Project Development Process: Who Represents the Smallholders?

TaroTeraccesCapeVerdeOptEconomic Development Projects for Rural Poverty Alleviation appear to become locked into a limited number of approaches, often institutionalized across most of the donor community, that may end up reinforcing mechanisms for assisting smallholders with limited effectiveness while overlooking more critical needs of the smallholder beneficiaries. To understand how this can happen, it might be good to review the process by which economic development projects are formulated prior to implementation. This would include how the smallholder beneficiaries are represented in the early stages, and degree of commitment that predates any opportunity for extensive interaction with the beneficiaries through some form of participatory process such as the Rapid Rural Appraisal (RRA). By the time such diagnostic process can be made, it could be up to two years from the inception of the project, and projects are usually already fully committed to the intervention to be undertaken, with perhaps as much as US$ 500,000 already expended. The process does not, in and of itself, represent any adverse intentions on the part of those involved. Instead, it represents how well intended individuals can be caught up in a bureaucratic procedure of nearly circular self-promotion reasoning and reinforcement with little opportunity for innovation or involvement of the beneficiaries. It is important that those formulating projects are fully aware of the limitations in the project development process and how it can hinder innovative approaches, and become more committed to the mechanisms by which assistance is delivered, than the beneficiaries reliance on the service provided that will reduce the sustainability of the assistance beyond the limited period of donor funding and facilitation. There are perhaps six steps in the development project process that often requires up to two years for completion:

Project Identification

The first step in the process is the project identification. This is typically done between the donor and host government with the donor the primary initiator. There is little, if any, interaction with the intended beneficiaries, and in reality it would be very difficult, if not impossible, to effectively include beneficiaries at this point, primarily because the actual location and thus specific beneficiaries has not been identified.

Donors’ initiatives are usually guided by the broad strategic objectives of the donor government. The need to relate to strategic objectives may be necessary to secure the essential political support for funding from an electorate that often is not particularly interested in foreign assistance. This is the case for USAID, the largest donor for poverty alleviation projects, but with the lowest percent of Gross Domestic Product committed to foreign assistance. USAID has to classify all development effort into one of four strategic objectives approved by Congress. While these strategic objectives are broad enough to include most development innovation, they naturally represent the agenda of developed countries and what they can afford with their tax base and levels of discretionary funding being applied to a developing country with its Suppressed Economy and much more restricted tax base and levels of discretionary funding. This often makes for a very awkward fit that many countries do not have the tax base or discretionary funding to support, with the attempt to provide such financially unsupportable services frequently providing host government officers some Informal Income opportunities for claiming services provided that are more on paper than actual. The case of Certified Seed in Nigeria maybe an example.

Furthermore, the donor representatives for proposed projects are often more closely aligned with the developers and promoters of the proposed interventions within the donor’s country, than the end users.  This often initially comes from academia, and can be highly promoted to the students as the ideal way of providing assistance.  The end users, even in donor countries, then have to factor in the practical implications, such as in the economic costs and benefits as well as some of the intangible considerations such as the operational convenience, etc. that determine the final acceptance or rejection of any innovation. Thus, proposed interventions may be more the ideal of what can be effectively accomplished in the donor country, rather than what is widely accepted in the donor’s country, and giving the impression of a wider acceptance within the donor’s country than reality. The example here would be the use of Farmer Cooperatives to funnel virtually all development project sponsored support services to smallholders, while the agriculture cooperative system in the USA handles less than 30% and declining market share to the extent the US Department of Agriculture no longer tracks membership or market share with the Latest Information now over 15 years old. Another example would be the emphasis on irrigation scheduling consistent with plant water requirements which most USA farmers are familiar with, but not set-up to effective utilize for numerous valid reasons. Another would be the necessity for certified seed for self-pollinated crops such as rice or wheat each year, when less than 30% of the Colorado wheat crop is planted to certified seed while over 70% is planted to retained seed.

