Successful Rural Finance Institutions Book

This paper provides a synthesis of notable success stories of demand-driven production, processing, and marketing of high-value foods (HVF) among developing countries. It examines in comparative perspective, the development, organization, and performance of entire commodity systems rather than the experience of individual projects or companies. It focuses on cross-cutting issues and common patterns rather than elaborating on the microeconomic and historical details of individual cases. By identifying common technical, institutional, policy, and other factors which have contributed to commodity system development and international competitiveness, the paper seeks to contribute to the design of improved strategies for supporting food market development and export diversification in developing countries and in the formerly centrally-planned economies. It identifies a series of intrinsic technical and economic characteristics of food commodities/raw materials, food production, and marketing infrastructure and services which can lead commodity system participants to experience major problems related to production and market risk, inadequate or asymmetric information, logistical bottlenecks, and high transaction costs. The paper also examines organizational patterns in the focal commodity system, including competitive structures and institutional links between producers, processors/exports, and foreign market distributors.