Sagcot centre Ltd Management Report

July 2013 - January 2014

Prepared by Management

SAGCOT Centre Ltd

1/29/2014

SAGCOT Centre Ltd Management Report

1Table of Contents

1Table of Contents 3

2Cluster and Partnership Development 4

2.1Partner recruitment re-opened in Q1 2014 4

2.2Partnerships building and Investment facilitation (selection of activities) 4

2.3Cluster and corridor development 6

2.4Missions July – January 2014 7

3Policy Analysis 8

3.1Policy meetings 8

3.2Publications and Papers 10

4Monitoring and Evaluation 10

5Internal operations 10

5.1SAGCOT Centre establishment 10

5.2Human Resource Management 10

5.2.1Staff Numbers 10

5.2.2Staff salaries and benefits 11

5.2.3Training and coaching 11

5.2.4Human Resource Manual 11

5.2.5Challenges in Human Resources 11

5.3PROCUREMENT 12

5.3.1Procurement Manual and plans 13

5.3.2Procurement challenges 13

5.4Financial management 14

5.4.1Accounting and financial management 14

5.4.2Support on day to day strategic activities 14

6Annex 16

6.1Overview of SAGCOT Partners 16

2Cluster and Partnership Development

The SAGCOT Centre’s (SCL) management is actively working to facilitate investors and partners who are willing to engage in activities that facilitate green and inclusive investments.

2.1Partner recruitment re-opened in Q1 2014

The SAGCOT partnership currently consists of 43 partners of whom 24 are private sector, 12 are non-state actors and 7 are government institutions. 19 of the SAGCOT Partners have signed a Letter of Intent for agriculture investment in Tanzania under the G8 New Alliance for Food Security and Nutrition. The Centre has collected circa USD 76,000 in partnership fees since inception.
Due to the limited capacity the Centre faced challenges in following up adequately with partners and collect partnership fees. The application process was put on hold, but is re-opening to add a select number of partners. The partnership process is also being revised to allow more transparency and a more appropriate filtering of partners that aligns with investment decision making processes.

2.2Partnerships building and Investment facilitation (selection of activities)

• 
  Potatoe Partnership
  

ACT, TAP, MAFC, Syngenta, Europlant, Grimme & Lemken, NMB, Mbeya research institute, Mtanga farms and CRDB have joined efforts to explore the establishment of a potato value chain in Njombe. A field day was held on 24 and 25 January in Mbeya. The Centre is facilitating the collaboration amongst parties.

• 
  Rice coalition
  

TARIPA, Kilimo Trust, USAID and MAFC are progressing on the development of Tanzania’s rice sector. The sector has been severely challenged by the tariff free imports that deflated domestic prices. SCL is currently focusing on advocacy to address the unpredictability of GoT import policy, working with its partners, MAFC, TARIPA, ANSAF and USAID to address the data collection (prices) mechanism for policy decisionmaking .

• 
  Unilever MOU – tea sector
  

SCL has played an essential role in establishing an MOU between the Tanzanian Government and Unilever resulting from their G8 LOI commitment. It is working with the Prime Minister’s Office (PMO) and Unilever to materialise their USD 150 million expansion of tea activities that will result in engaging thousands of smallholders in the Ihemi cluster. A strategic meeting has taken place between the Minister of Agriculture and Unilever’s leadership in October 2013 in London. Unilever has submitted its application for strategic investor status to TIC, whereas PMO is working on other issues. A second meeting between Unilever and GoT leadership took place in Davos, January 2014, to brief and discuss further progress.

• 
  Monsanto Partnership
  

Monsanto is implementing its G8 commitment through a coalition of partners in the field, ranging from Muvi, FIPS and AGMARK and SAGCOT partner Opportunity International. The SAGCOT Centre is participating in the Monsanto partnership and facilitates the initiative through the dissemination of information, linkages to financial institutions, and engagement with the GOT.

