Interim evaluation

The Agreement at Completion Point (ACP) is based on the deliberations of and discussions by the partners on the findings and recommendations in the draft evaluation report of January 2004. It highlights the main elements which the Core Learning Partnership (CLP) agreed should be included in the formulation of a subsequent project phase.

The ACP has been drafted on the basis of the partners' first discussion of the report's recommendations, on the 17th May 2004. The discussion followed immediately after the Country Program Evaluation Workshop, the 13–14 May 2004, which therefore provided a frame of reference for the discussion.

The main partners involved in the initial discussion were: representatives of the Ministry of Agriculture, Livestock and Fishery; the project director, the head of the project M&E unit; the IFAD country programme manager for Benin and the IFAD evaluation manager.

The Interim evaluation (IE) mission found that, generally speaking, the Income-generating Activities Project (IGAP) has begun to have significant poverty-reduction impacts on the target groups, including on the socio-economic status of women. In the light of the foregoing conclusion, there is justification for pursuing some of the components and sub-components, if at rather different levels and durations, whereas the possible continuation of the other sub-components will presume more in-depth analysis of their added value, efficiency and sustainability. 

General

Evaluation findings

Thanks to the results obtained by IGAP, some beneficiaries - who were part of the target group at the outset - no longer, meet the criteria for inclusion, owing to the increases in their land holdings and income. This raises questions as to the "targeting" within future interventions and/or the reconfiguration of some components should the project continue.

Recommendations

• The possible continuation of IGAP should be studied within the perspective that either these beneficiaries will gradually be eased out of IGAP and guided towards other systems tailored to their new situation, or IGAP will develop new approaches better suited to their situation (meso-credit, medium- and long-term credit, a vertical production chain (filière) approach, including support for product marketing, etc.).

• The formulation of a second phase of IGAP should take account of other initiatives/projects underway in the same or complementary sectors (e.g. Agricultural Sector Support Programme (PADSA II), the Social Change Observatory).

Income-generating Activities Component (IGA)

Evaluation findings

The IGA component has been relevant and effective, although the efficiency has varied depending on the types of intervention.

The sustainability of private IGAs in a market economy is difficult to forecast with certainty. Nevertheless, the sustainability outlook for the traditional income-generating activities developed by individuals is acceptable. It does not depend on supplementary training, but rather on the capacity of these micro entrepreneurs to move on to the next stage – i.e. their capacity to continue growing by selling their products in distant markets (once the local market is saturated), by securing their access to land and by having access to an appropriate credit. The continuation of IGAP in its present form would do little to ensure the sustainability of these IGAs.

The sustainability of innovative IGAs is less certain at the end of Phase I, and they may require a short-term extension of support, of the same type as for traditional IGAs seeking to move to the next stage.

The sustainability of most of the group activities is very doubtful, regardless of any additional support that might be provided. However, groups are very effective and efficient as a means of transmitting information and introducing innovations. Groups of a social nature do not require the same kind of institutional support as group enterprises.

Recommendations

• In a second phase of IGAP, the IGA component might employ two approaches, which would not necessarily be mutually exclusive:

• extend interventions of the "first-stage" type (creation by the poor of profitable micro-enterprises) to the portion of the target population that has not yet benefited from this type of support, whether they are located in or outside the present areas of focus;

• develop sub-components that better address the growth needs of the most dynamic microenterprises (a filière approach aimed at facilitating product marketing, support for the development of business micro-plans, securing land rights), or else steer these micro-entrepreneurs gradually towards other systems that are more suited to their new situation (other projects and institutions) thus gently easing them out of IGAP's area of intervention. This second option would necessarily have to be supported by the implementation of appropriate policies and measures on the part of the Beninese authorities.

• Whichever approach is chosen for a second phase, the "group approach" and the establishment of processing centres should be reviewed in order to scale this part of the project correctly, based on the structural realities encountered in the field (this review might be carried out in concert with other projects and with the ministries using this approach). This recommendation differs from that of the supervision mission of 2003, which noted that financial management problems within the groups necessitated additional training and guidance in order to bring about significant improvements in the incomes of their members.

• In addition, particular attention should be paid to the impact of any new activities on labour intensity and costs in order to select activities that can be mechanized in order to decrease the intensity and costs and thus increase the economic and social profitability of production.

Rural Finance Component (RF)

Evaluation findings

The "credit line sub-component" of the RF component has proved irrelevant, ineffective and consequently inefficient.

