One Village One Product Movementin Africa― Issues and Feasibility in Ethiopia ―JAICAF
Japan Association forInternational Collaboration ofAgriculture and Forestry

March 2008


Table of Contents

Background and Objective of the Study........................................................................... 1
Chapter I: Principles of OVOP Movement and Its Realization in Developing
Countries
1. Principles of OVOP movement and its realization in developing countries ........... 3
1) Principles of OVOP movement ............................................................................... 3
2) Variation of actual cases of OVOP movement ....................................................... 3
2. Feasibility of the OVOP movement in Africa............................................................ 51) Significance and feasibility of the OVOP movement forthe present day Africa............................................................................................. 5
2) Variation of actual cases of OVOP movement ....................................................... 6
3. Reviewing other projects similar to the OVOP movement in Africa ....................... 7
1) Millennium Village Project ..................................................................................... 7
2) Project of participatory village development in isolated areas in Zambia........... 8
4. The OVOP movement and Japan’s international cooperation in Africa- Case in Malawi - ..................................................................................................... 9
1) Commitment of Malawi Government..................................................................... 92) Extension of the OVOP movement........................................................................ 103) Points to take note of in the OVOP movement..................................................... 10
5. Assistance for marketing and quality control on the aspect ofexport promotion.........................................................................................................11
Chapter II: Agriculture and Rural Institutions in Ethiopia
1. Objective and background......................................................................................... 131) Administrative Structures of Ethiopia.................................................................. 13
2. Ethiopia’s Agricultural and Rural Development Policies and Strategies Related
to OVOP ...................................................................................................................... 13
1) From ADLI to Market-Led Agricultural Development ........................................ 142) Plan for Accelerated and Sustained Development to End Poverty
㧔PASDEP㧕 ............................................................................................................. 14
3. Agricultural Products for the Application of OVOP in Ethiopia............................. 14
4. Institutions: Micro finance and Cooperatives.......................................................... 15
1) Micro Financial Institutions (MFIs) ..................................................................... 152) Cooperatives ........................................................................................................... 163) Saving and Credit Cooperatives............................................................................ 16

5. Concluding Remarks for this Chapter: Application of OVOP Movement inEthiopia...................................................................................................................... 17
Chapter III: Issues of OVOP Movement in Ethiopia and Potentials for Japan’s
Cooperation
1. Issues of OVOP movement in Ethiopia and future orientation.............................. 18
1) Issue: Creation of “the platform of consultation” for sharing the objectives andprinciples of the “OVOP movement” ...................................................................... 18
2) Issue: To understand the total picture of information for respective
commodities by respective regions......................................................................... 193) Issue: Systematic organization of actors for promoting the OVOP movement ... 19
2. Japan’s cooperation for the OVOP movement in Ethiopia...................................... 20
1) Relationship with Japan’s country assistance program....................................... 20
2) Reviewing relationship with existing cooperation ............................................... 20
3) Reviewing relationship with other donors............................................................ 21
4) Framework and perspective of the totality of cooperation................................... 21
5) OVOP project of JICA in Ethiopia......................................................................... 226) Support from Japan for OVOP movement............................................................ 23

Annex: Presentation “One-Village One-Product Movement and Rural Development”
by Dr. Yoshiaki Nishikawa on 30 August 2007 at AU, Addis Ababa ............................ 25

Background and Objective of the Study

Development initiative was launched by the then Prime Minister Koizumi in
the WTO ministerial-level meeting held in Hong Kong in December 2005. Since
then the initiative has been promoted in the area of agriculture, forestry andfisheries by the Ministry of Agriculture, Forestry and Fisheries. A part of thisinitiative is “a project of acquisition and analysis of basic information for theassistance of developing countries”, which started in FY2006 as a 5-year-plan. Oneof the central pillars of this project is “the study on agricultural and rural
institutions”.
The objective of the study is to collect, organize and analyze basic information
on formal (public) institutions and customary practices in agriculture and rural
areas closely related with cooperation in agriculture and forestry in order to realize
effective cooperation with sub-Saharan Africa (hereafter referred to as Africa ) andthe less developed ASEAN countries. The study in FY2006 had been focused on
assessment of the extent of acceptance of the fundamental principles of “One-Village
One-Product” movement in developing countries. The study was also conducted, inparticular, in the Republic of Ghana and the Republic of Uganda where the former
has already started the said movement and the latter was likely to promote it,
focusing on the identification of regional and national characteristics as well as on
the evaluation of needs for technical assistance in these countries.

In FY2007 as

well, the same theme, “One-Village One-Product movement in Africa”, was selected
and the study was pursued focusing on issues more specific to Africa.

FederalDemocratic Republic of Ethiopia having a huge potential in agriculture was selected
as the objective country of study.
The One-Village One-Product (hereafter OVOP) movement, originated in Oita
prefecture, has been spreading world-wide, adopted not only in other parts of Japanbut also in the Kingdom of Thailand, the People’s Republic of China, Malaysia, theRepublic of the Philippines,

Mongolia, the Republic ofMalawi and so on.

Contrary to the situation in East and Southeast Asia achieving high economic
growth, the OVOP movement in Africa, where there are many of the least developed
countries (LDCs), has been fully implemented only in a few countries such as
Malawi, and thus they have limited accumulation of information on the movement.
African countries, however, have been furthering economic liberalization,
integration into global economy, democratization, decentralization of power, andefforts to reduce poverty based on Poverty Reduction Strategy Paper (PRSP) and
UN Millennium Development Goals. As a result, in those countries more interest
has been aroused in rural development for poverty reduction, in strategy forregional promotion and in development of special products for export. From theabove point of view, high possibility can be seen in introducing the OVOP movement
into more African countries. In this respect Japan is certain to play an importantrole in assisting them. Concerning the background above mentioned, this study is ofdeep significance in exploring the possibilities of the OVOP movement in Africa andin examining the means of concrete support Japan can offer.
This study is developed along the following lines; firstly, fundamental
principles and lessons of the OVOP movement were confirmed through theexamination of experiences of the movement in Japan and other Asian Countries
such as Thailand, and then applicability of the movement to Africa is considered.
Secondly, basic information was gathered and analyzed within Japan on
agricultural and rural institutions in Federal Democratic Republic of Ethiopia.
Lastly, field surveys were carried out in the country in order to collect useful
information otherwise impossible to get in Japan.