Finally, the donor representatives spend most of their time in the host country capital or even their own capital, with limited opportunity to meet with the intended beneficiaries. What contacts may be available could be highly time restricted and well orchestrated by either the host government or project implementing teams of a parallel project anxious to promote their projects’ accomplishments up the four tiers of the Development Hierarchy as necessary to assure future funding for their projects. Such quarterly progress reports or periodicals articles tend to be correct in what they contain, but may use some selective reporting to overlook or side step some of the critical issues that need to be reported to assure post funding sustainability, as may be happening with the information suggested in the Farmer Organizations Survey. Ultimately this results in reports that can be Deceptive, Bordering on Dishonest. The most common means of deception is by omitting the overhead costs of the cooperative that the farmers will eventually have to pay for the cooperative to be sustainable after donor assistance ends. However, it can also be done by expunging information from consulting reports that does not toe the accepted party line of what is politically correct. Project developers and supervisors are usually content to accept reports as written, and are usually too pressed with other project supervisory activities to carefully scrutinize the reports, and make certain the critical needs for post funding sustainability are included. This may be good for the donors and implementers in assuring continued and future contracts, but does little, if anything, for the beneficiaries. Thus, the donor’s representatives involved in project development understanding of the beneficiaries and their development needs is almost exclusively second hand and may rely substantially on the politically correct stereotyping of smallholders and their development needs, which will be repeated nearly verbatim from country to country without ever being substantiated. The result in a superficial understanding of the plight of smallholders that overlooks many of the subtleties discussed in this website in what might best be highlighted by the famous quote:

“A little learning is a dangerous thing; Drink deep, or taste not the Pierian Spring: There shallow draughts intoxicate the brain and drinking largely sobers us again” Alexander Pope, Essay on Criticism, 1711

The intended smallholder beneficiaries are represented by the host government with the assumption that the government is well informed on what the farmers needs really are, and can objectively represent them. Overlooked by the donors’ designing projects is that the host government is most likely Financially Stalled in that the vast majority, perhaps 80 to 90%, of the government revenue funds are committed to personnel contracted obligations such as salaries, health care, pensions, housing, etc, with very limited funds available for operational costs including frequent routine field trips to work with beneficiaries. Thus, the civil servants claiming to represent the smallholder beneficiaries may have had only limited direct contact with the beneficiaries and, within the context of the host country’s top down autocratic administrative environment, the contact more than likely would be more instructional bordering on supervisory than interactive dialogue of equal participants.

In addition, the host government may have a strong vested interest in promoting public sector support services such as parastatal companies or government sponsored cooperatives, even though these have been notoriously ineffective in assisting smallholders and most have been disbanded or privatized. This vested interest by the host government is most likely the original source of the basically slanderous condemnation of private traders that has permeated the rural development effort without any documentary proof or evidence, and could easily represent exposure to those legally responsible for any written statements to possible Slander Litigation by an organization of private traders. The reality may be that the Private Service Providers are most likely the most cost effective service providers to the smallholder and become the default providers when the development efforts fail. There may also be a multitude of private traders living close to or below the poverty line such as the Banana Trader in Uganda or the Tomato Vendor in Zambia. The host government representatives are also most likely the source of much of the stereotyping of smallholders, such as the oft stated claims of illiteracy and lack of motivation. Finally, the host government officials representing the smallholders may be looking more for personal opportunities from the development effort in terms of legitimate supplemental income by being seconded to the implementing contractor or project implementation unit, or less legitimate more informal type of income opportunities. Given the exceptionally low salary scale of most developing country civil servants, much of this might be a financial necessity, but that can easily drift into some major corruption. Hopefully, this will not be as severe as the Voucher Program in Afghanistan or the possible informal land sales in Madibira, Tanzania. Is this really the best representation of the impoverished smallholder beneficiaries?

During this Project Identification process, with all the limitations on involvement of the intended beneficiaries, dependence on second hand information, and possible vested interest of the host government representing the smallholders, the basic innovation is determined as well as the mechanism by which the benefits will be funneled to the beneficiaries. This would include the current in-vogue value chain projects looking at high value crop for export, managed through farmer cooperatives, or micro-finance projects to provide production credits to smallholders, etc. While the host government will normally have considerable say in the project identification, particularly the geographic areas to be involved, the most weight will be with the donors. They hold the money and the ultimate right to determine how it will be spent. Be assured, the host government personnel are normally far more experienced with manipulating projects to their personal advantage than the donors are at avoiding such manipulations, thus the host government can accept most any project and still derive the desired personal benefits.

