Introduction

Ahmed Dakrouri is creating a comprehensive new agricultural system that will empower farmers to take control of their fate and revitalize neglected and impoverished regions of rural Egypt.

Dakrouri is empowering farmers by developing a comprehensive agricultural system that produces international export crops which will dramatically increase farmers’ income and revitalize entire regions. His aim is to transform subsistence level peasants into successful farmers making their own decisions; and as a group about what to grow, how many acres to plant, and what prices to accept.

 

The first element of his program is to create in collaboration with the farmers, a new and comprehensive agricultural system. New crops for export, such as basil and fennel, and then vegetables will be planted with better seeds and modern production techniques to provide much higher productivity and dramatically increased incomes compared to the subsistence income derived today from planting corn and wheat with low yields at low prices. These crops will be harvested and processed to add more value, such as processing dried basil, then extracting oils from crops and ultimately selling completely fresh crops directly to Europe via a continuous cold chain from the Upper Egyptian farm to the German supermarket. By having alliances and contracts with export customers, the profit from the middlemen will go primarily to the farmers with some to their Development Citizen Organization for social investments in the region.

 

The second element is to empower farmers to make their own decisions and to take control of their destinies instead of having the government or middlemen tell them what to do. Dakrouri has formed a Farmers’ Citizen Organization (CO) which will include every farmer who participates in the program. The group has begun organizing, acquiring greater agricultural skills and knowledge through technical courses taught by the farmers with successful experience with export crops. They also receive training on the needs and trends of export markets, production and marketing techniques, and organic crops and markets. This is laying the foundation for the Farmers’ CO to decide after a few growing seasons, what crops to grow and how many acres to plant. Earning the trust of each other and their positive track record, the number of farmers and acres planted will grow rapidly over the next five years.

 

This rapid growth will not only improve the income of each farmer, but will create enough wealth in the region to enable more social and economic investment. Dakrouri has incorporated the 11-year-old development CO started by his father into his scheme. This CO already undertakes social programs in the area and will receive additional income from the revenue of the Farmers’ CO—allowing social programs to grow as the overall agricultural program flourishes. They plan to extend their investments to other marginalized farmers, women, and fishermen, while introducing programs in nutrition, microcredit, and vocational training.

 

This comprehensive agricultural system has been so successful that it has attracted attention from other groups and agencies. The Canadian International Development Agency (CIDA) wants the Farmers’ CO to train other COs in other regions because the idea of changing an entire failed system offers far greater prospects for success in Egyptian agriculture than piecemeal efforts to fix the system.

Egypt has long had a very successful agriculturally-based economy. But, over the past fifty years, agriculture has been destroyed for most farmers as the government focused on industrial rather than agricultural development. Growing low-priced food for urban populations was important for political as well as economic reasons, so prices were set artificially low, and farmers were persuaded to continue producing through subsidies. Economic pressures gradually forced the government to reduce subsidies but political pressures would not allow a reduction in prices. So farmers, not the government, ended up subsidizing the urban and industrial growth Egypt has enjoyed over the past decades.

 

Egypt now imports most of its food products. Before 1960, Egypt was self-sufficient in almost all basic food commodities, with the exception of wheat, which the country had a self-sufficiency ratio (domestic production in relation to consumption) of 70 percent. By the end of the 1980s, the self-sufficiency ratio was around 20 percent for wheat, lentils, and edible oil. Many harmful policies were introduced under Former President Anwar Al Sadat, and more recently, the government has abandoned most subsidies without having any new policies to help farmers survive. As agriculture turned into a survival of the fittest and isolated regions had little access to the latest information, market distortions grew, which has meant that only the middlemen and a few exporters make money in agriculture today.

 

Another reason for the poor performance of agriculture is that most farms currently employ outdated land preparation, planting, irrigation, insect control, and harvesting techniques. For example, the efficiency of seed-bed preparation and irrigation stands at 50 percent. In insect control, over 75 percent of sprayed liquids are not effective due to the use of obsolete high volume sprayers and an estimated 28 percent of rice and wheat crops are lost because harvests are still largely gathered by hand.

 

Planting the same subsistence crops with the same outdated agricultural techniques has led to lower incomes, extreme poverty in many rural areas, and the rise of political and social unrest. Pleas for help and assistance have turned into anti-government demonstrations which have been suppressed. Many rural areas are now viewed as harboring terrorists, so security forces are everywhere.

 

The challenge is therefore to establish a productive and collaborative environment for farmers and introduce new farming techniques to increase agricultural production, while preserving the social fabric of the rural communities. At the same time, farmers reticent to let go of age old farming techniques must not be alienated. But these improvements are irrelevant if farmers do not have access to national and international markets to sell their products. Growers would greatly benefit from being able to produce crops that have a market and how to produce the required quality, as well as how to market their produce.

Dakrouri began considering the problem in 2001 by studying market trends and the crops that had the greatest potential for farmers in Minya, his home region. He concluded that export crops, first medicinal and aromatic crops which were already grown in Minya, and then various vegetable crops were most promising. He traveled in Europe, talking with people at each step of the supply chain. After three years, he and a small group identified six crops that held the greatest immediate promise. He found a few key export customers interested in new sources of supply that met their demanding quality standards at prevailing market prices.

 

Dakrouri gathered a team of people from Minya, drawing on his family’s long-standing reputation. They agreed on the crops to be grown and to bring in experts to help. They needed to convert to the new techniques to grow, harvest, store, and export the new crops. Dakrouri invested E£400,000 (US$71,000) of his own money to hire technical experts and trainers. He also began growing new and improved seed stock and planted the crops as demonstration projects on his farm. Dakrouri realized that they could make more money if they could transform the basic crops into higher value-added products, such as dried basil or oil extraction. They sought permission to build a small processing factory, which is now underway.

