By Skye Lawrence
Carter Coleman is the Founder and CEO of Kilombero Plantation Limited (KPL), Tanzania’s leading rice producer. The 5818 ha farm is located in the Kilombero Valley, 450 km from Dar es Salaam. Prior to starting Agrica he founded the Tanzanian Forest Conservation Group, a non-profit focused on preserving local forests. In our conversation he said the need for preserving the rainforest from encroaching villages became evident to him during the two years he spent hang gliding over the mountains and training falcons after he first came to Tanzania as a Rotary International Fellow in 1989. The Tanzanian Forest Conservation Group has grown into a large NGO.
Skye: What is the history of the farm and how did you end up buying it?
Carter: In 2005 I decided to do a farming project. I wanted the farm to be in Tanzania because I’d been there since 1989. I hired a former Commonwealth Development Corporation (DCD) manager who had worked in Malawi and Tanzania. He and I looked around Tanzania for a year until we found this defunct farm which also had a title deed, which is a major advantage.
The farm had originally been a joint venture between the Tanzanian and North Korean governments, an almost personal project between Kim Il-Sung and Julius Nyerere, the first founding father of Tanzania. In the late 80’s, the North Korean army cleared 5,800 hectares in the Kilombero Valley. Because there is no grid they built a little mini-hydro station in the foothills above the flood plain in the foothills of the Udzungwa-Mountains. They didn’t put in irrigation which is the most expensive piece of any farm because North Korea ran out of money after the collapse of the Soviet Union.
That’s when all the North Koreans went home. I remember at the time the North Korean Ambassador was busted with a container full of ivory on his way home. So the farm was left basically defunct and was owned by the Tanzanian government until we came along and signed a purchase contract in 2006. We spent the last of our seed capital on hiring consultants, primarily CDC guys to do studies for our business plan. Then we were like, “whoa, we need about $70 million to have an irrigated 5,000 hectare farm!”
Skye: How did you fund the project?
We spent a year raising capital by visiting investment banks and private equity firms who basically said, “Thanks. Good luck with that. See you around.” Agriculture is capital intensive, has a long time horizon and is high risk with low to moderate returns. It ticks all the negative criteria. We were very lucky to have been introduced to Capricorn Investments who is our majority shareholder. It is primarily Jeff Skoll’s money. Capricorn has a long-term principled investment approach with a small portion of their overall portfolio willing to do high impact investments like our farm.
Getting the first anchor investor like Capricorn Investments is key to getting a project like this going. Now because British Secretary of State Justine Greening we have investment
from AgDevCo. She believes in more trade less aide, and that the British should be supporting British companies creating jobs and providing food security in the developing world. She visited the farm in June of 2013 and because it has become a showcase commercial farm with a transformative smallholder program she asked AgDevCo to invest.
Skye: Was your goal to sell locally in Tanzania?
Carter: The goal is to sell within East African Community-Burundi, Kenya, Rwanda, Uganda and Tanzania. Similarly we have always wanted to be as socially and environmentally responsible as possible. The business case for the farm and indirectly for each of the half million smallholder rice farmers in Tanzania across the country is zero-duty trade within the East-African Community protected by the common external tariff. It is impossible to compete as a Tanzanian rice producer with agriculturally developed countries such as Pakistan or Thailand. These countries have invested billions of dollars in irrigation over the last 60 years and have a variety of agricultural subsidies for producers. Africa is years away from a similar system so you rely on the common external tariff. I’ll get to why that has become challenge later on.
Skye: What are the farm’s next steps?
Carter: Next we are completing the pivot irrigation system to cover 3,036 hectares. Our first 500 kilowat, renewable, bio-mass plant that gasifies rice husks is coming online in April. We plan to build a second 1.2 megawatt soon so that we will be totally renewable using hydro and bio-mass, with the exception of the diesel for the tractors and the combines. We will be completely off grid.
We have a strong smallholder program where we’ve trained 6,527 farmer families and increased yields from one ton per hectare to 4.42 tons a hectare this last season.
The Kilombero Valley is a flood plain between two mountain rainforests that gets a huge amount of rain, it’s hard to grow anything but rice in the rainy season. Everyone in the valley, around 150,000 – 200,000 people rely solely on a rainfed rice crop for their annual income and food security. The intensive rice system that we have introduced has been transformative for farmers.
Skye: How have you increased yields?
Carter: By planting on a grid that is 25 centimeters by 25 centimeters. This is an unconventionally wide-row spacing and intra-row seed spacing. You get a better yield with these methods and by planting on a grid rather than just broadcast helter-skelter. With an unconventionally wide array of spacing you get deeper root system, bushier plant, therefore three and four times the grain.
Skye: If yields are increasing what are biggest problems you see for small holders to scale up production?
Carter: Smallholders need crop financing. We need a microfinancing organization (MFI) or a need a bank to lend to them, and then KPL can have an off-take agreement. We’ve been working with one commercial bank and one MFI. The commercial bank had a great repayment rate, but then decided it was not worth the trouble because the program was too small, and not scalable fast enough so they pulled out. The MFI had a bad repayment rate, and so they didn’t continue.
Now I’m talking to two banks and AgDevCo about devoting some resources to this issue. Farmers need financing options to lift themselves out of poverty by not pre-selling a portion, or the majority of their crop prior to harvest. If they do this it is worth a fifth of what it is worth if they can hold on until harvest. Pre-selling and therefore losing value is what repeatedly happens in Africa.
Skye: In the US there is the farm credit union. Would something like this system be a model that the Tanzanian government could set up?
Carter: Funding is a key challenge. The Tanzanian government has this thing called Big Results Now Initiative where they have Key Performance Indicators. They talk about our company, which is a registered Tanzanian Company, as a model project. They want fifteen project like ours by 2017 and 1,000 new warehouses around the country, etc.
When they were announcing their Key Performance Indicators to the private sector I raised my hand and said, “ you don’t have a prayer of hitting your KPI’s until you sort out the market.”
In 2013, with no forewarning or consultation with producers or consultation with the East-African community, the Tanzanian government allowed 80,000 tons of Pakistani rice to be imported exempt from the common external tariff of the East-African community. First the wholesale price of rice plunged 54 % in Tanzania. Then Uganda, Rwanda and Burundi, which are key export markets for Tanzania’s surplus imposed the common external tariff on all Tanzania rice. It was a major double blow that destroyed the domestic market and the export market. Things are now just beginning to normalize.
Skye: Tell me a bit about the Southern Agricultural Corridor of Tanzania? How is Agrica connected to SAGCOT?
Carter: KPL is the showcase project because we are in the Corridor and we’re doing exactly what this Initiative wants; a state of the art commercial farm and with a lot of effective smallholder programs. That’s why Justine Greening came to visit us. We get visitors all the time. SAGCOT is a great thing because the SAGCOT Center plays a role in getting the government to stop the duty free rice for example. They play a useful lobbying role for sensible agricultural policy and attracting donor funding for infrastructure projects, roads and power grids.