Project Design

After a project has been identified the project goes into the project design stage. This is mostly filling in the details as to what will be done. This will include stating the assumptions on which the project is justified. At this point they can only be assumptions as there has been no opportunity to confirm the accuracy of them. The effort will be mostly done by the donor with some inputs from the host government, particularly regarding specific sites to be included in the project, and capacity building training opportunities, that will concentrate on government officers and serve as a “perk” for participating. During this stage the basic areas in which the project is to operate will be decided as well as the amount of external facilitation, the basic budget will be outlined along with budget line items. This would include how much will be spent on direct inputs to the beneficiaries, how much on capacity building mostly for host government officers, how much on capital investments for building and processing facilities, and how much for vehicles, etc. There will be virtually no contact with the beneficiaries during this phase. Again, it would be very difficult to effectively include them. The host government will continue to claim objective representation of the beneficiaries.

At the conclusion of the design stage virtually all conceptual thinking has been completed. The remaining stages are mostly fine tuning and reinforcement of the basic design. Despite the limited access and interaction the donor may have had with the beneficiaries, the heavy reliance on secondary information that may have been more promotional to assure future funding, than objective, and the possible contrary vested interest of the representation of the beneficiaries provided by the host government, it is very difficult to make substantial changes in the project beyond this point. Thus, while the intention might be for a bottom up approach to development, the process effectively becomes very top down.

Project Appraisal

Once the basic project design is completed the process enters the project appraisal stage. The purpose of this stage is to confirm the project design and add some site specific details. This stage is a team effort between donor staff or hired consultants with expertise and ideological commitment to the proposed innovation, and the host government. It represents a major and intensive interaction between donor and host government over a three to four week period. It includes site visits to the areas identified in the project design. Thus, this is the first time to meet with intended beneficiaries. However, the contacts with beneficiaries are often limited rather than in-depth and usually well organized, if not highly orchestrated, by the host government. Time limits, usually one day per site for the appraisal team, mandates this. Thus the beneficiaries interviewed will most likely be pre-selected by the host and possible pre-briefed, if not pre-programmed. They will also be preassembled in a central location and interviewed as a group, rather then randomly selected or casually met within the community. The host government personnel also will serve as the interpreters, if needed. This unfortunately will provide the opportunity for the host to leverage questions and answers to the government’s advantage. This often includes AWOA (Answered WithOut Asking) many sensitive questions and dismissing individuals as having too limited an education to be capable of proper responses.

As mentioned above, the objective of the appraisal team is primarily to confirm and fine tune the project design. It is normally not intended as diagnostic to evaluate if the design and innovations are meeting the most critical needs of the beneficiaries. This is assumed! Thus, in addition to the site visits, visits to similar ongoing projects will be made and discussions held with the implementing agency as well as reviewing some of their periodic reports back to the donors. How objective or promotional these discussion and reports are, is something that may need to be sorted out with regards to the Development Hierarchy and their need to assure future funding. Rarely will an appraisal team visit site locations of similar but completed projects to see how sustainable the projects were once donor funding ended, what modifications were made that made it sustainable, and what happened to the completed project resources if it was not sustainable without donor funding and external facilitation. Isn’t sustainability after donor funding and external facilitation has ended the objective of most development projects, with the post funding mutiplier the only real justification to the donor’s tax base?

Request for Proposals

Once the project appraisal is completed the contracting process begins. The first part is to prepare the Request for Proposals (RFP) along with the Expression of Interest (EOI) by those organizations that will be bidding on the project. The request for EOI will include the release of some of the details of the project so organizations will have enough information to decide if they wish to bid. The purpose of the EOI is to develop a short list of organizations that will be asked to develop a final proposal. The RFP is prepared by the donor in order to solicit a contractor to implement the project. It becomes a very comprehensive document that details exactly what the implementing contractor is to do. All the assumptions listed in the project design are now treated as indisputable fact, even though there has been no effort or field time to substantiate them. There will be no opportunity in the proposal to substantiate the assumption, just accept them as established fact. The RFP will include the type of innovations to be done, the mechanism used to convey the innovations to the beneficiaries, the project locations to be utilized, the support services to be built, the capacity building training opportunities and for whom, the vehicles to be purchased, etc. The RFP will also specify what technical assistance will be needed, the qualifications of all expatriate staffing as well as the duration of each advisers’ assignment. Once the RFP is prepared it will be released to the short listed organizations interested in bidding on the project and developing the necessary implementation proposal. Very little conceptually will be left to chance or open for discussion in the RFP.

