Evaluation of the USAID-Kosovo SME and Agriculture - Economic ...

Development Associates, Inc.Inconsistent supply of feed concentrate and supplements and when available are pricedabove the regional and world market. (These are both constraints and weaknesses.These constraints can be improved by providing: an agricultural finance program for producersand processors; providing technology transfer based on product specialization and marketing;assisting the feed milling industry through technology, storage and financing to import feedingredients in quantities that are price competitive in the regional market; assisting in thepromotion of sunflower production and processing that will provide a source of sunflower mealto be used in feed rations not only for dairy, but for beef, lamb and poultry feed as well.CARE activities have been well coordinated with other donors and with NGOs, such as HeiferInternational of Kosovo, an affiliate of Heifer International. There is cooperation with the WorldBank, Swiss Aid, FAO, and Mercy Corp and others.CARE and KBS have collaborated closely to take advantage of economic opportunities as wellas training to support both the producer and processors.KBS has provided experts in the fields of: 1) new potential dairy products such as fruit flavoredyogurt and whey drinks and 2) milk collection systems, lab equipment and procedures. Theseminars and workshops put on by these experts not only provided valuable technical assistancefor dairy processors they were of great assistance to the CARE program and the MCC. KBS andCARE participated in a joint training session at the USAID funded Land O’ Lakes milk testinglaboratory to learn proper techniques for milk testing. KBS worked with CARE to introducemilk processors to the use of forward contracts with the milk producers.IMPACTPreliminary results show 425 dairy farmers have increased milk production by 21% on averageduring the peak lactation period. Net farm income from dairy production has increased at least25% for the primary 425 farmers, with at least 50 jobs being created. The growth in milkproduction increased the number of processing centers and created additional milk products forthe market, such as yogurt and processed milk, that require more labor. The majority of theadditional labor comes from the rural area where poverty is high. The impact of the project ishigh.SUSTAINABILITYAgriculture development requires some serious fiscal policy changes in order to be sustained.Kosovar producers are paying very high customs duties, VAT, and in some cases, transit taxeson agricultural inputs with the exception of fertilizer. Their competitors in neighboring countriesdo not pay this sort of tax and in fact receive substantial subsidies in many cases. The Ministryof Agriculture has appealed and continues to appeal to no avail, the tax structure that puts anunfair burden on the small farmers who constitute one of the poorest segments of society.The assistance level in building local capacity to carry on agricultural and SME developmentefforts are in the building stage. Fundamental agricultural technical assistance will be requiredfor many years to come. Trained technicians and other people possessing other developmentalEvaluation of the USAID/Kosovo SME 102 May 2004and Agriculture/Agribusiness ProgramsVolume I