The main objectives of the project were:
- to lay the foundations of small-scale, private-sector, market-oriented agriculture so as to generate the necessary surpluses to promote and maintain growth in the agricultural sector
- to improve the livestock genetic material over the long term.
Activities The project had four components:
- livestock activities
- agricultural machinery
- a pilot credit scheme
- institutional and implementation support.
A total of 11 401 pedigree in-calf heifers, mainly of the Simmental breed, and a total of 12 343 sheep of the Pramenka breed or Pramenka crosses were procured during the project and given on a credit-in-kind basis to private farmers. According to the Completion Report, the project was very successful in achieving targets, particularly in terms of the animals imported or procured locally and distributed to farmers. It also had a major impact on the restocking of livestock, employment, the production of meat and dairy products, incomes, food security and nutrition. Benefits are likely to increase post-project as the advisory extension and health services and marketing infrastructure improve.
While the breeding and investment aspects were highly successful, the marketing opportunities for dairy products remained limited. Consumers have low incomes, and they are low-price oriented. The uncontrolled importation of milk through unprotected borders complicates the markets. Farmers selling milk to processors, especially to monopolistic dairy enterprises, get their payments late and sometimes get no payments at all.
The project enabled the beneficiaries to reach self-sufficiency in milk
consumption.
The major drawback has been the low credit recovery rate. According to
the Completion Report, the reasons for the very poor recovery rates include:
(a) political interference and the lack of a clear policy with respect
to loan delinquency; (b) the absence of in-depth involvement by the commercial
bank in following borrowers and recovering installments as they fell due
because it had not been a part of the beneficiary selection process and
did not carry any risk; (c) the absence of linkages between the beneficiaries
and dairy plants, milk collection points, or meat and milk markets; (d)
because of the selection of the beneficiaries by municipalities, it was
mistakenly thought that the project was distributing the animals on a
grant basis.
| The limited linkages among farmer associations, extension services and livestock veterinary institutes were severed during the war | ||
| Planned | Achieved | |
| To provide funds for the re-establishment of institutional linkages. To provide assistance to the Project Implementation Unit in the Federation and the Project Coordination Unit in the Republic of Srpska for project execution. To provide a training programme on three levels: local instructors
(training of trainers, mainly university professors), local trainers
(local project consultants and municipality extension workers) and
farmers (project beneficiaries). Training would include animal husbandry,
feeding and health care. |
The Project Implementation Unit in the Federation and the Project Coordination Unit in the Republic of Srpska were established and staffed. Training in the Federation was provided to local trainers (54
trainers from 17 municipalities) and the farmers (245 training courses
were attended by over 5 000 farmers) who received livestock. Training
for local instructors was not provided because foreign experts could
not reach the Federation due to air strikes by the North Atlantic
Treaty Organization against Yugoslavia and the closed air space
over Bosnia and Herzegovina. |
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Access to inputs and infrastructure
| Republic of Bosnia and Herzegovina was part of the former Yugoslavia and became independent in 1992. Soon after gaining independence, the country was thrown into a long and devastating civil war, during which about 250 000 people were killed. The war led to a massive destruction of infrastructure and facilities. Estimates of livestock numbers as of end-1995 indicated a possible reduction of livestock to only 30% of pre-war levels. The great majority of Bosnia and Herzegovina’s
population continue to be highly vulnerable to food insecurity,
unemployment and lack of basic services, particularly with regard
to housing, health care and power for heat and light. |
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| Planned |
Achieved |
|
| To procure 7 520 cattle, 5 775 sheep,
350 goats and 300 pigs. The animals will be distributed in the form
of ‘subsistence’ and ‘commercial’ packages
(proportion of 50:50%). A subsistence package was expected to comprise
one pregnant heifer or five small stock, while a commercial package
was likely to be up to 25 small stock or three dairy heifers.
|
On a credit-in-kind basis, 11 401 pedigree in-calf heifers, mainly of the Simmental breed, and a total of 12 343 sheep of the Pramenka breed or Pramenka crosses were distributed to farmers. Farmers showed greater interest in subsistence rather than commercial loan packages (80:20%). Reasons for low interest of farmers in commercial packages were: small farm size, marketing problems, large number of refugees and displaced persons having no social security, slow shifting of farmers attitude from planned economy to market economy, etc. Because of limited availability of artificial insemination, 25 breeding bulls were procured and distributed to farmers in villages far away from local veterinary stations. Goats were not procured because the beneficiaries were not interested in receiving them. Lack of interest in goats was most likely due to the negative results (high abortion and mortality rate) during the previous Emergency Farm Reconstruction Project. Pigs were not procured since the prices on the international market
were too high. Funds intended for pig supply were reallocated to
the supply of heifers.
