Interim evaluation

The Benin Income-Generating Activities Project (IGAP), approved by IFAD's Executive Board in December 1995, formally started on 13 September 1996 with the signing of the Government of Benin and IFAD of a loan agreement in the amount of SDR 8.05 million (equivalent to USD 12 million); the project staff was recruited in December 1996. The planned duration was seven years, with a completion date of 31 December 2003.

With a view to the coming end date of the project, an IFAD interim evaluation was carried out in May-June 2003. According to the Approach Paper for the evaluation, its ultimate objective was to assess whether the results, impact and efficiency of the project justified a continuation or whether a different approach should be pursued, if the decision-makers should agree to continue it.

Given the constraints and weaknesses facing the rural poor in Benin (identified during missions and studies conducted 1993 to 1995), the IGAP pursued a multi-sector strategy for working with the rural poor in the four départements in southern Benin ¹. The total project area is 24 000 km2, and the total population in the project area is 2.4 million, excluding Cotonou and Porto Novo. This substantial demographic pressure, coupled with the small plot sizes and permanent land use, are the main causes of land degradation, erosion, loss of fertility and low yield levels.

The development objective of the IGAP is to increase income and improve food security for the target group. The immediate objectives were to develop income-generating activities, protect the environment and promote grass-roots institutions.²

The project had originally been designed with two components: income-generating activities and support for grass-roots institutions. However, the objective of the second component was multi-faceted and very broad in scope, ranging from "ensuring the sustainability of activities under the income-generating activities component" ³ to "promoting grass-roots participation, at all levels, so the rural community would eventually be able to take ownership and assume responsibility in the areas that are instrumental to sustainable development." ⁴ Therefore, the two original components were divided into three when the project was launched:

i) an IGA-component seeking to "create a network of economic (micro-)enterprises formed either by groups or by individuals (micro-entrepreneurs) who belong to the target group".⁵ As per the logical framework, however, the micro-enterprises targeted were basically those made up of groups. The IGAs were to be supported by community discussions and coaching of the groups, technical training, the development and re-transfer of 150 ha of valley bottoms as rice paddies along with support for the groups to purchase equipment and 500 ha of land;

ii)  a rural finance (RF) component, with a sub-component to provide direct support for establishing FSAs as well as one for a credit line and risk fund at the Fédération des Caisses d'Épargne et Crédit Agricole Mutuel (FECECAM), to grant loans for the IGAs (particularly medium- and long-term loans to buy equipment and land); and

iii)  a grass-roots institution support component to foster community development by forming and strengthening village development committees (VDCs) and groups, establishing socio-economic infrastructure, providing literacy training and reinforcing national NGOs.

A final component was the establishment of a project management unit (PMU) with "full administrative and financial autonomy" ⁶ – recruited against precise terms of reference and documented competencies – to manage the project using the "faire-faire approach".

The "faire-faire approach" is intended to increase the effectiveness of implementation and the participation by beneficiaries (small rural producers) in defining their problems. It seeks appropriate solutions for strengthening the means available to the beneficiaries and increasing their responsibility in implementation and management of the defined development activities. Unlike the traditional "faire approach" (where the management both implements and supervises the project), the "faire-faire approach" is characterized by having the PMU give guidance and supervise only, while responsibility for implementation lies with the service providers carrying out the field activities. These service providers comprise NGOs (pre-selected to provide on-going training/coaching to the groups), micro entrepreneurs, VDCs and FSAs, and on the other side, consultants, entrepreneurs, the Regional Rural Development Centres (CARDER) to provide specialized services such as the dissemination of training, building of infrastructure and site supervision. Under this approach, the NGOs are hired on the basis of a rigorous selection process, with annual fixed-price contracts and a semi-annual performance review.

Depending on the type of services involved, the other service providers are hired on annual contracts or by the job.

After over six years of activities, the IGAP has begun to have significant poverty-reduction impacts on the target groups according to the indicators monitored, such as increased income, access to potable water, food security, acquisition of consumer goods, etc. The project also had a significant impact on the socio-economic status of women.

Among the impacts identified, some are easily attributable to the IGAP because of the exclusive nature of its work in a specific sphere or area (e.g. literacy progress in the area where the IGAP is the only project). Further, in September 2001 an assessment was made with the NGOs working in the project area of the changes attributable to the project, and a number of areas were identified in which the project had had a clear influence on the impacts observed. There also seems to be a cumulative effect of the IGAP's interventions on the impacts produced, as shown by the impact of producer training.

Within the IGAs component, the project supported the establishment of several hundreds of micro-enterprises covering over 50 types of economic activities (45 traditional and six innovative), distributed over five sectors. Paradoxically, these micro-enterprises are mainly single-proprietor enterprises, even though most of the strengthening and follow-up efforts were deployed for production groups; as a result, it is not possible to know the exact total number of micro-enterprises formed. As of 21 June 2003, a total of 386 production groups were receiving support (out of 450 projected): 62 were men's groups (16%), 200 were women's groups (52%), and 124 were mixed (32%). Women represent approximately 74% of the group members supported. Most of the groups have more than two activities and operate in more than one sector. While the potential sustainability of sole-proprietor micro-enterprises is strong, very few production groups will be able to survive, as their usefulness for most of their members is much more of a social nature than as a viable economic unit. In addition to the planned project activities to support the establishment of these micro-enterprises, the project will have created 195 food processing workshops (e.g., converting cassava into gari, pineapple into juice, etc.) in as many groups. However, the creation of such centres, on a grant basis, runs counter to the project's overall strategy for this component, which was that any action (i.e. with groups) would be undertaken on the basis of credit and not subsidies. ⁷ Only 93 ha of valley bottoms will have been developed by December 2003, and the acquisition of equipment and land has been quite low.