• 
  KPL
  

SCL continues to work with KPL to bring main issue influencing the company and thesector to the attention of key decisionmakers and leveraging their leading position in the rice sector to address these issues. KPL recently played a key role in the investment promotion event during the UK tour of the Tanzanian Minister of Agriculture.

• 
  Eco-Energy
  

The Eco-Energy project is still facing bottlenecks, recent one being the tariff free imports of sugar into the Tanzanian market. SCL is working together with Eco-Energy and other actors to tackle these issues on both a company and a sector wide level.

• 
  Water Resource Group
  

The WRG is a global public-private platform that facilitates discussions and policy decision making on water resource management in the context of economic development. The institution has been invited by the GOT to operate in Tanzania to assess water resources on a national and SAGCOT level. The Water Resource Group held it first workshop on Wednesday 27 November with a variety of stakeholders. SCL is facilitating the engagement of its partners in the WRG, but also tries to ensure that the WRG will focus its agriculture activities on fostering issues within SAGCOT.

• 
  Progress on SAGCOT BRN activities Mukulazi- TIC
  

TIC has been working on completing the transfer of the land settlement to TIC. This has occurred and allows them to continue with the tender. TIC is designing the tender process such that delivery on the SAGCOT objectives is guaranteed.

• 
  MoU to strengthen Non-State Actors Engagement
  

ANSAF, Taha and ACT have generated a TOR for closer cooperation and the recruitment of a consultant to coordinate the engagement of non-state-actors in SAGCOT. An MoU will be signed on 13 February 2014.

• 
  GAIN and SUN Business Network strengthening Nutrition focus in SAGCOT
  

A partnership between GAIN and SAGCOT Centre was announced at the SUN Business Network meeting on 15 January. Aim of the meeting was to engage businesses in improving nutrition in Tanzania. The GAIN-SAGCOT partnership will result in a stronger emphasis on nutrition in SAGCOT activities with the ambition of ensuring that all SAGCOT investments are “nutrition sensitive”. The partnership will also integrate more SME’s in SAGCOT activities. GAIN’s call for proposals for the marketplace initiative has generated circa 93 applications from small and medium scaled Tanzanian companies seeking access to funding for nutritious products.

• 
  Partnership for Prosperity UK- Tanzanian Government
  

The aim of the partnership is to strengthen the economic cooperation between the two countries, partly by direct investments in inclusive private sector investments in. DFID is co-investing in LOI signatories KPL, Unilever and Tatepa to facilitate their smallholder engagement and renewable energy activities.

• 
  Grow Africa Finance Working Group to focus on identifying financial solutions for SAGCOT value chains
  

As a follow up to the 2013 visit of USAID administrator Raj Shah’s engagement with the Tanzanian private sector (amongst which G8 LOI companies), Grow Africa hosted a meeting with the private sector in Dar es Salaam on 7 January to discuss bottlenecks in financial innovation for agriculture and value chain initiatives. An outcome of that meeting was the establishment of a finance working group facilitated by the SAGCOT Centre.

2.3Cluster and corridor development

• 
  Cluster Development
  

Due to a lack of funds the Centre has not initiated cluster activities yet. Terms of References for the Cluster Planning have been drafted and circulated to Donors in November 2013 with no response received sofar.

• 
  Green Growth Strategy for SAGCOT
  

The Green Growth Strategy has been finalised, but the Centre is awaiting the recruitment of the social & environmental specialist to re-ignite the Green Reference Group and implement the coordination of the Strategy. Coordination is a major challenge as several environmental bodies are establishing and fundraising for “SAGCOT initiatives” which have limited connection to the partnership or its efforts. The Centre is exploring a partnership with leading environmental institutions in order to properly manage and coordinate this space.