Story by Ray Mwareya
The writer Ray Mwareya is the Africa news correspondent for the Global South Development Magazine
Farak Doudi, 56, swings a rifle and cleans a water canal that washes into his banana fruit plantation. He marvels at the yellow banana trunks that sag over the waterway. At the same time he is jittery – sneaky bandits might raid his crop and ruin his income or even worse plunder his life. This is Shabelle region – the country’s southern province known as Somalia’s “food basket.” In this region much of Somalia’s farming is concentrated because water from the Shabelle and Hubba rivers provides irrigation even when the rains fail. Here, in a country that once rumbled on for 18 years without a government, farmers like Farak are leading an astonishing recovery for Somalia’s agriculture.
Before the country’s slide into lawlessness in 1991, when the president Mohammed Said Barre was deposed, Somalia was famous for its drought resistant goats, camels, sheep, bananas, sorghum and corn. At the time, Somalia was the largest banana exporter in all of east East Africa. Its greatest output was 110 tons in 1990 just before the onset of war. Its fruit was fancied for its sugary taste in the key markets of Europe, Kuwait, and United Arab Emirates. Even today after much mayhem Somali is the world’s largest producer of frankincense plant. Today in 2015, relative calm has returned. Al Qaeda linked insurgents have been neutralized, ocean pirates have been stamped out and United Nations backed government controls much of the country. The Somalia Central Bank is leading the way, distributing loans, tractors and land ownership certificates to committed farmers like Farak.
Before the war’s onset all of the country’s land was nationalised. Now, financial remittances from Somalis working in Dubai, Europe and America swell up to $1,2 billion per year, support 41% of the population and oil the country’s vital agriculture sector. Even traditional donors like Kuwait and Dubai are coming on board, constructing ports to export Somalia’s oranges, plums, groundnuts and camels. Once again the main cash crop, bananas, are thriving. Somalian agriculture on its own has distinct natural advantages. Somalia’s main export port of Mogadishu is close, just a five hour flight to the Arabian Gulf, whichi is one of the world’s most lucrative agriculture markets. Only 1.6% of the country is farmed. The other 69% is reserved for pasture. It’s not surprising that livestock farming makes up 40% of Somalia’s gross domestic income and 50% of its yearly exports.
In Somalia’s breadbasket, many welcome al-Shabab’s move to expel foreign aid groups and build canals.
Even the fearsome Al Shabaab Islamist militia has in some way positively impacted on this impressive resurgence of Somalia’s agriculture. In 2011, Al Shabaab militias expelled foreign aid groups in the breadbasket Shabelle province of south Somalia. Foreign aid groups brought food from outside instead of purchasing the produce of local farmers, moaned the militias. In south and central Somalia where they once ruled the militias dug deeper and wider water canals that turned a dry province into a lush green belt of rice and banana fields. Local restaurant owners who cooked local produce were at once exempted from the militia’s punitive taxes. “We want our people to be free of NGO and foreign hands. We want them to depend on each other and stand free of outsiders, “ said Abu Abdullah who was the militia’s head Lower Shabelle region in comments to Al Jazeera at the time.
Initially the militia’s actions were condemned as cruel for a province that was the epicenter of Somalia’s 2011 famine. But the results are startling today in 2015. Coupled with help from the European Union and funds from Austria, farmers in Somalia’s produced 200,000 metric tons of high quality grade in March 2014. For the first time Somali farmers were able to sell grain directly to the United Nations World Food Program after receiving training on how to handle ,grade, and warehouse their harvests. “It’s a joyous feeling,” says Farak. This is impressive because famine blighted Somalia in 2011, overwhelming four million citizens and killing 260 000. But this agriculture success is still fragile. Somalia is still categorized as the world’s most failed state by the Global Fund For Peace. Hardly a week goes without a suicide bomber rummaging through a crowd, hotel, cafe or airport in the capital Mogadishu.
Photograph: Jose Cendon/AFP
Rival warlords and outright criminal gangs still wrestle farmers to seize lucrative plots of banana fields. Gunshots and grenades still permeate the country and farmers sometimes hide for weeks. “I still till the land with a gun to protect my crop,” explains Farak. “A good harvest can endanger your life. Militias still seize our crops to earn hard currency.” In such fights, irrigation equipment is often burnt or looted for resale. Transport links to move grain and fruits from farms to ports are still broken after years of neglect. “We have to employ expensive security guards who demand 30,000 Shillings to protect a van of bananas for every 100 kilometers,” revealed Said Warra a research scientist for the Somali Crop Evaluation Forum a government agency that certifies grain for export. Militias squeezed by the African Union funded AMISOM peacekeeping force still take revenge by seizing lucrative banana export routes from farmers.
The whole of Somalia, after a ravishing civil war, understandably does not have even one agriculture research college. Indiscriminate shelling and airstrikes from US drones and neighboring armies who pursue jihad groups sometimes kill innocent farmers. The outside world in 2015 still makes life increasingly hard for honest Somali farmers like Farak. Important Somali money transfer unions in Kenya and Europe are being shut down over fears that money laundered by terrorists move through these channels. Many Somalis with families in the diaspora depend on these money transfer services to purchase everyday necessities. “My 28 year old son works in Frankfurt Germany. He can’t wire €300 to me every month for lack of channels. I need the funds to buy pesticides for my banana crop.” Drought still threatens Somalia every year.
Much of this 246,200 square meter country is a mountainous desert so its citizens crowd together in a few fertile areas. “Our biggest headache is the local market. It’s stifling too small to sell our crops and livestock. Many mangoes rot,” complains Mir Daham, an economist with the Somali Central Bank. Even in the face of obstacles farms continue to flourish in Somalia. “Crops, fish, cattle exports can be the big the break that’ll secure peace in this country. If more income flows into people’s pockets less people will be attracted to guns,” sums up Aned Wismail a secretary in the Somali agriculture ministry.
Dr, Musheshe, Co-Founder of URDT and African Rural University
Story written by Skye Lawrence
The drive is six hours from Kampala to African Rural University, Uganda’s first all-women’s university. As in many African cities, Kampala’s congested city center gives way to surrounding slums inhabited, in large part, by previously rural residents who have left their villages for the city in hopes of finding work. Often, they’ve moved only to find their hopes of prosperity starkly juxtaposed with the realities of urban slum existence. The road must be traversed by Land Cruiser. The University’s co-founder, Dr. Musheshe, our wonderful driver, Edward, and I left in the early afternoon, driving at maximum speed, and arrived at around eight in the evening in the pouring rain.
