Getting Serious about the Business of Natural Products: SANProTA, the Southern African Natural Products Trade Associatio

1. Getting Serious about the Business of Natural Products:SANProTA, the Southern African Natural Products Trade Association Presented by Gus Le Breton

2. Rural livelihoods in southern AfricaWhere are we now?

3. Facts about southern Africa Southern Africa is predominately arid or semi- arid. Soils are mostly infertile. Range animal production is limited by rainfall in arid areas and by nutrients in moist areas.   Arable land covers about seven percent of the region and irrigable soils less than one percent.   Staple food products are not keeping pace with population growth

4. Conventional agricultural production systems in marginal lands in southern Africa have failed to provide food and livelihood security for all There is a strong need for the development of an alternative approach to rural production in such areas

5. In parallel to this……. CBNRM has emerged as a powerful movement for the promotion of sustainable management of natural resources, and A somewhat less powerful movement for the promotion of more sustainable livelihoods for rural communities

6. CBNRM’s focus in southern Africa has been predominantly on wildlife (not surprisingly, given that it was originally promoted as a wildlife conservation strategy, rather than a strategy for improvement of rural livelihoods) Even from a livelihoods perspective, there was a strong rationale for this – high value resource, strong market, little product development required, comparatively easy to raise donor money for etc etc But this has limited the scope of its achievements

7. Consumptive use of wildlife, from which most of the profits of CBNRM have been derived, is a highly emotive issue in the West (the main market), and this makes it vulnerable The high profits generated have also created ‘sticky fingers’, intercepting the proceeds before they reach communities Wildlife is a fugitive resource, over which it is sometimes difficult to have secure tenure, and which is never around when you need it most! Most rural communities in southern Africa do not have, or have access to, wildlife, anyway

8. If CBNRM is to become a serious alternative or complementary approach to the improvement of rural livelihoods in southern Africa, it will have to expand its focus beyond wildlife alone This, inevitably, brings us to natural products

9. What are natural products? Natural products are products derived from naturally occurring biological resources, harvested from the wild by rural producers Given extensive attention already devoted to faunal resources, SANProTA restricts its focus to floral resources Sometimes called veld products, or non-timber forest products

10. How are natural products currently used?

11. Medicinal plants in the SADC market SADC Market consumes over 50 000 tonnes of medicinal plant per annum Some 450 000 traditional healers Regional trade worth over US$700 million Total trade (including export) probably over US$1 billion per annum

12. Harpagophytum procumbens (Devils Claw) Namibia produces 600 tonnes per year of cut, dried Devils Claw Rural producers are paid R12 per kg (i.e. R7,2 million) Some 15 000 people are involved in the trade, mostly from poorest sectors of society Secondary trade generates US$7-10 million per year in Namibia

13. Marula oil Partners in 4 countries have developed a system of shared marketing Selling marula oil to an international cosmetic company at UKP12.50 a litre, at source Estimated annual demand of 30 000 litres per year Low-grade oil used to make soap Trade worth US$560 000 a year

14. Baobab oil Still under research in southern Africa Established international market, previously met from Tanzania and West Africa Oil sells from US$20 a litre (crude) up to US$30 a litre (refined) Potential global sales of several hundred tonnes per year Potential value of annual sales, US$5-10 million

15. Other natural products already available Herbal Teas (Zimbabwe, Botswana) Fruit Jams (Zimbabwe. Botswana, Malawi, RSA) Fruit juices (Malawi, RSA, Botswana) Fruit confectionaries (RSA, Botswana) Other tree seed oils (Malawi, Namibia, Botswana, Zimbabwe) Cosmetic skin-creams (Zimbabwe)

16. Prospects for trade in the region Natural products industry has been growing rapidly world-wide over the last few years Trade in the region will inevitably increase This presents huge opportunities to rural communities It also poses several threats, including those of adverse ecological impact, bio-piracy and the threat that benefits will not accrue to rural producers

17. Threats to growth of trade Failure to give natural products the serious attention they deserve. Some natural products can be spontaneously commercialised (e.g. wild mushrooms), but many require investment in product development, ecological management, production and processing, and marketing Our own fears: over-protectionism, stifling the opportunities we might have Donors moving in

18. Threats to growth of trade (2) Orientation towards trade with the North Bio-piracy Barriers to trade Domestication/replication Biological threats to genetic base

