Swisscontact South Africa

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Swisscontact South Africa
Results from the Western Cape Aquaculture
Sector ComMark Results Workshop June 12,
2009 www.swisscontact.co.za
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Swisscontact

• Fields of activities and the proportion of total
  volume
• SME development (50)
• Vocational education and training (20)
• Environmental protection (10)
• Financial Services (20)

• Founded in 1959, by representatives of the Swiss
  private sector and science
• Believes in the private sector as the engine of
  economic growth, job creation and poverty
  alleviation
• Present in 25 countries in the south and east
  with 90 projects
• Major clients Donations (15), Swiss
  Developement Cooperation(contribution 10,
  mandates 30), various clients (GTZ, ADB,
  Worldbank, IDB, DFID, etc. 41)
• Project volume in 2008 of Euro 40 Mio..

• Board of Trustees e.g. SwissRe, Hilti, Credit
  Suisse, Syngenta, Nestle, SGS, Hesta AG, Maerki
  Baumann, Economiesuisse, Unia, ETH Zurich,
  University of St. Gallen
• 28 staff in Zurich, 45 international and approx.
  400 national professionals in projects
• Pool of Senior Expert Corps (600 experts), over
  150 missions per year

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Western Cape tables strategy for fish farms

• From Business Report, April 19, 2009 - citing
  Jo-Ann Johnston, Chief Director for Trade and
  Sector Development in the Department of Economic
  Development, Western Cape
• The strategy aims at creating 44 000 jobs, from
  2200 jobs today. And it aims at growing the
  output to 90 000 tons a year from the present
  4000 tons in the country.
• There is a need to cut red tape in setting up
  fish farming operations. And the production such
  as regular stocking and feeding needs to be
  enhanced.
• Worldwide demand is 2 Mio. tons per year. South
  Africa currently produces 4000 tons/year (0.2).
  The country imports 80 to 90 of products.

But how?
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Overview
Realising the market potential through market
development a perspective beyond individual
firms
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Our Approach
Its aim is to develop capacity at the firm level
life skills beyond provision of information!
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How we do it
Aquaculture sector level
Individual projects
Enterprise level
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Embedded Services

• Services that are packaged or bundled within
  commercial transactions in a value chain. There
  is normally neither a distinct service provider
  nor a fee paid.
• Examples include design advice to a manufacturer
  from a buyer or knowledge on input use from an
  input supplier.
• Embedded services often lead to the transfer of
  technical knowhow that make a supplier
  contractor relationship more efficient, effective
  and competitive.

Challenge To reveal these services, strengthen
them and include them in business plans (and
awareness) of suppliers.
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What we offer
Generic services to suppliers
Mentoring of contractors

• Advice on
• Type and selection of suppliers
• Type of support to suppliers (embedded services)
• Brokering
• Relationship management with contractor for
  buy-in
• Transparency in relationship with suppliers in
  terms of prices and embedded services

• Organisation of enterpreneurs
• Generic business and financial literacy training
  via specialised BDS providers
• Type of communication

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How does it work Trout Farming

• Immediate results
• Import substitution e.g. Woolworths Salmon
  Trout (60 of SA production)
• BEE scores wine farm owners ? export

• Roles and responsibilities
• Technical skills transfer through Cooperative
• Life skills and business training through
  specialized trainers
• Access to dams and release of workers by vineyard

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How does it work Mussel Farming

• Roles and responsibilities
• Services from Processor to producers
• Life skills and business training through
  specialized trainers

• Immediate results
• Increased local productions
• BEE scores Access to land

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What we achieved during 2007/08 in the short
term
Jobs Income

• Trout Farming (Stellenbosch) roll out pilot
  project
• 36 groups with an average of 6 members 216
  jobs
• Permanent employment as vineyard workers
• Total sales R 2,160,000 per year
• Additional income per worker R 2750 per month
  (average)
• Potential 200 ponds in WC (1 pond per group)
• BEE score card for vineyard owners

2007/08 222 Jobs R 3,230,000 increase in
turn-over/year

• Mussel Farming (Saldanha Bay) pilot project
• 2 groups with an average of 3 members 6 jobs
• Permanent employment as mussel workers
• Turnover R 1,070,000 per year
• Additional income per worker R 4000 per month
  (average)
• Potential 30 additional groups
• BEE score card for mussel corporation

Potential Additional 1400 Jobs
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Gertruida Abrahms

• Portrait
• 43 years old, 4 children
• left school in Grade 4
• R1920 per month basic salary as a general farm
  worker
• involved in Hands-On since 2 years
• profit 1st year R 33000, profit 2nd year R
  74000
• additional income per month R 3150
• I have learnt that unless you are careful,
  calculating and respectful towards your partners
  in the business, you will fail and not make a
  profit.

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David Frieslaar

• Portrait
• 38 years old, 3 children
• left school in grade 7
• R 2000 per month basic salary as a general farm
  worker
• involved in Hands-On since 1 years
• profit last year R 56000
• additional income per month R 1850
• Reflection on fish farming has changed me
  considerably I have to take responsibility for
  my business. I am disciplined in the feeding
  process now that I see the difference in the
  growth of our fish.

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Weighing, sorting, feeding
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What is Market Development?

• Characteristics
• It is a systemic approach Instead of assisting
  the small enterprises and farmers directly, it
  tries to develop systems that ensure that the
  poor have access to services that they need on a
  sustainable basis to fight poverty.
• It is an incremental approach This requires
  evolving packages of interventions over time, in
  different service markets or group of markets to
  improve the competitiveness of a sector.

Its aim is to develop capacity in the
Aquaculture sector sector bodies, research
institutions, training institutions, service
providers, business associations.
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Who are the sector players and functions?
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What we can achieve in the medium term
Sector Development

• Trout Farming
• Hatchery management business plan to be
  developed
• Additional jobs 20
• Pre-Processing and recirculation system 20
  additional jobs

• Mussel Farming
• Processing plant 106 additional jobs

Potential Additional 200 Jobs
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Market Study ? Market Strategy
15 of respondents have heard of the word
aquaculture while 85 of respondents have never
heard of the word.

• 41 of White respondent 39 of Coloured
  respondent
• 17 of Indian and
• 2 of Black respondents have heard of the word
  aquaculture.

Sample Size 305 Margin of error 5.6
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What we achieve in the long term

• Skills and capacity transfer to local sector
  bodies
• Technical assistance and capacity building of
  sector bodies in
• Generic and technical skills transferral to
  suppliers
• Mentoring of contractors to strengthen embedded
  services
• Advice of contractors on BEE
• Veterinary services
• Quality assurance
• Research and development market access

Sustainability
Knowhow transfer to local capacity
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Some estimates on costs
Project costs per job created R 4720
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Effective BEE?

• Some arguments
• focus on empowerment of small businesses safety
  net against fronting
• real empowerment includes basic life skills and
  literacy training and requires more time than
  most mentorship programs normally allow
• support services for BEE exist, but need to be
  coordinated
• a way forward for Black Economic Empowerment in
  collaboration with bigger corporates
• pro poor economic growth includes start ups who
  have a strong need for general life skills and
  literacy

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THANK YOU VERY MUCH!