Enabling poor rural people
to overcome poverty

Since 1981, IFAD has granted Benin eight IFAD loans for a total of USD 91 million. The first Country Strategic Opportunities Paper (COSOP) for Benin was approved in 1997 by IFAD. On the basis of the experience accrued under the first four projects, it set out a strategy for reducing rural poverty through micro-credit generated by mobilizing village savings; promoting farmer organizations through better access to markets; and enabling farmers (especially women farmers) to increase their income through sales of agricultural produce.

IFAD and the Government of Benin agreed to revise the COSOP in 2004, following an evaluation for which the framework was defined jointly by the two partners in the Approach Paper. The evaluation was prepared by two missions: one undertook an interim evaluation of the oldest of the four on-going IFAD projects, while the other made a review of the other projects. The actual Country Programme Evaluation (CPE) mission1 visited Benin from 12 November to 3 December 2003. It held meetings in Cotonou with the Ministry of Agriculture, Livestock and Fisheries (MALF) and with multi- and bilateral development agencies. Then followed field visits to the project management units and to a number of project activities in the target villages. The mission was wrapped up at a final consultative workshop and concluded with a debriefing, chaired by the Minister of MALF, where the findings and recommendations of the mission were discussed and subsequently set out in an aide-mémoire. The final version of the aide-mémoire was submitted to MALF on 3 December 2003.

Agriculture in Benin is characterized by a predominance of small farms. Production grows by 3% annually, which is sufficient to keep famine at bay. Since 1990 when the omni-present state dissolved, Benin has drawn up a development strategy for the rural sector in which farmer organizations and the private sector are called upon to play a greater role.

Democracy is gradually being established in Benin, probably with more success than in the neighbouring countries. The president’s party obtained the majority of votes in the parliamentary elections of 2003, decentralization is being introduced gradually and the first local elections have been held. While financial management has improved, the public sector reform and anti-corruption measures have rather stagnated. The media are active. The economic growth has been about 5% annually over the last ten years and overall macroeconomic stability has been established. The privatization of state-owned companies has been slow, and poor infrastructure has hampered development. The private sector continues to develop, but more so in trading than in industry – with all the inherent risks for an epiphyte economy, as demonstrated by the recent crisis in Nigeria to which Benin’s is closely tied. Clearly being a tributary of a big country undermines the Beninese economy and its growth factors become rather volatile.

The majority of Benin’s population of six million remains poor, with an annual per capita income of about USD 365 and a human development indicator of 0.463 (2002). While urban poverty decreased from 28% in 1994 to 23% in 2000, during the same period the poverty in rural areas increased from 25% to 33%, mainly owing to inadequate economic and social policies.

Benin has approved a poverty reduction strategy (PRS) paper structured around four main lines of action: strengthening of the macroeconomic framework; development of human capital and environmental management; institutional strengthening and good governance; promotion of sustainable employment, and the participation of the poor in decision-making. This structure is expected to gradually translate into an adequate and effective framework for combating poverty.

The COSOP of 1997 was somewhat ambiguous, not strictly logical, and too focused on the village-level approach. The objectives were not stated in a clear hierarchy, moving from IFAD’s mandate through the regional and national strategy to lead on to an operational plan. It is rather a general discussion of certain important aspects of rural development. Nevertheless, the four IFAD-supported projects:

  1. the Income-generating Activities Project (PAGER), from 1997 and covering the south of the country;
  2. the (quasi-similar) Microfinance and Marketing Project (PROMIC), from 1999 and covering the north;
  3. the nation-wide Roots and Tubers Development Programme (PDRT), from 2001; and
  4. the nation-wide Participatory Artisanal Fisheries Development Programme, from 2003

All have the objective to increase the income of the target groups (poor and very poor people, especially women and young people) in a sustainable manner. In this sense they constitute a coherent programme and have had a significant impact on poverty reduction amongst the beneficiaries: income levels, savings and food security have improved; the cropped areas have expanded, and a number of processing and marketing activities have been initiated.

From the perspective of effectiveness, efficiency and sustainability, a major result is a network of 144 local financial services associations (FSA) that provides savings and loan services to 820 villages or one third of all the country’s villages; women account for about 50% of all shareholders/clients. By mid-2003, FCFA 396 million had been deposited as savings by almost 45 000 members, and FCFA 625 million had been extended in loans to more than 26 000 beneficiaries. In this way, the FSAs contribute to the integration of rural savings into monetary economy and to some extent to integrate the remittances from migrants into the local economy. Most FSAs are profitable and cover their operating costs, and the remainder are expected to be in similar conditions soon. The FSAs – the most innovative feature of IFAD’s programme in Benin - involve a light fiduciary structure that provides staff training, establishes the rules and regulations, supervises the financial viability, forges partnerships with other similar financing systems, and facilitates access to members to obtain larger loans from other financing institutions. The FSAs also interact with the national institutions charged with the oversight of savings and credit systems, with the ultimate aim of establishing a viable savings and credit system without IFAD support.

