biie final evaluation report 22nd january 2015
TRANSCRIPT
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The Building Independence, Income, and Empowerment (BIIE)
Final Evaluation Report
Submitted to
Mr. Frank Tolentino
Sector Leader- Agriculture
SNV, Laos
Submitted by
Jitendra Kumar Sinha Independent Consultant
601, Yash Apartment Plot-16, sector-27
Kharghar, Navi Mumbai, INDIA [email protected]
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Table of Contents
Abbreviation........................................................................................................................................ 3
Note from Consultant ......................................................................................................................... 4
1. Executive Summary ..................................................................................................................... 5
2. Introduction ................................................................................................................................ 7
3. Background ................................................................................................................................. 8
3.1. The Project .......................................................................................................................... 8
3.2. Key Stakeholders and Institutional Arrangement ............................................................. 10
4. Evaluation Design ...................................................................................................................... 12
4.1 Methodology ..................................................................................................................... 12
4.2 Evaluation Criteria ............................................................................................................. 12
4.3 Sampling & Selection of Respondents .............................................................................. 12
4.4 Evaluation Methods & Tools ............................................................................................. 13
5. Key Findings .............................................................................................................................. 14
6.1. Relevance .......................................................................................................................... 14
6.2. Effectiveness ..................................................................................................................... 14
6.3. Efficiency ........................................................................................................................... 18
6.4. Project Impact ................................................................................................................... 20
6.5. Project Sustainability ........................................................................................................ 22
6.6. Value Addition by SNV ...................................................................................................... 25
6. Key Recommendations ............................................................................................................. 26
Diagram of Existing and Proposed Cooperative Set-up .................................................................... 28
Mechanism for Value Chain Management through Lead Farmers ................................................... 29
Mechanism on Access to Finance for Farmers ................................................................................. 31
Indicative Gantt chart for Scheduling Key Activities during Project Extension Period ..................... 32
Annexure 1: Evaluation Schedule ..................................................................................................... 34
Annexure II: KII Checklist for SNV Personnel .................................................................................... 36
Annexure III: Checklist for KII with Head of MOFA & DAFO ............................................................. 37
Annexure IV: Checklist for KII with BIIE Coordinator, MOFA & DAFO .............................................. 38
Annexure V: Checklist for KII with Dean, Savannakhet University ................................................... 39
Annexure VI: FGD Checklist for Farmers’ Groups ............................................................................. 40
Annexure VII: Individual Interview Checklist for Rice Millers ........................................................... 41
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Abbreviation
A2F : Access to Finance
BIIE : Building Income, Independence and Empowerment
DAFO : District Agriculture and Forestry Office
DoIC : Department of Industry and Commerce
EMRIP : Enhancing Milled Rice Production in Lao PDR
FGD : Focused Group Discussion
III : In-depth Individual Interview
KDP : Khammouane Development Project
KII : Key Informants’ Interview
LAK : Laotian Kip
Lao PDR : Lao People’s Democratic Republic
LDC : Least Developed Country
LEAP : Lao Extension for Agriculture Project
NSEDP : National Socio-economic Development Plan
PAFO : Provincial Agriculture and Forestry Office
RBF : Rabo Bank Foundation
RM : Rice Miller
RMA : Rice Millers’ Association
SHDP : Small Holders’ Development Programme
SNV : Netherlands Development Organisation
TOT : Training of Trainers
VDF : Village Development Fund
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Note from Consultant
I (Jitendra Kumar Sinha) was commissioned by SNV to conduct the final evaluation of the ‘Building Income, Independence and Empowerment (BIIE) Project’ which has been implemented by SNV with funding support from Rabo Bank Foundation (RBF).
The evaluation process started with a review of background documents and followed with the development of evaluation design & tools. Interviews with the Sector Leader and Senior Rice Value Chain Adviser were conducted to get detail information on project modalities and results framework. Subsequently, evaluation tools and plan were finalized.
I hired a translator (a teacher) from Savannakhet University, and no project personnel were involved during my field investigation and interview. It provided a complete independence and freedom from any biases.
Field visits were conducted in nine randomly selected project villages in four districts of Savannakhet and Khammouane provinces to interact with and interview farmers, millers, government officials, personnel from university and other projects like Khammouane Development Programme (KDP). The main objective of meeting and interaction with the various stakeholders was to gain insights into the project progress and account for their contributions to the project.
I was very impressed with excellent cooperation and support received from SNV personnel, millers, government and farmers’ groups, and would remain indebted for the support extended by them. In particular, I wish to put in record the excellent support received by the SNV team including Ms. Julie Graham, Mr. Frank Tolentino, Mr. Daovanh Sotouky and Ms. Siliphone Vongsaphay.
I also greatly appreciate assistance received from my translator Mr. Phoutthasone Khaoungvichit. The warmth and hospitality shown by farmers and millers and their openness in sharing information and experiences will be a lasting memory. I wish to thank them for their outstanding support.
Jitendra Kumar Sinha 22nd January, 2015
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1. Executive Summary
SNV with funding support from Rabo Bank Foundation started a three years project in January, 2012 in 70 villages of six districts of Savannakhet and Khammouane provinces. The project aims at reducing food insecurity and increase income and employment opportunities for small-holder farmers in two southern provinces of Lao PDR.
The BIIE project builds on success of “Enhancing Milled Rice Production in Lao PDR” (EMRIP) project which was a two year EU funded pilot project designed to pilot and test new models and ideas to overcome the longest standing issues limiting production such as lack of access to quality seeds, fertilizers, technical support, finance and market.
As the BIIE project ended in December, 2014 an external final evaluation was carried out during January, 2015 using participatory methodology to assess the impact of the project as well as to identify areas that have been difficult and challenging. This evaluation also reviewed the relevance, efficiency, effectiveness, sustainability and impact, and value addition by SNV to the project. The independent evaluator reviewed the secondary documents as well as conducted in-depth individual interviews (III) with millers, focused group discussion (FGD) with farmers’ groups and key informants’ interview (KII) with project team and key stakeholders (government, university, and similar project).
The evaluation findings are: (i) Project design was relevant to SNV policy and Government of Lao PDR 7th National Socio-economic Development Plan (NSEDP) (ii) Objectives appropriately identified need of the farming community, and the activities and outputs were consistent with intended effect; (iii) Objectives are achieved to a good extent as the project was effective in achieving its outputs and outcome; (iv) project was efficient in fund utilization and leveraging support from government; (v) project made impact in increasing overall income of the farmers by 11.2 per cent to 12.5 per cent; and (vi) many activities (like group functioning, linkage between millers, farmers’ group and government) are likely to be sustained (vii) project has social, economic, financial and environment sustainability (viii) SNV made significant value addition in the project as well as in the region by introducing concept of working with private sector on value chain development, and promoting community based seed production system.
On the other hand it was found that the project was a bit ambitious in terms of targets i.e. obtaining premium price of 9 Euro more per ton for good quality paddy rice. This has something to do with policy environment and market forces, which is outside project control.
The evaluator strongly feel that the work has not reached to the logical end and if the project ends at this stage then many of the gains made during project implementation will be lost. The project had a very short span to establish models, which need more time for consolidation and replication. The exit strategy need to be strengthened so as the model could be consolidated and learning is mainstreamed. The SNV has taken a unique initiative in promoting ‘Inclusive Business Approach’ which is more advanced than ‘Access to Finance’ approach. Therefore, SNV should consolidate and concretise the model further.
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Therefore, at SNV and project level the evaluator recommends to extend the project period by two years for consolidation of activities. The evaluator has provided GANTT chart for scheduling key activities during extension period at page 32 which can be further expanded. During consolidation phase, SNV should not make effort to expand to new village but encourage millers to do so at their own cost by the mechanism, as suggested by the evaluator in Mechanism for Value Chain Development through Lead Farmers (pp.30). The evaluator also recommends establishing and strengthening farmers’ cooperatives as a federated structure in each of the miller’s area; channelizing inputs, credit and services; procurement and delivery of harvested paddy through cooperatives; and further promotion of Lead Farmer concept as extension agent of millers and Cooperatives. At Millers’ level, the evaluator recommends completing registration formalities of the Rice Millers’ Association (RMA); assisting in establishing & adopting quality standard for paddy cultivation and milling (hygiene, grading, packing, branding) and using differential prices as per paddy quality; and further supporting RMA in exploring marketing linkage in domestic and international markets through DoIC
The evaluator also assessed the feasibility of channelling external loan to the farmers and millers, and recommends that it has to be introduced gradually as farmers are hesitant to take loan from external sources though three groups have been doing internal saving and lending. On the other side millers have been given concessional loan from the government during stockpiling of rice in 2011, and they look forward to such favour though they need money to improve their facility/mill’s capacity and provide cash to farmers. It is assessed that out of 13 millers in the project area, 4-5 millers do have good track record and they can be tried for external loan linkage with Rabo-bank.