Kigadi is located in one of Uganda’s poorest districts, evident in the deeply rutted roads long forgotten by the local authorities. Here is the home of newly minted African Rural University, awarded its provisional higher education licensure in 2011. It is a part of the Ugandan Rural Development Training Centre (URDT), which started in 1987 as a nonprofit working with local communities on agricultural training and extension services and later expanded to include URDT girl’s school in 2000, which began with thirty students. It has expanded to an institution of more than three hundred. For twenty-eight years it has grown with the partnership and support of its North American partner the African Food and Peace Foundation. The University will be graduating its second ARU class this year. All University graduates receive certification to become Rural Transformation Specialists, immediately to be employed by ARU as Epicenter Managers. As Epicenter Managers they will live full-time in assigned communities, serving as rural development field officers facilitating strategic planning and community development emphasizing agriculture.
When you pull off Hoima Road, which is strewn with trash and brimming with honking cars, motorbikes, bicycles, you find a campus with the same feel as a UK or US university. The campus roads are dirt but the hedges are neatly trimmed. The small roundabout in front of the main building has manicured hedges that spell out URDT from above. Smartly dressed students carry their books with purpose and attention.
URDT’s motto is “to awaken the sleeping genius in each of us,” rooted in the idea that each of us has the capacity to envision and create the life we desire for ourselves, our families and communities, and our country.
I’ve worked in rural development for the past few years and have heard much of URDT’s success. In April, I interviewed Dr. Musheshe for Africa Agribusiness Magazine; he was a panelist at the Harvard African Development Conference in Boston. “Come to see for yourself,” he said at the end of the interview. A month later, I found myself on the tarmac of Entebbe airport.
The Ugandan Rural Development Training Centre thrives remarkably in one of the world’s poorest countries. Important factors are: its visionary founder, Dr. Musheshe, the loyal community that works with him, and the employment of systems-thinking as an approach to human development.
The University is based on a simple, powerful way of thinking called the Visionary Approach. A series of questions provides a structure for achieving personal and community development. What do you want? What is your current reality in life? What are the action steps you need in skill level and education? What resources do you need to mobilize in order to move efficiently toward making your vision reality? Simple, not easy. This way of thinking has powerful effects. It moves people away from problem solving, getting rid of what you don’t want, toward creating what you do want. It is extremely empowering because implicitly it says to each of us, “You have the capacity, intelligence and creativity to make what you want a reality. Not only can you create the life you desire, but you are the active agent in your own development and future.” Each student has this mentality engrained in her everyday thinking.
One evening, as I sat on my stoop watching some girls play volleyball, a group of girls asked me how I was liking Uganda and URDT. We chatted for a few minutes about the universal questions: “Do you have a boyfriend? Is he handsome? Can we see a picture?” Laughing, I say, “Yes, yes, and yes.” “Why aren’t you married yet? You ARE 26!” The questions continue unrelentingly, but I’m happy to fire a few back: “What is URDT like?”
One young woman speaks up, “URDT has taught me to be honest about what I want, not what I think I can have. I want to build houses and be an engineer, so I take math, and physics.”
Another girls said, “URDT is about envisioning not just what you want, but what you want for your family. We are just about to finish up our permanent house which will be made of bricks, not mud. I created a plan with them on how we would achieve this. We’re close.”
A few days later I arrange a session with six school girls of different ages to learn more about how URDT is affecting their lives. They echo one another. “URDT is teaching us to envision what we want, have confidence that we can achieve it, and be clear about the skills we need to achieve these goals.”
Most girls I asked will say they are working with their families to expand agricultural businesses, build permanent houses, send their siblings to school or start more businesses within the family. Students at URDT can articulate the purpose of their education and its direct relationship to their lives outside of school.
Sitting in the morning assembly, after listening to the lilting voices of the national anthem, I realized that the second song that they sang was the African Rural University Anthem, sung by the entire community, every day. It goes like this…..
African Rural University
The Cradle of learning
African Rural University
The centre for transforming
You educate a woman
Uganda to be prosperous
You educate a woman
Africa to be at peace
You educate a woman
The world to be free
You educate a woman
Humanity to be happy
You have a vision
That is inspiring
You have a mission
That is empowering
They come from the East
They come from the South
They come from the West
They come from the North
To drink on the well of wisdom
Every day this Anthem reminds everyone how important women’s education is to the future: to the future of Kagadi, to the future of Uganda.
A report by Ugandan Human Services and international agencies shows that that over half of women in Uganda experience domestic violence, compared to the global average of 30%. In Uganda, like many African countries girls are pulled out of school to get married and/or because scarce family resources are used for boys to be educated. URDT girls school starts at primary five (around age nine) specifically to target girls who would likely otherwise leave school at this age.
Signs adorning the roadside say, “Beating my wife destroyed my marriage. Don’t do what I did.” and “Domestic violence is a criminal offense.” While “stay in school” plaques decorate high school lawns. But when I spoke with Michael Newbill, the Economic and Political Chief at the US embassy he noted, “Yes, these signs are important. Remember, though many are funded by international donors.” I wondered, if these are not locally inspired are these messages really taking root in Ugandan society? Patriarchy is a way of life here and women’s rights will not be achieved in any real way without a prolonged struggle. Needless to say supporting women’s education is hardly a top priority for many.
In the shade of a eucalyptus tree, Charlotte, an Epicenter Manager, sets up her “power point” presentation, a dowel wrapped in fabric with the facilitation “slides” she uses in villages. Charlotte was assigned to work in Kasambya subcounty after graduation. Earlier, in her third year at the University, she lived for a month in the village, working to understand the local challenges. She took this knowledge back to ARU to develop her research and skills before moving to the village after graduation. Each slide is drawn as well as written because of both the high illiteracy rate and the large number of local languages. Below are a few of the nineteen slides in her presentation.
Text BoxImage“What these meetings are about: when you work for the happiness of your village you help yourself, when you help yourself you work for the happiness of your village”
URDT Rural Development Curriculum
“Know what you want: When you know what you want you gain great power”
“Foundation Choice: the three foundations for a happy life are freedom, health and being true to one’s self”
“The first act of creation is to imagine what you truly want”
“Remember your inner power will work like a sharp spear to get what you want. But you must direct it very clearly and firmly (focus).”
“In times of difficulty, tell yourself the truth of how things are and what you truly want”
“Reflect upon the water project as if it were accomplished”
“Anything which is truly important to you in your life is worthy of your life energy”
“Creating momentum. Nothing happens until you take action. There is often a delay between the time you do something new and you see results.”
“Point of most power. You create tomorrow today. Right now is the key to your future.”
I’m touched by the simple genius of the curriculum, which is like a condensed version of every self-help book, motivational course, and strategic planning workshop I had ever taken – no small number. Over thirty years, these slides have been honed by Dr. Musheshe, alongside Peter Senge, a top systems thinker at MIT, and Robert Fritz, an award-winning artist, author and leading professional in corporate change management. These are no ordinary “slides.”
To see the outcomes of this approach, we drive two hours to Safira’s house. We turn off the main road, a narrow track with high elephant grass squeezing the Land Cruiser, onto a shaded driveway that passes through a large grove of matoke, Ugandan bananas. This matoke is now part of the thirty acres Safira’s family owns. Before she entered URDT, her family of eight lived on a quarter-acre.