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| Marketing possibilities
for milk were very limited partly due to lack of compressors and
cooling equipment at the milk collection centres. |
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| Planned |
Achieved |
|
| To facilitate and finance insurance to protect the farmer against accidental death of the cow or offspring. The insurance protects the investment, as well as ensuring the farmer’s ability to pay back his loan.
|
The purchase price for each heifer included a one-year insurance for the animal. |
|
| To support re-establishment of the supply chain for fresh milk by re-equipping six milk collection centres in Republic of Srpska with compressors and cooling equipment. | For milk collection, 16 cooling tanks were procured. | |
| To finance a study to develop a strategy to accelerate the recovery of a special Pramenka sheep industry. The Pramenka breed is known for its good milking capacities, soft white cheese and spring lambs. | A study, ‘Quality of Sheep Fatty Tissue from the Hilly-Mountain Region of Central Bosnia’, was conducted to explore different possibilities for the use of sheep fat. |
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| To finance pilot credit activities to support small-scale, private agricultural and horticultural producers, especially those who are ultra-poor and unable to take up the livestock benefits of the Small Farm Reconstruction and Development Project. | The pilot credit scheme was cancelled because the USD 1 million UN Development Programme grant was not available. |
|
| Because grazing
areas were neglected for a number of years, pastures degenerated,
legumes were lost entirely from the complex (due to lack of phosphate
applications on deficient soils), and desirable grasses were suppressed
by the growth of undesirable weeds. Fields remain heavily mined,
putting the lives of farmers and livestock at risk. |
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| Planned |
Achieved |
|
| To re-establish and improve natural pasturelands through the purchase of pasture seeds. |
Very limited improvement of meadowlands was achieved through procurement of seeds and mineral fertilizers for demonstration purposes. The pasture improvement programme was discontinued because the implementing partner (the Republic of Srpska Agricultural Institute) lost interest in the issue. |
|
| The general management
system for cattle was based on a cycle of six months of summer grazing,
followed by winter enclosure in stalls in the immediate vicinity
of the farmhouse. Cattle were fed hay and limited amounts of crop
by-products, including undersized potatoes, stock beet and milled
maize. The production strategy of most cattle-owners involved producing
with few inputs. |
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| Planned |
Achieved |
|
| To provide animal-husbandry extension services to farmers through the financing of brochures on husbandry, rations and health care. |
In the Republic of Srpska, 5 000 copies of ‘Farmers Booklets’ were distributed free to project beneficiaries, local veterinarians, livestock officers and agricultural engineers. The booklet includes information about animal husbandry, breeding, forage production and credit conditions. In the Federation, two different extension bulletins, one for livestock specialists, agricultural engineers and veterinarians and the other for farmers, were published and distributed among beneficiaries. |
|
| Each municipality
had a municipal veterinary station that provides animal health care
services and is responsible for artificial insemination of cattle.
The stations were each usually staffed by one veterinary officer
and two or more animal health technicians. During the war, veterinary
and artificial insemination equipment and infrastructure at the
stations were badly damaged. |
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| Planned |
Achieved |
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| To finance post-delivery services during the first 12 months by reaching agreements between municipal veterinary stations (or private veterinarians) and the project. |
In the Republic of Srpska, the project entered into a one-year contract with municipality veterinary stations to cover all required veterinary care, including artificial insemination, pregnancy testing and all veterinary and livestock extension advisory services. In the Federation of Bosnia-Herzegovina, one qualified veterinarian was hired to provide advice and training to farmer-trainers and farmers themselves through project implementation. |
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- In post-disaster projects, the rehabilitation work should not be confused with development, which requires rural credit and normal commercial operations. In situations such as post-war Bosnia and Herzegovina, a grant component, together with a loan, should have been put in place.
- It is important to provide proper information to the livestock recipients indicating that animal distribution is a credit programme. Moreover, government commitment is essential to make sure that people understand the credit programme. Also, livestock loan repayment programmes should allow for sufficient grace periods to help borrowers pay their loans back. Many beneficiaries thought that this IFAD programme was a grant programme similar to others going on at the same time in the Federation of Bosnia-Herzegovina.
- The project provided loans to borrowers and used an agent bank to collect repayments. The agent bank was not very motivated to follow up on the borrowers since the money did not belong to it. In the future, agent banks should obtain funds as loans and should on-lend these, at their own risk, to final borrowers. The choice of an agent bank turned out to be a high-risk issue.
- The credit package given to beneficiaries should have been planned in a way that would have enabled the beneficiaries to repay their loans. Even though the financial model showed evidence of profitable income-generation through the redistribution of livestock, more attention should have been given to individual cases. In this project, many beneficiaries were each given only one heifer, and this did not enable the beneficiaries to create sufficient income for credit repayment.
- It is essential to analyse and ensure the existence of milk markets before dairy cows are distributed to beneficiaries.
- It is important to help farmers become organized into producer associations and other groups so as to improve their weight in the market.
- Farmers need advice and training in certain aspects of practical livestock management so they can safeguard the health and productive potential of their animals.
- The lack of adequate extension and animal health services can seriously undermine the capacity of project beneficiaries to absorb new technologies, including those related to improved livestock breeds, improved seeds and other specialized inputs.
- In circumstances similar to those in post-war Bosnia and Herzegovina, farmers should be offered alternative income-generating activities as well (in addition to livestock production). Diversified production is an advantage because it can provide flexibility to farmers earning incomes from different sources.
- For restocking projects in areas where there are sufficient numbers of animals and functioning financing systems, cash loans are a better alternative than in-kind loans. Cash loans allow each farmer to choose the animals they want to purchase. However, sufficient technical support to assure the purchase of suitable and healthy animals should be provided to the farmers.