2.4Missions July – January 2014

• 
  Investor Mission Minister Chiza, London, UK October, 2013
  

Minister Chiza headed a delegation to the UK upon invitation of the UK ministry of Foreign Affairs. In addition to an investment promotion, the Minister visited a number of SAGCOT partners and other key stakeholders. The CEO of SAGCOT participated in the tour. SCL is actively following up with the British High Commission

• 
  Association of Businessmen and Industrialists of Tanzania and Turkey (ABITAT) September 2013
  

ABITAT was founded in August 2012, by a distinguished group of Turkish and Tanzania businessmen in Dar es Salaam. The mission of ABITAT is to improve industry contacts between Turkey and Tanzania, hence leading to increased investments in Tanzania. The SAGCOT CEO participated in a mission with the CEO of TNBC.

• 
  Transformation Leaders Workshop, Geneva, Switzerland, September 2013
  

The DCEO participated in the Transformation Leaders Workshop organised by the New Vision for Agriculture . The main takeaway is that SAGCOT is still seen as a role model by the 11 other partnerships that emerged worldwide, but many raise concerns about the significant delays and struggles of making SAGCOT operational.

• 
  World Agriculture Forum, Aquascalientes, Mexico, September 2013
  

The DCEO participated in the World Agriculture Forum in Mexico upon invitation of the Mexican Ministry of Agriculture. Following in the footsteps of Tanzania, the Mexican government has collaborated with multiple stakeholders to set up a high level Public-Private partnership. This event saw the launch of the Agro-parks concept, a cluster type model that the partnership, the state of Aquascalientes and Wageningen University have designed. SAGCOT was invited to share the learnings of the SAGCOT partnership in a two day event on PPP cluster development.

• 
  Kilimo Trust high Level Executive roundtable, Kampala Uganda, November 2013
  

Planned alongside the 50 year anniversary of the EAC the CEO visited this meeting to strengthen relationships with MAFC and Kilimo Kwanza. The four main themes of the event were (1)Enhanced competitiveness in production , productivity and market access (2)Turning agricultural knowledge into business (3) Turning EAC’s comparative advantage in human capital and natural resources to a competitive advantage in the global market (4) Enhancing business and employment for the youth in agriculture.

• 
  African Forum – 100 Innovations for Sustainable Development, Paris, France, December 2013
  

SAGCOT was chosen as one of 100 innovations to be featured at the “African Forum – 100 Innovations for Sustainable Development” hosted by the French Ministry of Foreign Affairs and the French Development Agency. SAGCOT was selected from among 800 applications submitted to a call for proposals. Board member Roshan Abdallah Dr. Roshan Abdallah, SAGCOT Centre Ltd. board member, represented SAGCOT at the event.

• 
  World Economic Forum Annual Meeting, Davos Switzerland January 2014
  

The CEO and DCEO participated in the WEF Davos meeting with the main aims to:

• 
  Facilitate progress on LOI investments by arranging and engaging in meetings with company and government leadership.
  
• 
  Strengthen the Agriculture-Nutrition profile of the SAGCOT initiative
  
• 
  Expand partners network by exploring opportunities in Water, Innovative Finance and Infrastructure investments
  

3Policy Analysis

The Policy analysis workstream of SCL focuses on identifying and addressing specific bottlenecks that hinder individual investments/partnerships from progressing whilst also working in collaboration with other advocacy bodies to address sector wide issues. SCL expanded its capacity by hiring a policy analyst with a main focus on tracking and facilitating progress on the Partnership Accountability commitments.

3.1Policy meetings

• 
  Access to Fertilizers, August 2013 – through a series of meetings, SCL facilitated a coalition of actors ( ACT, TPSF, TAHA, TFA, TPSF) to generate a roadmap to address the issue of lack of access to quality fertilizers in Tanzania. The roadmap was presented to MAFC, through PMO, who is already working on progress. TAHA is working with the Horticultural Sector to develop a list of folia fertilizers to be presented to MAFC for possible consideration leading to expedited registration. Other issues addressed include the challenge of fake or adulterated fertilizers in the market.
  