Chapter I : Principles of OVOP Movement and Its Realization in
Developing Countries

1. Principles of OVOP movement and its realization in developing countries
1) Principles of OVOP movement(1) The movement of OVOP is a sort of communal endeavors expressed in various
terms, such as “chiiki-zukuri” (regional promotion or development), “mura-okoshi”(village development) or “machi-okoshi” (municipality development), and differsfrom a simple economic development project targeting a particular sector, like thedevelopment of medium and small enterprises, that of a rural manufacturingindustry or that of an exporting industry.
(2) OVOP movement is a “movement” the principal actors of which are theinhabitants of a community, and is neither a project nor an undertaking of
top-down nature, imposed by and implemented under the auspices of external
entities like the central government or donor agencies(3) Three fundamental principles of OVOP movement are: “self-reliance andself-help”; “human resources development”; “local yet global”. Originality andingenuity on the part of a local community are its essential attributes and whatcounts most is the creation of a commodity that is unique to a particular locality
by mobilizing such originality and ingenuity and by exploiting locally available
but undeveloped resources (local resources). To speak of self-reliance and self-help
by relying on originality and ingenuity, for the international cooperation in thecontext of OVOP movement, it is essential to share the spirit of OVOP movement,
which should not be the imposition of a particular formula or a particular mode ofapproach to the problem.
(4) OVOP movement is not a simple process of fabrication of things but anobjective-oriented endeavor for the development of human resources throughfabrication of things.

2) Variation of actual cases of OVOP movement
The designation of OVOP movement is a phrase which is easy to understandand appealing as a buzzword, but it is liable to mislead. As a misunderstanding due
to the phrase “One-Product”, people often erroneously interpret the OVOP
movement as an activity of specialization in the production of a particular product.
Another common misunderstanding tends to lead people to presuppose that the
OVOP movement is the only solution for regional development, inducing them to try
to solve all the problems solely by OVOP movement.
Because actually practiced cases of OVOP movement present a relatively wide
range of variation, it is important to examine in what sense of the term the OVOP
movement has been put into practice.
(1) Actual cases designated as an OVOP movement include those undertaken on thenational level as well as those realized on the level of local government.
(2) OVOP movements in developing countries have a character that they arepracticed more as an undertaking or a project of a central government than as amovement of local people.
(3) Basic principles of OVOP movement advocate the human resources development,
where the creation of products is only a motive for that purpose, so to speak.
However, as a matter of fact, the majority of OVOP movements in developing
countries have a character more oriented to the creation of products.
In view of the above-mentioned characteristics of OVOP movements
proliferating all over the world, in the implementation of an OVOP movement ascooperation for development, it is needed to establish a common understanding
among actors concerned about the movement objective that will have to be definedin advance by stating in clear terms what kind of movement shall be promoted.
However, on the other hand, it could be also noted that there would be more
opportunities of drawing on originality, ingenuity and diversity of the local
community, if a wider range of choices is offered by positively appreciating suchvariation of concepts and reality, rather than to impose a particular type of the
movement by defining it narrowly in fixed terms.
While the OVOP movement is one having the inhabitants of a local community(including organizations of inhabitants) as principal actors, it is needless to say thatit does not signify that they are left alone to act on their own or independently, but
the movement evolves in partnership with other actors as well.

2. Feasibility of the OVOP movement in Africa
1) Significance and feasibility of the OVOP movement for the present day Africa
In the past 15 years, the political and economic circumstances surrounding
Africa have undergone a great change. Firstly, as a result of policies of economic
liberalization in Africa, it has begun to take a course to reintegrate into the global
economy. In NEPAD as well, the orientation toward the integration into
globalization is clearly stated. It can hardly be said that the policies of structuraladjustment and economic liberalization have brought about an economic growthwith a broad base and export expansion to Africa. The OVOP movement, if it isfirmly interwoven in rural development and local community, hides potentials tocontribute to the realization of pro-poor economic growth with a broad base. Only, it
is necessary to take heed to the fact that the globalization by nature has two facets,
offering opportunities on one hand and imposing threats on the other.
The second aspect of recent change of circumstances about Africa is the
emergence of importance of regional development or regional economic development.
In African countries as well, the cases where local inhabitants themselves embark
voluntarily on regional development are on the increase. In this sense, it can be said
that the present day Africa offers a good opportunity for the OVOP movement to be
accepted and to develop.
In present day Africa, the OVOP movement is considered to have thesignificance enumerated as follows:(1) It is precisely relevant to the priority issue on the part of Africa, reduction ofpoverty. Comprising elements needed for rural developments, the OVOP
movement can be expected to contribute greatly, in particular, to the poverty
reduction in rural areas.
(2) The trend of decentralization is lately taking root also in Africa, and finallyconditions are getting ready for regional development. By focusing on theregional development in rural sector, the OVOP movement is likely to provide a
motive force to strengthen the part that has traditionally been a weak link in
Africa.
(3) The significance of the promotion of products creation and economic growth in aregion that the OVOP movement will bring about. Until quite recently in Africa,
there has been a tendency that the efforts for poverty reduction are mainly
focused on the aspect of social development, with a relatively lower priority
being given to the efforts for economic development.

