IFAD-IDRC

Summary Progress Report

(July 2010 – March 2011)

Prepared by Álvaro Paz

Contents Executive Summary ........................................................................................................................ 1

THE PROGRAM ............................................................................................................................ 1

Analytic underpinnings ............................................................................................................... 1

Purpose, objectives and outcomes .............................................................................................. 1

IMPLEMENTATION STRATEGY ............................................................................................... 2

Implementation strategy.............................................................................................................. 2

PROJECTS AND RESEARCH ACTIVITIES ............................................................................... 5

Identification and development of projects and research activities ............................................ 5

Projects and research activities ................................................................................................... 5

Scaling Up the CLAR Mechanism ......................................................................................... 5

InnovaTRC .............................................................................................................................. 6

ValorIC ................................................................................................................................... 7

Scaling Up Rural Enterprise Partnerships............................................................................... 8

Scaling Up Technology-based Rural Innovations. ................................................................. 8

Scaling Up the Learning Route Approach. Executed by PROCASUR, Latin America. ........ 9

Thematic areas .......................................................................................................................... 10

Location .................................................................................................................................... 12

EARLY FINDINGS...................................................................................................................... 13

CONCLUDING REMARKS ........................................................................................................ 14

Acronyms and Organizations

AGROCENTRAL Central de Cooperativas Agrícolas de Chuquisaca – Bolivia (Agricultural cooperative

organization of Chuquisaca)

AGRORURAL Programa de Desarrollo Productivo Agrario Rural – Ministerio de Agricultura de Perú

(Program for Agricultural Production and Rural Development, Ministry of Agriculture of

Peru) www.agrorural.gob.pe

CAN Secretaría General de la Comunidad Andina (Andean Community General Secretariat)

http://www.comunidadandina.org/

CAD Canadian Dollars

CIDRE Institución financiera de desarrollo (Bolivian Financial Development Institution)

www.cidre.org.bo

CLAR Comité Local de Asignación de Recursos (Local Resource Allocation Committee)

DTR-IC Enfoque de Desarrollo Territorial Rural con Identidad Cultural (Cultural Identity-Based

Rural Territorial Development Approach)

http://www.rimisp.org/proyectos/index_proy.php?id_proyecto=188

IDRC International Development Research Centre www.idrc.ca

IFAD International Fund for Agricultural Development www.ifad.org

IEP Instituto de Estudios Peruanos (Institute of Peruvian Studies) www.iep.org.pe

LAC Latin America and the Caribbean

NGO Non-Governmental Organization

MINCETUR Ministerio de Comercio Exterior y Turismo de Perú (Ministry of Foreign Trade and Tourism,

Peru) www.mincetur.gob.pe

NEC-PDSS Proyecto de desarrollo de la Sierra Sur (Sierra Sur Development Project)

www.sierrasur.gob.pe

NESsT: Non-profit Enterprise and Self-sustainability Team www.nesst.org

PROCOMPITE Public resource allocation initiative aimed at promoting productive competitiveness, enacted

by the Parliament of Peru (Act 29337)

PROCASUR Corporación PROCASUR (PROCASUR Corporation) www.procasur.org

PROSAT Prosat Foundation (Technical Assistance sponsor)

REMURPE Red de Municipalidades Urbanas y Rurales del Perú (Urban and Rural Municipal Network of

Peru) www.remurpe.org.pe

RIMISP Centro Latinoamericano para el Desarrollo Rural (Latin American Centre for Rural

Development) www.rimisp.org

SOCODEVI Société de coopération pour le développement international www.socodevi.org

UNEC Unidad de Negocios de Especias y Condimentos (Spices Business Unit)

Executive Summary

Innovations developed by local communities in Latin America were thought to have no place

amid the economic and institutional transformation of rural settings. More often than not,

mainstream top-down development initiatives have not taken into account local innovative ideas.

Conversely, some non-orthodox rural development projects in the region (e.g. IFAD-funded

initiatives) have found that local communities can act as “melting pots”, where local knowledge,

stemming from the rich cultural inheritance of rural communities, combines with “formal”

knowledge in order to produce powerful innovative alternatives and reduce poverty at the local

level. Nevertheless, little is known about these innovations, the people who made them possible,

the way knowledge is spread, and how they could be scaled up to achieve greater impact. Some

examples of these innovations are the following:

Microfinance: collective lending, micro-insurance

Agriculture: low-cost pressurized irrigation systems, collective marketing of organic produce

Institutions: local governance mechanisms, participatory approaches to natural resource

management

Health care services: low-cost incubators for rural hospitals, waste management systems.