Although the financial services associations (FSA) sub-component of the RF underwent major difficulties for a time, its spectacular recovery since 2001 and the very interesting results obtained to date make this sub-component very relevant, very effective and reasonably efficient. Moreover, the ability of the FSAs to overcome crises, which demonstrate their will to endure and their capacity to learn from experience, suggest that they could become permanent. The outlook for sustainability of the FSAs is therefore promising, but it could take some time to achieve and might require sustained and fairly long-term support.

Recommendations

• As the continuation of the credit line sub-component of the RF is no longer justified, it should be closed.

• But the continuation of the FSA sub-component, on the other hand, is both justified and necessary. In planning for a follow up phase, consideration should be given to its duration (which should be fairly long), and the focus should be on consolidation of the existing associations (good governance, management and recovery systems, mobilization of savings, refinancing, etc.), on extension of the coverage of existing FSAs and on the creation of a permanent umbrella structure in collaboration with the Microfinance and Marketing Project (PROMIC), as well as on the creation of new FSAs, first as offshoots of strong existing FSAs, then from the umbrella structure.

Local government and grass-roots organization support component

Evaluation findings

The "NGO strengthening sub-component" is no longer relevant in its present form. The relevance of the other sub-components should be re-examined, as their effectiveness and efficiency is mediocre and their sustainability varies considerably.

Recommendations

• Continuation of support for national NGOs in its present form is no longer justified. This sub-component should be reviewed with an eye to making it more transparent, equitable and sound.

• Continuation of the other sub-components may be justified in some cases but not in others. More in-depth analysis of the value-added, efficiency and sustainability of each sub-component is needed to determine whether continuation is warranted. A study of partnership possibilities with specialized projects in various areas should also be undertaken in order to identify possibilities for reducing project sub-components.

• Support for the village development committees (VDCs) should be reconsidered (i.e. until the approach to decentralization has been clarified) and should be characterized by a reduction of technical efforts and an intensification of policy efforts, i.e.:

1. A temporary suspension of the creation of VDCs and of the process of gaining legal recognition for VDCs;
2. A light support (of a maintenance nature) for "good" VDCs in order to avoid their premature consolidation and the emergence of unrealistic expectations on the part of their members;
3. An ongoing contact with the unit responsible for decentralization in order to clarify the role and functions of the VDCs (and other village committees) among the village institutions contemplated in the framework of decentralization.

Project Management Unit (PMU) component

Evaluation findings

The PMU is only relevant if the project is continued. It is effective, but it could be even more so on gender issues through the formulation a specific strategy and activities. The implementation approach ("do-do") that it is required to use is very costly and leads to a dependence on the part of beneficiaries that is detrimental to the sustainability of the project results.

Recommendations

• If a follow up to the project is agreed, solutions to the two weaknesses (high costs and beneficiary dependence) should be sought, e.g. through the use of a different implementation approach, outsourcing of some costs (as in the case of the study of impacts carried out by Cauris Conseils) and the reduction of project sub-components.

• A different approach that might be considered is the "faire avec" ("do with"). A study of suitability and feasibility should be done in order to identify the areas of intervention that would benefit from this approach and the support needed by the PMU in order to apply it effectively. The findings of that study should then be taken into account in formulating the next phase of IGAP. The "faire avec" approach should be introduced gradually into the interventions deemed most suited to its application, and it should be monitored closely in order not to lose the effectiveness achieved by the PMU.

It is worth noting that this approach is characterized by the transfer of a fair degree of responsibility for management to the beneficiaries, together with a requirement for proof of the financial profitability of all investments in production before they are made and the provision of a significant financial contribution by the applicant, in the form of a personal monetary contribution or a credit obtained from a financial institution. This approach is already being used in Benin by the ADEX and the CEPEPE, and it will be adopted soon by PADSA II. In addition to encouraging beneficiary responsibility in the implementation and management of development activities and leading to much more rapid achievement of autonomy by the beneficiaries, this approach significantly reduces the need for control mechanisms because disbursements by the project for an investment are made only after the applicant-payer is satisfied with the services received from the supplier and after he has made his own contribution towards payment for the services rendered. By way of comparison, ADEX manages a fund of about USD 4 million using this approach, with a team of five people.

• The reduction of sub-components will require an analysis of impacts by each component prior to the formulation of a follow up phase to determine the added value of each sub-component in achieving impacts, and thus identify the combination of the components and sub-components that will maximize impact and efficiency.

• A policy and specific measures with regard to gender issues should also be formulated and incorporated into the next phase.

• If the project and the PMU are to continue, the special treatment accorded to NGOs should be replaced by a competitive bidding system open to all operators in a sector, not just the NGOs working in that sector.