• 
  Agro input subsidy programme- July, 2013 SAGCOT Centre facilitated a multi-stakeholder effort to address delayed payments to fertilizer producers of the governments Agro input subsidy program. The delay jeopardized the continuation of the scheme in the new planting season as distributers and fertilizer companies were running short on working capital. SAGCOT Partners; TASTA, YARA TZ and ACT joined TFC and TPSF in this discussion to agree on a common approach to the government. ACT and TPSF approached the Ministry of Agriculture on behalf of the coalition with the complaints. The outcome of this initiative was positive as the Ministry of Agriculture paid the parties.
  

• 
  Enabling environment for Agriculture issues- September 2013. Private sector and Non state actors shared experiences and recommendations on best to jointly address shared bottlenecks. SAGCOT partners Ecoenergy, USAID- SERA Project and ANSAF (Agricultural Non-State Actors Forum). It was agreed that the group would use research and recommendations to advise the Government in order to improve the poor performance of the Agriculture sector and the use of policy briefs which are commodity based may be an option to advise the Government. So far ANSAF has tested this in cashew nuts and are very successful.
  

• 
  Land Act No 4 and No 5 Amendments- November 2013 a meeting of selected partners was convened that involved high officials from the Ministry of Lands Housing and Human Settlements (MLHHS), the private sector organizations represented by the TPSF and the Development0 Partners represented by DFID for the purpose of sharing experiences on issues of concern to the parties on the ongoing revision of the land legislation in Tanzania. The meeting on 1^st November, 2013 was also attended by SAGCOT Partners SABMiller and Ecoenergy to share their concerns and opinions of the private sector on the Act and recommend.
  

• 
  Big Results Now Agriculture. SAGCOT centre is participating and advising PDB on access to land in BRN investments especially in the corridor where a number of projects have been identified. SAGCOT Centre Ltd CEO was the co-chair of the agricultural lab in BRN and is a member of Ministerial Steering Committee for BRN in MAFC
  

• 
  G8 New Alliance for Food Security and Nutrition. As active member of Partnership Accountability Committee (PAC), who oversees the implementation of the G8’s New Alliance for food security commitments by different actors. SAGCOT centre has been the main facilitator of the meetings and most involved in supporting reporting on progress of private sector. The Team is chaired by PMO and consists of MAFC, DFID, USAID, ACT and ANSAF and meets Quarterly.
  

3.2Publications and Papers

• 
  Seed Policy brief
  

SAGCOT Centre collaborated with MAFC, TASTA and USAID to prepare a seed policy brief to list the achievements of seed policy reform in Tanzania and the key issues that need to be addressed in the near future. The report was finally finalised and published in November 2013

4Monitoring and Evaluation

The M&E activities of SAGCOT will be initiated in 2014 when the M&E consultancy will be procured in 2014.

5Internal operations

5.1SAGCOT Centre establishment

• 
  SAGCOT Centre 5 year workplan and funding agreement
  

The five year workplan has been completed and signed off by the board

• 
  Governance structure
  

The Memarts have been revised and the appointment of board members has been completed. The Government (RUBADA) has also been invited as an additional member by the existing Members (CTI and ACT). TORs for the board have been generated and signed off by the AGM in December 2014.

5.2Human Resource Management

5.2.1Staff Numbers

Current staff numbers

Currently, the SAGCOT Centre has a total of five (5) staff permanent employees including: the Chief Executive Officer (CEO), the Deputy Chief Executive Officer (DCEO), Executive Assistant, Office Administrator and Driver.

Resignations and terminations

It can be concluded that the Centre’s first round of recruitment had mediocre success as staff proofed not to be skilled enough to deal with the scope of work and level of professionalism required.

• 
  The Accountant has not been provided with permanent contracts because his skill set did not comply with SAGCOT requirements.
  
• 
  The DCEO’s Driver resigned after being informed that he would not receive a permanent contract as he could not operate the car as required.
  
• 
  The Operations Manager resigned citing personal reasons.
  

Vacancies

Vacant positions are: Head of Cluster Development, Environmental and Social specialist, Accountant, Operations Manager and Program specialist. An HR consultant has been procured to assist in filling these vacancies.