Non-agricultural rural businesses: innovations in rural community tourism services

Energy: micro hydro-electric generators

Technology: efficient rural stoves and heating systems

Rural innovations are of special importance, since they take advantage of opportunities, reduce

economic risk and empower poor populations to take charge of their own development. If

expanded, multiplied and adequately mainstreamed, they could represent an alternative for

reducing rural poverty in the region.

However, the courses to be followed and the processes involved are largely unknown. This has

major policy implications: successful innovations –no matter how good their small scale

performance– will only have limited overall effects upon poverty reduction unless they are

scaled up and impact a large number of poor families.

The Scaling Up Rural Innovations Program (hereinafter the Program) seeks to understand

how innovations that have proven to be effective in local settings can be further disseminated

and widely adopted. The Program also aims at contributing to the understanding of innovation

processes and the role of local knowledge in economic development.

At present, the Program is supporting 6 action-research projects:

1. Scaling Up the CLAR Mechanism. An imaginative resource-allocation mechanism has been

jointly developed by local communities and development practitioners from IFAD-supported

projects in rural areas of Peru. The mechanism, called Resource Allocation Local Committee,

assigns public resources to development initiatives in rural municipalities, thus ensuring

participation, fairness and transparency. A network of municipalities in Peru (REMURPE) has

teamed up with a leading national rural development program (AGRORURAL) and a well-

known research institution (The Instituto de Estudios Peruanos) to expand the use of the

mechanism to about 200 rural municipalities over the country. The project is conducting

research on how institutional innovations can enhance the effectiveness of public investment.

2. InnovaTRC. Rural tourism is increasingly becoming an important economic activity in rural

communities of Peru. The Peruvian Ministry of Tourism (MINCETUR), together with a local

university (Universidad del Pacífico) have devised a contest mechanism –the InnovaTRC

contest– to identify and foster the adoption of best practices and innovations developed by

local tourism entrepreneurs among about 200 rural community tourism ventures in the

country. The Program is funding the contest and analyzing its effectiveness in disseminating

innovations. The InnovaTRC contest will likely be included as part of the country’s national

tourism public policies.

3. ValorIC. Cultural identity is an asset that is ever present among many poor rural families in

Latin America. RIMISP, together with its partners in Bolivia and Peru, have developed an

innovative approach to foster non-agricultural livelihoods based on cultural identity. This

approach is being applied and field-tested in 5 rural territories in both countries. The Andean

Community of Nations has officially included this approach in its rural development policies.

4. Scaling Up Rural Enterprise Partnerships. Rural cooperatives and associations in Bolivia

have little access to capital resources for funding their endeavours. The project is linking up

rural cooperatives and associations with private capital investors to create well-funded

sustainable rural business partnerships. About 149 rural cooperatives and associations will

likely benefit from the outcomes of this project. The Minister of Finance is interested in

fostering these kinds of partnerships in rural settings, as part of the country’s national public

investment policies.

5. Scaling Up Technology-based Rural Innovations. Local Knowledge, when paired with

technological innovations, can produce meaningful solutions to social problems in rural

communities. This project is scaling up several technology-based local innovations in Peru,

Ecuador and Brazil. Based on the global experience of the project executor (NESsT), a

mechanism to build entrepreneurial skills among innovators and further link them with

research and academic institutions is being developed and assessed. Project results will be

channelled towards national innovation and science councils in the region.

6. Scaling Up the Learning Route Approach. Knowledge exchange is key to foster local

innovation. The Learning Route Approach develops local capabilities to promote innovation

by exchanging knowledge among peers. This project is researching the effects of this

approach on local innovation in 50 cases throughout Latin America. PROCASUR, the

organization that is executing the project, will use the results to enhance the approach and

have it scaled up to Africa and Asia

The abovementioned projects have produced interesting initial findings, namely:

A purposeful combination of local and external knowledge is key for producing effective

innovations. These innovations are carried out by innovators that, besides from being creative

and ingenious, need to possess entrepreneurial skills in order to combine different types of

knowledge to develop effective innovations.

Rural innovation can come from outside rural contexts. Ideas and knowledge originating

from outside community boundaries can generate local innovative processes, which highlights

the importance of exposing local innovators to outer knowledge and experiences, and linking

them with researchers and academic experts. Temporary migration, trips abroad and targeted

knowledge-exchange activities may have an important effect in promoting local innovation

and scaling up processes.

Early evidence shows that innovations emerge as either unintended by-products of ongoing

rural development activities and processes, or as intended products of local innovators who

are interested in finding a solution to a pressing local problem. In either case, innovations are

not the result of an explicitly planed process.

Preliminary findings show that scaling up successful innovations (i.e., innovations that have

proven to be effective at the local/pilot level) is usually not the result of a natural process.

More often than not, effective innovations are not spontaneously disseminated or spread.