(4) The OVOP movement is likely to contribute to the expansion and thediversification of exports. Only, as mentioned previously, it is needed to takenote of the fact that the effect of globalization on rural sector in Africa has
positive as well as negative facets.
(5) The OVOP movement is also likely to be able to contribute to the elimination ofgender inequality. The consideration to gender issue is indispensable also in thedevelopment of Africa, being a cross-sectoral subject requiring solution. The
prospect that the OVOP movement will lead to augmentation of income,enhancement of capability and organization formation for women has greatsignificance.
(6) OVOP movement as a solution for the issue of rural youths. In the present day
Africa, young people account for the majority of population. Particularly in rural
areas, however, the opportunities of employment and earning income for young
people in rural areas are not offered sufficiently. The OVOP movement, throughits contribution to development of regional economy and human resources
development, will provide the opportunities of employment and earning income
as well as the knowledge and technical skills to young people in rural areas.

2) Points to take note of in developing the OVOP movement in Africa
In the preceding section, the significance that the OVOP movement holds for
Africa was summarized from the viewpoint of its potentials there. In reality, there
could be certain cases where the movement cannot produce intended effects owing
to the conditions which are generally and particularly found in Africa. The OVOP
movement is not an all-purpose cure for regional development or for ruraldevelopment. Least of all, it is not a magic wand for export expansion. In order tomake each of the efforts succeed, the only sure alternative is to combine themovement ingeniously with other policies or projects.
(1) In Africa, the reality of poverty is widely spread and grave, and the level ofindustrial development is low. The diversification of rural economy, the progressof rural industry and the development of signature agricultural products arealso still limited in extent. With a low rate of school enrollment, short average
expectation of life, a high rate of infection with HIV/AIDS or othercommunicable diseases, the situation could be summarized as that theprerequisites for economic development are still not sufficiently in place.

(2) Since the tradition that any region or any locality, as a principal acting entity,
takes the initiative in an attempt to develop the region is almost nonexistent in
Africa, both local inhabitants and local government officials lack the experienceand the competence in this regard.
(3) InAfrica,economic

infrastructure

including

that

for

transportorcommunication is still underdeveloped. The situation presents constraints forthe market-oriented production, whether it aims at domestic market or atinternational market.
In view of the abovementioned 3 aspects of constraint, it should be understoodthat, in Africa, even if the OVOP movement is introduced, the undertaking alone
will not always assure successful results in a short term perspective. Consequently,
in the international cooperation for introducing the OVOP movement, it isnecessary to have a long term outlook in undertaking it.
In African countries, international organizations and donor countries from theWest have a strong influence on the framework of development or assistance. In
order to introduce as assistance into such an established structure a new andunique concept or mechanism derived from experiences in Japan or Asia, such as
the OVOP movement, it is needed to find a suitable place to fit into within thedevelopment plan and the framework of foreign aid of the concerned country.

3. Reviewing other projects similar to the OVOP movement in Africa
This section is devoted to discuss other projects which are similar to the OVOP
movement and have been implemented in the past, in order to further clarify theprinciples and significance of the OVOP movement.
1) Millennium Village Project(1) What is Millennium Village Project?
Millennium Village Project (MVP) is an undertaking being implemented byinternational organizations and other agencies in order to alleviate the poverty
situation in Africa that has attracted much attention and in which Japan also has
been participating through financial assistance by the Government and donation ofmaterials by private enterprises. On the other hand, as to the relevance of the
project, questions have been raised about its broad applicability in the framework ofdevelopment

policieswhich

promotehuman

resourcesdevelopment

anddecentralization, because the MVP is a simple extension of the conventional gap

approach.
The MVP is a project that is being implemented in many parts of Africa withthe goal that by 2015 the extreme poverty in destitute villages shall be eliminatedand the villages capable of autonomous development shall be created, through theinvestment in health services, food production, education, access to clean water andconstruction of basic infrastructure.
(2) Evaluation of the MVP and its relationship with OVOP.
When the OVOP movement is to be promoted in Africa, it is desirable toidentify clearly the difference in contents and the concept about the developmental
intervention between such an internationally well recognized project and the OVOP,
and also to define the objective and the relevance of Japan’s projected cooperation
associated with the OVOP movement.
The way of development pursued by such a project as MVP where the inputs
from outside constitute the main element is, before the sustainability of financing isquestioned, contradictory to its own advocacy of bottom-up approach, throwing aninevitable doubt about its sustainability.

As for the “Campaign” approach it adopts,

too, although the approach works with ease on a pilot scale, it is criticized for thelack of universality.

The OVOP movement is also a campaign but of a different

nature, where efforts are focused on the creation of specialty products and culturethat will make frontal faces of respective regions, while exploiting fully the local
characteristics and resources with originality and ingenuity. Consequently, Japan’s
cooperation could draw on these features of the OVOP movement to make scale-upof the scope of MVP based on “Campaign” approach, to transform it into a modelwith expanded attributes of sounder sustainability and broader dimensions. By
introducing the mechanism of collaboration between local inhabitants and public
administration in the original OVOP movement in Oita Prefecture, throughpractices of concrete cases, it would be possible to overcome the problems of the“Campaign” approach.
2) Project of participatory village development in isolated areas in Zambia
A project implemented in Zambia by Japan International Cooperation Agency,
JICA, Project of Participatory Village Development in Isolated Areas (PaViDIA), is
one that aims at capacity building of inhabitants in rural areas and empowerment
of organizations supporting them, engaging in activities associated with the ruraldevelopment by participatory approach and the extension of sustainable agriculture,to establish a model integrating those elements and to make the model take root in
Zambia. Although the project has not necessarily adopted expressly the approach of
the OVOP movement, its contents are considered to have many elements which arecommon with those of the OVOP movement. Particularly its stated objective,“Through their activities of facilitation of the micro-projects, extension agents
improve their skills for identifying farmers’ problems, for excavating excellent
extension information and for transmitting them; through the process in which
farmers plan and implement the micro-projects on their own initiatives, andexperience directly the effect, they acquire the capacity to activate community
activities afterward”, conforms to the objective of human resources development for
the administration personnel as well as for farmers, advocated in the OVOP
movement.