*****
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2. Introduction
The BIIE is aimed at reducing food insecurity and increase income and employment opportunities for small-holder farmers in two southern provinces in Lao PDR namely Savannakhet and Khammouane provinces.
The BIIE Project is designed and composed of five components:
1. Formation and strengthening of farmer groups
2. Improved access to credit, input, and extension
3. Strengthen the enabling environment (market and policy conditions for rice miller and farmers)
4. Strengthen rice mills in business operations, strategy and planning (rice business and supply chain management)
5. Enhance fair and transparent trade between rice farmers and millers.
The project duration was from January, 2012 to December, 2014. As the project ended recently, an independent final evaluation was conducted during January, 2015. The objective was to provide an un-biased external evaluation of performance of the BIIE project based on the indicators in the project Logical Framework and other un-anticipated project results.
The final evaluation reviewed and evaluated relevance, efficiency, effectiveness, sustainability, and impact and value addition by SNV. This evaluation report presents the evaluation design, processes, key findings and recommendations.
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Pro
ject
inte
rven
tio
ns
Serv
ice
Mar
ket
Ou
tpu
t Se
rvic
e M
ark
et
Ou
tco
me
Imp
act
En
terp
rise
Lev
el
Imp
act
Po
vert
y
Lev
el
Increase incomes of Rice
Farmer by 15% to 20% by
the end of the project
Facilitate the process that rice
millers develop and implement
production plans with small holder
rice farming households on fair &
transparent trading agreement
5 rice millers have capacity
to engage in fair &
transparent trading with
farmers
Rice miller groups are
capable to assist rice millers
to improve access to market
and policy conditions
5 rice millers and 2,500 farming
households have a fair and
transparent trading agreement
2500 Farming households
are organized in well-
functioning groups
Rice farming households
receive premium price of 9
Euro more per ton for good
quality paddy
Build capacity of selected
service providers in
delivering training and
advisory services to rice mills
Support rice miller groups in
vision building and action
planning
At least 1 service provider is
capable of training and
supporting millers and farming
households in rice mill, and
supply chain management and
business
development/entrepreneurial
skills
5 Rice millers increased
their skills in rice mill and
supply chain management
Increase income of rice
millers by 20%
Improved access to market
and policy conditions for
rice millers and farming
households
5 Rice millers and 2500 farming
households have improved access
to credit, input and extension
Select promising and
committed rice millers and
organize training on small
holder business module
(EMRIP approach)
Facilitate and capacitate rice
millers and farmer groups to get
access to input, credit and
extension
5 rice millers have capacity
and willingness to form &
strengthen farmer groups
5 rice millers are capable and
willing to organize input, credit
and extension to farming
households at reasonable terms
Increase rice production
by 10% per hectare
3. Background
Lao PDR is a land-linked country bordering Myanmar, Cambodia, China, Thailand, and Vietnam. About 6.8 million people live in its 18 provinces, with most people – 63 percent – still living in rural areas. The country is largely mountainous, with the most fertile land found along the Mekong plains. The river flows from north to south, forming the border with Thailand for more than 60 percent of its length1.
Lao PDR has been successfully transitioning from a centrally-planned economy to a much more market-based system since the introduction of the New Economic Mechanism (NEM) in 1986. This has contributed to relatively high economic growth including GDP growth averaging more than 7 percent per annum between 2001 and 20102.
While living conditions have improved markedly in urban areas, and poverty has continued to decline, poverty and near poverty still remain widespread, especially in rural areas where the vast majority of Lao people still live and work largely at a subsistence level.
3.1. The Project
The BIIE project supports farmers as they make the all-important transition from subsistence farming to farm managers with the ability to effectively self-manage their own financial futures. The project result chain as envisioned is shown below.
Figure 1: Result Chain/Envisioned Change Process of BIIE Project
Source: Project Proposal, BIIE Project
1 http://www.la.undp.org/content/lao_pdr/en/home/countryinfo/ 2 UNDP Lao PDR Programme Document “Realizing the MDGs in Lao PDR - Consolidated Programme of Support to MPI for the Achievement of the Valuable Goals of the 7th NSEDP 2011-15” pp. 3
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The project components, interventions and key activities are presented in table 1 below
Table 1: Project Components and Activities
Project components
Project interventions
Main activities
Formation of and Strengthening farmer groups
Select promising and committed rice mills and organize training on small holder business module (EMRIP approach)
1.1.1. Select promising and committed rice millers and organize training on small holder business module (EMRIP approach)
1.1.2. Develop a 3-year business plan with each selected miller and sign agreement of cooperation
1.1.3. Training of rice miller in farmer group formation and strengthening
1.1.4. Facilitate miller to form new and strengthening existing farmer groups
1.1.5. Develop training package and guidelines tailored to envisaged role and function of farmer groups
1.1.6. Organize leadership learning programmes to the management board of farmer groups
1.1.7. Facilitate inter-group learning between different farmer groups
1.1.8. Facilitate millers to help organize farmer group reflection event per cropping season
1.1.9. Support farmer groups with appropriate equipment for collective use
Improvement of access to credit, input and extension
Facilitate and capacitate rice millers and farmer groups to get access to input, credit and extension
2.1.1. Facilitate and capacitate rice millers and farmer groups to get access to input, credit, and extension
2.1.2. Facilitate rice millers and farmer groups in planning and organizing inputs on time
2.1.3. Facilitate rice millers and farmer groups to get access to credit from financial institutions
2.1.4. Organize training on business planning and loan proposal to the rice millers
2.1.5. Support rice millers to organize and develop fair trading agreement with seed producer groups
2.1.6. Support rice millers to increase quality of rice seed from seed producer groups by providing input & training
2.1.7. Capacity building of rice millers and seed producer groups in regular monitoring of rice seed production
2.1.8. Build capacity of rice millers and farmer groups in providing extension to their members
Strengthening enabling environment (market and policy conditions for rice miller and farmers)
Support rice miller groups in vision building and action planning
3.1.1. Support rice miller groups to implement the action plan
3.1.2. Training on small business association management
3.1.3. Organize leadership learning programme for the board members of rice mill group
3.1.4. Support rice miller group to organize rice policy dialogue workshop
3.1.5. Support rice miller group to organize rice business matching meetings with prospective buyers
3.1.6. Support rice miller group to organize periodic consultation and reflection meeting among the members and also with farmer groups
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Project components
Project interventions
Main activities
3.1.7. Provide support to establish and strengthen secretariat
Strengthening rice mills in operating their business (rice business and supply chain management)
Build capacity of selected service providers in delivering training and advisory services to rice millers
4.1.1. Build capacity of selected service providers in delivering training and advisory services to rice millers
4.1.2. Support service providers to develop tailor made training packaged based on TNA on rice business management, supply chain and entrepreneurial skills
4.1.3. Support service providers in delivering trainings and advisory service in business management, supply chain and entrepreneurial skills to rice mills and farmer groups
4.1.4. Organize specific trainings on ware house management, productivity improvement and packaging and branding.
Enhancing fair and transparent trade between rice farmers and millers
Facilitate the process that rice millers develop and implement production plans with small holder rice farmers on fair & transparent trading agreement
5.1.1.Training of rice millers in developing rice production plan and monitoring with farmers
5.1.2.Facilitate village value chain meetings to build trust, enable dialogue and align planning and action
5.1.3.Facilitate to develop fair and transparent trading agreement between farmer groups and miller including action planning for monitoring and purchasing
5.1.4.Regular monitoring by the project to make sure the agreement is properly followed by the parties
Source: Project Proposal, BIIE Project
3.2. Key Stakeholders and Institutional Arrangement
The key stakeholders and project interventions proposed were:
Rice Millers (RM): Rice millers were supposed to be provided with the knowledge needed to upgrade their rice mills operation, especially for managing rice mills and supply chain. Additionally, they were supposed to receive trainings in techniques for accessing finance. In return for this support rice millers were expected to assist rice farmer groups with credit, inputs, and extension service, in cooperation with DAFO staff and project staff.
