Jeff Neilson

Global value chains and global production networks in the changing international political economy: An introduction

The emergence of global production and distribution systems, which bring together diverse constellations of economic actors through an increasingly complex regime of global corporate governance, widespread outsourcing of productive functions, and new international divisions of labour, has stimulated the rise of corresponding conceptual models to explain these developments in International Political Economy (IPE).

Value chains, neoliberalism and development practice: The Indonesian experience

ABSTRACT This paper provides a critical analysis of the emergence of an approach within the practice of international development that adopts a ‘value chain’ discourse, and traces the conceptual underpinnings of this discourse and practice through its translation from scholarly literature. This practical application of value chain theory has involved the selective application and interpretation, by development practitioners, of key scholarly ideas on global commodity chains, development strategies and industrialization. The specific application of value chains in Indonesian development practice, however, is silent on other aspects of the global value chain framework, such as the role of the state in mediating development strategies, power asymmetries within chains, and world-historical circumstances that shape upgrading possibilities. Despite foundational roots in critical analyses of global capitalism, recent ‘value chains for development’ applications appear to be perpetuating a neoliberal development agenda, which is facilitating the enhanced penetration of multinational capital into the economy and lives of the rural and urban poor.

Global Markets, Farmers And The State: Sustaining Profits In The Indonesian Cocoa Sector

Abstract The rapid expansion of cocoa farming among Sulawesi smallholders since 1980 has transformed the island into a hub within the global cocoa industry. It hosts a number of multinational trading firms and has an expanding grinding sector. In recent years, however, the cocoa sector has been struck by severe pest, disease and quality problems, which are undermining the long-term sustainability of one of Eastern Indonesias most important rural industries. Some form of intervention is needed if the cocoa industry is to avoid steady decline. This paper examines the role of informal institutions, cocoa multinationals and government in attempts to maintain farm profits in Sulawesi.

Chained to Development? Livelihoods and global value chains in the coffee-producing Toraja region of Indonesia

ABSTRACT A popular rural development strategy in recent years has been through the adoption of what has been widely called a ‘value chain approach’, where improved linkages between small producers in underdeveloped rural communities and ‘lead firms’ constitute the foundations for development interventions. Whilst the global value-chain framework can deliver insights into the broad structural processes shaping livelihood possibilities, the adoption of value chains as a development strategy tends to disregard the complexity of smallholder livelihoods that shape poverty alleviation pathways in different contexts. The relationships between global value chains, development interventions, and rural livelihoods are explored in this article through a case study of smallholder coffee farming in the Toraja region of Indonesia. In this case, value-chain interventions in the coffee sector are unlikely to significantly contribute to improved rural welfare due to the diversified reality of local livelihoods, the nuances of how coffee production is embedded within Torajan culture and economy, and excellent prevailing market opportunities. The livelihood framework, therefore, provides an important corrective for the sometimes excessive optimism presented by advocates of a value-chain approach to rural development.

Winner or loser of climate change? A modeling study of current and future climatic suitability of Arabica coffee in Indonesia

Previous research has shown that the production of Arabica coffee (Coffea arabica), the main source of high-quality coffee, will be severely affected by climate change. Since large numbers of smallholder farmers in tropical mountain regions depend on this crop as their main source of income, the repercussions on farmer livelihoods could be substantial. Past studies of the issue have largely focused on Latin America, while the vulnerability of Southeast Asian coffee farmers to climate change has received very little attention. We present results of a modeling study of climate change impacts on Arabica coffee in Indonesia, one of the world’s largest coffee producers. Focusing on the country’s main Arabica production zones in Sumatra, Sulawesi, Flores, Bali and Java, we show that there are currently extensive areas with a suitable climate for Arabica coffee production outside the present production zones. Temperature increases are likely to combine with decreasing rainfall on some islands and increasing rainfall on others. These changes are projected to drastically reduce the total area of climatically suitable coffee-producing land across Indonesia by 2050. However, even then there will remain more land area with a suitable climate and topography for coffee cultivation outside protected areas available than is being used for coffee production now, although much of this area will not be in the same locations. This suggests that local production decline could at least partly be compensated by expansion into other areas. This may allow the country to maintain current production levels while those of other major producer countries decline. However, this forced adaptation process could become a major driver of deforestation in the highlands. We highlight the need for public and private policies to encourage the expansion of coffee farms into areas that will remain suitable over the medium term, that are not under legal protection, and that are already deforested so that coffee farming could make a positive contribution to landscape restoration.