4. The OVOP movement and Japan’s international cooperation in Africa - Case in
Malawi 
Exchange between Malawi and Oita Prefecture through the OVOP movement
started since the 1990s. In 2003, then President Bakili Muluzi who visited Japan at
the occasion of TICAD-III visited Oita and decided to introduce the OVOP
movement into Malawi. Incumbent President Bingu wa Mutharika who succeeded
the ex-president Muluzi instructed to further promote the OVOP movement,
transferred the jurisdictional authority to the Ministry of Local Government and
Rural Development, and decided to improve and strengthen the system forpromoting the movement.

As a form to assist the Malawi Government in its efforts

for the OVOP movement, JICA initiated in October 2005 the technical cooperation
project: “Project for institutional building and human resources development for
OVOP movement in Malawi”, in which until now a number of experts, JOCV
members, and senior overseas volunteers have been dispatched to Malawi, andseveral Malawian trainees have been accepted to participate in training in Japan.
1) Commitment of Malawi Government(1) Budget allocation and establishment of the secretariat system
The budget for the secretariat of OVOP has been appropriated relatively
amply from the beginning. The number of personnel of the secretariat has grown to
10 currently, indicating that a certain level of structure is being formed as a parent
body of the movement.
(2) Collaboration with related organizations
Since the secretariat of OVOP is an organization on the national levelcommitted to the promotion of the OVOP movement, it is expected that otherexternal organizations would draw on its resources for engaging in respectiveactivities.
(3) Collaboration with local governments
In the undertaking of the OVOP movement, each one of extension agents is
expected to play the role of promoting the movement in his or her daily activities. A
training program has been implemented continuously for these extension agents,
and as of December 2007, the program had so far received the extension agents fromall the districts of Malawi.
2) Extension of the OVOP movement
In order to facilitate the extension of the OVOP movement, the humanresources development for OVOP groups (technical training), the certification of
OVOP groups, and the enlargement of the market (presentation in exhibitions,promotion of sales to supermarkets, etc.) have been carried out.
3) Points to take note of in the OVOP movement
Following points can be indicated from the experience in Malawi.
(1) Necessity of the driving force behind the movement
Although in the initial phase of the OVOP movement in Malawi, it wasapproached, in a way, from the political perspective, the role of former President
was significantly large from the viewpoint of publicity of the movement.

It would

be worthwhile to take note of the fact that the presence of such an influential leader
makes a great difference in its dimensions of expanse.
(2) Creation of mechanism to reward those who endeavor
In the certification of groups of the OVOP movement, care has been taken to
create a mechanism to assure the subsequent sustainability by establishing suchselection criteria as those in which groups having been engaged in activities on
their own initiatives, or groups owning reserves of capital (monetary asset) of acertain amount are to be certified, so that the groups with spirit of commitment may
be selected.

In the cooperation of JICA as well, the approach was elaborated by notselecting in advance a specific region and a specific product and instead byproviding assistance in collaboration with the secretariat to active groups, and thus
avoiding the situation that the donor had to play the main role in activities(3) Utilization of existing organizations
In considering the strategy for industrial development in Africa, it isimportant, from the viewpoint of sustainability, to make effective use of existingorganizations, rather than to create a new organization starting from scratch. In
Malawi also, there are already present a multitude of organizations of microfinance,technical assistance, etc, and hence, in undertaking the OVOP movement, thenecessity to take the trouble to create from scratch a new organization independent
from these organizations is insignificant. The secretariat of OVOP, driving force andfacilitator of the movement, makes it a basic principle to concentrate its resourceson the activation of existing organizations.

5. Assistance for marketing and quality control on the aspect of export promotion
As the factors that lie behind the accelerated interest in “the OVOP movement
as a development policy” in developing countries, one can point out the technologicalchanges of extension of ICT and reduction of transportation cost as well as the socialchanges such as the heightened awareness toward environment and theaugmentation of social responsibilities of enterprises.
In considering the differences and similarities between the approaches ofWestern donors and the aspect of export promotion with OVOP, Fair Trade andMillennium Village Project (MVP) are worth noting. While Fair Trade is amovement on the part of consumers and villagers of production countries opposing
the monopoly by multinational enterprises, it still contains, at the same time, thepotential of leading to the collaboration among the three parties, providing a lesson
to the OVOP movement, too. As for the MVP, while it is different from the OVOP inthat it is a comprehensive approach incorporating elements of education, healthcare and ICT, it has the methodology of assistance based on regional economy incommon with the OVOP movement, and hence leaves a room for futurecollaboration with it.
As the organizations that are capable of engaging in export business incollaboration with the OVOP movement, foreign-financed private enterprises,
NGOs, etc and indigenous organizations such as agricultural cooperatives,
Chambers of Commerce, etc, are supposed to be eligible.

In the OVOP movement,

it is important to find an already existing organization that can be utilized and to
make effective use of it, rather than to create a totally new one for the purpose.
As for the matter related to the possibility of assistance on the aspect of“quality control” in the OVOP movement, the approach, “Value Chain Analysis(VCA)” pursued extensively by Western donors is important. Particularly in EU, as
imports of agricultural products from Africa increase, the approach has been
expanded as Global VCA.