Other activities for reducing poverty have included: literacy training (with limited success); income-generating activities (generally very basic processing of agricultural produce that has added little value); marketing activities (often limited to purchasing agricultural products for re-sale along the main road or in nearby markets at very little profit); increased production of roots and tubers; and the financing of infrastructure (wells, dirt roads, warehouses, classrooms, etc.). All these activities have undoubtedly benefited the poor, even if in some cases one might well ask whether people have been prompted to borrow for activities that do not generate enough income to repay their loans.

The strategic and thematic analysis of the country programme has lead to a certain number of findings and recommendations with regard to improving the on-going programme and giving guidance to the future programme.

While the main thrusts of the next COSOP would remain the reduction of rural poverty, the linkage with the PRS should be stronger to ensure that the strategy is fully owned by the government. Also, it should be prepared through a participatory process that involves all partners concerned, even though it remains an IFAD policy document.

Strategic partnerships will be actively pursued with other development agencies and coordination pursued to avoid any duplication of effort. IFAD will step up its advocacy role in support of the poorest and participate in dialogue on development policy. In view of this, IFAD’s field presence should be both strengthened and more permanent.

No matter how well formulated the strategies may be, they must be adapted to subsequent developments and use (e.g. IFAD’s efforts to promote women have not been sufficiently reflected in project implementation, even though women play an important role in IFAD projects) and no less they should be in line with the country’s policies. The alignment of IFAD-financed projects along the line of the new local government structures should be given greater consideration. Further, the internal alignment of the on-going projects should create the consistency that could lead to one national programme.

The participation of the beneficiaries (i.e. the poor) in programme formulation and management must be clearly established and put into practice. Such participation is linked to the approach to implementation: the “faire-faire” (done by others) which involves using service providers appointed by the projects; or the “faire-avec” (done together), i.e. placing the responsibility for the development in hands of the beneficiaries from the outset. It goes without saying that moving from one approach to the other must be done gradually so as not lose the acquired effectiveness of the projects.

Any targeting policy aimed at benefiting the poor must be sufficiently flexible to continue to assist those who have just risen out of poverty but still need some assistance, although of a different nature. If young people are to remain a target group, special consideration should be given to ways of involving them. The targeting techniques used imply a collectivist approach to dealing with groups. However, even where the self-help groups are given strong support, they rarely become economically viable even in the long run. Approaches based on individual dynamism and capacity seem to offer greater prospects.

While income-generating activities should lead to better living conditions within a reasonable time period, in reality, such activities often are not sufficiently profitable and local markets are easily saturated. Within the programme approach an integrated production-marketing approach should be adopted, and partnerships with other downstream actors forged. The shortage of land in the southern part of the country necessitates the promotion of non-farm activities such as small animal husbandry, processing of agricultural and fishery products, and handicrafts.

The programme management also needs revisiting:

  • IFAD will need to specify the framework needed for the continued and necessary flexibility in project formulation, and cater for a certain amount of risk taking in innovation and cover the risks inherent in any development activity.

  • Project supervision does not focus enough on quality, innovation or project strategy. IFAD concentrates on these aspects in the case of the directly-supervised projects. However, such supervision standards should be set and action taken to ensure that they are applied by the Fund’s cooperating institutions also.

  • Accounting systems should be standardized, rather than established by each cooperating institution responsible for the project supervision. This would make it easier to make a comparison of performance, e.g. with regard to administrative costs that seem to vary from one project to another.

  • Serious administrative dysfunctions in tendering procedures (e.g. for procurement of vehicles) and delays in the replenishment of project accounts (leading to delays in implementation and in the payment of salaries) impede project efficiency and lead to higher costs. Every effort should be made to ensure that project management is both efficient and cost-effective.

In conclusion, this country programme is satisfactory and has given good results as well as real impact on poverty within its field of intervention. Assuming that the programme performance is improved in a manner that is sustainable and appropriate for the target group, the programme deserves to be continued and it possible expanded.

1/ The evaluation mission was composed by : Mr. Henri-Philippe Cart, Team Leader and socio-economist ; Mr. André Bourque, and Ms Pascaline Babadankpodji. Mr. Flemming Nichols, IFAD Lead Evaluator, joined the mission from 12 to 16 November and from 24 November to 3 December.