Project Proposal

Once released, the potential contractors scurry around to respond to the RFP. While the RFP may be released some 18 months after the initial project identification, the response time for the formal proposal is often restricted to one month or less. This makes for a mad scramble in getting the proposal written that could extend for several volumes when all the detailed CVs of the proposed expatriate advisers, past performance of the organization, and budget materials are included. However, the critical portion may be only 10 to 20 pages, barely enough to reiterate the technical concepts of the RFP. Typically the people who prepare proposals are a specialized group within the responding organizations’ headquarter staff with limited opportunities to actually visit field locations, and will not necessarily include those who will implement the project. They will be assisted by any on-the-ground personnel in the host country, if such people exist, or by very brief country visits if time allows. Any such on-the-ground input will most likely come from host government officers or other “key” individuals, but very rarely involve the beneficiaries. The time limitations would severely restrict direct contact with beneficiaries.

To develop competitive proposals, most responding organizations will track projects and have all site visits completed prior to the release of the RFP. However, it still remains a very rushed processed that does not allow for extensive in-depth reflection on what may need to be done and relies heavily on past proposals equally rushed in their preparation. The proposal will respond in detail to the RFP with little if any innovative deviations, particularly conceptual deviations seeking a more effective adjustment to the proposed interventions, or qualification of the advisory staff. Such deviations from the RFP would be considered as non-responsive to the scope of work and the proposal will be down graded for it. It will also consume additional pages that would again downgrade the proposal. It will typically cost a responding organization approximately $60,000 to assemble a proposal. This is the main reason for the EOI and short-listing of organizations.

Project Implementation

After the project proposals have been fully evaluated and whatever contract negotiations needed are completed, the contract is awarded and the implementing team can relocate to the host country and commence implementing the contract. This is now as much as two years from the original project identification. It is also the earliest opportunity for any extensive non-biased participatory activities with the beneficiaries such as a RRA to determine if the beneficiaries’ needs are being addressed. But by this time what is left to decide? The basic project innovation was decided two years ago, the staffing according to the detailed RFP has been hired and relocated with a full commitment to the proposed innovation, and personnel contracts for the stated duration of their assignment. There has been a total upfront investment by the donor and contractor of approximately US$ 500,000. It would cost a similar amount to make major shifts in the project requiring revamping of staff including paying off personnel commitments and relocation costs, if the RRA was not supportive of the innovation.

Thus, there is really little choice but to leverage the RRA to support the proposed innovation. This is easily done by using leading questions in any interviews with the beneficiaries, avoiding asking questions inconsistent with the project objectives, or concentrating on responses that the project can address. This is very natural since the staffing is consistent with the proposed innovation and will naturally make inquiries consistent with the innovation. If the smallholder beneficiaries are not really interested in the innovation or have more important concerns it is too late for the project to pack-up and go home or shift to another location. The smallholder beneficiaries’ only recourse is to allow the project to proceed, to participate where possible as there is some uncertainty as to if it might succeed as promoted, but mostly continue on their own if the project fails to meet expectation. That might be manifested in Smallholders consigning only enough produce to the cooperative to cover debt obligation and side selling the bulk of their produce to private traders for an immediate cash settlement at perhaps a 20% discount from the cooperative price as reported in Kitwe, Zambia. This could be an example of astute smallholders’ response to well intended but highly institutionalized projects not fully meeting expectations, including overlooking their Overall Financial Management Strategy that could emphasize retaining good in-kind, rather then monetizing them. The 20% discount might represent the overhead costs of the cooperative, and returns might be at farm gate parity. Also, consigning only enough produce to cover the Loan Obligation and prevent any produce being used to pay off a neighbors loan in what was a communal loan pool.

Summary

While there is no question as to the sincerity or commitment of the donors and facilitating organizations to eventually assist in the poverty alleviation of smallholders, the process of getting development projects in place to assist them may not lead to the most effective projects. Most of the conceptualization is done very early in the process by people relying mostly on secondary information, limited direct contact with the beneficiaries, or with some vested interest in public sector services or personal benefits. Thus, by the time the project is actually implemented, some two years after being identified, there is little alternative but to leverage the acceptance of the project by the smallholder community intended to benefit from it. In this case, it is highly possible for the mechanism for funneling assistance to the smallholders can become more important and overly institutionalized into the development process than the effectiveness of the assistance even when that mechanism does not have a competitive advantage, and critical issues can be overlooked for decades as with the possible oversights in the Basic Premises, and not consider alternatives explanations for the basic premises, that may indicate a serious imbalance in the Available Calories relative to what is expected to be exerted with serious implications for the timely completion of specific tasks that will substantially reduce the potential yields. This might be extrapolated to consider that many development projects have an inadvertent, at least a conspiracy, for advocating the genocide by starvation of the smallholder producers and be subject to possible referral to the ICC (International Criminal Court) the tribunal in the Hague for crimes against humanity.