In the future, the effort to explore the collaboration

between the Global VCA and the OVOP movement would prove to be greatlybeneficial to both parties, since it will make available the strong features of Japan
to complement those of VCA.
Recently, the strategy of regional development through “adding high value” toagricultural products, called “Brand Agriculture”, is rapidly extending. This is aconcept in which the requirement of quality control is extended to production areas,
special features, local characteristics and individuality of the raw materials.

The

OVOP movement can be said to be the ideal mechanism to promote Brand
Agriculture as a “movement” to link consumers and producers together.

Chapter II: Agriculture and Rural Institutions in Ethiopia

1. Objective and background
Objective of this chapter is to examine the policy and strategy related to theapplication of OVOP movement in Ethiopia which aims at the improvement of livesof people in general, and smallholder farmers in particular, of Federal Democratic
Republic of Ethiopia (FDRE).
In examining various conditions related to “One-Village-One-Product”
movement in Ethiopia, we made extensive reviews of policy documents and strategy
papers in order to elicit information on the production, processing and marketing ofagricultural products. In this chapter we make reviews on the policies on
agriculture and rural development in Ethiopia, based on the information acquired
through interviews and documents conducted and obtained at the Ministry ofAgricultural and Rural Development, the Association of Ethiopian MicrofinanceInstitutions (AEMFIs) and Oromia National Regional State’s Commission for theDevelopment and Promotion of Cooperatives.
1) Administrative Structures of Ethiopia
Ethiopia has a federal structure of government since 1991 change ofgovernment. Currently nine National Regional States (formed on ethno-linguistic
basis) and two self-governing cities constitute the (FDRE). These National Regional
States are administratively sub-divided into Zones, and districts (woreda inAmharic). The lowest level of administrative unit is called kebele, also called
Peasant Associations (PAs). Although there has been significant decentralization, atleast in theory, the regional states and levels of administration below them areheavily dependant on the policies and strategies prepared by the federal
government.

2. Ethiopia’s Agricultural and Rural Development Policies and Strategies Related
to OVOP
Agriculture is a pivotal sector of the Ethiopian Economy. The sector accounts
for about 50 per cent of the GDP, 65 per cent of total exports and 80-85 per cent of
all employments.

1) From ADLI to Market-Led Agricultural Development
The present government of Ethiopia came to power in 1991 by overthrowing
the former military government that ruled the country under the banner ofsocialism (1974-1991). Shortly after it came to power the new government initiatedanagricultural

and

rural

development

policyknown

asAgricultural

Development-Led Industrialization (ADLI). It aimed at the development of both
agricultural and industrial sectors, to pull the country out of decades long command
economy and a chronic food shortage it faced. The specific objective of ADLI was toenhance the productivity of small farmers and to improve food security both in therural and urban areas.
Although this policy resulted in significant increase in production of cereal
crops, it came with some unintended consequences that the prices of agricultural
products significantly fell in the local markets. This has served the government
with lessons to focus not only on increasing production but also to seriously consider
the market side of the equation. Commercialization of agricultural products now
occupies a central part of agricultural and rural development policies, having beensummarized as Market-Led Agricultural Development (MALD). The success of
MLAD requires: market analysis; support of smallholder farmers; provision ofmarket price information; improvement of agricultural marketing system (system oflabeling quality, communication of market information, strengthening andexpanding cooperative societies).
2) Plan for Accelerated and Sustained Development to End Poverty㧔PASDEP㧕PASDEP is a policy and strategy document issued by MARD in 2006. The
major objective of PASDEP is the transformation of smallholder agriculture fromsubsistence to market-oriented one. The document emphasizes on promoting area
specialization in agricultural production based on the agro-ecological diversity of
the country. It aims at identifying different potential areas for the production ofmarket-demanded products. PASDEP has identified agricultural products with highpotential for export trade, including coffee, oil seeds, live animals, cotton, pulses,
etc.

3. Agricultural Products for the Application of OVOP in Ethiopia

Ethiopian government has identified high-valued agricultural products
demanded by the market in order to accelerate the market-oriented agriculturaldevelopment. Ethiopian Home Gardens Project is a project that is suitable for theeffort for promoting the production and marketing of locally grown agricultural
products. The aim of the project is to establish institutional, legal and promotional
structure for introducing an approach called Geographical Indications (GI). We
found the work of the Ethiopian Home Garden Project informative that need to be
replicated in attempts to encourage market-oriented agricultural products.
Encouraging and supporting the production of the products should only come after
sustainable and reliable markets for the identified important agricultural products
are identified.