Furthermore, in most cases innovators and entrepreneurs need to step up and purposefully

lead the scaling up process.

Local innovations can be scaled up and can influence public policy. Several projects

supported by the Program are scaling up local innovations that are positively affecting public

policies. Providing an assessment of how these processes unfold is a key activity of the

Program.

A comprehensive approach is needed to foster and scale up local innovations. Specific

support mechanisms are required. Some of the projects have found that setting up

organizational networks helps build sustainable support systems for local innovation

purposes.

Local innovation and scaling up are not new issues in the rural development community. Yet,

they are still poorly understood processes. The knowledge being produced by the Program will

help to gain understanding on the process of scaling up innovations. The Program will also

produce knowledge about how to manage both the enabling and hindering factors that affect

scaling up processes.

The Program findings are contributing to the growing research on how local economies that

thrive outside formal sectors (i.e., rural and peri-urban economies) can develop by using

their own inventiveness and local culture. These findings will provide valuable knowledge

about how to design comprehensive innovation policies and foster development in poor local

communities, usually excluded from mainstream development processes.

The Program is now focusing on synthesizing and communicating the results from Program-

supported projects. Local and national policymakers are the target audience, as well as

researchers and development practitioners in the region.

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THE PROGRAM

Analytic underpinnings The Scaling up Rural Innovations Program (hereinafter, the Program) understands rural

innovations as those creative solutions to problems and imaginative strategies that take

advantage of new opportunities in the rural areas1 of a region. Rural innovations are thought to

be the result of combining local knowledge and local assets with outside ideas and technologies.

Thus, this knowledge and asset combination becomes an innovation –a new way of doing

things– through practice, experimentation and adaptation, mostly through local innovators and

entrepreneurs, as well as rural micro-enterprises, but also supported by other public and private

agents, such as researchers, policymakers and development practitioners. These agents and their

interactions/networks, together with local institutions in a particular socio-technical context can

be referred to as local innovations systems.

The Program defines Scaling up rural innovations as the process of expanding, disseminating

and promoting the adoption and widespread use of innovations. The former aims at increasing

the positive effects and impact of innovations, but also cross-pollinating with other ideas in

different contexts, and producing new innovations. Scaling up involves moving from a micro

scale, often limited to a small number of communities and sectors, to larger geographic areas and

populations. This process not only includes specific scaling up activities, but also the

development and creation of the conditions that enable innovations to consolidate and thrive in

different contexts.

Purpose, objectives and outcomes The purpose of the Program is to understand how rural innovations that are successful in a

limited scale can be disseminated and widely adopted, as well as to determine the underlying

factors that either promote or hinder this process. The ultimate goal is to gain deeper knowledge

and understanding as to why certain communities or groups are able to innovate successfully, as

well as how the scaling up of innovation processes takes place within and among different

innovations systems.

The Program has three specific objectives:

- To identify and gain a deeper understanding of scaling up of innovations that have helped

leverage the strategies and assets of the rural poor, and present sound empirical evidence of

their effects on individuals, groups and territories.

- To develop and test better ways to disseminate, value and use the knowledge acquired through

these innovations, to further develop stakeholders' innovation skills and strengthen

partnerships among them, as well as with other external actors who help leverage and

institutionalize up scaling processes.

1 The term “rural” is broadly defined: Rural areas/territories include the entire rural landscape; agrarian areas, small

towns located in the countryside, and also the urban-rural links that usually exist between rural areas and large cities.

2

- To experiment and develop specific approaches, mechanisms and tools to influence the design

and implementation of decentralized public policies and investment aimed at expanding the

innovation capacity of rural communities and organizations.

The Program has the following expected outcomes:

- Rural innovations oriented towards the valorization of the assets of the poor have begun to be

used by public and private development projects and initiatives, including those driven by the

poor populations themselves and their organizations.

- New evidence on the validity of rural innovations and possible ways to have them scaled up

in development debates and decision-making, all of which will enrich and update

development approaches and policy proposals.

The empirical knowledge produced by the Program will be shared, understood and spread in

broader domains and among a wider range of stakeholders, thus making a meaningful

contribution to rural development public policies in the region. This knowledge will also be the

basis for building bridges between LAC and other regions, where local innovations and their

alternatives for up scaling can contribute to further rural development in impoverished areas.

IMPLEMENTATION STRATEGY

Implementation strategy The abovementioned activities are being deployed following an implementation strategy, which

is consistent with IDRC’s business model and its institutional framework. The strategy is based

on three principles:

- “Bundling” activities into mid-sized projects (CAD 100,000 – CAD 300,000) with a focus

on specific thematic and regional needs and opportunities. They are to be carried out by a

range of stakeholders, such as strategic partners, universities, regional research centres,

private enterprises, and other organizations committed to rural development and poverty

reduction, with proven management and research capabilities.