Reviewing the impacts of coffee certification programmes on smallholder livelihoods

ABSTRACT Certification programmes and voluntary standards for sustainability are now a common feature of many agricultural landscapes worldwide. The rapid expansion of such programmes has only recently been accompanied by concerted attempts to assess the lived experience of enrolled producers. This article reviews empirical research assessing the impact of certification programmes on coffee smallholder livelihood assets, and presents an initial framework for both conceptualising and analysing change in livelihood assets resulting from certification. Several of the reviewed studies identified enhanced livelihood assets arising from certification under specific institutional and contextual settings, but causation was difficult to establish. A greater number of studies found either neutral or mixed impacts, and a small number reported negative impacts. While a consensus has yet to be reached regarding all livelihood impacts of certification programmes, we present a series of propositions that reflect widely reported impacts. Further findings drawn from the review include: (i) stronger pre-existing institutions within the producer community are more likely to result in benefits for individual households; (ii) the value chain structures through which certification programmes are implemented are highly varied and strongly influence livelihood outcomes; and (iii) methodologically, existing studies rarely present either reliable baseline data or a realistic control group for comparison, making causation difficult to establish. EDITED BY Dagmar Mithöfer

The state and food security discourses of Indonesia: feeding the bangsa

This paper examines the ways in which discourses of food security and food sovereignty are articulated in Indonesia, exploring their emergence within particular historical episodes and considering how this change has informed their current deployment by state-based actors. Looking first to the wider global discourses that encompass perspectives on food security and food sovereignty, this paper attempts to map a specifically Indonesian perspective on ‘food security’ (ketahanan pangan), and its relationship with ‘food sovereignty’ (kedaulatan pangan). Kedaulatan pangan emerges as a fundamentally endogenous political construct in Indonesia; that is, only marginally related to the broader global discourses of food sovereignty as espoused by organisations such as La Via Campesina. As presented by the Indonesian state, kedaulatan pangan is not oppositional to ketahanan pangan, as sometimes is portrayed elsewhere, but should instead be understood primarily as a rhetorical device to strengthen the role and function of the state and to reinforce existing associations between food security, state control, and national scale food self-sufficiency. The Indonesian notion of kedaulatan pangan responds primarily to the scalar notion of feeding the bangsa, the abstract Indonesian word for ‘the nation’. The dominant discourse has been embraced and projected by political actors to further vested interests and also appears to be contributing to policy interventions with negative food security outcomes for some of Indonesias most vulnerable individuals.

Lead Firms in the Cocoa–Chocolate Global Production Network: An Assessment of the Deductive Capabilities of GPN 2.0

abstract Recent models of Global Production Network Theory (known as GPN 2.0) have attempted to theoretically explain the underlying determinants, or causal drivers, of particular industry network configurations, which in turn shape the territorial outcomes for regional development. To date, the ability of this ambitious conceptual model to thereby explain economic geography has remained largely untested beyond the select industry networks examined by its proponents, most notably the electronics, retail, and automotive sectors of East Asia. In this article, we stress test the causative model for the case of lead firms in the global cocoa–chocolate sector, and assess its ability to subsequently explain industry configurations and territorial outcomes in a particular country: Indonesia. Our application suggests that GPN 2.0 has considerable utility for directing empirical research, but challenges beset its fuller theoretical promise. We identify a problematic relationship between the deductive causality implied by GPN 2.0 and the inherent relationality of GPN 1.0 that remains, in our view, unresolved. As a result, we remain skeptical of the broader theoretical claims that GPN 2.0 possesses explanatory powers capable of deducing industry network configurations from a discrete set of supposedly independent variables.

Being Sandwiched: The Reshaping of ASEAN-China Food Trade

“The China question” casts a long shadow over the global food system. China’s WTO accession in 2001 and recent emergence as a major agri-food exporter have triggered widespread anxiety among rural producers worldwide. At the same time, the potential to find markets in the rapidly growing Chinese middle class represents a salivating prospect for food companies across the globe. Perhaps nowhere in the world has “the China question” loomed larger than in the ASEAN countries, given Southeast Asia’s sizeable agriculture-dependent population and the vital role played by agri-food sectors to ASEAN countries’ export earnings. Whilst governments in China and ASEAN have publicly embraced closer agri-food trade, this has been undertaken against a backdrop of concern within rural populations. Illustratively, at virtually the same time that the Thai government was heralding China as providing a golden opportunity for the country’s agricultural sector (Xinhua News Agency, 2005), farmers in northern Thailand were vociferously protesting against their local markets being swamped by imported Chinese fruits and vegetables (Voice of America, 2005).