 

Egyptian legal requirements dictated a comprehensive legal structure to go with his new agricultural system. Dakrouri began with two COs which form the heart of his agricultural system—the Farmers’ CO. This is a cooperative-like agency owned and controlled by the farmers that will become the main economic engine of the entire system. The Farmers’ CO will earn 5 percent on farmers’ sales, paying for the training and extension agents who support them. Next, Dakrouri wanted to ensure the whole area would benefit as the program succeeded so the second CO, the Development Association (AMA ESED), was included. It has served the community in Minya with social programs for eleven years. There will be three different economic units, one to process the crops for the new processing plant, another to provide all the logistical services needed, and an export unit, focused on getting the best prices and picking the best export customers.

 

As a liaison between the farmers and exporters, Dakrouri contracted with three exporting firms. He is working on translating their requirements/demands into production programs for the growers, as well as providing a range of value-added services. Dakrouri has been able to negotiate higher than prevailing market prices for the products.

 

On the financial side, Dakrouri is not seeking any profits. His value-added operations are sustainable because of the higher revenue gained from selling higher quality crops. The Farmers’ CO takes a 5 percent service fee from the sales of the value-added crops. This money covers the cost of the training and extension services he provides to the growers. Currently, the 5 percent service fee only covers 25 percent of service costs, but will grow as more acres and farmers are added to the program.

 

Some of the profits generated by this system will be directed toward community development through the Development CO founded by his father. Dakrouri’s biggest target population is women, as 73 percent of rural families are fully or partially sustained by women. Dakrouri will seek to better their lives through direct training and cooperation with other COs and programs. Another target group is fishermen, who live in very precarious conditions. By 2010, Dakrouri plans to offer vocational training and rehabilitation programs to the rural population to integrate and prepare them for jobs in the service, commercial, and industrial sectors.

 

The pieces of the agricultural system were put into place between 2004 and 2006, but the implementation of the total system only began with the 2006 to 2007 crop year. Four hundred acres have been planted by fifty-five farmers, supported by twelve extension agents, with the harvest presold to three exporters at attractive prices.

 

The Farmers’ CO plans to grow to 1,000 farmers and 5,000 acres planted in the Minya region. Dakrouri has a multifaceted plan for geographical expansion, and once operations in Minya are secure, he will expand into three other governates in northern Upper Egypt. While Dakrouri will spearhead the expansion, he will rely on local unaffiliated COs to replicate his model. Dakrouri will provide training as well as information and the supervision necessary to restructure their organizations to match his model. Dakrouri has already been approached by COs as well as the CIDA, which offered to finance his training of other COs.

Dakrouri’s extended family has a history of over eighty years of service to their community (almost 300,000 constituents) as members of parliament, governors, and community leaders. Dakrouri’s late father was the last to contribute to this cause for over three decades. Dakrouri is from an affluent family and went to an English language school in Cairo. He went to elementary school in North Carolina while his father completed his PhD, attended high school and university in Cairo, and then received his MS in Management at MIT.

 

During Dakrouri’s school years he was brought up as a free spirit, with a lot of leeway, but was under continuous scrutiny from a very busy and demanding father. Being the eldest son, Dakrouri was given responsibility for everything related to his family from the age of ten or eleven, while his father was away—and his father was away a lot. Though sometimes difficult, Dakrouri’s formative years were during college. He was fortunate to have had opportunities to travel to Europe five out of six summer holidays during his graduate and postgraduate years, and to do training/work related to his field of specialization, civil engineering.

 

Dakrouri began his career with major Egyptian construction companies; working on construction sites and immediately tried to bring to life the modern management techniques he had learned, especially improving organization performance through collaboration. But these ideas were unknown in Egypt and not readily accepted.

 

After nearly fourteen years with major contractors, Dakrouri’s family agreed that he would create and lead a new project financed by them; an E£10M (US$1.7M) resort project on the Gulf of Suez. It was close to completion when a collapse in the tourist investment sector forced him to delay the project for a few years. Dakrouri is no longer interested in reviving the project and is close to selling it to an international investor.

 

Dakrouri began looking for a more fulfilling future that would allow him to return to his family roots in Upper Egypt and community service while using his skills in starting and managing huge, complex projects which valued employees in a team-like work environment. In early 2004, Dakrouri went through a career enlightening experience when he was introduced to the SEKEM (ancient Egyptian for “vitality from the sun”) concept of agricultural development. It awakened a whole school of thought he believed in, but was not able to implement twenty-two years earlier in his career. Seeing a successful example of implementation of a people-based development initiative gave hope and renewed vigor to adopting this new school of thought. With Dakrouri’s experience over twenty-five years and the personal financial resources necessary, the ingredients came together for Minya to be a success.

 

Dakrouri was close to his father, who lived his life in public service, particularly in the last six to seven years, and his history of service to Egypt and to the community (mainly in Minya) for over thirty-five years. Prior to his father’s death in 2004, Dakrouri had few ties to his community in Minya. He was brought up and lived in Cairo most of his life. After his father’s death, he was faced with a choice to continue his ancestors’ mission of service to their community or to close everything and continue to live as he always had. He chose the former and made a life commitment to find a vehicle to carry out his mission. Dakrouri also believes that although Minya is a smaller community, he has an obligation to spread his idea and services to all communities in Egypt. He is using the skills he acquired during his apprenticeship in business and his passionate belief that enterprises prosper when people are valued and incorporated into their operations, to bring his comprehensive agricultural project to life in a way that empowers thousands of farmers and revitalizes many impoverished rural areas.