- A systems approach to rural innovation and scaling up processes, so that projects not only

encompass innovations, innovators and local knowledge, but also take into account the role of

entrepreneurs and the institutional and organizational context.

- Building on ongoing processes and taking advantage of existing capabilities within

development and research organizations, public development initiatives, local innovators and

entrepreneurs in the region.

Based on the abovementioned principles, the Program has defined the following strategic

activities that are being undertaken by the projects supported by the Program, namely:

- Identifying, describing and mapping rural innovations and the local knowledge associated

thereto, within specific development areas or sectors.

- Developing and assessing support mechanisms, as well as approaches and strategies to

develop, value and scale up rural innovations.

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- Networking among stakeholders at the local, national and/or regional level to foster scaling up

rural innovations.

- Developing and enabling institutional and organizational contexts in geographical and/or

thematic areas to promote the creation, development and scaling up of relevant innovations.

- Providing direct support to scaling up processes, which include innovation and

entrepreneurial capacity-building at individual, community and local organizational levels.

- Developing and implementing knowledge-sharing mechanisms (learning routes as well as

other knowledge-sharing approaches) to disseminate innovations and foster innovative

activities in other locations.

- Explicitly engaging policymakers at the local, national and regional levels to address

innovation and scaling up issues pertaining to specific thematic areas.

Besides from the projects supported by the Program, a series of supplementary research and

synthesis activities are being developed. These activities will increase the coherence of the

Program by bringing together researchers from the various projects to foster cross-cutting

research and knowledge-sharing activities. In addition to such supplementary research activities,

a communications website is to be developed by the end of June 2011.

A graphic representation of the implementation strategy can be found below (Figure 1). The

diagram shows the relationship among the strategic activities that each of the Program projects

will undertake, as well as the Program outputs, outcomes and main objectives. It should be noted

that each of the projects supported by the Program will undertake –in varying degrees and with a

different focus– all of the strategic activities described above and shown in Figure 1. Therefore,

all of the projects will contribute to the production of program outputs and outcomes.

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Figure 1. Implementation strategy

Rural innovations start

to be used by public

and private

development projects

and initiatives

Evidence about the

validity of rural

innovations and the

possible ways to scale

these up Is produced

Program

Outcomes

Program

Objectives

Program

outputsProjects strategic

activities

Meetings with

IDRC and IFAD

Analyticall

documents

Workshops

with experts

Innovation &

knowledge maps

Innovation

competitions

Media and dissemination

actitivies

Learning

Routes

Young

innovators

meetings

To develop and test ways to

disseminate, value and use innovations,

and develop stakeholders' innovation

capabilities and strengthen

partnerships.

To experiment and develop

approaches, mechanisms to influence

public policies aimed at expanding the

innovation capacity of rural

communities and organizations

To identify and understand

the scaling up of

innovations and present

empirical evidence of their

effects

Identification and mapping

of rural innovations

Support to scaling up

processes

Development and assessment

of support mechanisms

Knowledge exchange

mechanisms

Developing

enabling contexts

Networking among

stakeholders

Engaging

policymakers

Supplementary

research, synthesis

and communication

activities

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PROJECTS AND RESEARCH ACTIVITIES

Identification and development of projects and research activities The projects and activities that are currently being supported by the Program were developed in

three stages:

Stage 1: During 2010, potential partners for project development were identified. Project

proposals were submitted by these partners during 2010. Three project proposals were further

approved and became operational by late 2010.

Stage 2: An open call was launched in October 2010, and a large number of proposals were

received by December 2010, out of which two were selected for funding, whereas the third one

was forwarded to another IDRC initiative for further assessment.

Stage 3: A new project was identified, developed and approved by the end of 2010. During the

same period a series of supplementary research, synthesis and communications activities were

devised.

The main challenges of building the Program portfolio were: (i) finding eligible grantees in the

region that were both interested in scaling up rural innovations and met the administrative

requirements for receiving IDRC grants; ii) developing proposals that would further contribute to

the Program objectives and that would also be in line with the proponent organizations’

objectives and interests, iii) developing a relevant project portfolio in a timely manner, since the

Program had a specific deadline to be met.

Projects and research activities The Program supports six projects, one supplementary research activity and one communications

activity. These projects and activities have been developed following the Program

implementation strategy (described above).

Scaling Up the CLAR Mechanism The project is being executed by REMURPE, AGRORURAL and IEP in Peru. Budget:

CAD146,600. The project started in June 2010 and will be completed by June 2012. The project

is scaling up the Comité Local de Asignación de Recursos (Resource allocation local committee

– CLAR in Spanish). The CLAR mechanism is considered to be an important institutional

innovation. This mechanism is suited for resource allocation processes at the local level; it

fosters the empowerment of local actors, competition and equal distribution of resources among

rural poor communities.

