/25]

Agree

Key Actions:

Key Action Responsible DueDate Status Comments Documents
Request for project no-cost extension submitted to the donor, EIF.
[Added: 2017/11/25]
Project Team/UNDP 2017/05 Completed The request for extension was submitted to EIF and the approval of the extension up to 31 Dec 2017 received in mid May 2017.
2. Recommendation:

Evaluation Recommendation or Issue 2:

Considering that the project is going to end soon, and the project resources is limited, the MTR suggests that the project budget needs to be used wisely to target areas where matter most for the sector and that is doable under the scope of the project. 5 scenarios are provided for consideration.

 

The project focuses its interventions using the combination of some scenarios provided under the MTR (as also conclude by the MTR in the recommendation parts): 1) support the sector policy development; 2) focus on wrapping up project activities namely the support to association; and 3) support using value chain approach to enhance access to more diversified market for more diversified (higher value added) Cambodia cassava product.

Management Response: [Added: 2017/11/25]

Agree

Key Actions:

Key Action Responsible DueDate Status Comments Documents
2.1. Support the development of cassava policy - Establish the cassava working group - Support drafting the national cassava sector policy
[Added: 2017/11/25] [Last Updated: 2018/05/18]
MoC (Policy Development Unit)/ Project Team/UNDP 2017/12 Completed -- The prakas on cassava working group was issued; - The steering committee who will play role to support the policy development for the sector was formed and the first meeting was held. - A team of consultants to support the generation of technical input for sector policy development was mobilized and has been in the process of developing technical input for the sector policy. - Technical draft of cassava policy was produced in December 2017. History
2.2. Wrapping up project activities -Produce an export manual - Support on contract farming - Conduct a SPS study - Produce a market penetration strategy - Produce communication materials - Organize a cassava investment forum
[Added: 2017/11/25] [Last Updated: 2018/05/18]
Project Team/UNDP 2017/12 Completed - The export manual, SPS, contract farming model produced; - Consultants were recruited and the communication material produced; - Market penetration strategy was produced; - The concept notes and plan to organize cassava investment forum were produced and the forum took place in November 2017 with participation of farmers, processors, exporters, buyers and other key stakeholders in the Government and private sector. History
2.3. Support to enhance access to diversified market for diversified Cambodia cassava product - Identification of the potential markets for direct export of Cambodia higher value-added product (other than chip) – Native starch; - Market access strategy developed; - connection with potential buyer globally and particularly to at least one of the potential market identified established; - compendium of knowledge on the market requirements, such as SPS, of those specific markets produced, and training provided to the key project beneficiaries namely private sector, farmers association, relevant entities having responsibility to enable market access. - Follow up plan after the project end (exit strategy) will put in place and hand over the relevant initiatives/agencies.
[Added: 2017/11/25] [Last Updated: 2018/05/18]
Project Team/UNDP 2017/12 Completed - Potential markets for cassava identified and market penetration strategy developed; - Connection with buyers is initiated by bringing global/reginal buyers to meet local suppliers of Cambodia cassava through Cambodia Cassava Business and Investment Forum which was organized in November 2017; - Compendium of the knowledge product for market access and training provided to the target beneficiaries; - Exit strategy is developed and implemented. History
3. Recommendation:

Evaluation Recommendation or Issue 3:

An exit strategy should be based on the following principles: build stakeholders’ capacity, design at a minimum a roadmap for a cassava policy formulation process, and ensure knowledge transmission and remanence given the valuable information produced by the project, keep networking lead stakeholders.

Management Response: [Added: 2017/11/25]

Agree

Key Actions:

Key Action Responsible DueDate Status Comments Documents
3.1 Development of project Exit Strategy and link the relevant intervention/actions areas to the relevant agencies/entities.
[Added: 2017/11/25]
Project Team/UNDP 2017/10 Completed - The project Exit Strategy was developed , and implemented in parallel.

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