As for the rural finance component, 44 FSAs have been set up with buildings and equipment, covering roughly 320 villages, i.e. many more than the number of villages originally planned. These FSAs are held by 15 479 shareholders, 6 002 of whom are women (49% men, 39% women, 12% legal entities). However, it is estimated that the actual number of members is some 25 000, more than 50% of whom are women (bearing in mind that 75% of the members of groups and cooperatives are women, who are often not individual shareholders).

As at 31 March 2003 the capital mobilized by these 44 FSAs was CFAF 170.5 million. Although women represent 39% of the shareholders and 50% of the members, they hold just 22.2% of the capital. The FSAs have credits outstanding of CFAF 302.2 million, mainly consisting of small loans for three to six months, in other words the kind of credit that meets the needs of the poor. Since the outset, 69.5% of shareholders have received a credit. Out of the 44 FSAs, ten already have the capacity to cover their expenses completely and seven others can cover 90% of their expenses. It should be noted that the FSAs experienced a major crisis in 1999-2000, but, remarkably, were able to weather that crisis. On the other hand, to date only CFAF 65 million, or 7% of the allocated funds, were disbursed to the FECECAM credit line, which means that very little medium- and long-term credit has been granted. Use of this credit line is thus abnormally slow, and it is unlikely that the line will be fully used in the coming months.

Lastly, 72 VDCs have been formed to date, or approximately 87% of the 83 targeted villages, and the PMU planned to work on the remaining 11 in 2003. VDCs generally enjoyed a high level of acceptance by the authorities and the people in the villages as a development tool. Nonetheless, the VDCs were still quite far from being the tool that "the rural world can use to take ownership and responsibility of the areas needed for its sustainable development".

The fact is that, behind the concept of the VDC, there is a multitude of institutional realities, but their existence and function are basically determined by the existence of the IGAP. The functionality of the vast majority is rather weak, and sustainability is very uncertain, particularly in the current context of the decentralization of institutions. With regard to socio-economic infrastructure, the completion rate was generally low (16% to 42%), except for the classroom modules (which will be 90% complete). Literacy training has also produced disappointing results, with just 3 166 having received such basic training, out of a projected 11 250. The strengthening of national NGOs has yielded good results in terms of the quality of the services they provide to the IGAP, but also at the price of a number of perverse side effects on beneficiaries, the NGOs themselves and the relationship of the project with the NGOs.

As for the PMU, it was set up as planned. It is dynamic, competent, effective and thorough, while at the same time flexible, transparent and results-focused and it learns from its mistakes. Except for gender issues, the management systems in place are well tested, effective, reliable and suited for their mission. The PMU handles the faire-faire approach well, though it is quite costly and has not yielded the expected results in terms of participation and ownership by beneficiaries.

The IGAP offers good potential for the sustainability of all its impacts and outcomes. However, sustainability of these impacts could be threatened by the project's very success if steps are not taken (assuming the project is continued) to address other poverty reduction needs. The project was also able to create innovation in two of its components, with strong potential for replicability, and these innovations have already been tapped by the PROMIC (Microfinance and Marketing Project) ⁸.

When reviewing these outcomes, it seems that the IGA component has been both relevant and effective, though in a manner not planned by the project (i.e. for single-proprietor micro-entrepreneurs instead of production groups), while its efficiency varies depending on the type of intervention. The foreseeable sustainability of IGAs for individuals is generally good (except for enterprises requiring extended surface areas, owing to low land acquisition rates) while that for groups is almost non-existent.

Even though the FSA sub-component of the RF component got off to a very rocky start, its spectacular comeback since 2001 and the very significant outcomes to date make this sub-component very relevant, very effective and reasonably efficient. The outlook for sustainability of the FSAs is promising, but could take time and require sustained and rather long-term support. On the other hand, the FECECAM credit line sub-component has proven to be irrelevant, ineffective and consequently inefficient.

Under the grass-roots institution support component, the sub-component for strengthening NGOs lacks relevance. The relevance of the other sub-components should be re-examined, as their effectiveness and efficiency are average and their sustainability potential quite variable.

The relevance of the PMU is meaningful only if the project is continued. It is effective, but could be even more so on the gender issue by taking on a strategy and specific actions. It could also be more effective by adopting a different implementation approach (such as the faire avec approach), externalizing certain costs and reducing the number of sub-components in the project.

In light of the foregoing conclusions, there is justification for pursuing some of the components and sub-components, if at rather different levels and duration, whereas the possible continuation of the other sub-components will presume more in-depth analysis of their added value, efficiency and sustainability. If the project is to be continued, these analyses should be conducted before any extension is implemented; the "faire-faire", group and gender approaches should also be reviewed; and the formulation of any continued work should take special account of other initiatives and projects in the same or in complimentary sectors (e.g. PADSA II, the Social Change Observatory, etc.).

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1/ After the project start, a new administrative division was introduced, changing the four initial départements – i.e. Mono, Atlantique, Ouémé et Zou – into seven departments, by adding Couffo, Plateau et Central.

2 / Appraisal report, September 1995, Volume I, p. 16.

3/ Idem, p. 20.

4/ Idem, pp. 19 and 21.

5/ Idem, p. 17.

6/ Appraisal Report, September 1995, Volume I, p. 25.

7/ Appraisal Report, September 1995, Volume I, p. 18.

8/An IFAD project in the northern half of Benin that is almost identical to the Income-Generating Activities Project in terms of objectives and activities.