Rice Miller Association (RMA): RMA was to be strengthened through various organizational development activities such as business strategy and planning, multi-stakeholder facilitation skills, and leadership competency. The rice miller groups had to play the role of lobbyist to the district and provincial governments to enhance conduciveness of socio-political environment for rice production, marketing and export.
Seed Producer Groups: EMRIP project had piloted community based seed production and distribution system by promoting seed producers’ groups of farmers. During BIIE the concept was to be further strengthened.
Lead Farmers: BIIE had to pilot and test Lead Farmers concept as extension service agents. The project was supposed to identify and train them so as millers and farmers could utilise their services.
District and Provincial Governments: Provincial Agriculture and Forestry Office (PAFO); District Agriculture and Forestry Office (DAFO) and Department of Industry and Commerce (DoIC) at district
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and provincial levels had to be given a better understanding of value chain development and market dynamics. This would have allowed them to support effective market development and achieving Lao government policy objectives for rice production, marketing and export. These levels of government were also supposed to play an immediate and continuing role as facilitators and enablers of efficient rice production systems and value chains.
Financial Service Providers: Financial service providers (ACLEDA and APB) were to be connected to potential customers, and had to be given the opportunity to deliver focused and needs based service packages to target groups. SNV was supposed to work in concert with financial institutions to help design a loan package that fits the unique agriculture environment in Lao PDR.
Rice Farmers Groups: Rice farmer groups had to be established and strengthened through the trading networks of participating millers/rice miler groups, who would have helped deal with rice farmers’ supply chain issues. These interventions will form the basis for increased trust, lasting market relationships and market-oriented increases in paddy rice production.
SNV had to establish good relationships with the stakeholders. An inclusive multi-stakeholder approach was to be adopted since inception during which intensive consultation and dialogue between all stakeholders had to be assured. This included facilitation of multi-stakeholder visioning, planning, implementation and monitoring trajectories.
The main aim of the Final Evaluation (FE) was to assess how effectively and efficiently project activities have progressed in attaining project objectives. Specifically, the FE mission reviewed and evaluated relevance, efficiency, effectiveness, sustainability and impact. The FE was conducted during January, 2015. This evaluation report presents the evaluation design, processes, main findings and key recommendations.
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4. Evaluation Design
4.1 Methodology
The methodology included
1. Review of the project documents 2. Briefing with SNV personnel 3. Meeting with stakeholders including
government officials (PAFO, DAFO & DoIC); 4. Participatory field assessment with
farmers’ groups in four districts 5. Active observation 6. Synthesis of information and report
preparation
4.2 Evaluation Criteria
The evaluation considered following criteria:
a. Relevance: The extent to which the objectives of the project intervention are consistent with beneficiaries' requirements, partners' and donors' priorities
b. Effectiveness: The extent to which the project intervention's objectives were achieved, taking into account their relative importance.
c. Efficiency: The extent to which economically resources/inputs (funds, expertise, time, etc.) are converted to results.
d. Sustainability: The continuation of benefits from the project intervention after the financial assistance is stopped as well as probability of continued long-term benefits.
e. Impact: Positive and negative, primary and secondary long-term effects produced by the project intervention, directly or indirectly, intended or unintended.
f. Value Addition: Value addition by SNV, innovative in the region
4.3 Sampling & Selection of Respondents
The BIIE project worked with 13 millers and 70 farmers’ groups of six districts of Savannakhet and Khammouane provinces of Lao PDR. The evaluator visited 50% sampled millers (7 millers) and 10% farmers’ groups (8 villages).
Table 2: Villages and Farmers’ Groups Covered during Evaluation
S. No. Province District Villages
1 Savannakhet Saibully Yongchen
2 Nasob
3 Khammouane Sebangfai Ban Muangladkhoi
4 Ban Noy
5 Xaibuathong Keokhaymouk
6 Phonenadee
7 Ban Phakhong
8 Mahaxay Mahaxay
Total 2 provinces 4 district 8 villages
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The evaluator also covered non-project miller and non project farmers’ group to get ‘With & Without’ and ‘Before & After’ picture in the project area.
4.4 Evaluation Methods & Tools
The evaluation included a combination of methods & tools. The evaluator visited selected villages in four districts to collect data. The data collection tools included:
4.4.1 In-Depth Individual Interviews
(III) – 9 Numbers
Semi-structured interviews using a flexible interview guide were conducted with randomly selected seven millers and representative of one RMA. The same set of questions was also administered to non-project miller. The questions were focused on the training, capacity building, and support provided by millers to farmers’ group, key issues and challenges encountered. Please refer Annex VII for the Millers’ guide questions.
4.4.2 Key Informant Interviews (KII)-13 Numbers
The KII was conducted with 13 personnel from SNV, University, Khammouane Development Project (KDP) and government officials. The key informants were interviewed on key aspects of the development challenges, project components, approach and insights gathered through the project interventions. Challenges faced were especially captured for future learning. Please refer Annexure II, III, IV and V for guide questions on KII.
Case studies were also collected to demonstrate how the BIIE project contributed in achieving income, independence and empowerment, highlighting both challenges and achievements.
4.4.3 Focused Group Discussion (FGD)-9 Numbers
This tool was used with the farmers’ groups to bring out the degree they have been collectively /individually benefited from the project interventions. Local empowerment and institutional strengthening processes were also captured. The checklist for FGD is given in Annexure VI.
4.4.4 Active Observation
While carrying out evaluation process, the evaluator recorded what he observed by taking descriptive notes.
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5. Key Findings
6.1. Relevance
The relevance of the project was assessed against appropriateness of objectives to the problems that it was supposed to address and to the physical and policy environment within which it operated.
SNV is dedicated to a society in which all people, irrespective of race, class or gender, enjoy the freedom to pursue their own sustainable development. SNV’s goal is to catalyse sustainable development processes3. It supports people to access and develop the capabilities, services and opportunities needed to live a healthy, productive and otherwise fulfilling life, while sustainably using the natural resources they depend on. SNV approach is to harness local strengths, building capacities, and empowering people and organisations to improve their own communities.
The National Socio-Economic Plan (NSEDP) of Lao PDR embodi es the government’s most important development goals and related plans for their achievement. The 7th NSEDP 2011-15 introduced a much stronger focus on inclusive and equitable growth, reduce poverty and inequality, and further advancing the country towards graduation from LDC status by 2020.
The project focuses on rice farmers who are largely un-organized and exploited. The project reaches the farmers through the millers with an objective to ensure provision of inputs and services for their income and food security and empowerment. These priorities are also fully consistent with the SNV policy and Lao PDR government’s NSEDP.
6.2. Effectiveness
The effectiveness was assessed by the progress against outputs and outcomes indicators given the project Log-frame.
6.2.1 Assessment of Achievement against Project Outputs and Outcomes
The table below indicates achievements against project outputs indicators.
Table 3: Achievements against Project Outputs Indicators
Output Indicator Findings
5 RM have capacity to engage in fair & transparent trading with farmers
13 RMs are engaged with 70 farmers’ groups in fair & transparent trading
RMs have capacity and willingness to form & strengthen farmer groups
RMs have expressed and demonstrated willingness to form and strengthen additional farmers groups.
3 SNV website at http://www.snvworld.org/en/regions/world/about-us/about-us/vision-mission
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RMs are capable and willing to organize input, credit and extension to farmers at reasonable terms
RMs are organizing inputs and credit to farmers at fair and reasonable terms. Need support in extension services*
Service providers are capable for training and supporting millers and farmers in rice mill, and supply chain management and business development/entrepreneurial skills
The project tried adopting Lead Farmers concept. Need to further develop and implement the concept
Rice Miller Group are capable to assist rice millers to improve access to market and policy conditions
In the progress, tasks need to be completed during consolidation phase
*Note: Millers in BIIE project belong to small & medium category with 3-6 tons/day rice milling capacity. The rice mills are normally operated by husband-wife duo. As such, they normally do not have manpower to reach to farmers with extension services.