Safira (right) and her mother (left) with their car
Safira is the first in her family to attend school. Her father beams with pride as he tells me, “Now all five children are in school.” When I ask Safira’s mother how URDT affected the family, she turns to the interpreter, “I never had an education. I dropped out in primary four, but when I attended parent visitor days I realized I wanted to go back to school. Now I have my high school degree just like my daughters.” She beams at me, and I wish I spoke the local dialect to tell her much I admire her and her family, but Charles, our excellent interpreter and radio manager, does the job.
I ask them, “How did you go from a quarter-acre to thirty acres? That’s a big farm!” Safira, now 24, says, “Well, all students at URDT have to do what we call a Back Home Project. We learn in school and then we have a project we implement at home. It is part of our education to work on a vision with our family. We have family meetings and develop a vision together, then we decide what each member will do to make this vision a reality. We kept our vision on a piece of paper near the kitchen table. Our vision was to have a permanent house and have everybody go to high school. With the agricultural and management skills I learned at URDT we were able to grow a variety of crops to sell at the market. Now we have expanded into other business such as mechanics and are working to open a pharmacy. Now all the children are in school, we have a large farm and a car, and are looking to buy more land. The Safira story epitomizes the Back Home Projects at work, radically changing family life and opportunities for the next generation.
I think to myself, “I wish my family could have such a clear vision!”
Similar to Safira’s story is that of Charles Kisembo Goodyear, a student at URDT Institute, the only area of the organization that enrolls boys. Charles’s neat house resembles the URDT campus. Meticulously maintained hedges ring the house, and the dirt yard is swept clean. Charles is a savvy entrepreneur and equally skilled farmer. On the tour of his farm, he explains in minute detail the intricacies of biodynamic farming, the expansion of his passion fruit crop, and his steadily growing swine business. With direct enthusiasm, he says, “I have started farmer’s cooperatives and groups in this area to teach others the best practices I learned at URDT.” He, like Safira, is spreading the word through his commitment to his business and family, and also through his strong “pay it forward mentality.” To list his bustling farm’s activities would require a lengthy case study; in short, he is adding value to sugarcane using machinery he designed and built in his URDT metalworking classes. Additionally, he has extensive mango groves, and even transports his produce to Juba, South Sudan, to fetch premium prices. No grass grows under his or his lively wife’s feet. His manner and speech resemble that of a TEDster delivering the classic eighteen-minute talk in Monterrey California.
Dr. Musheshe is a leader with awesome vision and crystal clear purpose who embodies the values he instills in his students. URDT and ARU are products of his vision and his committed team of educators, who put their hearts and souls into maintaining and growing these schools. “I’ve always been an activist at heart,” he says. He was tortured as a political prisoner under Idi Amin for being a leader of student protests while at Makerere University. Later, an attempt was made on his life by a grenade thrown into his house. He says, “I might not have started the URDT if that hadn’t happened. It had the opposite effect they wanted. It made me determined to stay in my country and help my people forever. Uganda has come so far. Back then it was a very violent place.” He has received prestigious awards across the globe for his achievements, as well as the Golden Jubilee Medal from the President of Uganda for the creation of African Rural University.
Dr, Musheshe, C0-Founder of URDT and African Rural University
URDT’s programs and activities range from a burgeoning TV station and exchange students from the US, to a long-standing and award-winning community radio station. The radio station, broadcast to over three million listeners in Western Uganda and the Eastern Democratic Republic of Congo, is particularly impressive. One evening over a Nile Special, the local Ugandan sorghum beer, Dr. Musheshe told me its story.
“I attended the Rio Earth Summit in Brazil in 1987, the first global summit on climate change. When I returned to Uganda I wanted to start a radio station along with four other countries. We called it Eco News Africa. The idea was to combat desertification in Uganda. When I told this to a UN Development professional the man laughed uproariously, “We don’t have desertification in Uganda. Are you kidding me?” I said, “Yes, that’s the point. We don’t have desertification YET, but if we don’t provide education on deforestation and environmental protection measures we will in twenty years.” Now twenty years later, western Uganda, where URDT is located, sees few issues with desertification. The same cannot be said of Northern Uganda.
The radio station is wildly popular in the community. After a breakfast of matoke and coffee deliciously prepared by Kadija, the cook and mother of everybody at URDT, we bundled into the land cruiser to visit a “farmers’ listener group” that convenes weekly to listen to the agricultural program broadcasting up-to-date research, technologies, and market data, all of which help them to improve their farms. For half an hour, farmers introduced themselves to me through Charles, the radio manager and my translator. Their testimonies tell not only many challenges, but a deep sense of appreciation for the radio station that provides them with information that they could not be accessed otherwise.
I asked the farmers how they communicate to the station the topics they need the program to cover. They point to Catherine, Kyanaisoke subcounty’s Epicenter Manager who is standing quietly to the side of the group. “She comes to our meetings, plus she is around. We tell her and she lets the station know. Sometimes people from the station come to us.” The feedback system works: there is currently a mango blight, and next week’s program is on prevention methods.
After a week at URDT I accompanied an economics Lecturer, Emmanuel Sunday, on a recruiting trip for the University. We were recruiting at high schools in Kibale district, near the border of Rwanda, a nine hour drive south through Queen Elizabeth Park. We went to three high schools, where each headmaster kindly rallied the students to hear Professor Sunday explain ARU’s mission of developing women leaders who will focus on rural transformation in Uganda. Each time Professor Sunday noted the University is for women, and women only, there was a considerable stir in the room followed by a young man asking, “Why is this place only for women?” The answer: “Women are essential to changing society because they effect the family. Unfortunately girls are often taken out of school early, before boys, and therefore do not gain the knowledge and skills to positively affect their families and communities. Women interact with the family more than anybody else. When you teach them about nutrition, health, and economics, they are a good investment for uplifting the family. When you educate a woman, you educate her family.”
In each school, the teachers and headmasters knew of URDT, and particularly they knew of Musheshe. Their eyes showed deep respect. One headmaster put it so succinctly that I scrambled for a pen and a piece of crumpled paper: “If we had a hundred URDT’s, Uganda would be just fine.”
As the African Rural University Anthem says, people come from the North, South, East and West of Uganda to URDT to “drink on the well of wisdom.” This is a bright light in a country whose 32 million people are hampered by high HIV, unemployment, a particularly violent history, and low development levels. URDT is a rock causing ripples that spread further and further each year. These ripples make their way into every valley and every mud hut, to families who dream of having a brick home with neat hedges. URDT is changing Uganda one mind at a time through the dedication of Dr. Musheshe’s vision.
