Coming to terms with market support

In late 2012, Oxfam and WFP collaborated on a joint review, entitled, ‘Engaging with Markets in Humanitarian Responses‘, which aimed to understand how humanitarian agencies are engaged in supporting markets. The review found that, beyond the basic consensus that agencies should ‘do no harm’ to markets, and use them where they are sufficiently functional, there was a range of perceptions regarding the extent to (which humanitarian organisations should and could support and strengthen markets to improve their functionality.

There is no doubt that, for many international organisations, humanitarian interventions today are very different to those in the past. Now, working through and supporting local markets whenever possible is considered best practice in the humanitarian field.

However, despite the now widespread consensus that, where possible, humanitarian interventions should have some components of market engagement, until recently there has been neither widespread consensus nor debate as to what form and extent this engagement should take. While working through markets to deliver relief has become a commonplace humanitarian strategy, providing support to markets, with the aim of reinforcing their capacities and resilience as critical components of food security and livelihood security, has remained largely the domain of developmental strategies and interventions.

Interviews conducted by Oxfam and WFP and a review of the existing literature suggest three main approaches to market engagement that form part of a spectrum of market based programming.

• ‘Market integrated relief‘[1] – the practice of working through markets to provide relief and basic services (this covers most existing cash and voucher transfer programmes).
• ‘Indirect support through markets‘ represents one of a series of humanitarian response options, characterised by rehabilitating or strengthening – through temporary or one-off actions – those parts of the market system (identified through market analysis) that need support to effectively supply basic needs during emergencies. While it is a short term activity, it can be implemented in a way that promotes recovery.
• ‘Market-based strengthening and development‘ is a long term approach that seeks to boost the market’s ability to support livelihoods and has the potential to build resilience to crises.

While humanitarian agencies and their partners have a wealth of experience in implementing market integrated relief, together with responses that stretch into early recovery, many of the activities that fall under the ‘indirect support through markets’, are new to them. This is an area with huge potential to affect the functionality of and access to critical market systems – and therefore affect the capacity of people to withstand crises and to reinforce their livelihoods. Yet this area represents a significant gap in understanding of how and where humanitarians should engage.

Oxfam and WFP have identified some of the critical challenges and areas of work needed to address this gap.

The first step is to establish a common terminology and framework for market based programming. This would allow agencies to engage with markets (and other actors) more confidently using differentiated and coherent response options for different levels of engagement. This common framework would allow agencies operating anywhere along the market based programming spectrum, to have a shared understanding about the fundamental principles and methodologies of market analysis and market intervention across different contexts, and across the programme cycle. An understanding of how markets work is connected would also ensure that livelihoods programmes are prepared to deal with sudden shocks and that emergency response interventions incorporate a longer-term sustainability aspect.

Other areas of work include ensuring that assessment tools support response analysis; building the evidence base for ‘indirect support through markets’; developing analytical tools that adequately capture the complexity of markets and how they function; and improving the ability of humanitarian staff to carry out market analysis.

These challenges may necessitate a change in the way that some humanitarians work. We may need to look to our development colleagues for information, support, advice and tools. We also might need to re-assess our organisational mandates, and align our operational policies accordingly, so that we can be clear about what our organisations can and cannot do. This work will involve thinking strategically, and realistically, and it will take time to develop positions and capacity. What is clear, however, is that this work is well worth doing.

[1] Minimum Standards for Economic Recovery after Crisis. SEEP (2009)