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Building upon previous efforts to scale up the CLAR undertaken by IFAD-funded projects in

Peru, 8 rural municipalities throughout the country are piloting the mechanism, and about 200

municipalities are expected to adopt it during 2012. The mechanism dovetails with the

PROCOMPITE law, a national initiative that will channel over US$30 million (most of them

will likely come from an IFAD country loan) to rural municipalities. Research-based

recommendations to enhance national public resource allocation procedures are currently being

developed by the project and will be proposed to high level national policymakers.

InnovaTRC Executed by MINCETUR and Universidad del Pacífico in Peru. Budget: CAD97,100. The

project started in September 2010 and is expected to end by October 2011. This project is testing

a competition and awards mechanism – the InnovaTRC contest– which identifies, documents,

and promotes innovations in rural community tourism.

Box 2. Rural community tourism: sharing day-to-day activities with local communities.

Many tourists visiting the rural areas of Latin America are not only interested in sightseeing or outdoors activities, they also what to “connect” with rural communities.

Rural tourism focuses on providing the visitor a “living experience” of the rural world; this includes staying in rural families’ homes, and participating in communities’ day-to-day activities.

In Peru, several rural tourism ventures have developed innovative

ways to provide tourists with high quality services, rural activities, and novel ways to manage community ventures. These innovations, if widely disseminated could benefit other rural tourism initiatives in the country.

Box 1. How does a CLAR work?

- A local municipality, together with local communities, agree to allocate a certain amount of public resources to tackle a specific issue or develop a business sector (natural resource management, handcrafts, seed production, etc.)

- All communities in the municipality have the opportunity to submit project proposals, in a format they fill comfortable with. The most popular format among Andean communities are the so called “talking maps” (mapas parlantes – in Spanish). This maps show the current situation (of the community, of the business) and the desired future situation.

- Decision makers and community authorities’ asses the different proposals and select the best ones. The number of proposals to be funded depends on the available resources at that time.

- The resources to execute the project are directly transferred to the local communities. The communities themselves take charge of the project.

- When the project is completed the community renders a formal financial report to the municipal government and presents the results of their endeavour. Again, maps are commonly used for this matter.

The CLAR has increased the effectiveness of public investment at several municipalities in the southernmost regions of Peru. If scaled up, about 200 rural municipalities could benefit from this innovative mechanism.

Picture 1. The woman in the picture is using a map to explain how they will benefit from an increase in milk production if the community’s project is approved and developed. Sibayo, Arequipa. Peru

Picture 2. Huáscar Huandy tourism association. Tourists are having breakfast with a local family. Cordillera Blanca, Ancash. Peru.

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Sixty rural community tourism innovations and best practices have been identified so far, out of

which 10 will be selected through a competitive process (June 2011) and will be supported, so

that they can be further developed and scaled up. Outstanding innovations will be duly

awarded. The scaling up of these innovations is expected to positively affect 200 rural

community tourism ventures in the country. Besides from scaling up specific rural tourism

innovations, the competitive mechanism (contest) is in itself an innovation; it is not only a prize

awarding procedure, but also functions as a dissemination mechanism, to foster further

innovations in the sector. The InnovaTRC contest has been adopted as part of MINCETUR’s

national policies.

ValorIC Executed by RIMISP, PROSAT and NEC-PDSS in Peru and Bolivia. Budget: CAD149,800. The

project started on July 2010 and is expected to be completed by July 2012. The Project is scaling

up the Cultural Identity-Based Rural Territorial Development Approach. This approach fosters

the valorization of cultural and natural assets in impoverished rural territories, for further

developing poor rural communities.

The project has developed an approach that is being scaled up at the local level in 5

municipalities (2 in Peru and 3 in Bolivia). Innovative tourism services and alternatives for the

inclusion of cultural identity in local products is being fostered in the territories where the

approach is being applied. The approach has also proved of interest for the Comunidad Andina

(CAN) and has been included as part of its regional policies, and is now being applied by the

CAN in 4 regions of Bolivia, Peru, Ecuador and Colombia.

Box 3. Cultural Identity: an untapped asset to develop value added livelihoods in rural settings.

Meals, handcrafts and products made by rural families in Latin America are commonly based on communities’ cultural heritage and local knowledge. This feature can be used to develop poor families´ livelihoods. For that matter, cultural identity has to be explicitly recognized as an asset by local communities.

Using a combination local capacity building, networking, awareness campaigns and territorial branding, the cultural identity-based rural development approach fosters the development of innovative livelihoods in rural impoverished territories. Since cultural identity is an untapped asset, the scaling up of this model can have an important effect in the development of rural areas in the region.

