FED Annual Report: Fiscal Year 2014

The USAID Food and Enterprise Development (FED) Program for Liberia is a USAID-funded development program that was launched in September 2011. USAID FED uses an all-inclusive strategy incorporating micro, small and medium enterprise (MSME) farmers, processors, suppliers, women, and youth while partnering with the government of Liberia and local civil societies to achieve food security.

The goal of USAID FED is to increase food availability, utilization, and accessibility by building an indigenous incentive structure that assists agricultural stakeholders in adopting commercial approaches.

This incentive structure is built upon:

  • Improved technology for productivity and profitability
  • Expanded and modernized input supply and extension systems
  • Commercial production, marketing, and processing
  • Enterprise services
  • Workforce development

USAID FED works with the Ministry of Agriculture (MoA), Ministry of Commerce and Industry (MoCI), Ministry of Finance (MoF), civil societies and the private sector in providing communities access to agricultural inputs — including improved seed varieties — extension services, nutrition messages, processing services, market information, transportation, credit, agro-business education, training, and enterprise services.

In five years, USAID FED’s thrust to expand market linkages is expected to lead to substantial increases in income and job opportunities. USAID FED aims to significantly boost the production, processing, marketing and nutritional utilization of rice, cassava and vegetables, and to enhance the productivity of goat farming in the counties covered by the program.

These initiatives are being carried out in Bong, Lofa, Nimba, Grand Bassa, Montserrado, and Margibi counties. USAID FED focuses on these counties because they are situated along regional development corridors that are crucial in promoting intra and inter-county commerce. These growth corridors are expected to improve food availability and access for all Liberians.

USAID FED’s methodology is market-led and value chain-driven; it is committed to developing indigenous capacity building, with a specific focus on Liberia’s women and youth.

USAID FED is implemented by five partners: Development Alternatives, Inc. (DAI), Winrock International, International Fertilizer Developmental Center (IFDC), Louisiana State University (LSU) and The Cadmus Group.

Executive Summary

FY 14 has seen FED successfully ramp up programming in spite of several challenges such as the Ebola outbreak that happened in the last quarter of the fiscal year.

In FY14, FED implemented programming in 876 villages (more than three times the number of villages in FY13) in 38 districts in the counties of Bong, Nimba, Lofa, Grand Bassa, Margibi and Montserrado. The introduction of the cluster approach to programming led to a more efficient operation of the FED County Offices as well as its partner local NGOs (LNGOs).

The cluster approach focuses value chain programming in geographic areas where there is a concentration of farmers working in that specific value chain. This approach has allowed the program to significantly exceed several of its targets as shown in the Indicator Progress Report (IPR) table. (See Attachment A).

Among the most notable accomplishments of USAID FED in FY14 are as follows:

  • Implementation of improved technology in 6,525 hectares, which is 13 percent higher than target.
  • Provision of direct program assistance to 1,637 private enterprises, producers’ organizations, women’s groups, trade and business associations and community-based organizations, which is 137 percent more than the target for the fiscal year.
  • Direct assistance to a total of 40,779 (114 percent of target and more than twice the outreach of FY13) individuals coming from 36,723 households.
  • Generation of 2,177 jobs or full-time employment (FTEs), which is 21 times higher than target and 24 times higher than what was generated in FY13.
  • Sales at the farmers’ level have reached US$1,077,100, which is more than three times the sales of FY13.

FED leveraged private sector resources in expanding production, improving productivity, and increasing processing and storage capacity. More than US$1.4 million were generated from the private sector as investment in different segments of the value chain, resulting in increases in processing capacity and storage capacity. By the end of FY14, additional processing capacity reached 16,400 metric tons, while storage capacity rose by 2,054 cubic meters.

It is very important that these increases in processing and storage capacities were achieved in FY14 in sync with surplus production by FED-supported farmers. In FY14, FED-supported rice farmers sold more than 1,220 MT of rice from the FY13 production worth US$565,000. FY14-supported rice farmers are expected to harvest over 10,000 MT of rice from more than 3,800 hectares cultivated in FY14. It is expected that approximately 50 percent of this produce will be sold to processors.

Among the achievements under Component One was the establishment of 10 rice business hubs in strategic locations. Eight of these hubs were fully functional at the end of FY14. All 10 are expected to be functional by Q1 of FY15 and will provide processing (threshing and milling) and storage services to rice farmers in time for the harvest in Q1 of FY15. They will be providing power-tilling services during the rice production season in FY15. Other accomplishments under Component One are detailed under each task and sub-task.

Under FED’s Component 2, significant milestones have been achieved in the area of Business Enabling Environment (BEE) in FY14 with the ratification and promulgation of four policies: EO#64 and the seeds, fertilizer and pesticide regulations. EO#64 waives import duties on agricultural inputs including machineries, equipment and agro-chemicals. This duty waiver is designed to encourage more private sector investment in agriculture. The seeds, fertilizer and pesticides regulations will ensure quality of these inputs. Quality assurance is expected to result in increased productivity and profitability, which will encourage farmers to invest in these agro-inputs.

One of the major challenges faced by the program is beneficiary readiness for formal financing, since the beneficiaries are largely informal micro-enterprises with no business history. They are, therefore, deemed high-risk and non-bankable. No banks are willing to lend to them. To address this constraint, FED focused on mobilizing informal financing using Village Savings and Loans Associations (VSLAs) as a platform. FED was able to organize 123 predominately women VSLAs. FED also partnered with a micro-finance institution, the Liberia Entrepreneurial and Asset Development (LEAD), and was able to generate US$276,300 in financing for the agricultural activities of FED beneficiaries. In FY15, FED will scale up support to VSLAs and to LEAD, as well as focus on finding private sector value chain players who are willing to offer embedded financing.

Under Component 3, a major accomplishment is the approval by the Ministry of Education of the National Diploma in Agriculture (NDA) curriculum that FED helped to develop. The NDA is a two-year vocational diploma program that partner vocational institutions agreed to adopt. In preparation for the implementation of the NDA, FED supported the development of the syllabi and lesson plans of the courses to be rolled out in Year One.

Still under Component 3, FED planned to establish five Enterprise Service Centers (ESCs) that will provide access to Business Development Support (BDS) services to MSMEs in agriculture. A major challenge that FED faced in this effort was finding organizations or businesses in the counties that have the capacity to deliver BDS services. In general, local organizations in Liberia are in need of capacity-development support to run their businesses in a profitable manner. It is therefore difficult to expect them to have the knowledge and skills to help MSMEs in agriculture in improving their businesses. FED selected three candidate organizations to support as Enterprise Service Centers. They have been provided with extensive training and coaching on various facets of business development services. However, after all the training and coaching, an evaluation of their capacity still shows that investing in hard assets to support them to become ESCs may not be the best use of USAID’s investment.

To address the issue regarding the absence of the ESCs, the program leveraged the VSLA initiative to provide BDS services to 2,193 (213 percent of target) micro, small and medium enterprises (MSMEs) including farmers. These BDS services primarily involved training and coaching on basic business practices such as record-keeping, savings, knowing market requirements, relationship between costs and sales, pricing, and planning of production.

In FY15, instead of focusing on establishing ESCs, FED will focus on developing providers who can provide BDS services including registration of micro and small enterprises that FED is working with. Further, since access to BDS services is a subtask under Component Two, ESC establishment will be combined with this task and will be transferred to Component Two.

Further Reading