For more information visit urdt.net, aru.ac.ug, or afpfonline.org
Interview with Jendayi Frazer, Managing Partner, African Exchange Holdings (AFEX)
By Dave Ramaswamy, Africa Agribusiness Magazine
Jendayi Frazer is the former U.S. Assistant Secretary of State for African Affairs, heading the Bureau of African Affairs from 2005 to 2009. She is now Chairman of the Board of East Africa Exchange, building agricultural commodity exchanges in Africa.
Dave: Please tell us about the East Africa Exchange. What are its goals? Who are the partners involved? What is your implementation timeline?
Jendayi: East Africa Exchange (EAX) is our regional commodity exchange. It aims to serve the East African Community and is based in Rwanda. We’re moving to Kenya, Uganda, Burundi and eventually to Tanzania. Africa Exchange Holdings (AFEX) owns EAX. AFEX is the parent company with three partners — Tony Elumelu, Nicolas Berggruen and myself. AFEX has one other subsidiary, AFEX Nigeria, which seeks to be a commodity exchange in Nigeria.
Dave: What are the goals you would like to achieve through this commodity exchange?
Jendayi: The vision of the partners is to transform African agriculture through market-based solutions. Our approach is through commodity exchanges and through warehousing.
The agriculture sector is important to Africa’s prosperity because it employs so many people. Some 65% to 85% of the population in most countries is in agriculture, so it’s a strategic sector for the continent and for most countries. If you want to have a transformative impact then agriculture becomes a key sector. The vision is to help formalize agriculture. It’s a sector that has many small-scale farmers, with fragmented landholdings. It’s a sector that is a key input into agro-processing and industrialization.
How can smallholder farmers capture the most value? How do you introduce reliability in food security and ensure food safety? How do you have quality inputs into agro-processing? The agriculture sector then becomes key.
We bring value in three ways. First, through the commodity exchange, we support price transparency. The small-scale farmer can then know what the true value of her output is across the market as a whole. She can compare this price with what she is offered by a middleman, at farm gate, after harvest. And in most cases the exchange will offer a price premium, which means a higher income for her.
Second, we build warehousing. That helps to address the issue of spoilage. So much of the food that’s produced in Africa never gets to market. It’s spoiled and we lose tremendous value there.
Third, through our warehousing, we help farmers build collateral as they deposit their crops. So, you can get banks involved to lend against that. We do that through warehouse receipts. This receipt certifies that the crop in the warehouse is safe and meets standards.
Overall, we want to increase incomes for smallholder farmers and build a vibrant agriculture sector. We’re doing it in three ways:
— Through commodity exchange, which increases price transparency,
— Through warehousing, which reduces crop spoilage, and
— Through electronic warehouse receipts, which increase bank lending.
Dave: Why was Rwanda selected as a launch country, since you mentioned countries like Kenya, Uganda and Burundi for expansion?
Jendayi: It’s the ease of doing business. The business environment in Rwanda is attractive to investors, and the government moves fast. We went to all of the countries in East Africa. We first approached the East African Community (EAC), and we entered into a Memorandum of Understanding (MOU) with them. This stated we could be the regional exchange, working with each EAC member state. The EAC member states comprise Burundi, Rwanda, Tanzania, Kenya and Uganda. We’re working with the EAC as a community, at the secretariat level.
We approached all the EAC member states in parallel. Rwanda moved the quickest to establish an agreement with us. We were able to register our company and become operational faster in Rwanda. So, the business environment in Rwanda was most receptive to getting started.
We see Kenya and Uganda as essential markets for us to participate in. Uganda is the breadbasket of the region. Kenya is the financial hub and also one of the largest markets there. Tanzania is quite important as well since it produces significant food product.
Dave: What are your planned investments in this first phase? I know Rwanda just launched. How do you see your investments evolving over the next two or three years?
Jendayi: We signed our first agreement with the Rwanda government in 2012, and 2014 was our first full operational year as an exchange. We started with auctions to test the market and get a sense of what the pricing is. It was also a way to introduce ourselves to the market. At the start of 2015 we go to a spot market in Rwanda. Then, we’re looking to organize a regional spot market. Finally, we move on to futures and derivatives trading.
We’re looking at 2016 or 2017 for futures and derivatives for the Rwanda market. As far as the traded commodities, we started with maize and beans. From there we plan to trade cash crops including tea and coffee. Finally, we plan to allow trading of minerals and energy. That’s the progression of the products.
We have been self-financed up to this point. Our principals Tony Elumelu and Nicolas Berggruen have provided the majority of the funding. The investment that they’ve put in over the last two and a half years is about $10 million to $12 million. As far as investments going forward, they’ll continue to contribute, of course. We’ll take shareholders from anywhere in the world. But we would particularly like other East African investors as shareholders. We want local buy-in as we strive to be an East African exchange.
We would like to partner with development finance institutions (DFIs). This is because we face a big capital expenditure in warehousing. Back-end warehousing is critical to formalize this commodity market and allow for spot trading.
Along with warehousing, having collateral management is key. You can have a building and put something in it and it rots inside. With collateral management, we can build a platform for using crops/grain as collateral. This allows banks to lend against that collateral to smallholder farmers. So, we’re looking at a significant investment over time.
Dave: What are your implementation challenges?
Jendayi: Some of the challenges are on the trading side. This requires working together with the banks on settlement. What has happened in the past is one seller will offer their crop and the buyer will buy. Then the buyer disputes over crop quality. And then the buyer defaults on the settlement side by not taking possession. We’ve had to establish relationships with banks to enforce the legitimacy of the counter-party to that transaction. This is to ensure that settlement occurs and fairness to both buyers and sellers.
Also there have been cases where the underlying product or collateral wasn’t there. We have to ensure the underlying product or collateral exists. We have to ensure product quality and standards. That is one of the bottlenecks on the trading side.
On the warehousing side, the challenge has been collateral management. So, we need companies that guarantee the quality and quantity of crop in warehouse, and, if necessary, will be there to take delivery of the physical crop or grain.
On the trading side, our strategic partner is NASDAQ OMX. That’s the electronic platform that we’re using so trading can take place from anywhere. In Rwanda we will be rolling out the NASDAQ platform to the warehouse level. This way cooperatives and others can have access to it.
On the warehousing side, our strategic partner is Collateral Management International (CMI). They are the main collateral managers for the South African Futures Exchange (SAFEX). They’re prepared to put their balance sheet behind the product in our warehouses. We have certified warehouses that are exchange-based warehouses.
On the financing, we’ve developed relationships with banks. We also have a partnership with a company called Done Technology which issues our electronic warehouse receipts and does our warehouse inventory management. They do the warehouse receipts for the South African Futures Exchange as well. Our strategic partners are the banks that are doing the financing— Ecobank is one in Rwanda, and there are a couple of others.
United Bank for Africa (UBA) is doing financing of our warehouse receipts in Nigeria. We’re also looking to other partners on the banking side. Of course, the local and national governments are key partners.