5.2.2Staff salaries and benefits

The staff has been receiving their salaries as stated in their letters of appointment for all the months they have worked at the Centre except for the following positions:

• 
  The CEO and Deputy CEO. These staff has not received salaries for the months of April, May, September and October 2013 due to financial constraints
  
• 
  Staffs pensions have not been paid to the right authorities since their commencement dates.
  
• 
  Staffs have not joined any medical scheme so far as they cannot afford to pay the annual lump sum fare. The Centre is exploring pre-financing options to commence in 2014, although it has to be explored whether these are in line with its operational guidelines.
  

5.2.3Training and coaching

Due to a lack of funds there was no external staff training in 2013 and most induction training was conducted in-house. For 2014 it is expected that this will be done by the HR consultant.

5.2.4Human Resource Manual

The Human Resources manual has been revised in line with comments received from funders and has been approved by the board.

5.2.5Challenges in Human Resources

• 
  Pension payments for staff have not been submitted to relevant authorities since they have joined the Centre. SCL will request the government to pay for outstanding liabilities and will negotiate a deduction of penalties with the relevant authorities.
  
• 
  Capacity building and professionalism is required to equip the Centre and its staff for the high pace and dynamic program ahead.
  

5.3PROCUREMENT

Due to funds being made available by UNDP and DFID, SCL is able to initiate procurement of basic consultancies.

Procurement status

#	CONSULTANCY	Expected duration		STATUS	SOURCE OF FUND
1	HR Support	1 year	Jan 2014 - Jan 2015	Contract signed	UNDP
2	Information and Communication Support	6 months	Jan 2014 – Jan 2015	Contract signed	UNDP
3	Legal support	1 year	Jan 2014 – Jan 2015	Contract signed	UNDP
4	Integrated management information and CRMS setup	1 year	Jan 2014 - Dec 2014	Phased negotiation of contract	UNDP
5	Policy Backstopping consultancy	5 months	Dec 2013 - April 2014	Contract signed	UNDP
6	Procurement Management Agent	6 months	March 2014- March 2015	3rd call for proposals	DFID
7	Audit Firm	One year	March 2014 – March 2015	TOR drafted	DFID

5.3.1Procurement Manual and plans

• 
  The procurement manual and plans have been revised based on input from the funders, and was signed off by the board.
  

5.3.2Procurement challenges

• 
  Professional Capacity. The Centre still requires professional capacity to facilitate its procurement activities, especially since it is dealing with 7 different funders who will be applying strict procurement audits on the Centre
  
• 
  Funding to complete procurement. The Centre has not secured funding for it is entire annual work plan yet
  
• 
  Delay in procuring a Procurement Management Agent. Initial support in procurement pledged by UNDP was withdrawn, causing delay in procurement and re-allocation of staff resources towards procurement and away from other activities.
  

5.4Financial management

Deloitte Consulting Ltd was engaged by the SCL to provide accounting and financial management support at the Centre on 30^th September 2013. The key activities carried out to-date include:

5.4.1Accounting and financial management

The following key activities were implemented:

• 
  Accounting records: Collected the missing financial information that was not posted in the SCL ledger, recorded the backlog and updated the financial records for the period covering March 2013 onwards. A proper system of receiving, recording and filling of financial information was established.
  
• 
  Cash and bank: the Deloitte team became a bank agent and support SCL with bank transactions as well as verification of the bank information. Update of the cash books and preparation of the bank reconciliation statements from January 2013 to January 2014.
  
• 
  Fund flow management: preparation of funder’s overall and individual budgets, drafting of letters of agreements, follow up on the outstanding funding such as USAID and Diageo, and preparation of financial reports for individual funders.
  
• 
  Accrued liabilities: updated the list of outstanding liabilities including historic liabilities from 2012, preparation of the fund re-allocation plan which was approved by the management and endorsed by the Board during the Board Meeting in December 2013. Request made to the Government fund to re-allocate funds to cover these liabilities.
  