Picture 3. Lunch being prepared in Uriondo,Tarija. Bolivia. The “soltero” (singles’ dish) is a traditional dish made of fresh onions, tomatoes, cheese and boiled potatoes. It is popular among people who live in the nearby city of Tarija and enjoy spending the weekend in the countryside. Being prepared by locals in an authentic rural setting adds value to this kinds of products and services

8

Scaling Up Rural Enterprise Partnerships. Executed by CIDRE, Universidad Privada Boliviana and the Fundación Valles in Bolivia.

Budget: CAD232,600. The project started in January 2011 and will be completed by July 2012.

This project is scaling up an innovative rural enterprise model that has proven successful in a few

cases in Bolivia. The model links up rural smallholders with capital investors and creates well-

funded sustainable enterprise partnerships, allowing smallholders to access competitive markets

and receive timely technical assistance.

The most innovative feature of this model is the comprehensive approach to develop and support

rural enterprises. Also, technical and managerial assistance is provided throughout the business

chain (production, transformation, value-adding and marketing), together with capital resources

to fund the venture, and “reputation assets” to build trust among parties and consolidate the

partnership. The project has developed a financial risk assessment tool, particularly suited for

rural endeavours, which is being field-tested in 5 rural enterprises. This tool is key to foster

investment capital towards rural enterprises. A total of 149 micro enterprises related to 4

agrichains (quinoa, faba beans, peanuts and spices) have been identified as potential partners for

the 4 rural enterprise partnerships to be fostered by the project. The Minister of Finance and

Economy is interested in the new financial tool being developed by the project.

Scaling Up Technology-based Rural Innovations. Executed by NESsT in Peru, Ecuador and Brazil. Budget: CAD264,100. It started in January

2011 and is expected to end by July 2012. The project is scaling up technology-based

innovations that combine local inventiveness with science and engineering, to produce

innovations that focus on solving practical problems.

Box 4. Rural Enterprise Partnerships in the Bolivian oregano agri-chain.

Poor smallholders in Padilla, Bolivia have increased their family income in about 100% by growing high quality oregano.

This is the result of an enterprise partnership between a producers association (AGROCENTRAL) a national NGO (Fundación Valles) and a Canadian NGO (SOCODEVI). The partners established a private company called UNEC (Spices Business Unit, in Spanish). The company collects, dries, packs and exports the produce to high value markets in Latin America. Fundación Valles provides technical and managerial assistance.

This model is not contract-farming: Besides selling fresh oregano to UNEC, farmers are also shareholders entitled to a third part of the company’s revenues.

This partnership model is an innovative and effective way to link smallholders to high value markets and create sustainable business partnerships. The model can be replicated among other smallholder associations in the region.

Picture 4. Fresh oregano being harvested in Padilla. The produce is derived to UNEC for processing

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So far, 25 innovations developed by local entrepreneurs have been identified in Peru, Ecuador

and North-western Brazil. At least 8 of them will be scaled up by the project during the first half

of 2012. NESsT has developed an effective support mechanism to scale up technology-based

innovations. The mechanism is based on developing entrepreneurial skills of local innovators

and linking them with research and academic institutions. In order to enhance this mechanism,

the project is assessing entrepreneurial support mechanisms that foster innovation at the local

level. Up to now, 28 different entrepreneurial and innovation support mechanisms/approaches

have been identified in Peru, Ecuador, Colombia, Brazil and Mexico, and will be assessed by the

project by the end of 2011.

Scaling Up the Learning Route Approach. Executed by PROCASUR, Latin America. Budget: CAD 220,000. The project started in April 2011 and is expected to end by May 2012.

The project is researching and scaling up the Learning Route Approach. This approach focuses

on strengthening local capabilities to promote innovation by exchanging knowledge among peers

in order to foster innovation and enhance rural livelihoods. Up to date, a review of PROCASUR

datasets on learning routes’ participants has been undertaken.

Box 5. Practical solutions

Freeze-dried potato is a major staple food in the Andes. The traditional production technique involves stepping into buckets of frozen potatoes filled with water, in order to peel the frozen potatoes. This is an excruciating task mainly carried on by women.

A local innovator from Apurimac – Peru has developed a machine that peels frozen potatoes. The machine combines traditional production techniques with modern food processing technology. The innovation is at the pilot stage and will soon enter a commercial stage

Picture 5. Walter Utani collecting a batch of potatoes peeled with the machine he invented.

Box 6. Knowledge exchange among peers.

Much can be learned from peers. The Learning Route Approach has shown that informal interactions among people interested in the same theme or issue greatly improves the innovative capabilities of each member of the group.

