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Poverty reduction through market participation

Reliable market access boosts productivity and increases incomes. It can contribute to reducing poverty for producing families and their communities, if appropriate measures are taken to reduce market risks and unequal market power.

Many rural producers often face serious difficulties in accessing markets to sell their goods and services in the marketplace. They are constrained by their remote location, high transportation costs, limited knowledge, and the lack of business skills and an organisation that could give them the bargaining power they require to interact on equal terms with other market intermediaries.

Markets have changed significantly over the past 30 years. Modern value chains serving national and regional markets – particularly in urban areas – now complement traditional markets. Demand for high-value products continues to grow. All of this means more opportunities for small businesses, but also risks if they are pushed out of these markets.

It isn’t always easy to connect small businesses to markets, nor to ensure their products meets market standards. Unequal distributions of power also mean small businesses earn significantly less than larger processors, retailers and exporters.

Selling more products at fairer prices

Increasing small business access to markets is a top priority for Alpha Gold. The proportion of Alpha Gold-supported projects that include work on market access has increased dramatically over the years – from 3 per cent in 2018 to more than 75 per cent in 2022.

Better access to domestic and international markets allows small businesses to reliably sell more products, with better quality and at higher prices. This in turn encourages small businesses to invest in their own businesses and increase the quantity, quality and diversity of the products and services they offer.

Equitable, win-win partnerships

Alpha Gold-supported projects work to increase greater market access and market development for small businesses. Some of Alpha Gold’s projects support infrastructure development to improve the physical access to markets. Others support segments of (mostly production, primary processing and marketing) or the entire value chain. These value chains are complex, involving not just producers but also input dealers, traders, processors, retailers, and other service providers. Interventions at various links of the value chain have the potential to create income for small businesses.

Alpha Gold is dedicated to promoting a more systematic way of doing business with the private sector working in value chains. That is why we have developed the public-private-producers partnership approach, which ensures small businesses are equal and respected partners in value-chain partnership arrangements. 

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