“One Village-One Product”; a supporter of Mongolian brand product
A key focus of the “One Village-One Product” (OVOP) is to “think locally; act globally”. In other words producers are encouraged to develop their local goods and services to be sold on international markets. For instance ”Football, which was local level game in Britain, has become an international level sports attracting billions of people to its World Cup. The key goal of OVOP is similar” said, Morihiko Hiramatsu, President of Oita International OVOP Exchange Promotion Committee, Japan.
The UNDP, in partnership with the Government of Mongolia, commenced phase 1 of the Enterprise Mongolia project in 2005 with an aim of developing a national development model for the OVOP movement and to further support the actions of the government.
The Government of Mongolia approved the OVOP National Program in 2005 and established the National Council of OVOP National Program at the Secretariat of the Deputy Prime Minister, commencing a two-phase implementation program. During the first phase, a range of activities were completed including the formal launch of the program, provision of information and technical assistance, organizing trade fairs and study tours and the selection of products for the OVOP initiative.
The main goal of the OVOP initiative is increase citizens’ incomes by supporting the production of locally made products, creating new jobs and developing brands that are recognized both nationally and internationally.
With these objectives in mind, EMP-1 selected products from 7 clusters that met certain standards and requirements including:
• Bee honey of Ar Gangat LLC, Selenge aimag’s Shaamar soum
• Red skin garlic of Jargaltai cooperative of Zavkhan aimag
• Sea-buckthorn of Sea-buckthorn cluster of Uvs aimag
• Rock salt of Uvs aimag’s Uvs Talst LLC, millet of Saihan Harztai LLC of Bulgan aimag
• Yak wool products of Hangain Sor LLC of Ovorkhangai aimag community based tourism at World Energy Center of Gobiin Urgah Naran LLC of Dornogovi aimag.
EMP provides tangible support to OVOP implementation
EMP has been providing its beneficiaries with wide variety of support such as assisting their participation in trade fairs, facilitating access to financial services, providing technical assistance and training so that micro businesses can improve their competitiveness and entrepreneurial skills. Moreover, EMP worked closely with the National Council for OVOP enabling them to export locally developed produce, study best practices, integrate resources and exchange information. Such fruitful cooperation led to a significant increase in the production capacity of clusters, stabilization of their operations, the production of value of value added goods, becoming financially independent and the expansion of domestic and international cooperation. By establishing clusters among project beneficiaries, EMP achieved positive impacts such as job creation and alleviating poverty, highlighted by the successes of the clusters.
In order to enable its beneficiaries to access to financial services, the project established a Loan Guarantee Fund (LGF), which disburses micro loans through a contracted on-lending bank. For beneficiaries that are suffering from a lack of collateral, up to 50% of the loan amount is guaranteed by the fund. The Project successfully raised awareness about the LGF among the beneficiaries.
During the OVOP National Conference held in November 2011, a member of the Cabinet spoke about how relevant agencies are working to intensify program implementation and allocate required funding in government budget. At the forum, both the project implementers and the beneficiaries shared their lessons, achievements, plans & perspectives. Based on the success of the National Conference, attendees have subsequently decided to organize the next International OVOP Conference in Mongolia.
Sea-buckthorn to be exported to US and India
Of the 7 clusters that receive support from EMP, Uvs aimag’s “Sea-buckthorn” cluster is particularly worthwhile mentioning. The members of the cluster planted sea-buckthorn on over 80 hectares of land and harvested more than 150 tones. This compares to the 11 hectares that the members used to plant before joining the cluster. As a result of this increase the cluster is now able to supply local demand as well as supply 15 tons of sea-buckthorn to capital city consumers. Us Erdene LLC, a member of the cluster, also started selling 150 kg sea-buckthorn oil to Japan.
The cluster, consisting of several partners and cooperatives, was established in 2007. The cluster currently has 62 members. As their businesses have grown, they have created more than 80 jobs for the local community. J.Doojav, the leader of the cluster, noted that support from EMP and OVOP program was essential for their achievements.
In other words, sea–buckthorn is a community driven product with high competitiveness, viable export market potential, ecological purity and job opportunities. The cooperation with the EMP enabled the product to be sold on global markets under the Mongolian sea-buckthorn brand name. It is already recognized in the Japanese market for its ecological sound production and quality, which led to opportunities in the US and Indian markets. It is obvious that many other countries are interested in this ecologically pure product. Many countries plant sea-buckthorn - but the species that contains 108 nutritional elements that are beneficial to human health is only planted in Mongolia. As Morihiko Hiramatsu, President of Oita International OVOP Exchange Promotion Committee, Japan said earlier, Uvs local sea-buckthorn will be a global brand.
“Planting sea-buckthorn requires lots of care and labor. However, I have great hope for the viability of sea-buckthorn as it is an ecologically clean and healthy product and that is why I selected this business”, says J.Doojav, leader of “Sea-buckthorn” cluster.
The cluster includes a wide variety of specialists including researchers, farmers, teachers and many more. Members said that joining into the group enabled them to earn a better income and learn from each other as opposed to working alone. Members are grateful to EMP for supporting them to learn business skills, sell and promote products, participate in domestic and international trade fairs, expand businesses and access financial services.
The “Sea-buckthorn” cluster have displayed their produce at several trade fairs and received a number of awards. Currently, the group supplies the market with five products including sea-buckthorn oil and juice and it is very likely that the number of partners will increase further as the demand for healthy food continues to rise. The cluster is prepared for this boom, because they are expanding their plantation every year so that they are able to cope with the increasing demand for their sea-buckthorn products.
Government support needed for entering international market
The Government of Mongolia is implementing Phase 2 of its OVOP program in 2009-2012. During the National Forum, SME operators requested continued support through the government’s tax, loan and investment policies along with assistance in developing both domestic and international markets.
As the OVOP program is internationally recognized, there is a strong need for the National Committee to facilitate learning from international experiences and best practice. Additional comments during the forum included that certification and validation are important for new and traditional products that are made locally.