The Learning Route approach brings farmers to in-the-field experiences (in this case, a successful organic coffee plantation) and encourages discussions among peers. This approach to knowledge exchange can is a powerful tool to disseminate innovations.

Picture 6. “Ruteros” (the participants of a learning route) of the Bicultural learning route carried on in Bolivia by PROCASUR visiting an organic coffee processing facility

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Thematic areas Program projects cover a wide range of rural development thematic areas. These areas closely

relate to those previously identified in the Program grant design document. They are:

- Valuation of pro-poor assets. Pro-poor assets are tangible and intangible resources and

factors to which the rural poor have privileged access (i.e., biodiversity resources, cultural

identity and landscape).

- Improving financial and non-financial rural services. Rural financial services include

micro-lending, savings accounts, insurance and financial tools to bring capital investments to

rural areas. Non-financial services include technical assistance, entrepreneurial support, legal

advice and information services.

- Developing rural enterprises. Rural enterprises include: cooperatives, farmers associations

and micro enterprises, among others.

- Enhancing rural development approaches and mechanisms. Rural development

approaches that address the new contexts and challenges arising from rural areas.

- Developing institutions for the poor and citizens’ rights. These institutions cover the

following areas: citizens’ rights, property rights enforcement, equal access of women and

youth to public decision-making, among others.

Table 2 depicts the themes covered by the Program projects. Projects are shown in the first

column, while thematic areas are shown in the first row. It should be noted that all of the projects

included in Table 2 will contribute to “enhancing rural development approaches and

mechanisms”, while the objectives of “improving financial and non-financial rural services” and

“developing institutions for the poor” will only be addressed by 2 projects.

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Table 2. Thematic areas covered by the projects

Thematic area

Project Valuation of local assets (tangible

and intangible) & Knowledge

Improving financial & non-financial rural

services Developing rural enterprises

Enhancing rural development approaches and mechanisms

Developing institutions for the poor & Citizenship

Scaling Up the CLAR mechanism

Enhancement of an allocation mechanism to channel resources (i.e. public resources for local projects)

Improvement of transparency, equity and participation of local communities in decision-making

InnovaTRC: Scaling Up Innovations in Rural Community Tourism

Development and support to innovative activities based on local assets such as biodiversity and culture

Support to local rural tourism initiatives. For example: lodging and

guiding services

Development of an incentive mechanism to disseminate innovations (i.e. rural tourism innovation contests)

ValorIC: Scaling Up the DTR-IC Approach

Development and support to innovative activities that build on local cultural assets

Support to tourist-oriented, lodging, local food and handcraft

businesses

Refinement of the cultural identity-based rural development approach developed by RIMISP

Scaling Up Rural Transformation Societies.

Development of a financial instrument to fund rural enterprises and cooperatives

Support to rural enterprises involved in agrichains such as the oregano and the Quinoa chains in Bolivia

Development of an approach to incorporate managerial skills in rural enterprises, such as marketing of agricultural produce

Financial regulations and policies to foster capital investments to

rural enterprises

Scaling Up Technology-based Rural Innovations.

Development of innovations based on technology customized to local contexts, such as rural stoves and small coffee-processing machines

Capacity-building for entrepreneurial activities (i.e. cost analysis and accounting)

Refinement of a support mechanism to foster technology-based innovations

Scaling Up the Learning Route Approach.

Refinement of a knowledge exchange mechanism to foster local innovation

Note: supplementary research activities and communications cross over all the above mentioned thematic areas and projects.

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Location The Program is of a regional nature, in the sense that its findings will appeal to a wide variety of

audiences in several Latin American countries. However, Program operations are concentrated in

the Andes region, with additional activities in Brazil. Figure 2 shows the overall location of

project activities in the region. Most of the activities are being carried out in Peru and Bolivia. In

some cases (for example, the southern areas of Peru), a number of activities are being developed

by different projects in the same location.

Figure 2. Location of project activities in the region

Scaling Up the Learning Route

Approach

Latinamerica

ValorIC:

-Tarija, Bolivia (3 areas)

-Arequipa, Peru (2 areas)

InnovaTRC:

-Puno -Apurimac

-Arequipa -Ancash

-Madre de Dios -Tumbes

-Cuzco -Arequipa

-San Martín

Scaling Up Technology Based

innovations

-Cuzco -Puno

-Lima -Cajamarca

-Quito (Ecuador) -Fortaleza (Brasil)

Scaling Up the CLAR Mechanism:

-Puno -Cuzco

-Arequipa -Cajamarca

-Piura -Huancavelica

-San Martín -Apurimac

Scaling Up Rural Enterprise

Parnerships

-Cochabamba -Chuquisaca

- La Paz -Potosí

Note: Each coloured spot shows the location in which a project is or will be developing activities. In some cases, these activities are relatively large interventions (i.e., in the ValorIC locations), while in other cases they are specific activities (i.e., in the InnovaTRC locations).

