ICARDA annual report 2004

had a significant effect on people’s
livelihoods, because livestock are
one of the main sources of income
in these dry marginal areas.
Researchers also found that the
households which borrowed money
from micro-credit schemes in 2000
or 2001 were those already most in
debt. This suggests either that these
households were less suspicious of
the new micro-finance institutions,
because they had already borrowed
from informal sources, or that they
were under pressure to accept
money from any source without
considering the risks.
Even after micro-credit schemes
were introduced, villagers continued
to borrow from informal
sources (Fig. 31). Although friends
and relatives sometimes provided
interest-free loans, shopkeepers,
traders, and moneylenders charged
interest rates of 77% per year on
average. What is more, the ‘poorest’
had no access to formal lending
institutions (Fig. 31). This demonstrates
the importance of microcredit
facilities, because without
them the poorest households are
forced to rely on very expensive
informal credit sources.
The study also examined the
effect of micro-credit on household
incomes by asking people whether
they felt that their income had
decreased, increased, or stayed the
same since 2000. Answers were
scored using a five-point scale,
where 1=substantially decreased,
3=no change, and 5=substantially
increased. Scores were averaged
across the different household
types and poverty categories.
In general, across all three household
types, the ‘poorest’ felt that
their incomes had decreased, while
the ‘less poor’ felt that their incomes
were the same as, or higher than, in
2000. The benefits of micro-finance
schemes were seen in the ‘less poor’
category, as ‘less poor’ creditscheme
households perceived a
greater increase in their incomes
than ‘less poor’ control-village
households. Overall, the ‘less poor’
credit-scheme members benefited
more from the initiative than the
‘poorest’ credit-scheme members.
The study showed that microfinance
schemes can alleviate poverty
in the dry areas. However, efforts
must be made to include smaller,
poorer villages with less infrastructure,
so that the poorest are not
excluded from such schemes.
Local institutions in dairy
sheep systems in dry
marginal areas
Informal local institutions give the
poor access to markets and inputs,
and act as safety nets when crops
fail and livestock are lost. However,
they are not necessarily fair
because the poor lack bargaining
power. Traders often take advantage
of them, paying low prices for
their products and charging them
more for their inputs. Better understanding
of these informal local
institutions is essential for designing
policy interventions that will
improve their efficiency and postively
impact the poor.
In 2003 and 2004, ICARDA studied
informal local institutions governing
the processing and marketing
of dairy sheep products in dry
marginal environments. The study
covered 44 villages in northwest
Theme 4
Fig. 31. Average
amount of
money that
households in
different poverty
categories borrowed
in 2000
and 2003, classified
according
to lending institution.
Syria’s Khanasser Valley (annual
rainfall 200-250 mm), one of
ICARDA’s integrated research sites.
The sustainable livelihoods
framework was used to conduct
qualitative and quantitative studies.
To measure social capital and
analyze the linkages between institutions
and rural livelihoods, participatory
tools were used to collect
and analyze information. Historical
calendars were constructed to show
trends in weather, population, land
tenure, migration, irrigation, health,
education, and electricity supply.
Cheese-makers (Jabbans) and their
families were interviewed individually
and in groups, and observations
were made in the field. A
sample of cheese-makers also completed
a questionnaire.
The main livelihood strategies in
the valley were identified as (i) offfarm
work; (ii) cropping—mainly
barley, cumin, and some wheat for
home consumption; and (iii) sheeprelated
activities—lamb fattening,
and milk production and processing.
Sheep milk production and processing
are mainly managed and funded
by local producers, and are still
important even though the percentage
of villages with milk producers
and cheese-makers has declined
steeply over the last 30 years—from
77% to only 23% in 2003. This is
mainly due to increased cumin cropping
and a fall in sheep numbers
(Table 11). Although cumin was
strongly emphasized by farmers, the
ICARDA Annual Report 2004
61