19. Why haven’t natural products already assumed greater prominence? Although the global bio-trade market is huge, there is a fundamental gap that remains unbridged between rural African producers and the market This gap is manifested in the fact that the products themselves do not exist Without products, rural communities have nothing to sell

20. Why hasn’t there been more investment in product development?

21. Barriers to private sector investment Uncertain macro-economic and political environment Poor market access and transport infrastructure, high transaction costs Higher levels of plant biodiversity in Latin America and SE Asia Most plant diversity found on common land Geographically dispersed production base (within and between countries)

22. Barriers to development sector investment Natural resource management viewed as conservation issue, not development issue Hard to justify financial support for product development, given the uncertainties that this will result in tangible benefits to rural communities

23. Barriers to public sector investment Lack of available finance Fears for Intellectual Property Rights Segmented and sectoralised information (i.e. information kept by scientists) Insufficient capacity at community level Duplication and loss of synergy in research

24. What can we do about it? We have made extensive, subsidised investments into mono-cultural cash-cropping If we were to make a similar subsidised investment into natural product development, we might be able to capitalise on the economic opportunities presented Focus on resources that are relatively abundant and familiar, but for which substantial actual or potential market demand exists

25. What is SANProTA? Southern African Natural Products Trade Association Conventional trade association, but with additional functions as a development institution Intended to develop and promote trade in natural products accessible to rural communities Operational in 5 countries: Botswana, Malawi, Namibia, Zambia, Zimbabwe

26. SANProTA’s Goal To enable poor rural communities in the southern African sub-region to generate supplementary incomes through the sustainable exploitation of natural products To establish a viable and enduring natural products industry in the region, in which por rural communities are the primary producers

27. SANProTA’s objectives To provide a platform for regional professional exchanges in Natural Product trade development To research and develop existing and new NPs To create and engage in markets for NPs from rural communities, leading to a sustained increase in community-based domestic and export NP trade

28. How does SANProTA operate? Legally, SANProTA is an autonomous trade association Initially, it is hosted by SAFIRE in Zimbabwe Ultimately, it will have its own offices Three-tier management structure:

30. Executive Office Staffing Chief Executive Officer – CEO of SANProTA. Liaison and Information Officer – responsible for members liaison, as well as acquisition, compilation and dissemination of info on NP trade and development Research and Market Development Officer – manages SANProTA’s relations with commercial R&D partners and buyers, and represents members in export markets. Based in UK Finance officer – manages finances

31. Other Staffing NP Business Development Advisor – advises members on the development of NP businesses, market linkages etc. NP Technical Development Advisor – advises members on the technical side of NP business development, including production, processing etc. Also support staff: secretarial, driver/messenger etc.

32. TimeFrame Official Launch at the Botswana International Trade Fair, Gaborone, September 2001 Full implementation: January 2002 – December 2005 Established as a permanent, and ultimately self-financing, institution

33. SANProTA Activities (1) Networking Fact-finding visits and exchanges Information exchange – web-site, newsletters etc. Policy analysis and advocacy on NP trade and development Business Meetings for members

34. SANProTA Activities (2) R&D Establish and maintain R&D database Sponsor R&D by members and partners on NPs of specific relevance/importance to SANProTA (total budget US$750 000) Facilitate sharing of R&D activities/information amongst members

35. SANProTA Activities (3) Marketing Develop and maintain NP Market Information System Identify and develop existing and new market opportunities Develop selected NPs commercially Advise members on NP market-related issues Operate agency services in strategic markets

36. SANProTA Selected Species 4 species have been selected for its initial focus. These are: Adansonia digitata Schinziophyton rautanenii Kigelia africana Cucurbitaceae (wild melons)

37. What is SANProTA currently working on? Expanding its membership Consolidating its funding Developing a bioprospecting policy for its members Preliminary R&D work on its chosen species Developing partnerships with commercial R&D institutions Developing a web-based R&D and market information database Selling members’ products!

38. What can SANProTA do for you? direct market information, support and advice, on request; access to a web-based database on natural product research, development and marketing; preferential access to grant funds to facilitate the development of new natural products; the opportunity to participate in exchange visits with other natural product producers in the region;

39. What can SANProTA do for you? regular technical newsletters and updates on natural product research, development and marketing; linkages to a global network of natural product buyers and trade promotion agencies; and representation at international trade fairs and other marketing fora.

40. How can you join? Fill in application form Submit it to SANProTA Executive Office before 31st March 2003 Applications will be considered by Management Board in early April, for approval at the AGM in Blantyre, mid-April