Local innovation refers to the dynamics of Indigenous Knowledge (IK) - the knowledge that grows within a social group, incorporating learning from own experience over generations but also knowledge gained from other sources and fully internalized within local ways of thinking and doing. Local innovation is the process through which individuals or groups discover or develop new and better ways of managing resources - building on and expanding the boundaries of their IK.

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The purpose of this paper is to map some elements that can contribute to an IFAD strategy to stimulate and support pro-poor innovations. It is an initial or exploratory document that hopefully will add to an ongoing and necessary debate, and is not intended as a final position paper. The document is organized as follows.

The International Livestock Research Institute (ILRI) and the Ministry of Agriculture (MoA) initiated a 5 year project in June 2004 with the financial assistance from the Canadian International Development Agency (CIDA). The project, entitled: “Improving productivity and market success” (IPMS) of Ethiopian farmers, aims at contributing to a reduction in poverty of the rural poor through market oriented agricultural development.

This policy brief sets out the conceptual and empirical underpinnings of a learning-orientated monitoring and evaluation approach known as Institutional Learning and Change (ILAC) and discusses options for learning-oriented interventions and policy research. 

This note offers a conceptual framework for dealing with 1) institutional and capacity assessment; and 2) capacity development issues, mainly in the public sector areas. This framework will be particularly useful in the in the preparation of support to sector programmes and budget support exercises.

Farmers and businesses need to adapt constantly if they are to survive and compete in the rapidly evolving environment associated with the contemporary agricultural sector. Rethinking agricultural research as part of a dynamic system of innovation could help to design ways of creating and sustaining conditions that will support the process of adaptation and innovation. This approach involves developing the working styles and practices of individuals and organizations and the incentives, support structures and policy environments that encourage innovation.

Early applications of the innovation systems framework to developing-country agriculture suggest opportunities for more intensive and extensive analysis. There is ample scope for empirical studies to make greater use of the theoretical content available in the literature, and to employ more diverse methodologies, both qualitative and quantitative. Further, there is room to improve the relevance of empirical studies to the analysis of public policies that support science, technology, and innovation, as well as to policies that promote poverty reduction and economic growth.

The present report is based on the authors' visits to Bolivia, Honduras and Nicaragua, during June-August 2004 in order to develop an initial understanding of innovation processes and identifying stakeholders working with national innovation processes. It also review the experiences of the invited Latin American participants in the 7th Global Conference of Competitiveness Institute (entitled "Building Innovative Clusters for Competitive Advantage") in September 2004 and finally presents suggestion for further activities.