Educating the market is also a challenge. This means reaching out to cooperatives, farmer groups and others to give them confidence in the exchange and explain to them how it works. Even reaching out to the ministers. Many African ministers don’t know the intricacies of commodity exchanges. So, the education process is challenging yet critical.
Dave: There is no agricultural investment that survives first contact with rural African reality. You can’t just have a warehouse, you also need electrical power. This is to ensure grain/crops are maintained at the right humidity and temperature and don’t rot inside. In rural Africa, construction standards are different from that in the West, and sourcing materials for warehouses is difficult. Who are the providers or partners you’re working with to overcome these challenges?
Jendayi: In Rwanda and Nigeria, we have partnered with the respective Ministries of Agriculture. In Nigeria, there are a lot of grain stores, warehouses and silos managed by the Ministry of Agriculture. They have given us access to a few of those warehouses. But, we had to bring in the equipment to upgrade them to our standards. That’s a heavy capital investment, but we’re making it.
The same is true in Rwanda. The Ministry of Agriculture provides the physical warehouse structure. We bring in the dryers and all the equipment that we can put inside. We bring the warehouses to a standard so that we can use them. We don’t own that warehouse, but we bring in assets to maximize its utility.
It’s a type of public-private partnership (PPP). The government benefits, the community benefits. We’re looking forward to the same type of model in Kenya. There the National Cereals and Produce Board has significant warehouses. We would like to lease some of them.
We are talking to the development finance institutions (DFIs) to help finance warehouse construction. It’s a public good for the country.
Dave: You spoke of public-private partnership and I want to build on that. Africa has phenomenal agriculture potential. A critical limiting factor to realize that potential is governance. Countries in Africa still have laws on the books that, to farmers, are exploitative and predatory. Many of these laws are a legacy of the colonial era. So, legislators need to make farmer-friendly policy changes. What are the top three governance changes required for agriculture investments?
Jendayi: That’s a great question.
First, uniform enforcement of regulations around food safety. Currently, there’s food getting into the market that’s diseased. It’s got aflatoxins and other harmful organisms. For instance, the testing of certain grains and others is not well done. We had a case where we tested some maize for aflatoxins. Aflatoxins could cause liver cancer. We had to send it to three different countries to see if it was safe for human consumption. It was difficult to verify whether the maize sample was carrying this toxin. You don’t want it to get into the food supply. Yet, people were selling this maize across countries. There are a lot of vested interests do not want enforcement of those standards.
Second, I think one of the challenges of the market is fragmentation. One of the requirements to make African agriculture competitive globally is scale. Every country wanting their own exchange is not going to work. Then, you cannot bring in the needed liquidity to ensure that scale.
I think that countries trying to control the food supply in their territory is a problem. For instance, when there’s a shortage of maize in some countries, they’ll put up export restrictions. They hinder the market in ways that depress prices and compound shortages over time. I think we need harmonization of laws that allow for formal integrated markets. They are already informally integrated. To formally integrate the markets is key to the success of Africa’s agriculture and to make it competitive globally.
Third, is the issue of how governments regulate capital markets and exchanges. Countries are currently struggling with the notion of the warehouse receipt. Many of them are trying to pass legislation around warehouse receipting. A warehouse receipt is just a contract. And banks can lend against that.
Governments need to allow for the exchange to exist as an institution. It can be self-regulating at first, so that it gets started. You allow it to exist on the basis of contract law. The banks will lend to an institution if that institution has integrity.
Governments should not attempt to over-regulate the sector with laws that govern exchanges.
Dave: Homeland security starts with food security. Food security in turn requires energy security. If you look at ongoing conflicts in Africa, they have food security underpinnings.
You have helped resolve conflicts in various parts of Africa. What do you think is a good framework for winning the peace that incorporates sound food and energy policy?
Jendayi: I was just in Eastern Congo working on a project in a community dialogue. Different communities have in the past been in conflict and compete for resources. We separated the groups and asked them what would be their top development priority. This is an agricultural area. All the community members said access to the market.
I think that agriculture is such a strategic sector. If you can make it viable as a business opportunity, it can serve as a foundation for prosperity. If you allow farmers to maximize the value of their labor, you will end up having a lot less conflict.
When resources are scarce that’s when people are going to fight the most. Farmers need to have access to markets that provide fair value to their labor and increase their incomes. Then, the likelihood of conflict is much, much less. You can make agriculture viable for smallholder farmers. I’m not suggesting that it stay there. We need to take the way production is organized today and formalize that. Then, we need to ensure that there’s value transferred back to the producers and build from there. Make farming a formal way of earning a living, not subsistence but entrepreneurial.
Dave: The Obama administration has announced Power Africa. How do you build agriculture clusters around these planned energy investments?
Jendayi: That’s a good question. My understanding of the Power Africa initiative is that the administration is trying to lock up deals that are already present. They’re trying to take it the last mile to conclusion or to closing. They’re not the initiator of the deal. The market is going to determine where you have these agriculture clusters.
What we need to do with our commodity exchange is ensure that we have warehousing located in strategic locations, so people who are producing crops can store it close to the point of production. Then, we need to have access to the roads and the infrastructure so that we distribute crops to those who are trying to buy or use it. We’ll make the market by formalizing it. But our distribution will follow the market.
Dave: Starting in 2008, African governments offered big land concessions to foreign investors. Unfortunately, after four or five years most of these investments never got off the ground. The ones that did have failed or are close to doing so. There are various reasons for why they failed, but one of the biggest reasons is what I call the “first mile problem.” Governments gave out these land parcels in regions where there was no asphalt road. No power. No irrigated water supply.
Investors thought they were getting food. All they got was a photo of food.
Our example of that is in Rwanda. A few of the initial warehouses that we wanted to have access to were based in non-grain-producing areas, so they were not of great value to us. We had to go back to the government and say, we need to get warehouses where the grain is actually produced.
Dave: Reminds me of the joke about a drunk guy looking for his keys where the light is, not where he lost his keys.
Jendayi: That’s right. In our case, because we are building our exchange on the foundation of small-scale farmers, we have less of that challenge.
Our challenge is on the distribution side. If we have grain stored in warehouses, how do we transport that to the city or to other countries?
The way we’re going to do that is through our network of warehouses. That’s where the collateral management comes in. If someone buys a crop sales contract on the exchange, the point of delivery can be in another country. We’ll be able to do it that way, which is why a regional exchange makes so much sense in East Africa. Like I said, there is a big debate right now about national versus regional. We are the first regional exchange, because the market is already regional. There are others who are pushing back saying, no, we have to have a national exchange first.
In the East African Community, there’s not a single country that can have a viable individual exchange that can be sustained from liquidity standpoint. All East Africa has a smaller GDP/market than Nigeria. I think there’s some reality that needs to come into place. The way we’ll do it, like I said, is with a network of warehouses.
We also have the NASDAQ platform which has done regional. You can take national faces and bring it to the regional platform. The NASDAQ OMX platform that we are using did a regional exchange in the Nordic countries.