• 
  Auditing: updated the financial information and prepared the draft financial statement to January 2014. ToR’s for the audit committee drafted and solicitation of CV for the possible candidates initiated. The on boarding of the audit committee is pending Board approval and once finalized it will enable the Centre to appoint the auditing firm to conduct the financial audit.
  
• 
  Processing transactions: Processing of various payments in proper operation, including the payroll. The roles include alignment of expenses with the budget, ensuring the presence of supporting documentations, preparation of payslips and submission of statutory deductions to the relevant authorities.
  

5.4.2Support on day to day strategic activities

The Centre received the support from Consultants (mainly Deloitte) in its day to day operations by providing guidance on acceptable controls and processed for purchasing and usage of office stationeries and other consumables, maintenance of records, and the office operations. Other day to day support activities provided included:

• 
  Facilitation of Board and other meetings
  
• 
  Budgeting and supporting travel arrangements
  
• 
  Responding to third party queries (e.g. suppliers, partners, donors, etc.)
  
• 
  Managing relationship with suppliers
  
• 
  Managing relationship with staffs and other consultants
  
• 
  Filing, documenting and providing advice on different matters ranging from personnel and organizational
  
• 
  Verifying and establishing staff and consultants contracts
  
• 
  Attending strategic and operational meetings, such as weekly task meetings, board meetings and funders meetings
  

6Annex

6.1Overview of SAGCOT Partners

Private Sector

• 
  Africa Potato Initiative
  
• 
  AGCO
  
• 
  Bayer Crop Science
  
• 
  Bunge Limited
  
• 
  Diageo / East African Breweries Ltd
  
• 
  EcoEnergy
  
• 
  Kilombero Valley Teak Company Limited (KVTC)
  
• 
  Kilombero Plantation Ltd (KPL)
  
• 
  Kuwait Danish Dairy Company
  
• 
  Monsanto
  
• 
  Minjingu Mines and Fertilizer Ltd
  
• 
  McLaughlin Gormley King Company (MGK)
  
• 
  Nestlè
  
• 
  Olam
  
• 
  Opportunity International
  
• 
  Pyrethrum Company of Tanzania
  
• 
  Seedco Tanzania Ltd
  
• 
  Shambani graduates enterprises Ltd
  
• 
  Silver Street Capital
  
• 
  Syngenta International AG
  
• 
  MIC Tanzania (TIGO)
  
• 
  Unilever
  
• 
  United Phosphorus Ltd (Advanta)
  
• 
  Yara International
  
• 
  SABMiller/Tanzania Breweries Ltd
  

• 
  National Microfinace Bank (NMB)
  

Farmer and Apex organization

• 
  Agriculture Council of Tanzania (ACT)
  
• 
  Confederation of Tanzania Industries (CTI)
  

“As SAGCOT Partners we strive to enhance food security, transform agriculture and improve the livelihoods of smallholder farmers.

Our mandate is to achieve this by catalyzing responsible and inclusive agriculture investments in Tanzania’s Southern Corridor”

Tanzania Horticulture Association (TAHA)

• 
  Tanzania Sugar Growers Association (TASGA)
  

Development partners, Foundations and NGOs

• 
  Alliance for a Green Revolution in Africa (AGRA)
  
• 
  Africa Wildlife Foundation
  
• 
  Department for International Development (DFID)
  
• 
  Royal Norwegian Embassy
  
• 
  Tanzania Agricultural partnership (TAP)
  
• 
  United States Agency for International Development (USAID)
  
• 
  World Bank
  
• 
  Heifer International
  
• 
  United Nations Development Programme (UNDP)
  

Tanzanian Government

• 
  The Government of the United Republic of Tanzania
  

• 
  President Office
  
• 
  Prime Minister’s Office
  
• 
  Vice President Office
  
• 
  Ministry of Agriculture, Food Security and Cooperatives
  

• 
  Financial sector deepening trust (FSDT)
  
• 
  Tanzania Investment Centre (TIC)
  
• 
  The Rufiji Basin Development Authority (RUBADA)
  
• 
  Tanzania Investment Bank (TIB)