What Brazil’s World Cup meltdown teaches us about market systems

By Team: Private Sector Engagement 16th Jul 2014
Syrian refugees watching the World Cup in CARE’s Community Centre in Azraq Camp, Jordan Syrian refugees watching the World Cup in CARE’s Community Centre in Azraq Camp, Jordan © CARE/Johanna Mitscherlich

Football teams are a system and markets are systems too... I am a market systems practitioner who lives and works in Brazil. After the emotions from Brazil’s semi-final failure calmed down, I started to draw a few analogies from the World Cup. Painful as it was (for me at least), Brazil’s epic 7-1 defeat might teach us a few things about how to make market facilitation initiatives more successful and resilient.

1. You need to earn the ‘right to win’

Obviously, thinking that you have the ‘right to win’, as Brazil perhaps did, doesn’t mean that you will win the market game. We believe that smallholders have the right to better participation in market systems, but to ‘win on the field’ they need thorough and sound market-based approaches – based on better access to markets and knowledge of how markets work.

2. You need more than just ‘star players’

A system built up on fragile foundations is vulnerable, and it will easily break down in the same way as the Brazilian team did without its star players Neymar and Thiago Silva. The market system equivalent of the ‘star players’ can be, for instance, two large key lead firms in the market system which the smallholders depend upon for their successful access to and participation in markets. Successful market facilitation initiatives cannot be dependent on one or two large companies, they need to diversify and provide alternatives.

3.You need alternatives to your ‘first team’

Formal markets (the 11 players on the field) are not the only important members of the team. Team-mates on the bench (informal markets) can provide an alternative for smallholders’ production when formal markets for some reason fail. CARE’s Sustainable Dairy Value Chain project in Bangladesh is an example of this: the formal milk market temporarily collapsed for smallholders when cheap powdered milk was imported into the country. The only available market for local smallholders was the informal, local one, which was still active in parallel with the formal market. Without it, smallholders would have lost their main source of income.

4. You need to adapt when things go wrong

Market systems, like football matches, can be surprising, volatile environments. All of a sudden, new competitors can enter the market, prices can fall, new standards and regulations can come in place. You can concede two (or four!) goals in a very short time, and your project team must be flexible enough to learn from what went wrong and react. Remaining in a state of stupor while the context changes will doom your project to horrible failure. To succeed in the face of unexpected adversity, you need the capacity – based on good M&E and learning systems – and the flexibility to adapt.

There are also a few learned lessons and analogies around the impact of corruption and bad governance, but that is for another blog...

Gianluca Nardi

Gianluca Nardi joined CARE in 2005. He is Senior Women’s Economic Empowerment (WEE) Advisor based in Brazil and he leads the Women in Value Chains component of the WEE strategy globally. His main areas of expertise are market facilitation, women’s empowerment, micro-enterprise development, rural development, private sector engagement and working with extractive industries.

With over 15 years of experience working in various management and consultancy roles in Brazil, Nicaragua, Angola, Cambodia and Italy, in both the private sector and NGOs, Gianluca holds a Masters in International Development from the University of Ferrara, an ILO Diploma on Markets Facilitation, a diploma in Extractive Industries and Sustainable Development from the Catholic University of Lima, and a certificate from the Advanced Social Management Programme from the University of Cambridge and the University of Queensland CSRM.