Aug. 8, 2018
Economist, partner of Agencia Futuro
Economist Gustavo Grisa, partner of Agencia Futuro, an impact business consultancy in Sao Paulo. He is one of the leading Brazilian professionals in public innovation, industry corporate responsibility and public-private partnerships for local and regional development, working as a policy and strategy advisor for public administrations and corporations. Grisa has an MBA from Thunderbird School of Global Management (USA) and is a member of the Cambridge Sustainability Network. The economist gave an exclusive interview for AgroPages.
How can the private sector promote actions to minimize social and environmental impact in agribusiness and promote better productivity and profits for farmers?
One of the main differentials of the Brazilian agribusiness in relation to its main global competitors is a better ordered supply chain and an even stronger sectorial organization to promote environmental and social projects that can prevent and minimize the impact, maintain and increase the value of the land and property.
Issues such as recycling, water resources management and waste management in the environmental field, and the establishment and development of young entrepreneurs and farmers in rural areas, in the social field, are critical. Access to technology and the best quality of electricity and connectivity in the field are also fundamental. Public-private interaction is the logical way to build this reality, since projects and infrastructure with government resources will be increasingly insufficient. However, the era of public-private projects of great impact on agribusiness is just beginning, as government agencies will be increasingly flexible and willing to develop projects with industry representation. So, we’ll need better and more innovative impact models and regulations to make these partnerships possible.
How important are sustainable practices? How can practices such as packing recycling and reverse logistics be more encouraged, and thus, generate more income for farmers?
The economically more complicated situation is when there is no practice, policy, or regulation of sustainability or social responsibility in an activity. For example, the registration and control of agrochemicals is the best prevention against misuse and smuggling; local economic development projects are the best guarantee of a continuously positive operating environment, with the local population and society engaged and aware of the economic and social importance of agribusiness.
The Brazilian agribusiness sectors need to be more vigilant in preventing even more non-tariff barriers due to sustainability and phytosanitary issues; need to increase their involvement in production chains that have international certification, in global production chains. Such involvement is critical to ensuring access to markets and influencing the productivity capacity of the land. These initiatives will be increasingly led by organized sectors, and increasingly by government agencies.
How can Brazilian agribusiness improve its articulation, image and reputation as a major development catalyzer?
The Brazilian agribusiness is composed of 30% of agriculture, including livestock, 27% industry, 12% of inputs and 31% of services. In general, agribusiness contributes about 23% of the Brazilian economy. However, a strategic and governance success can lead development to regions stimulated by agribusiness to be promoted, with a consistent growth above the national average during the next 20 or 30 years.
Politically, Brazilians in general are not fully aware of this. Although there have been a lot of improvements lately, the contribution of agribusiness to the country's development has not found a proportional response in terms of governmental articulation in search of an integrated and efficient support system; in the media in general, a better understanding of the agronomic role of agribusiness not only in employment and economic contribution, but also in social and cultural cohesion. Even today, the defense of agribusiness is still focused on the defense of rights as property and defense, and not on a regulatory platform and public-private governance that can take the country to another level, closer to its potential.
I believe that the best way to improve this articulation is through strong industry and sector associations, with public-private agencies working in a coordinated manner in actions such as strategic public relations, monitoring of stakeholders, and a more professional and lasting work of marketing and national and international brand. The communication of the "Brasil Agro" brand, or something similar, should be more profound, articulated by sector and considering the partnership and the seal of official agencies such as EMBRAPA, APEX and others.
How can the development of agricultural cities and regions further contribute to agribusiness?
An important geographical aspect besides logistics is the need for high-level regional services in the agribusiness regions. It is necessary to develop distribution channels, network of suppliers, structure for research and dissemination of technology. Ideally, it would be important to have at least every 500 km of reach in the center-north and every 200 or 300 km of reach in the center-south a competitive urban center with services, technology, access to logistics and health services and quality education. It requires adequate infrastructure for business tourism and security for executives and international professionals.
In this sense, greater public-private strategic coordination is needed to develop regional poles of development, strong, reference cities, where the resources and income of agribusiness circulate for a longer time and can be retained to a large extent. This is an important role for business leaders in the sector and for the government, especially the Ministry of Cities, which today is more of an urban infrastructure ministry and does not fulfill its main strategic purpose, states and municipalities. Governments need to be more regulators, formulators, facilitators; more brain, and less execution, operation.
Speaking of public policy, in the role of government, how can the Government prioritize its actions to strengthen regional economic vocations, in many cases, based on agribusiness?
The economic vocations of a region will always be strengthened if there are better operational and systemic conditions, such as credit, financing, logistics, quality of education in general and professional education; and career choice for the new generations. We need to think about local and regional production systems and the efficiency of their logistics corridors, increasing the possibility of competitive prices in the medium and long term. New forms of logistical integration, such as railways and waterways, should be better thought of in a global export context.
But it is a misconception that sectors heavily commodity-based can not be combined with a modern industrialization and service economy. Even because they use the same logistical efficiency, distribution channels and regional infrastructure.
The government should provide a stable legal and macroeconomic environment that allows more internationally competitive interest rates, and better guarantees for competitive agribusiness activities. I personally advocate the merger in a Ministry or in a special agency for the agribusiness, more of coordination than executive, to have synergy between environmental, social and economic issues, aspects of certification and phytosanitary. The support to the activity must attend to a logical strategy, although executed in part by different agencies and mainly by public-private partnerships with strong governance and commitment to improve the brand, credibility, prestige and impact of the Brazilian agribusiness in sustainable terms.
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