4. Institutions: Micro finance and Cooperatives
1) Micro Financial Institutions (MFIs)
Rural MFIs have been considered by the government as major tools to promotemarket-oriented agricultural development. It is apparent that the rural poor haveno access to formal financial institutions such as commercial banks, which aremainly confined in urban areas. The national development strategy of Ethiopia
gives much attention to the provision of micro financial services to rural areas withthe purpose of providing smallholders with access to farm inputs such as fertilizer,
improved seeds and productive tools.
The development of MFIs in Ethiopia is a recent phenomenon. The
government issued the legal framework for the development of MFIs in 1996.
However, the sector is growing rapidly. The number of clients, volume of loan
portfolio and saving increased by 263 %, 479 % and 206 % respectively between
2001 and 2005.
(1) Ownership Structure of MFIs in Ethiopia
NGOs, the Ethiopian government and international donors have contributed
to the emergence and expansion of micro-credit services in the rural areas since
1970s. Still, NGOs and regional governments are important stakeholders in most of
the existing MFIs in the country.
(2) Limitation in MFIs Services
Though a significant growth has been observed in the development of MFIs in
Ethiopia, their service coverage is very limited. The majority of the rural poor do nothave access to formal financial sources such as commercial banks, MFIs andcooperatives. There are other informal sources including individual moneylenders,
traders, friends and relatives. The share of informal financial sources in theprovision of micro credit is very significant, which covered 69 % in terms of numberof borrowers and 61 % in terms of loan size.
2) Cooperatives
The history of cooperatives in Ethiopia goes back to the 1960s. The
development of cooperatives was relatively faster in the period of the military
government (1975-1991). There were four types of cooperatives namely producers’
cooperatives, service cooperatives, saving and credit cooperatives and housing
cooperatives. However, most of the cooperatives of that period were disintegrated
when the government came to an end in 1991. This was a good indication that theformation of cooperatives during the military regime was not based on the free will
and consent of the people.
The current government of Ethiopia has placed much emphasis on thedevelopment of cooperative societies. In 1994, the government issued a cooperativelaw, Proclamation No. 85/1994, and in 2002, the government established theFederal Cooperative Commission (presently re-named as Federal Cooperative
Agency-FGC), under the auspices of the Ministry of Agriculture and Rural
Development (MARD). The major idea here is that cooperatives play an importantrole in facilitating input and output marketing and in the provision of financial
services to rural smallholders.
 The government has an ambitious target in relation to the development ofcooperatives, intending to provide 70% of the country’s population with access tocooperative services at the end of the five-year’s plan (2006-2010).
3) Saving and Credit Cooperatives
Saving and credit cooperatives (SACCOs) are among the various types ofcooperative societies flourishing in the country. In 2004 there were 2,146 SACCOs
with 155,120 members, and this figure was almost doubled in 2006 by 5,437
SACCOs with 381,212 members.
Rural SACCOs are small in number. 72% of the SACCOs in 2003 were found in
Addis Ababa. Rural SACCOs provide different services to rural smallholders,
including mainly loans provision, marketing activities, input goods distribution.
SACCOs have faced numerous constraints such as lack of the required skill andeducation of members; weak coverage in their service provision, etc.

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5. Concluding Remarks for this Chapter: Application of OVOP Movement inEthiopia
The exiting agricultural and rural developments policies, strategies andinstitutions are favorable for market oriented agricultural production. The policies
aim at working on selecting, encouraging and supporting smallholder farmers to
produce high value and market-demanded agricultural products. The current
approach to identify local products of specialty, as has been demonstrated by Home
Gardens of Ethiopia Project, is encouraging. However, identification of more local
products of commercial value is needed.
The work on building farmers’ capacity through training can be done throughFarmers’ Training Centers (FTCs). The government has planned to open one FTC ineach PA all over the country by the year 2010. This would create convenientsituation to promote human resource development and to encourage local
knowledge and self-reliance.
There are a number of potential agricultural products of commercial value inOromia Regional State. Some cooperatives have already achieved great successes inexporting them or presenting their products to the local markets. Enhancing thecapacity these cooperatives or cooperative unions, particularly in technical aspect,
in order to make them successful in the area of their “specialization” would be one
possible way of introducing the OVOP movement in Ethiopia. Nevertheless, further
studies of selected primary cooperative or cooperative unions that would be selected
for such a purpose is needed. The application of OVOP movement may consider
capacity building of SACCOs leaders and members so that they will becomecompetent and profitable in a sustainable fashion. OVOP movement may facilitate
agricultural development in Ethiopia and support smallholder farmers byfacilitating market opportunities and by creating market links between cooperative
societies and buyers in Japan and other Asian countries.
Encouraging MFIs, particularly promoting the share of individuals in them,
can also be considered as a way of promoting production and marketing ofagricultural products.
The technology of processing or semi-processing of agricultural products is yet
to be effectively and successfully developed, which has limited the potential benefit
farmers would have received from their product. Assisting the establishment ofefficient systems of packaging, storage or preservation technologies, in theframework of the existing primary cooperatives or cooperative unions, for fruits andvegetables and dairy products, and suitable means of transporting the products
from their origin to destination would be a way of promoting and applying OVOP
movement in Ethiopia.

Chapter III : Issues of OVOP Movement in Ethiopia andPotentials for Japan’s Cooperation

1. Issues of OVOP movement in Ethiopia and future orientation
The following sections are devoted for discussing what sorts of issues can beconsidered in the development of OVOP movement in Ethiopia, if the examination
is focused on the promotion of movement mainly through the assistance activities ofa public entity that is the Government.
1) Issue: Creation of “the platform of consultation” for sharing the objectives andprinciples of the “OVOP movement”
 In Ethiopia, as a result of a long period of imperial and military- socialist rules,
the situation that the authoritative structure of decision making of “top-down”
system pervades the society throughout the country is a national characteristic. In
order to promote a pilot development driven principally by local initiatives undersuch a social structure, by drawing on particularly the specific characteristics of
local inhabitants and local governments, it makes an important issue to create a“platform of consultation” on which the actors involved in the movement of OVOP
can talk to share well the objectives and principles of the movement andperiodically to review and verify the proceedings of it.

For the purpose of sharing

or unifying the understanding of the matter, following points would make up the
subjects of discussion.
(1) Is the OVOP movement “market-economy-oriented type of movement or a“government-assisted” type of movement?
From the viewpoints of Western donors who consider the priority ofmarket-economy and small government as the basis of cooperation, the OVOP
movement would rather be looked at as a government-assisted type of aid project. It
is needed to understand the fundamental concept that the prerequisite of OVOP
movement is the originality and ingenuity and self-help of local inhabitants and thegovernment simply supports the effort, and also to demarcate clearly the roles
played by the government and local inhabitants.
(2) Coherence between the extent of government assistance and the principle of“Self-help and independence, originality and ingenuity”
In Ethiopia, it is anticipated that the sharing of principle and spirit of“self-help and independence, originality and ingenuity” would be difficult.