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EARLY FINDINGS The Program has completed its second period and is commencing its third period. So far, some

early findings that show progress towards the Program objectives can be drawn from the project

activities. It is worth noting that these findings are preliminary and not conclusive. However,

they are good starting point for discussing and analysing the scaling up of rural innovations.

Following is a description of the initial findings associated to each of the Program objectives.

Most of the innovations that are being scaled up by the Program’s projects have both local and

external knowledge (i.e., science and technology) as their key elements. However, their mere

presence is not enough to create an innovation; a purposeful combination of both kinds of

knowledge is needed to foster innovative and up scaling processes. Moreover, the combination

needs to be fit for the specific contexts and settings in which the innovation proves relevant.

Some of the projects supported by the Program are using combinations of local and external

knowledge to add value to pro-poor assets and produce innovative livelihoods for the rural

poor. These experiences will be helpful for understanding how the assets of the rural poor can be

used creatively to reduce rural poverty.

Rural innovation can come from outside rural contexts. Some ideas stem from academic

settings or from the development community, and subsequently find their way into the rural

domain. Later on they are adapted by local innovators and entrepreneurs to further produce

effective innovations. The same applies to the local knowledge developed in a particular location

that will further “travel” to other locations and eventually inspire new innovations. The former

highlights the importance of connecting local communities to outer knowledge and

experiences. Internet access effectively connects communities to the global information

network. Also, traveling to other countries and visiting similar initiatives outside the locality has

an inspiring effect on local innovators. Some of the innovations supported by the projects show

that some innovative ideas are brought to the community by temporary migrants and outsiders

who settle in the community. Purposeful knowledge-sharing activities (i.e.; learning routes) have

similar effects on local innovators.

Innovation is an ongoing social process. All the projects supported by the Program show that

they are not stand alone projects that begun with the Program´s funding; they are part of an

ongoing complex social processes. “Successful innovations” are constantly being produced by

these processes. Therefore, the resulting innovations do not scale up per se; it is the whole

process that expands and develops (scales up); increasing the density and quality of the

networks linking up with new actors, mediators and knowledge intermediaries, incorporating

knowledge form varied sources and “evolving” to produce ever-changing innovations.

Therefore, innovations are usually not the result of an explicitly planned, externally promoted

“innovation” process o project.

Local innovators and local talents play an important role in most of the innovations being

scaled up by the projects. However, entrepreneurial skills prove key to effectively develop and

scale up innovations; thus meaning that innovators and local talents may need to acquire

entrepreneurial skills to scale up innovations, whether by developing entrepreneurial capabilities

or by partnering up with entrepreneurs. Linking local innovators with academic experts is also

an effective way to strengthen innovators’ capabilities. Local innovators usually lack access to

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scientific knowledge, which could help them improve and scale up their innovations. Traditional

training approaches (i.e., formal academic training) are not suitable for local innovators, who

usually lack formal education.

CONCLUDING REMARKS

- Effective local innovations to reduce poverty in rural communities do not only arise from rural

settings; innovations generated in peri-urban communities and innovations generated in urban

settings with a “rural focus” also have the potential to tackle current rural poverty problems.

During the following period the Program will identify future research opportunities with a

particular focus on the urban-rural links that foster local innovations and innovations stemming

from peri-urban communities.

- Demographic and institutional changes are re-shaping the economic outlook of rural areas.

Rural youth is being particularly affected. However, they are constantly finding new venues of

opportunity; most of these opportunities are related to migrating to the cities and/or engaging in

innovative informal economic activities. ¿How can innovative livelihoods being developed by

rural youth be fostered and scaled up? This is interesting research theme that falls beyond the

current scope of the Program.

- Early findings confirm rural innovation is not a theme of interest per se; stakeholders in

different sectors are interested in sector-specific innovations. Therefore, policy

recommendations that will be produced by the Program will be tailored to meet sector specific

demands.

- Rural innovation and scaling up are not new themes in the rural development community.

However, it is still a poorly understood process. Many donors, development agencies and

national development organizations involved in rural development, poverty reduction and food

security are increasingly looking for ways to capitalize on their local or pilot success cases,

which usually revolve around some kind of collective or individual innovation process. The

knowledge being produced by the Program could provide answers about how foster scaling up

of innovations stemming from rural development initiatives or individual innovators.

- National policymakers in the region are interested in the results being produced by the

Program. Early evidence shows that scaling up rural innovations is an effective way to bring

local innovative ideas to the attention of national policymakers. During the next period, the

Program will identify and assess the best ways to engage policymakers and deliver sound,

practical and effective policy recommendations that answer to their needs.