We know how to do it. It’s a matter of policy makers understanding the necessity from a scale point of view and a liquidity point of view. Africa is changing fast. I can see that exchanges are going to be key to the transformation of the agricultural sector. Some people would argue that maybe it’s too early, the market is not ready. I don’t believe that.
I think that small-scale farmers need institutions that will allow them to capture the value they grow. That’s through price transparency. At harvest time, they’re all flooding the market with their crops, dropping the prices. Now what they will do is they will sell some for school fees and other expenses and then they can hold back some and then try to sell crops when the market is even better. I think we can offer that value to them through the exchange and also the financing through collateral management. I think it will have a big impact.
Dave: Congratulations on your pioneering work.
Jendayi: It’s going to be quite phenomenal. If we make it, it will be phenomenal. I’m sure we will. I can see that it’s truly going to be transformative. We’re not the only ones. If you look at the market right now, if you look at the landscape of exchanges, commodity exchanges, you have SAFEX which is private sector-led, based on large-scale farmers and successful over many, many years.
Then you have the Ethiopia Commodity Exchange, which is government-owned, based on small-scale farmers and in the interim looks successful. There are still some years to go. We have to test it more, but it looks like it’s been a successful approach. We’re right in between.
We’re private sector but working with small-scale farmers. We have to prove a model that doesn’t exist yet.
Dave: At the U.S.-Africa summit held a few months ago, there were some administration critics saying “it’s too little, too late” for Africa. This was a weak attempt by the U.S. to play catch-up with China. How do you see private sector players from the U.S. working in Africa? Some of them feel like they cannot compete with the Chinese government for projects. It’s a multi-polar world, and you see it in Africa as well. You have Indian and Brazilian companies working there. How can U.S. private sector interests form a coalition to fund African development?
Jendayi: Yeah, it’s a great question. First, I don’t think the American private sector has “lost the game” by China’s new interest in Africa. I think that the American private sector should see China’s involvement as beneficial to them. One of the ways in which China is coming in is on the infrastructure side. That infrastructure is necessary for American companies to do business at less cost. It’s an advantage.
The disadvantage that China presents to the U.S. is on the fairness side. That’s the issue of corruption and lack of transparency, because China can play that “lack of transparency” game and American companies cannot.
At this moment in time, it is a disadvantage. Over the long term, American or other companies that operate according to the rules will win out. Chinese companies will have to start operating according to the rules. Africa’s civil society, governments and even the African private sector are going to demand fairness. A lack of fairness could lead to collapsed infrastructure and even lives lost. During economic development, every country goes through this arc where corruption becomes quite expensive.
I suspect that over the long term American companies won’t be in a losing position. I think there are many African countries and many African businesspeople who want to do business with American companies. That’s because they know there’s going to be fairness, innovation and true competitiveness. On the Obama administration and how the U.S. government facilitates companies coming in, I think the U.S. government can do a lot more in Africa, a lot more to help American companies be more competitive.
I think the President’s trip, especially the second trip, and the initiatives that he laid out help. Even the U.S.-Africa summit goes a long way toward that, as well as the summit matching the U.S. private sector up with Africa’s private sector. Now those guys were already matched, let’s be honest. Most of the American companies that came to this summit have already been doing business in Africa, and they’ll be the big players in Africa. It was nice to convene around a set of initiatives that were constructive and needed.
I think the Obama administration has stepped up its game in the second term and I think that is positive.
Dave: What are your key messages to investors waiting on the sidelines to enter Africa?
Jendayi: First, he who moves fast and first usually wins the day. So don’t wait too long, or you’ll be locked out. But otherwise I don’t mind investors sitting on the sidelines because we move fast and first, so let them sit there. Second, go big and grow bigger than the problem. There’s a lot of opportunity in Africa. The perception of Africa versus the reality is so different. It’s so huge. You can do business in Africa, and people make good money doing so.
Dave: What can the U.S. and the world learn from Africa? What are things that you have seen with your experience that serve as a role model to other parts of the world?
Jendayi: Africa has a lot to teach the world. The old paradigm that people put forward is long since history.
The ability to run a lean operation in the face of lean resources and build it and scale it up is one of the good things you will see in Nigeria. In the face of weak, low-capital markets and huge barriers, you still see success stories of indigenous firms growing to compete with multinationals.
In agriculture and health, Africa has a lot to teach the world. There’s a public health crisis in the world, with chronic disease linked to the modern diet. The traditional African diet has a huge diversity of foods. This includes dietary crops like cassava, millet, sorghum and teff grown without fertilizers or pesticides. And meats consumed from free-range livestock.
That mix of foods kept—and still keeps— people quite healthy. Some of the tallest people in the world are in Africa—people from tribes such as the Nuer, the Dinka, the Maasai. With their traditional diets, these tribes average over 6 feet 2 inches in height with lean physiques. Height is a proxy for good health. Then there are these very tall Rwandans.
You can’t just focus on a few foods, you need a diversity. Africa has had human continuity for thousands of years because of this food diversity. Because, as you know, many civilizations that have collapsed excessively relied on a particular crop. When the rainfall patterns were disrupted due to climate change, the whole civilization was wiped out. Traditional African food and dietary diversity has allowed humans to survive for hundreds of thousands of years.
Dave: It’s been a pleasure talking to you. Thanks for your time.
Jendayi: Thank you.
Story and pictures by Jennifer Hyman, Director of Communications
Land O’Lakes International Development
Working as a community health volunteer (CHV) in Madagascar since 1998, Jeannie Razafinadramanana never imagined that her passion and commitment to volunteerism would enable her to play an important role in transforming the dynamics within her hamlet of Tataho.
But after joining forces with the Strengthening and Accessing Livelihood Opportunities for Household Impact (SALOHI) program, she significantly bolstered her knowledge base beyond her traditional focus on maternal and child health. Not only did she learn how to provide more substantive health and nutritional support to a wider segment of the community, but she also became deeply engaged in the promotion of Village Savings and Loan (VSL) programs that sparked community cohesion and newfound trust.
Led by Catholic Relief Services (CRS) and implemented by a consortium of international partners including Land O’Lakes International Development, Adventist Development and Relief Agency (ADRA) and CARE, since 2009 the United States Agency for International Development (USAID) funded SALOHI program has been tackling food insecurity in 100,000 households — for nearly 650,000 people — across 110 rural communes in eastern and southern Madagascar.
In collaboration with Malagasy community leaders, the 5-year SALOHI program addresses a range of development issues, including health, nutrition, agriculture, emergency preparedness and resource management. Through this multi-faceted approach, SALOHI has helped communities become more resilient to disasters and economic shocks, while improving food security and decreasing dependency on external assistance.
