MSM trains officials from the Royal Government of Bhutan

In the period of 7-14 April 2021, a team from Maastricht School of Management (MSM) led by Dr. Jeroen van Wijk delivered a training to 17 officials from the Ministries of Agriculture and Economic Affairs of the Royal Government of Bhutan on value chain analysis in the Renewable Natural Resources (RNR) sector.

The aim of the training was to enhance the understanding of value chain dynamics in order for the government to better stimulate agribusiness initiatives. Bhutan is a land-locked country located at high altitude in the Himalayas. With a population of 700,000 people, it has a small domestic market. However, the country has good trade relations with India and also with Bangladesh, while it has opportunities for low volume, high value agricultural exports, such as spices and mushrooms, to distant markets. The main question addressed in the training was how the government could encourage private entrepreneurs to invest in value addition of renewable natural resources, thereby creating jobs, expand exports, and meet the targets as outlined in Bhutan’s 12th Five-Year Plan 2018-2023 for the RNR sector.

The training consisted of 12 modules taking up 2 to 3 hours each, divided over 6 days. Due to the Covid-19 situation the training was taught in a hybrid classroom mode. Participants were together in one conference room but split over six round tables. They remained individually and virtually connected with the trainer and group via Zoom, which enabled interactive lectures, breakout group support, group presentations, and plenary discussions.

The training was delivered to a well-motivated and knowledgeable group of trainees. Each module started with an in-depth and interactive lecture to share knowledge and key aspects of value chain analysis, business development and product marketing. The knowledge session was followed by group work where the participants analyzed a value chain of one selected product. The final hour of the module was reserved for plenary presentations and discussion. The approach of dividing each session between a lecture, group work and presentations and discussions provided the opportunity of directly applying the new knowledge into practice.

The importance of value chain analysis
Value chain analysis is an effective manner to diagnose the ails of an economic sector and to assess opportunities for value addition. The research approach focuses on the connections between a series of companies (the “chain”) which generate the product and bring it to the market, and on how governmental and international organizations could help these companies upgrade and become more competitive.

Dr. Jeroen van Wijk kicked-off the training with modules that explained how to analyze the key dynamics of value chains, value chain governance with its lead firms, innovation and upgrading, and how to assess markets. In subgroups, participants studied the value chain of one of the six products or commodities selected for the training: dairy, broilers (aiming at the domestic market), apple, cardamom (exported to markets in India and Bangladesh), and honey, mushrooms (exported to distant markets).

“I got to see the real situation of the value chain of many Bhutanese products and how we can improve and expand our agribusiness sector collectively” - Participant

Private Sector Development
The first week of the training ended with two modules by Mr. Drs. Andre Dellevoet. In the morning the focus was on the external policy environment of agribusiness and looked at government policies in support of private sector development. In the afternoon, Mr. Dellevoet explained the process of business plan development and challenged the group by asking them to creep into the body of a local agribusiness enterprise in the value chain assigned to them and work out a viable business model for each of them.

The assignments carried out by the participants about the right internal/external policy mixes for private sector development and the development of business models were excellent and clearly demonstrated that the trainees had benefitted from the training.

Triple Helix and value chain finance
Access to finance is a major issue for Bhutanese agribusiness. The second week of the training therefore started with a module addressing this topic. Drs. Rene Verberk from RABObank presented various value chain finance models and looked into ways how agribusiness firms could enhance their ‘bank-ability’. This module was followed by an interactive session on Technical Vocational Education and Training (TVET) by Dr. Julius Gatune. He stressed the importance of TVET institutes for innovation and upgrading in agribusiness; many firms, also in Bhutan, have difficulty in finding skilled new employees. Triple Helix Development aims at the involvement of the private sector in curriculum development at TVET institutes.

One of the final modules of the training was reserved for the analysis of trust levels in the value chain. Distrust is a common hindrance to effective value chain development and it is important for chain facilitators to know tools that can assess trust among agribusiness firms and that can help restore it. The training ended with participant groups presenting their value chain analysis of selected commodities.  

A refreshing experience in a short time span
The Bhutanese government officials were very positive in their formal evaluation of the training. They said the training was well organized, interactive, refreshing and taught by trainers who are experts in their field and also knowledgeable about Bhutan. According to one participant, Bhutan is in a phase of developing value chains and encouraging private sector agribusiness, in which this training equipped the participants with relevant information that they can apply in their work and help towards the development of Bhutan.

MSM created and delivered this training on the request of DAI on behalf of the EU-Bhutan Technical Assistance Complementary Support Project (EU-TACS) which is Funded by the European Commission.

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