This step involves working closely to support a range of market actors who are either marginalised or key to the development of the market system in the future.
The underlying focus of this roadmap is to support the actors of a selected energy market to make their system more inclusive, benefiting themselves as well as poor actors. As not all actors are equally capable of making their energy system work better for themselves this step focuses on supporting the marginalised actors, including gender equality. In addition, it also motivates the key actors, who are more savvy and well connected, to work together with the other actors to transform their energy market system effectively by themselves.
This roadmap step provides guidance on how to empower the marginalised energy market actors, including building gender equality across the system. These actors include micro-entrepreneurs, small-scale manufacturers, laborers, raw material suppliers, as well as service providers and intermediaries, who need to be empowered to become more capable and willing to interact on a more even footing with the more powerful actors. This empowerment goes hand in hand with the processes of assessing the roles and value they will play in improving their energy system as a whole.
This step also provides guidance on how to develop and implement a strategy of engagement to convince the key market actors, who have pre-existing prejudices and expectations about external interference in their market system, which may affect their willingness to take part in the activities of the next roadmap steps, to join the process. This step helps the market facilitators better understand the motivations and incentives of these key actors, including devising ‘hooks’ to attract them, and finding ways to keep them interested even when things are not going to plan.
Marginalisation within a system refers to any group of market actors, from both the supply and demand side, who face disadvantages due to a lack of bargaining power, knowledge, political influence and, or, their socio-economic status, including a gender imbalance. This typically includes entrepreneurs who manufacture, distribute and retail the energy products and services, paid labourers, local service providers, including financial services, some small-scale market chain intermediaries and the end use consumers. However, there are often other marginalised actors in the system, and analysis needs to be carried out to identify who they are and what type of support they require, in particular to ensure the greater involvement of women in the process.
Poverty, vulnerability and marginalisation happen for many reasons. This includes limited opportunities and ability of people to meet their basic food and living requirements, and those of their dependents, in addition to debt repayments, through reliable and attainable income streams. This is often exacerbated by ill health, physical or psychological trauma, and lower social ranking, particularly for women. Marginalised people often find themselves falling behind in a fast-changing world, or being pulled out of it by various factors that can take generations to be broken, including the following:
Building the knowledge and skills of marginalised actors can improve the way they interact, so they can work together to unlock the vicious circles or marginalisation, poverty and environmental degradation that negatively impact them. This is illustrated in Figure 1, which outlines the typical recurring elements of the pathway out of poverty for the very poor - although it is important to note that in reality, this process is rarely as linear as suggested!
Figure 1 Recurring elements of ‘pathways out of poverty’ of the very poor (USAID Microlinks)
Experience has shown that even small increases in the participation of marginalised actors can lead to rapid and significant improvements in market systems, such as access to improved quality of energy technologies, improved bargaining power of market actors or increased access to low-risk finance. Empowering marginalised actors can kick-start and catalyse their greater involvement in the market system. It is important to note that this support is often only required in the short-term as once the empowerment process starts to take place the market system takes over, continuing to build their skills and attitudes to stay productive, efficient, competitive and adaptable.
Even basic market engagement activities such as allowing the female head of the household to participate in a community meeting about household cooking , or improving the rules of participation in a cooperative meeting about a community mini-grid, can lead to empowerment in itself!
At the start of the roadmap process market actors often don’t know what they need to do to achieve positive change, or what skills and attitudes they require to more effectively engage with other market actors. Some market actors don’t like to admit weaknesses, whilst others believe they’re weaker than they actually are. Empowerment is usually quite time and resource intensive but if done well can lead to significant levels of sustainable and long-term impacts, resulting in “pro-poor” market development.
However, it is also important to note that the engagement of marginalised actors is very context specific so common sense and an extremely flexible approach are required. It is essential to try and understand the most immediate priorities and needs of these marginalised actors and support them accordingly. Experience has shown that building their following core skills can be particularly effective:
Being Proactive: supporting marginalised actors to start identifying potential business and market opportunities themselves, rather than waiting for other market actors to tell them what to do.
Being Creative: adapting their knowledge or combining it with that of other actors to create new appropriate and innovative market opportunities.
Being Effective: helping them implement new business deals and building relationships that add value to themselves and other actors.
Note: As well as supporting the marginalised actors directly it is also important to empower other more powerful and market savvy market actors – in particular the importance and benefits to them of engaging with marginalised actors - otherwise they will tend toward “Business as Usual”.