Improving the Nutritional Quality of Food Markets through the Informal Sector: Lessons from Case Studies in Other Sectors
IDS Evidence Report 171
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Policymakers in a number of countries in sub-Saharan Africa (SSA) are seeking to work with food markets and food businesses as part of efforts to reduce undernutrition. These market-based approaches include national fortification programmes, public food distribution systems, new product development and the promotion of biofortified crops.
Food markets have clear potential to improve diets, including those of many low-income populations. However, current market-based approaches generally fail to engage a large and critical portion of these markets: informal businesses – particularly food traders, processors and retailers. It is the informal sector that supplies much of the food purchased by the poor, delivering products to the locations where they live, typically at very low prices. However, food in informal markets is often not sufficiently nutrient-rich and can be unsafe. Many policymakers regard the informal sector as a barrier to development or believe that it will quickly disappear with the spread of supermarkets and centralised food value chains. However, available evidence suggests that most food in SSA countries will continue to be sold in informal markets for the next several decades, due to broader economic and institutional conditions that favour informality.
Policy approaches aiming to suppress the informal sector are generally ineffective; in some cases, they can actually decrease the quality and safety of food. Similarly, food and nutrition policies that simply ignore the informal sector may fail to have effects for low-income populations. Finally, nutrition initiatives that include the informal sector may contribute to the success of parallel initiatives involving formal businesses, since formal businesses generally compete with informal businesses and respond to their behaviours. Developing new approaches that engage informal food businesses is therefore an important policy priority. Yet programmatic action in the informal sector has not been examined in a systematic way in the context of food and nutrition.
This Evidence Report helps to address this gap by analysing several programmes in other sectors that have sought to improve performance in informal markets in SSA. The report groups these programmes into three case studies: food safety interventions, programmes targeting small medicine sellers, and efforts to promote salt iodisation. The review finds that there are substantial benefits of adopting a facilitative approach towards informal businesses: in particular ‘light-touch’ interventions centred around training and behaviour change can yield significant improvements in the quality of products and services. At the same time, these approaches are not panaceas; the case studies emphasise that ‘light-touch’ interventions do not lead to technically perfect outcomes: post-intervention performance is patchy, and inappropriate products and practices remain. Yet, by triggering moderate improvements in informal markets, these programmes may have substantial benefits for the poor.