“Before the training, I did things like distribute medicine to women, administer vaccines and hand out mosquito nets,” Jeannie explained. “But most mothers gave birth traditionally. They never saw a doctor for pre- or post-natal care. They didn’t weigh their children to find out whether or not they were malnourished, nor did they pay much attention to what constituted a healthy diet.” Those who were sick were typically only provided with traditional natural compounds, she said, rather than any type of western medicine, and children were rarely vaccinated. Now, she says, 100 percent of the children in her hamlet are vaccinated for a variety of potentially detrimental illnesses, including Hepatitis A, B and C, Rubella and Polio.
Through SALOHI and the Land O’Lakes team working in her community of Tataho, Jeannie learned how to sensitize pregnant mothers to prepare healthy, nourishing foods. “In general, the dietary training I’ve provided has focused more on how to improve existing staples to make them more nutritious, rather than trying to switch residents’ diets altogether. For example, I’ve shown my clients how they can add meat, small fish or oil to cassava dishes, to make them more nutritious.” She has also shared with others her newfound knowledge on the seasonality of crops, so that villagers have a better understanding of when it’s an appropriate time to plant peanuts, cassava or rice.
Traditionally, the women in her community exclusively breastfed their children for only 2 months, and then they would be transitioned to solid food. She now counsels women on the importance of exclusively breastfeeding for the first 6 months, and about how prolonging breastfeeding for an extended duration can even be an effective means of family planning.
“At first, the community didn’t fully embrace the new ideas I was trying to spread. But, later on, mothers were able to see for themselves the difference in their children’s health and mortality when they sought medical care for their families. This helped convince them of its importance,” Jeannie explained.
Promoting Village Savings and Loans
Even though Jeannie’s a CHV focused on health and nutritional support, she promotes the group banking model known as a Village Savings and Loan (VSL) through her regular household visits. The VSL operates with clear regulations that stipulate that the money can only be used for critical needs such as medical expenses and medicine, emergencies, and even investing in a business, but not for luxury items like clothing or luxury goods. When members borrow, they must pay back the principal, plus a 10 percent interest rate that goes back into the fund; meanwhile, at the end of the year, savers benefit from earning 10 percent interest on what they save.
“The VSL helped give birth to love in our community. People really started to like each other more, to care about each other more,” she said of the VSL’s impact. “During hard times, people don’t have to go far for help anymore. It not only changed our access to finance, but it changed how we related to one another.”
The people in Tataho not only had no concept of VSLs before, but also they rarely engaged in any sort of banking or savings. Jeannie explained that when people urgently needed financial support in the past, they had very few options. Those who would lend resources often charged astronomical interest rates at 100-200 percent. “Now, when there are happy events or sad events in the community – from birth to death – there is now an outpouring of broad community support. In the past, select individuals would help out a struggling close family member, but now the entire community is really devoted to the health and wellbeing of the entire population.”
As one of the 36 CHVs providing support to her hamlet, which has 3,000 households, although she hasn’t received a penny in earnings since she began her service in 1998, she is motivated by the advantages volunteering provided her in taking better care of her family and community. “Health has been my vocation for a long time, even if it’s not paid work. But, now I’m devoting energy more broadly on the health of the entire community, while providing more meaningful support to the women and children who are the greatest focus of my work.”
Another new focus for Jeannie as a result of SALOHI has been sensitizing the community to the importance of hygiene and basic sanitation. “I’m teaching people that they should only drink potable water, that they should wash their hands after using the bathroom and to use latrines when they need to relieve themselves. Honestly, these are things our community never regularly did before, but we’re changing our practices collectively.”
Importantly, Jeannie says that working as a CHV has made her and others like her feel empowered and gain an elevated status in the community. As most of the CHVs are women, their position gives them more clout and negotiating power within the family structure.
Her husband agreed, saying, “I’m very proud of her and seeing her take this kind of initiative in the community. Much of her work can be done from home or nearby, and things are going well. In fact, our dialogue as a couple and the ways we problem-solve have become much more effective, and we can really work things out together. I used to feel like the burden of family care was all on me, but now we treat each other as equal partners.” In total, the family has 19 family members, including three sons, six daughters, and numerous grandchildren.
Even though the SALOHI program is drawing to a close, Jeannie is emphatic that her CHV and VSL work will continue on. In fact, she and several other CHVs in her community are already planning for their next collective effort: literacy training for women. She says that 75 percent of the women in Tataho are illiterate, as they tend to start school as late as 10 or 15-years-old, and are often encouraged by parents who see them as a financial burden to drop out of school early and marry.
“I want to ensure that more women can read and have greater agency on their own futures, and also invest positively in the VSL. It would help empower them to get out of poverty.”
By Deborah B. Hamilton
Feed the Future Partnering for Innovation
Most companies want to “do well by doing good,” and Jose Jaar, president and founder of DelCampo Soluciones Agricolas, proves this is possible. Over the past two decades he has built an agribusiness that earns nearly $2 million per year selling drip irrigation supplies to smallholder farmers in Central America.
Jaar recently attended Feed the Future Partnering for Innovation’s AgBusiness Lab in Tanzania to discuss his business model with African drip distributors. The Lab was an interactive event featuring system design simulations, expert-led discussions, site visits, and farmer interviews all aimed at identifying profit-driven opportunities for African drip distributors to engage a largely untapped smallholder market potentially worth billions of dollars.
So, how did Jose Jaar build a profitable business in a smallholder market?
Business success depends on knowing the target market, creating products that fit the customers’ needs, providing excellent customer service, and pricing products to sell. Over the years, Jaar and his team of agronomist salesmen have cultivated customer relationships built on trust. They started by visiting the farms, listening to smallholders’ needs, and then providing training, advice, and support along with equipment sales. Today more than 60 percent of DelCampo’s sales are repeat business, and its sales representatives earn nearly 80 percent of their competitive salaries from commission.
In 2009, to build momentum, Jaar used funds from the Millennium Challenge Account-Honduras to offer credit to farmers to finance their purchases, which allowed many to access irrigation equipment for the first time. Today, DelCampo provides $250 in revolving credit to its regular customers, which they repay after the growing season.\
Approximately 40 percent of the world’s food producers are smallholder farmers, and estimates of potentially irrigable land in the developing world top 110 million hectares. So why do only 3 percent of the world’s one billion smallholder farmers have access to drip irrigation? Because, as Jaar notes, most irrigation systems are too large and too expensive for smallholder farmers.
Feed the Future Partnering for Innovation is a USAID program that helps to commercialize agricultural technologies and promote sustainable partnerships that benefit smallholders. Its sponsorship of the AgBusiness Lab included providing participating drip distributors with extension advice, and system design and cash flow tools, in addition to highlighting the Del Campo model as one that successfully adjusted in products to meet smallholder size and budget requirements – and made a good profit doing it.
Partnering for Innovation recognizes that drip irrigation is a critical piece in solving the food security puzzle, and projects that increased access will double yields and incomes for millions of African farmers. The program has additionally invested almost 20 percent of its total grant portfolio in companies that are scaling drip technologies to meet smallholder needs.
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