The table 4 below assess progress against Outcome Indicators.
Table 4: Achievements against Project Outcome Indicators
Outcome Indicators Findings
5 Rice Mills and 2,500 Farming households have a fair and transparent trading agreement
Millers and farmers are practicing fair trading. The agreements are mostly verbal and based on trust and confidence.
2500 Farming households are organized in well-functioning groups
3449 farming households are organized into well organized functional groups
5 Rice Mills and 2500 Farming households have improved access to credit, input and extension
13 Rice Mills and 3449 farming households have improved access to seeds and extension services by government. Millers organize fertilisers & fuel from dealers, and cash to farmers from their savings
5 Rice Mills increased their skills in rice mill and supply chain management
13 millers have improved their skills in rice processing and supply chain management
Improved access to market and policy conditions for rice miller and farmers
DoIC, DAFO and PAFO are working with millers and farmers to improve policy conditions
As such the project has achieved almost 100% of its targets. The above key result areas were effective in improving livelihoods security to farmers and their families.
6.2.2 Assessment on Access to Finance
Access to finance is one of the key issues for the farmers in the project area. The farmers are small, dispersed and largely un-organized. These farmers need credit to invest in paddy seed, fertiliser, labour and fuel to increase productivity and production of good quality rice.
The rice millers also need access to finance to improve their operational capacity, efficiency and supply of processed rice to market. They also meet small cash need of farmers by advancing cash
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Interview with Consultant on Rice Program & Capacity Building, Khammouane Development
Project, PAFO
Dr. Phetmanyosen Xangsayasone is a rice breeder from Agriculture Research Centre, NAFRI and is working
as Consultant to KDP-3 component since 2012. Earlier he worked with NTPC and helped farmers in better
rice production.
He informed that
1. There are 16 seed producer groups in Khammouane, which are being promoted through different
projects including SHDP & PIP.
2. PAFO has a seed quality laboratory for testing and certifying the seed quality.
3. 21 rice millers are working with KDP on seed supply system. As they were found cheating the
farmers and not following the quality standards (see box) the PAFO tried direct marketing of seeds
through seed producer groups to farmers. The procedure was as follows:
Seed producer group signs contract with farmers, and hand over the copy to PAFO;
PAFO has fund for seed purchase. It provides money to the seed producer group.
The farmers get the seed on credit but repay after harvesting.
4. The system had mixed results.
5. Common sticky rice varieties are TDK8 & TDK 11. Non-sticky rice varieties are KDML 105, RD-15
(Thai patent), Sebangfai 2 & Sebangfai 3.
6. SRI system does not in Laos due to uneven land and flood.
7. Vietnamese traders buy rice from Laos, make it powder and sell it. They also sell broken rice to
Lao-Beer Company.
8. Laos need export company for setting the standard and assisting government of Laos.
9. Laos’s millers cannot sell directly to market due to low of quality and quantity. Vietnam export 3
million sticky rice, most of them are from Laos.
10. Dept of Agriculture has standard for organic and GAP. KDP invited experts and conducted
workshop on organic rice production. Three millers in Mahaxay work on organic rice production.
11. KDP will end in March, 2015
12. Price of organic rice: vacuum rice – 8000 KIP/kg; non-vacuum – 8000 for 1.5 kgs.
13. Mekong Institute is working on marketing of rice to Vietnam and other countries
Recommendations for SNV
Agreement with millers and farmers.
Millers should buy with more head count so that they can sell at higher price.
Improve farmers’ organization,
Register millers association
credit, and getting it back through paddy after the harvesting. The millers normally do not have the capacity to provide credit to all farmers due to limited financial resources.
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The evaluator learned that at the beginning of the project a consultant was hired for legal advice on the provision of credit to small holder farmers and millers from Rabo Bank Foundation. The consultant prepared a detailed proposal on access to finance for small holder rice farmers in the target areas based on a detailed appraisal of Access to Finance. The following key components were suggested by the consultant:
1. Connecting small holder farmers with financial service providers 2. Improving operations and the sustainability of Village Development Funds (VDFs) 3. Facilitation of land titling for small holder farmers 4. Strengthen management capacity of rice mills
Rabo bank Foundation suggested the 1st, 3rd and 4th components be included in the BIIE project and requested further information on the viability of creating a local Network Support Organisation that could provide sustainable services in establishing new VDFs and strengthening existing VDFs4.
The evaluator also focused on above three components during evaluation work. The evaluator learned that the BIIE project together with the millers tried to facilitate farmers to access finance from the Agriculture Promotion Bank. The bank was very positive in the beginning. The project helped 63 farming households in three farmer groups to prepare business plan and necessary documents to apply for loan but the bank decided not to extend the credit to the farmers at the last minute. The project personnel opined that that the bank is not interested in catering to smaller loans to farmer groups.
The farmers participating in the project are able to get limited cash credit from the millers. Most of the millers mobilized their savings and loan from family and friends to provide fertilisers, fuel and cash to the farmers. Some of the millers like Mr. Pondma Jinthala and Mr. Khamsadom also took loan from commercial banks at 14 per cent interest and relent it to farmers as cash-credit. The farmers repay the loan in kind through paddy. The project linked millers to government seed production centre at Sebangfai, Khammouane. The DAFO also assisted millers in getting seeds on credit from seeds production groups, which the millers had to pay after the harvesting.
The project also made efforts to incubate the idea of development fund by encouraging three farmers’ groups in the project area to start savings and credit activity. The evaluator visited two such groups namely Phonenadee village farmers’ group at Xaibuathong district and Ban Noy village farmers’ group at Thakhek district in Khammouane province. In the first group 42 members out of 72 farmers and in the second group all the 49 members are involved in saving and credit activity. Both the groups charge 3 per cent interest per month as interest rate. While the farmers’ group at Ban Noy village does not offer credit to non-members the farmers’ group at Phonenadee village offer credit to non-member at 5 per cent monthly interest rate.
As such, both groups are involved in saving and credit and are aware of the lending process. However, they are not exposed to mobilise and channel loan from external sources and are hesitant
4 2012 Annual Report, BIIE
18
to do so. The evaluator asked specific questions on mobilising loan from external sources like bank, however the group members responded that they haven’t done so, and hesitant to opt for it though they need money as the farmers need credit to meet the production cost in rice farming.
6.3. Efficiency
The efficiency of the project was assessed against the cost, speed and quality with which inputs/ means have been converted into activities and the quality of the results achieved.
The project implementation modality was a departure from conventional approach where budget and facilities are provided to government, entrusted with project implementation. Instead the project was able to significantly leverage government support from PAFO, DAFO and DoIC which ensured technical support, joint planning and project monitoring.
The budget was only provided for capacity building, coaching and technical monitoring and, therefore, it was a low budget, effective implementation, highly efficient project.
The registration process of cooperatives and RMA are slow due to lack of set procedure on the government side. As registration of the RMA and cooperative are the first case of private sector to initiate a Business Members Organization, the government is taking long time to investigate and review documents.
Table 5: BIIE Budget Vs Utilization (Jan, 2012 to June, 2014)
Source: BIIE Semestral Report, January-June, 2014
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Interview with Rice Miller, Mahaxay Dist
Ms. Niphaphone has been in rice milling trade for last 18 years. She started her career as rice collectors: collecting paddy from farmers and supplying to millers on a commission. She established her mill in 1997 with a capacity of 2 tons/day, and gradually increased to 9 tons/day. She has been working with farmers in six villages of Mahaxay district and four villages in Yommalath district of Khammouane province.
She has been involved in SHDP and EMRIP project earlier and visited Thailand, Cambodia, Vietnam and India on exposure visit. She learned about organic farming during her exposure visit, and started promoting it in her area. She was able to encourage farmers to produce 50 tons of organic rice (70 tons of paddy) in 2014, which she was able to sell to wholesalers at 5500 KIP/kg (USD 0.7/kg), as compared to 4200 KIP/kg (USD 0.5/kg) for normal rice.
