Partnership for Economic Growth
The Partnership for Economic Growth (PEG) was a two-and-a-half year project funded by USAID, which supported the Somali people’s goal to improve economic growth and livelihoods in Somaliland and Puntland. Under the leadership of DAI, the program collaborated with the Ministry of Livestock, Ministry of Commerce, and private sector groups to better the environment for investment and export marketing and generated agricultural-based employment.
The livestock sector in Somaliland faced significant challenges, including increased competition from neighboring nations, trade barriers due to disease control, lack of access to veterinary inputs, and inefficient veterinary services. However, a strengthened livestock sector is vital, as 65% of the economy is comprised of livestock-related commerce. In partnership with private and public sector, CNFA contributed its experience targeting all livestock value chains to assist the sector in the following areas:
- Capacity building of local veterinary service providers;
- Improved animal feed and education for fodder farmers;
- Provided veterinary services;
- Trained of community animal health workers (CAHW);
- Strengthened and improved commercial livestock feed supply systems;
- Strengthened feedlot enterprises;
- Developed dairy processing facilities, conducted livestock end-market analyses, and provided rural financial services.
- Livestock Component:The Livestock Component was the largest of the PEG Project, where CNFA advised local non-profit organizations and enterprises that were recipients of capacity building grants and matching grants. These grants were utilized for the creation and implementation of demonstration farms, technical training in improved livestock care, dairy and fodder production techniques, livestock fattening programs, and capacity building of local stakeholders.
- Matching Grants to Local Enterprises:The CNFA Livestock Component collaborated with four small and medium livestock enterprises under a matching grant component. The goal of the matching grant component was to expand various sub-sectors of the Somali livestock industry through local organizations. PEG matching grant recipients and illustrative activities underwent the following:
- Al Husseini Farm and An’Aam Farm are Somali feed lot enterprises that received PEG grants and technical training in improved fodder production techniques. An’Aam Farm was created by an association of multiple investors, who collectively contributed more than $1 million in funds to create the farm. Al Husseini Farm operated on a much smaller scale, but both were fully functional feedlots providing animal fattening services to local farmers;
- Horumar Farm was a model dairy farm, established with PEG support, which specialized in camel milk and fodder production. Horumar Farm received a small matching grant to provide fodder production, dairy production, and dairy processing trainings to increase the quality of milk in the surrounding area. Inspired by the success of Horumar farm, one Somali woman purchased several camels purely to be able to take advantage of the growing market.
- With PEG capacity building assistance, Togheer Womens Livestock Traders Association initiated a small ruminants buying scheme, which purchased ruminants in rural areas and transported the animals to urban areas – primarily Buroa – or exported them regionally to an area with an increased demand and a higher price. Making only a $3 profit per head, the association applied for a PEG grant to begin a small-scale feedlot. The fattening station increased the weight of the sheep and goats, resulting in a price increase of up to 20% per animal at the end market.
- Capacity Building of Somali NGOs:Under CNFA leadership, four local non-profit organizations were contracted to implement training programs and develop community-based demonstration farms where training in fodder production (i.e., variety selection, harvesting techniques, hay baling and storage, and mineral supplementation) and animal health (i.e., disease control, drug quality, and use) would be available.
Expanding Regional Access to Micro-finance and Start-up Capital: Kaaba Microfinance Institution (K-MKFI), the only MFI in Somaliland, was able to open a new office in the town of Gabiley through PEG program funds, serving micro-enterprises and the informal markets in Western Somaliland. K-MKFI uses an Islamic-compliant lending methodology, which enables a previously untapped market in rural areas to access finance. The majority of K-MKFI’s micro-finance clients were small-scale livestock producers and traders:
- PEG contracted AIMS, a local consultancy firm, to complete an end market analysis of the livestock value chain in Somaliland and the larger region (Egypt, Oman, Saudi Arabia, United Arab Emirates, Yemen). This analysis and subsequent PEG knowledge transfer activity highlighted both opportunities and constraints facing the livestock value chain in the region;
- The Livestock Investment Chapter of the 2013 Somaliland Investment Guide synthesized the findings of PEG’s Livestock End Market Study. The Investment Guide highlighted investment opportunities through a printed edition and website feature, which provides a platform to expand access to investment capital and targets potential diaspora investors.