Therefore, it will make a challenge to foster a cadre of such decision makers as those
who can propose practical solution workable in Ethiopia, by provision of training inJapan in which trainees are able to learn about the function and role of local
administration and the actual cases of regional development, while learning
through actual experience the principles of the OVOP movement.
(3)

Positioning of certification of specialty productsWestern donors show a great interest in the guarantee of quality, and theinstitutionalization of the standard of certification. The guarantee of quality andthe improvement of quality are essential issues also in the undertaking of the
OVOP movement, and the intensification of awareness of quality should be includedin the objectives to be pursued in the movement.
(4) Relationship with credit schemes
There is a risk that the OVOP movement is perceived in a dwarfed view as acredit scheme provided by the government. Particularly, it should be taken note ofthat a low interest credit scheme with implications of subsidies is to be criticized.
(5) Criteria of achievement of the OVOP movement
It is needed to define clearly the criteria to represent the achievement inrelation to the objectives of the OVOP movement.
2) Issue: To understand the total picture of information for respective commodities
by respective regions through observations on the trend of formation of existingproduction areas
The efforts to identify products specific to a region or to identify those withproperties suited to marketing can be considered as cases to refer to. The
identification of competitive agricultural products can be counted as a necessary
prerequisite in the assessment of aptitude for marketing on international anddomestic markets. Floriculture is a case of formation of a production area induced
by international markets, in which the reality is that small-scale farmers can ill
afford to finance the initial investment on their own, and that besides they cannot
cope with the requirements for the quality control that the international markets
demand.
3) Issue: Systematic organization of actors for promoting the OVOP movement
As issues concerning the formation of organizations of actors, following
matters can be cited: (1) Human resources development to promote the systematic
understanding of the OVOP movement; (2) Building a structure of consultation
within Ethiopia; (3) Human resources development to foster actors to facilitate thecomplete understanding of the concept of quality control; (4) Effective utilization ofexisting financing institutions; (5) Systematization of control of shipping formarkets in the context of quality control; (6) Systematization of the mechanism andopportunities to verify the current situation of production, shipping, or
improvement of income.

2. Japan’s cooperation for the OVOP movement in Ethiopia
1) Relationship with Japan’s country assistance program
The coherence of support programs associated with the OVOP movement
within the framework of Japan’s country assistance program plan is an importantfactor in advancing the cooperation. In the country assistance program plan for
Ethiopia (tentative) being formulated currently, the establishment of food security
is held up as a major objective and following 5 areas have been set out as priority
sectors: agriculture and rural development; control of daily life water; education;
health; socio-economic infrastructure. The thrust of the OVOP movement is
positioned, among these 5 sectors of priority, in the “agriculture and ruraldevelopment”. What is referred to as rural development is a comprehensive
commitment comprising, in addition to agriculture, diverse measures to improve
livelihood which include the empowerment of food processing and distribution
systems of agricultural products, and support for entrepreneurs by exploiting
micro-financing and other resources. What the country assistance program plan
implies is that, in order to realize the food security also, viewpoints of various
measures such as the diversification of income sources in rural areas, the creation ofadded value other than primary products, and the improvement of market access byfacilitating the distribution of products, are important. Accordingly, the OVOP
movement is positioned in this context.
Japan’s assistance program has been formulated conforming to the PASDEP,
secondary poverty reduction plan of Ethiopia. PASDEP is focused on the poverty
reduction by economic growth through private sector development, export
promotion and tourism development. If the political system and the economic
situation stand as they are, the trend aiming at poverty reduction through economic
growth is predicted to intensify further, and the importance of the OVOP movement
is expected to increase.
2) Reviewing relationship with existing cooperation
Under the circumstances that the ODA budget of Japan has been cut back byabout 20 % in the past 5 years, and the budget of JICA also has been cut back morethan 8 %, and the expenditure for the cooperation with Ethiopia has not increased
any significantly, it is important, for making OVOP movement generate impact, tobuild strategic collaborative relationship with existing cooperation projects, rather
than investing anew on a large-scale. Moreover, for the activities on the level ofrural communities, it is also an important factor to collaborate with JOCV members
who are working in the provinces, irrespective whether they are specialized inagriculture or rural development or not.

On this account, it is desirable to initiatethem into the sprit of OVOP movement and to ask them to contribute ideas for the
movement.
3) Reviewing relationship with other donors
Donors of bilateral cooperation and international organizations are conducting
their aid programs by coordinating them, organizing the Donor Assistant Group(DAG) which coordinates the totality of assistance and the Technical Working
Group which coordinates the assistance of respective sectors. In the sector of ruraldevelopment, a TWG called “Rural Economic Development and Food Security(RED&FS)” has been organized. In advancing the cooperation, it is essential toshare the information in the RED&FS to obtain comments of other donors.
Moreover, among TWGs, there is one called “Private Sector Development and Trade(PSD&T)”.