She has planned to promote organic rice production in 500 hectares of Yommalath district in 2015, and the transplanting will start from 3rd week of January, 2015. She is not aware of organic certification agency in Laos, and informed that normally the wholesalers taste the rice first, and if satisfied with the quality, then they buy it.
Evaluator’s Note: The Lao Certification Body, or LCB, is an organization created that offers certification services to the agriculture and food sectors in Lao PDR. A full discussion of Lao organic standards can be viewed at http://www.laotradeportal.gov.la/index.php?r=site/display&id=167
The project was able to utilise 82 percent of its allocated budget by June, 2014. The project exceeded budget utilization in Vehicle and Equipment (114 per cent) which is actual cost of travel of project team to field areas, which can be justified as the project area is widely spread over in four districts. It is reported by the project team to the evaluator that the project have used remaining budget by December, 2014 end.
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6.4. Project Impact
As the project activities were directly related with capacities building of farmers and millers in rice production, processing and marketing the impact on rice value chain is quite visible. The millers are providing the inputs to farmer groups on credit. The farmer groups improved rice production, and are selling their paddy to millers and repaying the loan.
6.4.1 Impact on Income, Independence and Empowerment
The project impact was assessed against the impact indicators given in the Project Log-frame.
Table 6: Achievement against Impact Indicators
*Note: As per Senior Rice Value Chain Adviser The difference price among normal paddy and high quality paddy (improved variety) is 2,000 Kip/Moun or 166 Kip/Kg, that equivalent to 15 Euro per ton. Price of Normal paddy (traditional variety) 21,000 Kip/Moun Price of high quality paddy (improved variety) 23,000 Kip/Moun (1 Moun = 12 kgs)
The baseline study reported 2.13 tons per hectare paddy production during rainy season and 3.24 tons per hectare during dry/irrigated season5. The final evaluation found that the rice production has increased to 2.5 tons per hectare during rainy season (11.2 per cent increase) and upto 4.0 tons per hectare during dry/irrigated season (12.35 percent increase) respectively.
In area where millers used to provide credit to farmers, they used to charge a flat rate of repayment for definite volume of paddy for the credit provided to farmers, irrespective of change in prices of paddy. The project introduced varying volume of paddy as repayment corresponding to market price, which significantly reduced the repayment rate and increased farmers’income.
6.4.2 Impact on Gender
Lao PDR is one of the most ethnically diverse countries in the world, with an official 49 ethnicities that fall under four broad language families: the Lao-Tai, the Mon Khmer, the Hmong-Mien and the
5 Baseline Report, BIIE, June 2012
Impact Indicator Finding
Increased Rice Production by 10% per hectare
Rice productivity in majority of villages has increased from 2.13 tons to 2.5 tons in rainy season (11.2% increase) and from 3.24 tons to 4.0 tons in dry season (12.25% increase)
Farmer received premium price of 9 Euro more per ton for good quality paddy
Farmers are receiving better prices due to fair practice
Project made effort to introduce differential price concept for different quality of rice*.
Increased income of rice miller by 20% Rice millers’ income increased because of better head count due to good quality rice production. On an average 40%-50% increase was realized by rice millers.
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Chine-Tibet6 In the Lao PDR, residence after marriage can follow three main patterns – matrilocal, patrilocal, or bilocal – with most of the majority Lao Tai group practicing the matrilocal – type pattern.
Generally speaking, the matri-local system, where the husband moves in with the wife’s family, affords women higher status and decision-making power. The house and property belong to woman’s family and through familiarity with her surroundings. The daughter who lives with and takes care of the aged parents inherits or receives property from the parents; mainly the house and the land. Majority of project beneficiaries belong to Lao Tai community and followed matri-local system.
The Constitution (1991) guarantees equal rights for women and men and equal treatment before the law. A National Commission for the Advancement of Women (NCAW) was set up in 2003 to drive national policy to promote gender equality and empower women. The 2004 Law on the Development and Protection of Women focuses on eliminating discrimination against women, combating violence, and creating an enabling environment for women’s empowerment7.
The majority of women live in rural and ethnic minority communities. They are affected by poverty and food insecurity, given their central role in food collection and management. Lao women are traditionally responsible for collecting fuel-wood, rice transplantation and weeding. This labour-intensive work exacts a heavy burden since women are primarily responsible for housework and child-rearing. Agriculture employs about 80 percent of the total workforce, with women making up more than half of workers at 54 percent.
During the evaluation, questions on gender aspects were included. The evaluator found following points:
Women play a critical role in agriculture and the use of natural resources, and are primarily responsible for maintaining their families’ food security.
Men and women spend similar amounts of time on agricultural work, but men spend more hours on income generating activities (including agricultural work).
In addition to their work in farms and within the household, women are involved in informal small-scale income earning activities and handicrafts production to supplement their family incomes.
Women have limited mobility, and traditional customs do not allow women to work far from the village.
SNV has emphasized gender equity and social inclusion in all its projects, including BIIE where gender mainstreaming is done through women empowerment especially for female millers who play key roles in enhancing women participation at village, district, and provincial levels in rice production and trading.
6 Lao PDR Gender Profile, Gender Resource Information & Development Centre (GRID), 2005 7 UN Women, ‘Lao PDR Fact Sheet’ http://www.unwomen-
eseasia.org/docs/factsheets/04%20Lao%20PDR%20factsheet.pdf
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Meeting with Non Project Village Group, Tueng Village, Sebangfai dist
The seed producer group was formed under SHDP in June, 2012, there are 23 families. The project provided equipments like grader, dryer on grant, and transplanter at 50% subsidy. The project also provided 75 bags of fertilisers (@800 Baht/bag) and 33 bags of seeds (33x30 kgs=990 kgs seeds @4500 KIP/kgs) and 1000 empty bags as support to revolving fund. There is one more seed producer group in the district promoted by SHDP.
The group received training on seed production techniques and was able to sell 12 tons in 2013 through millers. However, in 2014 they could sell only 2 tons though they produced 19 tons of seeds. They had to sell remaining seeds as paddy for consumption purposes.
In 2014, the government changed the policy and directed the group to sell directly to farmers, not through the millers. The group did not have experience in direct marketing. Moreover the farmers asked for buy back guarantee of paddy, but the seed producer group was not able to ensure buy-back, unlike millers. They used to sell millers @4500 KIP/kgs, and the millers used to arrange transportation of seeds from the village, however when they tried to sell directly, the farmers asked for delivery in their villages, and the seed producer groups had to pay for the transportation (@250,000 KIP/ton).
The group shared learning from their failed attempt as below:
1. Link with miller for buy-back arrangement for the farmer to whom they sell the paddy seeds; 2. Either improve capacity on promotion and marketing or hire expert’s services
The project reports include gender segregated data, and focus on reporting on gender neutral progresses including both men and women.
In the project area, women control the finance and have more decision making power in money matters than men. They share responsibility in domestic work.
Women are members of farmers’ groups and attend meetings though the men normally dominate such meetings.
6.5. Project Sustainability
The final evaluation assessed the sustainability aspects from the perspective of the likelihood of a continuation of benefits produced by the project to the beneficiaries. The final evaluation also looked into the possibility of the sustenance of project interventions beyond the project period.
The assessment of sustainability focused on institutional, social, cultural, financial, technical and environmental factors.
6.5.1 Institutional sustainability
Institutional sustainability is achieved when prevailing structures and processes have the capacity to continue to perform their functions over the long term.
The project is designed to enhance the sustainability of food and income security through effective functioning of farmers’ groups and improving their income from rice production and value chain development.
The project has been successful in bringing the farmers together in groups. The organisation of farmers into groups has facilitated dissemination of information. They meet regularly to discuss the trainings, sharing of experiences, exchanging ideas and difficulties they face.
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Each group has selected five members’ committee (Chairperson, Vice, Finance/Account, Procurement, and Marketing), and their orientation and training have been conducted. The group cohesiveness is strong and there are strong likelihood that the farmers will continue to work in groups as these have increased their solidarity and bargaining power.
