Monday, August 9, 2010

Microfinance- livestock style.

I spent one week with the livestock team learning about their programs and visiting their many beneficiaries in the field. It is an impressive program to say the least. Briefly, here’s how it works.

Beneficiaries are selected based on their interest and ability to handle livestock. Beneficiaries can choose their “product,” fish farming, goats, chickens or cattle. Sometimes the beneficiaries already own these animals and the program helps them grow their livestock populations. Other times, beneficiaries start from scratch.

Fish farming. Fish farming is a bit new in Uganda but it’s on the rise and even has academic programs dedicated to the field. Fish farming is exactly as it sounds, a large shallow pond is dug and filled with fish, local Ugandan Tilapia and African Catfish. What’s interesting about these two fish is that the tilapia reproduces like crazy and the catfish eat the tilapia. The two fish self-regulate each other. Catfish can’t reproduce in captivity so they are basically artificially grown through some interesting science (a few sacrificed male fish) and the simulation of fresh water. One female cat fish can produce up to a thousand eggs, which in turn are fertilized and hatched into lots of little catfish. This takes place at SP’s fish farm. The fish are released into ponds to grow for a bit. Then they are transported to the beneficiaries’ farm where they grow to a consumable size. The water is drained from the pond and they are then netted and sold to a distributor for sale. Beneficiaries can make about $2,000 per sale which happens about twice a year. SP then resupplies a new batch of fish, usually several thousand of them. One beneficiary that I visited had built a nice house for his family as result of the profits gained from the sale of his fish. I’ve painted a rosy picture of fish farming but I assure you, it is a lot of work. Usually, the recipient needs to clear out a heavily vegetated piece of land which means cutting down trees and removing lots of dirt, by hand using basic tools like hoes and shovels. They must have access to a fresh water source, usually a stream or natural spring. This water is channeled to fill the pond and to flush the pond out from time to time. Beneficiaries organize fellow community members to help dig the pond. SP also helps labor alongside the recipient (I too did this and it is very hard and I have soft, little, American hands that quickly blister and bleed). An average sized pond can take 15-90 days to construct. Yes, 90 days of hoeing and digging.

Chickens. Beneficiaries receive a bunch of chickens after they first construct a chicken coop and receive some basic training on chicken rearing. Beneficiaries must pay back a certain number of chickens within a certain period of time. If the chickens are producing eggs, half of the eggs need to stay at home to feed the children of the beneficiary; the rest can be sold for income. If the beneficiary runs into some financial difficulties, they can sell some of the chickens to make some income. SP also vaccinates the chickens so they do not die from diseases. Side note: There are some interesting local chickens that don’t have feather on their necks.

Goats. Beneficiaries build these really cool goat houses. They are elevated off the ground and have slotted floors so the goat feces drop to the ground, away from the animals. This keeps the animals healthier and disease-free. It also allows for the caretaker to clean the area easier. SP provides 2 or 3 goats, usually pregnant females. The goats reproduce quickly and the beneficiary pays back 2 or 3 goats within 2 years. They can only repay back females so if they have male goats they are advised to sell the male and purchase a female to repay back. On several field visits, I heard accounts of beneficiaries selling a goat to cover their hospital bill. That’s why I say we’re in the microfinance business, just not the typical microfinance. Instead of taking out a small loan to start a business or joining a community savings scheme to cover unexpected financial needs, clients are just using their goats as their backup plan. They remain debt free because the goat is pretty fluid in the sense that you just have to take the goat to the market and sell it for some quick cash. No paperwork for a loan, no high interest rates, no need for approval. Another great thing is that goats reproduce. So what if you have to sell it to meet a financial need, you’ll have another goat (or 2) in a few months. Does microfinance pay you back like that? Aside from those benefits, a one week old goat is one of the cutest animals I have ever seen. Side note: I had to help a SP vet castrate a one month old male to prevent inbreeding. I just held him down as he bleated bloody murder.

Cattle. If a beneficiary has a good bit of land (2 acres), they can receive a cow, again, usually female. However, cows costs a bit more so the beneficiary has to be really serious or very capable of caring for the animal. The cows provided are usually your typical black and white dairy cow, capable of producing 10-12 liters of milk per day. The traditional, Ugandan cattle only produce 1-2 liters per day and take several more years to reach the ability to reproduce. SP is not-so-secretly trying to mix the breeds of cattle so they can be more productive in terms of milk output and reproduction. The cows are also food security for families. Again, beneficiaries need to consume half the milk, especially if there are children in the home. The rest can be sold at the market for a nice, daily income that can normally cover food costs for the day. It’s a pretty nice arraignment. If the beneficiary is given a bull, they can sell his reproductive “services” to neighbors with female cows. SP also provides veterinary care to ensure their investment (cows) is healthy, growing and productive. Beneficiaries have to build a crash (a wooden cage that can isolate a cow so the vet can treat the animal safely).

Another great aspect of the program, in addition to all the ones already mentioned, is that the program is almost self-sustaining. In the development world, that’s a big deal. When the program first started SP purchased all of the animals using donated funds. Now, the animals are reproducing enough. I was able to witness a repayment meeting where 2 women (the program does target women because they usually don’t own things or see much money) were repaying SP with 2 goats a piece. 2 new women were identified to receive the goats. The goats had plastic tags shot into their ears (by me) to identify them as SP goats (so they can’t be sold right away). Then the 2 women randomly picked 2 numbers out of a hat and they left with their goats. The whole process took just a few minutes and didn’t really cost SP a dime. Lovely.

SP also has a gift catalog for their donors to purchase livestock. Instead of giving a gift of $60 dollars, I can just purchase a goat or two for a family in need. Obviously I am just giving a cash donation, but it is earmarked for the livestock program. Very cool. Sidenote: I learned at IHQ (International Headquarters in Boone) that they actually really like earmarked donations or restricted funds. It helps them know how much they have allocated for a certain project or place and removes the tough decision of where or how to spent the donated funds.

So that recaps the livestock program going on in Kamwenge, Uganda. It makes a lot of sense, helps thousands of families in the surrounding villages and is close to being self-sustaining. As the program is growing so is the demand for the animals and the technical support. The community is embracing the work, building fences and crashes, repaying on time and taking good care of their investments.

Lastly, even the poorest of the poor can find a place in the program. The poor (in this area, in my opinion) are those who do not own land and cannot grow their own food but also do not own a very successful business or offer a useful, in demand service or skill.

Side note on poverty: Most resident have decent housing, few have electricity or indoor plumbing, some houses are nicer than others but they are all pretty similar. Land can be sold by an older brother (or main inheritor) thus sending the remaining siblings into poverty. Food is abundant. The land is fertile and most people are hard working. Bananas, avocados, pineapples and maize are all cash crops and are abundant. Meat in the form of chicken, beef or goat is also around but not for most. So people aren’t poor in the sense of hungry, but they are poor in the sense of malnourished. I’ve seen plenty of big, swollen bellies on kids and unhealthy looking adults too. End side note.

Even for those who own little land (the poor), they can still grow chickens and even those with a bit more land can accommodate a few grass-hungry goats. They are really low maintenance. I visited a few sites that were in an urban (but still rural) town setting. The goat house took up most of the backyard. The owner would take the goats out of the town to a pasture or along the side of the road to eat each day, then bring them back to their house at night. Those who can build a fish pond or have enough land to graze cattle aren’t necessarily poor, but are often food malnourished. They benefit from the food security aspect of the program, by eating some of the fish or consuming the milk from the cattle. It’s a win-win for many. For any Office fans out there, it’s a win-win-win.

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