Partnership for Economic Growth
The Partnership for Economic Growth (PEG) was a two-and-a-half-year, $10 million project funded by USAID (2011-2013), which supported the Somali people’s goal to improve economic growth and livelihoods in Somaliland and Puntland. Under the leadership of Development Alternatives Incorporated (DAI), the project collaborated with the Ministry of Livestock, Ministry of Commerce and private sector groups to improve the environment for investment and export marketing and generate 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 was comprised of livestock-related commerce. In partnership with private and public sectors, CNFA contributed its experience targeting all livestock value chains, assisting the sector in the following areas:
- Capacity building of local veterinary services
- Community Animal Health Workers (CAHW) training
- Improved animal feed and education for fodder farmers
- Commercial livestock feed supply systems and feedlot enterprises strengthening and improvement
- Dairy processing facilities’ development
- Analysis of livestock end-market
- Rural finance services
- Improved Capacity of Livestock Organizations and Enterprises: Under the Livestock Component, the largest of the PEG Project, CNFA advised local non-profit organizations and enterprises that were recipients of capacity-building 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.
- Expanded Livestock Sub-Sectors through Matching Grants to Local Enterprises: The Livestock Component collaborated with four small and medium livestock enterprises under matching grants. The goal of the matching grants was to expand various subsectors of the Somali livestock industry, including commercial livestock feed supply systems and dairy production through local organizations. Some of the PEG matching grant recipients and illustrative activities included the following:
- Al Husseini Farm and An’Aam Farm, two Somali feedlot enterprises, 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 small scale, but both were fully functional feedlots providing animal fattening services to local farmers.
- Horumar Farm, a model dairy farm established with PEG support, specialized in camel milk and fodder production. The farm received a small matching grant to provide fodder production, dairy production and dairy processing training 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 Women’s Livestock Traders Association initiated a small ruminant 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 increased demand and higher prices. Making only a three-dollar profit per head, the association applied for a PEG grant to begin a small-scale feedlot. The fattening station increased the weight o sheep and goats, resulting in a price increase of up to 20% per animal at the end market.
- Expanded Regional Access to Micro-Finance and Start-Up Capital: Kaaba Microfinance Institution (K-MKFI) was able to open an office in the town of Gabiley through PEG funds, serving micro-enterprises and the informal markets in Western Somaliland. K-MKFI used an Islamic-compliant lending methodology which enabled a previously untapped market in rural areas to access finance. The majority of K-MKFI’s microfinance clients were small-scale livestock producers and traders.
- Conducted a Market Analysis of the Somali Livestock Value Chain: PEG contracted AIMSm 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 and Yemen). This analysis and the 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: The findings of PEG’s Livestock End Market Study were synthesized in the 2013 Somaliland Investment Guide. The guide highlighted investment opportunities through a printed edition and website feature and provided a platform to expand access to investment capital and targets potential diaspora investors.