At millers level a Rice Miler Group was promoted by SNV in 2009 and the BIIE is carrying it forward by upgrading the ‘Group’ to ‘Association’ and completing its registration and linking with government department. As it is working since 2009 the likelihood of its continuation is also strong.
6.5.2 Economical sustainability:
Economic sustainability is achieved when a given level of expenditure can be maintained over time.
Due to the project interventions on improved farming practices and linking farmers’ groups with improved seed provision and market the income of farmers have been increased significantly. As the farmers have learned the techniques and are now well connected with millers as value chain actors the probability of economic sustainability with existing 3449 farmers’ families is very high.
These farmers are likely to be economically secure unless major threat/hazard occurs. The economic value can be further increased if collective approach in procurement and marketing through farmers’ cooperative is promoted.
6.5.3 Social Sustainability
Social sustainability is achieved when social exclusion is minimised and social equity maximised.
There has been substantial capacity building and empowerment of the farmers, particularly women. Due to their involvement in the project and their economic role the villagers view these women with respect. The project should continue to target farmers’ independence and empowerment vigorously with collective actions to gain further solidarity and momentum.
6.5.4 Environmental Sustainability:
Environmental sustainability is achieved when the productivity of life-supporting natural resources is conserved or enhanced for use by future generations.
The main project support is for rice cultivation and trading. The inputs for production include improved seeds and fertilisers (mostly bio-fertiliser) with no pesticides. These activities are essentially on a micro-scale and unlikely to have a noticeable effect on the environment. In Khammouane province, the project is promoting organic rice production.
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For rice milling, the main environmental issues are as follows8:
• Effluent produced during cleaning of equipment may cause water pollution through insufficient treatment of effluent
• Air pollution both on site and in the surrounding locality may result from release of dust to the atmosphere from handling or processing of the paddy or its by-products
• High internal and external noise levels that may generate health hazard and nuisance to the local community
• Disposal of solid wastes, particularly unused rice husk and bran, as well as other wastes generated from the cleaning process
• Raw materials and by-products may be subject to pest infestation and contamination
The rice millers in project area are small, and away from the villages with low amount of wastage. The husk is normally used as food for chickens together with broken rice. Sometimes the husk is collected and burned.
The rice millers should ensure proper handling, storage and transportation of rice husk and rice husk ash so as to check environmental pollution. They should also explore possibilities of ash utilization in making bricks or use in cement plants.
8 IFC Scoping Study on Clean Technology at
http://www.ifc.org/wps/wcm/connect/8894fe804726241c945cbf2b131bed2a/Scoping%2Bstudy%2Bclean%2Bt
echnology%2Bopportunities%2Bin%2BIndonesia.pdf?MOD=AJPERES
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6.6. Value Addition by SNV
This aspect was looked from the angle that whether the practices introduced by SNV, prevailed in the area or not. The evaluator investigated the new practices which are introduced by SNV. In case the practices already existed, the evaluator investigated value addition to existing practices by SNV.
6.6.1 Involvement of Private Sector
The concept of involving private sector in development is new in Lao PDR as the government has traditionally been apprehensive of their profit motive. During the interview with provincial and district government officials and KDP personnel the evaluator learned that the SNV has introduced the concept of working with millers as private sector, which has been proved successful. As a result, other projects and government are also coming forward to work with private sector.
6.6.2 Promotion of Community Based Seed Production System
SNV is a pioneer in promoting community based seed production centres. When it was realized that there is a huge problem in seed production, distribution and marketing of good quality seed, SNV promoted this concept. It selected six seed producer groups and four rice mills to test a private sector model for seed production, distribution and marketing.
The seed producer groups received on farm coaching on good quality seed production from a rice seed expert. The interventions contributed in developing a sustainable local market for existing production of improved paddy seeds. During discussion with KDP personnel the evaluator learned that now 16 seed producers groups have been promoted in Khammouane province alone by other projects like SHDP and PIP.
6.6.3 Farmers’ Functional Literacy
SNV promoted specially designed farmer log book to record all rice production related information including cultivation area, seed variety and quantity, cropping calendar including dates of seedling transplanting, application of fertilisers, and harvesting. The farmers also record all the expenses associated with the rice production such as quantity and amount of seed, fertiliser, labour, and fuel used. This passbook helps farmers to calculate after harvesting and selling of produce every cropping season.
The farmers can also use the passbook for recording incidence of flooding, draught and pest infestation. This is a new practice in the region as farmers do not have culture of recording their cost and income. They are into subsistence farming with no knowledge if they are making income from cultivation, or opportunity cost of getting involved as wage labour is high.
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6. Key Recommendations
The evaluator particularly assessed the capacities of millers and farmers to access external finance.
At millers’ level, the evaluator found that they are acting as important link in driving upstream and downstream supply chain. Millers are engaged in upstream activities such as provision of inputs, including improved seeds, fertilizers, fuel, cash-credit and transportation facilities for harvested paddy, and in downstream activities such as selling milled rice to big traders and rice mills within and outside Lao PDR.
The evaluator also learned that as millers have benefited from the project they are planning to enhance mill’s capacity and expand their operation. In the past, millers have been given concessional loan from the government under rice stockpiling arrangement9 in 2011 which many of them did not pay back. The millers look forward to such favour in future also. On the other hand, during discussions with government officials (DoIC) it was learned that the government is aware of this mal-practice, and now cautious on providing such concessions. The government has also commissioned a study on finding reasons for non-payment of loan.
It is worthwhile to mention that a study10 reported that
“ ......the continuing investments in new mills and expansion of processing lines and facilities, even with commercial loans at 14%, by most of the selected rice mills studied would seem to suggest that the margins for such mills are much higher...... furthermore, by linking to and being directly involved in both the upstream and downstream segments, the total returns to the increasing comprehensive supply chains anchored around these mills would be much higher than that at the mills alone”.
It clearly indicates that the millers have the capacity to repay the loan even at commercial rate. Therefore, the evaluator recommends to identify 4-5 progressive millers from the BIIE project, evaluate their credit worthiness and offer small loan amount (USD5000-USD10,000) initially for upstream and downstream services i.e. upgrading their mills for supplying rice to bigger mills and rice traders as well as for providing inputs to the farmers. The loan amount shall be increased subsequently for the millers who repaid the loan on time. This would instil practice of taking and repaying the loan.
As the studies have already confirmed that the millers make profit even at 14% commercial rate of return (which the evaluator agrees) the other millers would start following these millers once they realise that the millers who took loan from Rabo bank rapid the loan and at the same time made good profit.
At farmers’ level, linking farmers’ groups to external loan is more challenging as except three groups, none of them have practice of saving and credit. No group has taken loan from external sources and the farmers solely depend on rice millers for credit need. Therefore, the evaluator recommends that access to external finance need to be introduced gradually, as farmers do not have any experience and are hesitant to take loan from external sources.
9 http://siteresources.worldbank.org/LAOPRDEXTN/Resources/FINAL_LEM_English.pdf 10 Foreign Direct Investment in rice Value Chain with Special Focus on the Mills Sector at Lao PDR (2013), pp16 at http://www.isis.org.my/attachments/1476_LW_FDI_in_Rice_Value_Chain_in_Lao_PDR_2013.pdf
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The key recommendations on improving ‘Access to Finance for Farmers’ are:
• Initiate and pilot borrowing from external sources with existing three farmers’ groups who are involved in internal saving and lending.
• Promote federated cooperative structure (further explained through diagram in next page ) and Lead Farmers’ concept as Community Resource Person (CRP). Please refer the mechanism through the link
• Link millers and farmers groups with CRP as extension agent • Provide capacity building and hand-holding support in loan fund management. • Develop loan model and promote it at wider scale
The other recommendations are
• Extend the project period by two years for consolidation of activities; • During consolidation phase, SNV should not make effort to expand to new village but
encourage millers to do so at their own cost by following the mechanism, as suggested by the evaluator.
• SNV should consolidate, concretise and promote the model with government, donors, bilateral and multilateral agencies.
• SNV should prioritise resource mobilisation for replication/ up-scaling of the BIIE project approach.
• The project has also promoted organic rice cultivation in Khammouane province. SNV should liaise with other agencies in further promoting organic rice cultivation & certification.