In advancing the OVOP movement, it is needed to share theinformation with both Groups, in order to obtain the acknowledgement of the
movement and to show the synergic effect through interaction with the assistanceby other donors.
Donors of EU have been expanding the financial type of assistance, andmoreover, in comparison with Japan, they are rapidly increasing the volume ofassistance. Under such circumstances, the implementation of Japanese assistanceprojects in coordination with that of other donors will lead to the maximization of
their impact. The project type of assistance, owing to its scale, is focused on theformation of a pilot model, for the scale-up of which the financial resources from thebeneficiary country and other donors are essential. Consequently, it will become
important to establish coherence with the mechanism of budget implementation in
the provinces, while maintaining the coordination with other donors.
4) Framework and perspective of the totality of cooperation
It is important not only to implement the OVOP movement while maintaining
the coherence with the general assistance policy and existing cooperation programsof Japan and in coordination with the assistance of other donors, but also, on a long

term basis, to try to install in the policy and institution of Ethiopian Government
the spirit and function of the OVOP movement. The project type of activity is suited
to the type of undertaking which aims at producing a result in a fixed period andterminates at the end. However, in the planning of an institution which is expected
to endure for a long term, it is needed to have a grand design which covers theentire term exceeding the period of the project. In order to make the bottom-up
policy for the improvement of livelihood that the OVOP movement strives for serve
the policy of Ethiopian Government and the revitalization of rural areas on a longterm basis, it is essential to start up the movement, taking account of the estimatedamount of funding available on the part of Ethiopia, the sustainability of humanresources, as well as the predicted volume of Japanese assistance. It is alsoessential to present the project perspective that the accumulation of achievements
and the institution building shall proceed steadily, rather than ending up in ashort-lived rapid scale-up activity through a campaign approach. In the steady andsober activity such as that of OVOP movement, the political commitment also
constitutes an important element.
5) OVOP project of JICA in Ethiopia
Within the Ministry of Agriculture and Rural Development, the level ofrecognition of the “OVOP Movement” is high. Nevertheless, the extent ofunderstanding of the contents varies and most people tend to associate it withproduct development and quality control. The holding of the agricultural fairstarted by JICA experts have been counted as a means of promotion of “OVOP
Movement”.
The technical cooperation project of JICA dedicated to “OVOP Movement” isanticipated to start as a new project for fiscal 2008. As an overall image, it is toprovide funds and technical assistance, projecting to set up 30 project sites
throughout the country in 3 years from the beginning.
What the Ethiopian Government expects from the project is the raise of added
value of agricultural products through the “OVOP Movement”, which will lead tothe augmentation of farmers’ income. However, if Japan implements the project in aperspective including the viewpoint of rural area development, the ultimate impact
is expected to be the empowerment of rural communities. As an institutional
background, the decentralization in Ethiopia is fairly advanced, and local
governments have a relatively high degree of freedom. Since the capacity building
as applied to local governments is also possible to a large extent, this situation may
work to advantage.

6) Support from Japan for OVOP movement(1) Propositions on the role of training in Japan for the OVOP movement
It has been often pointed out that the OVOP movement is interpreted indiverse ways, and this report also makes analysis based on such viewpoints.
However, when an attempt is made to extend cooperation of regional development
by taking an example from a case of OVOP movement in Japan as the point ofreference, the significance of in-situ presentation of how the movement wasdeveloped under the special circumstance that the field is a local region in Japan isquite great. There the question is how to get Japan’s experience across to trainees.
Generally speaking, administrative officials, particularly those of the central
government have a strong tendency to press forward a uniform project as a national
project. In Ethiopia where powerful bureaucracy is present, the tendency isobserved. The training in Japan is considered to have a great significance since it isintended and designed so that the trainees are asked to make the Japaneseexperience of the OVOP movement, experience made up through a trial and error
process in which administrative officials were involved with the same way of
thinking as that of inhabitants, a source of reference in human resources
development in their own country.
The basic principle of training is that the trainees are asked to learn from thepast trials and errors and experience in Japan, so that they shall be able toapproach the issue by encouraging the local inhabitants concerned to make theirown choices suited to respective local areas, rather than by imposing products andmethods predetermined by a macro policy on the part of the government. While it isunderstood that the requests from the governments of developing countries arefocused on the areas of export promotion and product development, the trainees are
expected to understand as common knowledge the fact that the movement, as aprototype, is itself that of regional development of internal motivation, and contains
aspects of human resources development and capacity building in administrative
systems. Such knowledge does not have the character that can be transferredsimply, but involves essentially the question of mindset of those concerned.
(2) What about Japan should be transferred?
It is a questionable matter whether the projects of regional development
implemented in Japan, particularly those which have been implemented with thecentral government or local governments as the principal actor, have enriched ruralvillages or not.

In the comprehensive national development plans that have been

implemented for several times since the 1960s, the rectification of the gap between
urban areas and rural areas have been advocated repeatedly and the balanced
development of the national land was pursued. However, very often rural areascould not become the base of development. The origin of the OVOP movement is
identified with the approach in which local actors, while assessing the overall
economic situation of the whole country and consumers’ needs at that time, did notnecessarily keep pace with the policy of the central government in pursuing thedevelopment. What is really needed to be transferred to those people who intend to
introduce a movement or policy which is called OVOP movement would be the very
evolution of activities motivated internally by local initiatives.
(3) The role of governments
In order to promote the regional development under the social climate where
decentralization progresses, the empowerment of local governments that is needed
for realizing substantial decentralization is expected. In OVOP movements, local
governments not only supported the self-help efforts and extended financial andtechnical assistance, but also supported the formation of networks of actors
involved in regional development, as a result enhancing the competence of local
autonomy, which is an aspect of their role. In Africa including Ethiopia, through theextension of OVOP movement, there is a possibility of groping for a kind of politicaland social institution that enables local autonomy and collaboration among actors
within and outside the region. To promote such development, active intervention by
the government becomes important, and it is essential to expose the trainees toactual cases of such development through training programs.

AnnexPresentation “One-Village One-Product Movement and Rural Development”
by Dr. Yoshiaki Nishikawa on 30 August 2007 at AU, Addis Ababa

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Japan Association forInternational Collaboration ofAgriculture and Forestry
Akasaka KSA Bldg., 8-10-39 Akasaka,
Minato-ku, Tokyo, 107-0052, Japan
Tel: +81-3-5772-7880
Fax: +81-3-5772-7680

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