Liu Wenkui: NGOs Endeavor to Eradicate Poverty

Seeking Change

CT: Along with the advance of science and technology, Internet Plus is changing everything. What opportunities does it offer for public welfare?

Liu: The progress of Internet technology brings even more possibilities for anti-poverty projects. “Internet Plus poverty alleviation” raises another line of thought on solving the problem – that of promoting economic development in impoverished areas. High transportation costs and scant market experience, which result in products performing badly in market competition, are the biggest problem for farmers in these areas. Luckily, the problem is now solvable. The vital e-commerce poverty relief mode offers new development opportunities in our poverty alleviation work.

The CFPA has put in a lot of effort in the e-commerce poverty relief field. In March 2016, it found that e-business could earn fruit farmers decent incomes in Ya’an, Sichuan Province. Thanks to e-commerce promotion, 50,000-kg of oranges from Ya’an sold out within three hours. This was the CFPA’s first instance of e-commerce poverty relief. Exploring new e-business modes has thus proved successful in practice for public welfare organizations.

CT: Some e-commerce platforms focus on form at the expense of substantial content. What’s your opinion on this?

Liu: The basic function of e-business is to create an online marketing channel free of time and space boundaries. In recent years, the government and responsible enterprises have invested substantially in rural Internet infrastructure, thereby laying good foundations for farm produce e-business. However, how to make farmers benefit from the e-business platform remains a tricky issue. The situation can be ascribed to three bottlenecks: small scale, due to a production mode of scattered households; low quality, resulting from effective constraints; and the absence of long-term agricultural trust. These problems need to be resolved before farmers can benefit from e-commerce. We can now help them dissolve these three bottlenecks by bringing e-commerce poverty relief into effect.

CT: Could you be more specific about how the CAFA can solve these three operational bottlenecks?

Liu: The bottleneck of scale also constitutes one of productivity.

The scale of production from a single household can hardly meet the needs of e-commerce sales. Moreover, according to traditional production modes, a single farmer acts as producer and technician as well as seller. Low efficiency is generally the result of this lack of specialization.

This is why we build cooperatives in rural areas and divide them into several work groups. It solves the problems of production scale and efficiency.

The low-quality bottleneck is also a big impediment to farm produce e-commerce.

Under the traditional market pricing mechanism, prices gradually rise from wholesale to retail. However, the price at which products are purchased from farmers is usually low. To increase their incomes, therefore, farmers must use all means available to lower their costs and raise production. Those most commonly applied are the use of pesticides and chemical fertilizers, the former to reduce labor costs and the latter to boost yield. But low expenditure leads to low quality and consequently lower prices, so forming a vicious circle of food safety problems.

Unless they earn reasonable incomes, it is impossible for farmers to produce high-quality foodstuffs, let alone guarantee consumer rights and safety. To break the low-quality bottleneck, we have formulated a unified quality standard through strict monitoring and also set up a tracing mechanism. For example, now, every fruit crate is marked with the producer’s name. We also cooperate with an international UK inspection organization to ensure that products meet each of the 156 technical indexes necessary to meet the requisite standard. If one work group does not meet this standard, it is removed from our system. If three work groups fail the standard in a cooperative, the entire cooperative is removed. This constitutes an interest-binding system. Since news travels fast by word of mouth in rural areas, no one would risk imperiling the benefits of the entire village. This guarantees product quality.

Last is the trust bottleneck. Even though farmers produce good products, it is hard for consumers to distinguish among them. Consequently quality produce does not necessarily sell at the price it should. Our quality control system gives the CFPA the confidence to endorse these goods. Agricultural products that meet our quality standards, therefore, have unified branding and gain market recognition.

CT: What do you think are the most valuable lessons you have drawn from your experience in e-commerce poverty relief ?

Liu: The e-business evolution has reduced the transaction, production, and circulation costs of farm produce. Only when farmers gain more profits can the market mechanism be sustainable and healthy. The ultimate goal of poverty alleviation via e-commerce is to help farmers gain benefits. The first thing is to encourage farmers to undertake large- scale production and increase efficiency; second, it’s necessary to build a community of farmer’s interests by resorting to modern technology and organization modes. Via the community they can make profits by producing quality farm produce. As consumers are willing to buy farmers’ quality products, they thus earn reasonable incomes.

Wei Bo is a reporter at www.china.com.cn