• Document and disseminate best practices in written/ audio-visual forms (process documentation through write-shop)
• Organise policy dialogue with government (MOFA, DoIC) on value chain development by involving private sector; Provide support in mainstreaming best practices in government programmes
• Complete registration formalities with the RMA • Assist RMA in establishing & ensuring quality standard for paddy cultivation as well as for
millers (hygiene, grading, packing, branding) and differential prices as per paddy quality • Support RMA in exploring marketing linkage in domestic and international market though
DoIC and MoFA
A GANTT chart has been provided by the evaluator at pp.32 as a format for scheduling key activities during project extension period which can be further expanded by the project team.
******
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Miller
1 Farmers Group
as Cooperative Farmers’ Group Farmers’ Group Farmers’ Group
Miller
Farmer Group Farmer Group Farmer Group Farmer Group
Farmers’
Cooperative
Diagram of Existing and Proposed Cooperative Set-up
Existing Cooperative Set-up
Proposed Cooperative Set-up
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Mechanism for Value Chain Management through Lead Farmers
Existing Situation
1. Millers are providing inputs like seeds, fertilisers, oil and cash-credit to farmers’ groups. The group leaders ensure that the members repay the loan either in cash or kind (mostly in kind in terms of paddy);
2. They procure seeds through DAFO, who link them either to government seed production centres or seed producers groups. For fertilisers and oil they buy from dealers;
3. They also take support of government extension agents to train farmers on improved rice production practices. The millers pay them daily allowance (70,000 KIP), food and travel cost;
4. The BIIE project also supported each miller to conduct Training of Trainers on Rice production for at least two lead farmers in their farmer groups. In total 157 lead farmers (28 females) were trained in nine separate training events conducted for each rice mill.
5. Lead farmer ToT was followed by on-site farmer training by the miller. In many cases, the rice production training of farmers was jointly conducted by the lead farmer, the miller and an extension worker from DAFO.
6. However, this initiative had limited success, mainly due to low interest, poor communication and leadership qualities among lead farmers and lack of incentive mechanism to sustain their interest.
7. Still, five lead farmers (three in Mahaxay district and two in Nongbok) are being utilized by other projects (namely, SHDP & KDP) to provide training to farmers.
8. The millers are facing difficulties to mobilize cash and provide credit to farmers, though the demand for cash credit is very high.
9. They also anticipate reduction of support from government department (particularly in training to farmers) once the project is over.
10. Before the project, millers used agents in every village for collection and supply of paddy from farmers. These agents were called ‘Collectors’ and miller used to pay them ‘500 KIP per 12 kgs (moun) or 42 KIP/kg or 42000 KIP/ton
Aim /Goal
Revamp the Lead Farmers Concept as Community Resource Person to provide training and inputs to farmers and ensure repayment of loan and supply of paddy to millers by linking them with millers and farmers’ group
Strategies for Provision of Services
1. Out of 157 trainer farmers identify 10-12 Lead Farmers who are still interested to provide services on fee basis.
2. Build their capacities in interpersonal communication, leadership and training skills; 3. Link them with millers as their extension agents with following tasks;
a. Identifying new villages in miller’s coverage area b. Organizing farmers into groups, conduct training and technical follow up support in
improved rice production c. Organizing inputs through millers (seeds, fertilisers, fuel, cash) and providing them
to farmers; d. Maintaining records of farmers and their groups
4. The incentive mechanism for lead farmers can be worked out as below:
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a. Millers provide them same charge for collection and supply of paddy as collector i.e. 500 KIP per 12 kgs of paddy supplied
b. For additional two services i.e. (i) organizing farmers into groups and providing training; and (ii) supplying inputs to farmers, the millers also provide similar incentive i.e. 500 KIP per 12 kgs for each of two services;
c. As such the Lead Farmers can earn 1500 KIP for 12 kgs from millers. d. Therefore, if a Master Farmer covers 100 hectares area with 2.5 ton paddy/hectares,
his/her service fee for 250 tons will be worked out as i. (250 x 1000 x 1500) ÷ 12 = 31.5 million KIP
e. The amount is equivalent to employment for 300 days of working for skilled labour (@100000 KIP/day).
f. The miller also benefit from good quality rice, as the head count (full grain) per centage will be high with less wastage
g. As usual, the millers organize transportation for inputs and harvested paddy h. Since incentive is linked to volume of production (per kgs paddy) the lead farmers
will be motivated to provide regular technical and monitoring support to farmers i. The farmers not only benefit from provision of inputs, technical services, and market
facilities at doorstep but also from enhanced quantity and quality of paddy. j. As the Master Farmers bring resources to farmers they may be termed as
‘Community Resource Persons’ or CRP.
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Mechanism on Access to Finance for Farmers
Existing Situation
1. The BIIE project promoted three farmers groups as saving and credit groups. Though these are known as Cooperative, these are not registered so far
2. As all the farmers cannot save, therefore there is flexibility that only the members who are interested and capable can join saving-credit group.
3. As such in Phonenadee Farmer Groups, Xaibuathong district, Khammouane though there are 72 members only 42 members participate in monthly saving & credit activities. The group has saved 32 million KIP as on date from members’ saving. The individual monthly saving varies from 50,000 KIP to 100,000 KIP.
4. In Ban Noy village of Sebangfai district, Khammouane all 49 members’ participate in monthly saving & credit activities. The group has saved 42 million KIP so far. The individual monthly saving varies from 5000 KIP to 200,000 KIP
5. These groups have been doing internal lending. While Phonenadee group charges 3% and 5% interest rate per month from members and non-members respectively, Ban Noy group only lends to members at 3% interest rate per month.
6. They subsidize interest on loan for emergency purpose. For e.g. Phonenadee group does not charge any interest rate on emergency loan if return within a month, Ban Noy group does not charge any interest on emergency loan for three months.
7. Though they need additional fund for providing loan both the groups haven’t tried borrowing money from external sources. As such they do not have experience of taking and repaying loan from outside.
8. As such, there is need for loan but not the experience and willingness
Aim/Goal
Encourage the groups to borrow and return money from external sources and make them credit-worthy.
Mechanism
1. Conduct due-diligence on the credit worthiness and set a limit for cash-credit facility for each group. The limit should be low first time with the condition that if the groups utilize and repay the loan in full, the limit will be enhanced further.
2. As such the loan is readily available to the farmers at lower interest rate (6%-8% annually) which encourage the group to earn income through interest as they charge 36% annually.
3. The group may hesitate initially, but the SNV project personnel can encourage and provide hand-holding support in availing and utilizing loan.
4. Meanwhile, the project personnel help establishing federated cooperative structure and getting registered as Cooperative for larger intake of loan.
5. Once the Cooperative is registered, start channelizing loan to farmers through the cooperative.
***
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Indicative Gantt chart for Scheduling Key Activities during Project Extension Period S. No. Activities Time Frame (quarterly)
Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8
1 Access to Finance with Millers
i. Identification of progressive farmers & verifying their
credit worthiness
ii. Completion of loan processing and channeling 1st loan
iii. Providing hand-holding and monitoring support in
loan utilization
iv. Repayment of loan and issue of second loan with
higher credit limit
v. Promotion of successful cases to other millers within
and outside project through experience sharing
workshops, audio-visual aid etc.
