Analysis of the dynamics of government-supported smallholder baby vegetable enterprises for an integrated high-value development framework

Abstract

The government of Eswatini embraces the integration of smallholder farmers into high-value crop production as a vehicle for inclusive green growth. However, the outcome of the sector remains low and hampers its contribution towards this goal. The study assessed the levels of technical, allocative and economic efficiencies within the production processes. The study further analysed the levels of financial literacy among smallholder farmers. The challenges encountered by farmers were also characterised and strategies towards the integration of smallholder farmers into high-value crop production were suggested. A cross-sectional design that employed sequential mixed-methods approach was adopted and purposive sampling was applied to the selected a group of farmers from the Manzini and Hhohho regions. Data were collected through a structured questionnaire, key informant interviews and focus group discussions. The data were analysed through the SFA, discriminant and thematic analyses methods. Triangulation enabled synthesis of results for the proposed integration framework. Farm characteristics showed that age, gender, education, and labour cause variation in the group. Efficiency analysis showed that technical, allocative, and economic efficiencies were 52%, 53% and 29%, respectively. There were 88% respondents with below 50% economic efficiency, indicating low profit rates for sustainable production. High harvesting labour costs, overuse of fertiliser with unoptimized land size were significant sources of inefficiency among farms. The enterprises were largely affected by production and marketing risks. Low product quality and delayed cash inflows affect liquidity of farms, while weather variability and unavailability of labour during harvesting induced crop losses that undermined farmers’ economic returns. Growers use non-saving financial services and have unsatisfactory financial literacy that led to poor financial performance. The non-saving culture encouraged the use of costly capital to finance production processes. Proposed is a three-pillar framework for the integration of smallholder farmers into high-value vegetable production. The pillars include building capacity for improved technical and allocative efficiencies, strengthening sector risk management plan, and enhancing farmer financial literacy. Skills development and creation of innovation can be ameliorated through the promotion of youth engagement in agribusiness and improvement of extension services to create demand for agricultural financial services. This is imperative for improved farmers’ production capacity and increased marketed share, thereby, promoting rural development through profitable high value crop production.