While there may not be much that can be done with the overall stages of the process, it is important that those developing projects are fully aware of the limitations on the information they are basing project conceptualization. There is a need to get some highly independent evaluations of the needs of the smallholders and their communities. This would be independent of both the host government and their vested interest, and on-going projects with equally vested interest in promoting their perhaps limited accomplishments. There is also a need to return to completed projects some two years after donor funding and external facilitation has ended to see if the projects still exist, how they have been modified to remain viable, and, if they have not survived then what became of the projects’ resources particularly the financial resources. This may require some fortitude to bite what could be a multi-billion dollar, multi-decade bullet of ineffective, unsustainable projects.

Preferable there is a need for a strong and independent Monitoring and Evaluation (M&E) component for development projects. M&E components that not only measure beneficiaries’ willingness to participate, but more critical the degree they rely on projects for the services provided. M&E personnel must accept that they are not part of the donors’ propaganda of good intentions, but are representative of the underwriting tax payers assuring the tax money is well invested. This also makes them representative of the Beneficiaries assuring they receive appreciated services.  Donors designing projects might be well served to develop some strong criteria that will assure the sustainability of projects beyond donor funding, such as the questions in the Cooperative Survey. Then set targets for those criteria for contractors to meet, or explain why they cannot be met, and insist on these criteria be addressed in periodic progress reports

Both the smallholder producers are entitled to such evaluations to assure they fully benefit from the development dollars invested in assisting them, as well as the tax payers funding the donors to assure their taxes are not squandered. In the absence of such evaluations, when projects are not sustainable beyond donor funding and external facilitation, they become little more than an indication of the donors’ good intention with limited impact on rural poverty alleviation. It would also be nice if the RFPs provided opportunity or even required the contractor to varify the assumptions upon which the project was justified.

Example

An example of how a development project can get well outside the realities of what may actually be needed is a recent RFP for a major agriculture development project. In the RFP one of the major components was to address the problem of remote areas with poor conditioned roads, and the excessive transportation costs being charged to the farmers. The proposed solution was to provide the farmers with a marketing information service that would advise them of the current consumer prices for their produce. This was intended to provide them more information to negotiate with the traders for a better price. However, in the standard transportation quotes of $/t/km, what goes into the additional transportation costs associated with remote locations? Some of this would include:

  • The need for smaller vehicles that can negotiate the rougher roads. This could be as small as LandRover pickup as shown for Kenya.DSC03070-web
  • This could result in the need to transship goods from larger to smaller trucks.
  • In this case, storage facilities would also be needed for the transshipment.
  • Since vehicles are smaller, they may consume less fuel, but because of the smaller load on a t/km basis it will require more fuel, and usually the consumer price of fuel is at a premium to the USA prices.
  • Also, because of smaller loads it will take more time and thus more labor costs to move commodities to or from the more remote locations.
  • In addition, the overall speed will be substantially reduced, possibly from an average of 80 km/hr on tarmac to an average of 30 km/hr, as well as the amount of breaking and accelerations in the more rutted portions of the road. All of which will add additional fuel and labor costs.
  • As the truck will bounced around more negotiating the ruts, the maintenance costs for tires, brakes and suspensions will also increase.

Factor all this in and what would be a transparent additional cost for doing business in remote areas that unfortunately has to be borne by the farmers in terms of higher prices for goods brought in and lower prices for produce being marketed? In Zambia transportation cost off the tarmac were 3x that for the highways. If all the information was available and in the context of a Financially Suppressed Economy that restricts profit margins this could easily be a very transparent cost increase. How a market information system will address these legitimate costs is unclear. Perhaps, it will mostly inform the producers of just how unfortunate they are.

However, since the RFP required a marketing information service, all responders eagerly promoted the service as there was no opportunity to demonstrate an understanding of the legitimate concerns with working in remote areas and asking to address those issues. That would result in a deduction as non-responsive, and would extend the response beyond the allocated number of pages.

Last Revised: 17 Feb 2010

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