vi. Follow step 3 with more millers
2 Promotion of Federated Cooperative Structure
i. Discussion and common agreement with other
farmers’ group in the millers’ area
ii. Identify interested groups, and elect/nominate
committee members from each groups
iii. Assist in developing cooperative’s rules and
regulations, including for provision of inputs, services
and marketing of harvested paddy
iv. Register Cooperatives in suitable government Act
v. Initiate channeling of inputs supply and provision of
external loan
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3 Development of Lead Farmer/CRP concept
i. Develop/refine criteria for selection of Lead
Farmer/CRP based on project experience
ii. Shortlist 8-10 Lead farmers to be trained as potential
CRP
iii. Conduct training need analysis (TNA) and design
training programme for CRP in leadership,
communications, negotiations, team work and other
necessary skills as identified
iv. Develop their incentive package as per the mechanism
recommended by the evaluator
v. Negotiate and agree on the incentive mechanism with
millers and farmers
vi. Organise modular training programme for the
shortlisted CRPs
vii. Provide hand-holding support to them during their
work
viii. Ensure payment of incentive as from millers as per the
agreed terms
ix. Organize experience sharing workshops/meetings with
CRPs to capture learning
x. Improve the concept as per the learning and replicate
at wider scale
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Annexure 1: Evaluation Schedule Date Day Activities Person/Farmers’ Group
05/01/15 Monday Travel to Vientiane
Meeting/Briefing with Sector Leader, SNV Mr. Frank Tolentino
06/01/15 Tuesday Travel to Khammouane
Meeting with Senior Rice Value Chain Advisor, SNV Mr. Daovanh
Travel to Savannakhet, night halt
07/01/15 Wednesday Meeting with Deputy Director, Extension Department, Provincial Agriculture & Forestry Organization
Mr. DuangChan Koevongsack
Meeting with BIIE Coordinator, Savannakhet Mrs. Duang Ta
Meeting with Dean, Env & Forestry, Savannakhet University
Dr. Bounheuang Ninchaleune
Travel to Saibuly District, Savannakhet Province
Meet with District BIIE Coordinator Mr. SisamPhan Phet Sa lad
Travel to Savannakhet, night halt
08/01/15 Thursday Travel to Saibully district
Meeting with Project miller Mr. Khammanee Inthongsai
Meeting with Farmers’ Group, Project Village Yongchen Village
Meeting with Farmers’ Group, Project Village Nasob Village
Meeting with Project Miller Mr. Pondma Jinthala
Meeting with Non Project Miller Mrs. Sisamay Mangsoutsax
Travel to Thakhek, Khammouane, night halt
09/01/15 Friday Travel to Sebangfai district
Meeting with Head, DAFO, Sebangfai district, Khammouane Province
Mr. Phan Thon XaiyaVong
Meeting with Deputy Head, DAFO, Sebangfai district, Khammouane Province
Mr. Sisomphone
Meeting with District, BIIE Coordinator, Sebangfai district, Khammouane Province
Mrs. Chom si
Meeting with project Miller Mr. Khamsadom
Meet with Farmers’ group, Non Project Village Tueng Village
Meet with Farmer group, Project Village Ban Muangladkhoi
Travel to Thakhek, Khammouane, night halt
10/01/15 Saturday Travel to Xaibuathong district
Meeting with project Miller Mr. Soukasem Khotmanyvong
Meeting with project miller Mr. Khamphami Phetsarath
Meeting with Farmers’ Group Keokhaymouk village
Meeting with Farmers Group Ban Phakhong village
Travel to Xaibuathong, night halt
11/01/15 Sunday Meeting with Farmers’ Group Phonenadee village
Travel to Mahaxaiy district
Meeting with project miller Ms. Niphaphone
Meeting with Farmers’ Group (seed producers) Mahaxay village
Travel to Thakhek, Khammouane, night halt
12/01/15 Monday Meeting Deputy Director, Department of Industry & Commerce, Khammouane Province
Mr. Thongxay Mangnomek
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Meeting with Head of Agriculture Promotion, DAFO
Mr. Keoviengkhon Sihavong
Meet with Deputy of PAFO, Khammouane Mr. Viengkham Sayaphone
Meet with Farmers’ Group Ban Noy village
13/01/15 Tuesday Meet with miller association Mr. Phesamon
Meet with KDP C3 Dr. Phetmanyseng Xangsayasane
Debrief meeting with BIIE Daovanh, Frank, MOFA
Travel to Vientiane
14/01/15 Wednesday Debriefing Meeting at SNV, Vientiane CD and Sector Leader
15/01/15 Thursday Completion of administrative and financial procedure
Departure
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Annexure II: KII Checklist for SNV Personnel
1. What are roles/tasks of SNV in the BIIE project? 2. How did you select the project areas? What procedures you followed? 3. How do you monitor project progress? How often coordination/review and planning
meetings conducted? 4. How often you visit the field? Can you tell some of the key observations you made in the
field (i) regarding implantation of field activities; (ii) regarding functioning of farmers’ groups/association?
5. Who are other key stakeholders? What kind of support they provide? How do you mobilize support from them? Is there any coordination mechanism? Please explain?
6. Whether you have taken any activities together with stakeholders? Which ones and how? 7. How are you planning to up-scale/disseminate/mainstream project learning? 8. What is the project withdrawal strategy? 9. Any other inputs/feedback?
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Annexure III: Checklist for KII with Head of MOFA & DAFO
1. What are MOFA/DAFO roles in the agriculture development in the province/ district? 2. What are their opinions on BIIE project? 3. Whether MOFA/DAFO is managing any similar project? If yes, please inform
similarities/differences. 4. What is the coordination mechanism between all the projects in the district/province? 5. How do you see the role of the millers? How do you ensure that they are fair to the farmers
and do not cheat them? 6. What are the main problems with the farmers? How the project is helping to solve those
problems? 7. What are your recommendations to improve SNV and BIIE performance? 8. Any other inputs/feedback?
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Annexure IV: Checklist for KII with BIIE Coordinator, MOFA & DAFO
1. Since when you have been involved in the BIIE project? 2. What are your roles in the project? 3. Whether you have been involved in any similar project earlier? If yes, please inform
similarities/differences. 4. What are your views on the project and SNV performance? 5. What training/capacity building inputs they have received from SNV? How far they were
able to implement new skills gained through these training? 6. How frequently you go to the field? 7. How do you see the role of the millers? How do you ensure that they are fair to the farmers
and do not cheat them? 8. What are the main problems with the farmers? How the project is helping to solve those
problems? 9. What are your recommendations to improve SNV and BIIE performance? 10. Any other inputs/feedback?
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Annexure V: Checklist for KII with Dean, Savannakhet University
1. What are university’s roles in the agriculture development in the province/ district? 2. What are the main problems with the farmers in the province? How the university is helping
to solve those problems – through training, research, others? 3. Are you aware of SNV BIIE project? If yes, what is your opinion on BIIE project? 4. Whether your university attended any programme by BIIE? In what capacity? 5. What is the collaboration with government departments? 6. What are your recommendations to improve SNV and BIIE performance? 7. Any other inputs/feedback?
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Annexure VI: FGD Checklist for Farmers’ Groups
1. Since how long the farmers’ group/association is established? 2. Since how long you are member of this farmer group/association? 3. What are the purposes of your group? Do you think the group is fulfilling its purpose? Please
explain. 4. How often the meetings are organized-weekly/fortnightly/monthly? 5. Have you taken credit from your group? If yes, how many times? What is the repayment
schedule and period? 6. Have you received any training on farming practices? Which one? How long was the
duration? 7. Which learning you found most relevant for your farming? 8. What are the facilities provided by your group?
a. Provision of good quality seeds and fertilisers b. Provision of cash credit c. Rice production technique training d. Post harvest technique training e. Training in group management f. Linkage with rice-millers/market g. Linkage with government services
9. How these activities will continue with project activities once the project closes? 10. Whether you are linked to any rice miller? What kind of support they provide? 11. How do you find the price offered by rice miller? Is it better than price offered in open
market? 12. Do you receive any guidance/advice for rice production? Who provides them? What kind of
guidance/support? 13. Do you see any change in male/female situation: in the society; in the family? 14. Who keeps the money at home? Who decide how to spend the money? 15. Any suggestion or feedback for project?
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Annexure VII: Individual Interview Checklist for Rice Millers
1. Since how long your mill is working in this area? 2. When did you join the BIIE project? How did you learn about the project? What procedure
they had to follow for selection? 3. How did you select the villages and farmers? 4. How often you meet the farmers -weekly/fortnightly/monthly/as per the need? 5. What are the facilities provided by the project?
a. Rice processing technique training b. Training in entrepreneurship development c. Training in Leadership development d. Exposure on paddy procurement procedure e. Linkage with farmers f. Linkage with government services g. Development of inclusive business plan
6. Which learning you found most relevant for your operation? 7. What inputs do you provide to farmers
a. Seeds b. Fertilisers c. Oil d. Cash e. Buy-back
8. Do you charge interest on inputs they provide? How much and how do you ensure repayment?
9. Do you receive any guidance/advice from the government department? Whether you received such supports before the project?
10. Any suggestion or feedback for project?