cases from tanzania - Sustainet

Sustainable agriculture: A pathway out of poverty for East Africa’s rural poor
Too many small-scale farmers, the small size of individual loans, and the dispersed rural
population push up the costs of banking services. A lack of formal land titles means that
individuals cannot offer collateral for loans. Consequently, there are no formal structures
to provide credit to rural people, or for mobilizing their savings. Multipurpose savings and
loan cooperatives could partly fill this gap. In Asia, village-level savings and loan coops have
existed for decades. In Africa, however, micro-credit schemes that could support rural finance
have not been widely promoted. Farmers and others are forced to resort to moneylenders
and other sources of informal finance, which are generally inadequate and expensive.
Current policies “Sectoral ministries will work closely with the rest of the government to
make financial services more accessible to rural communities, and in improving marketing
services. The two interventions will lead to farmers utilizing technology that will increase
productivity because synergies exist between improving services and increasing productivity”
(KSRA, p. 24).
Sustainable agriculture solutions This is not a problem that can be addressed by sustainable
agriculture, but sustainable agriculture also requires access to capital so farmers can
invest in their land (land improvements, soil and water conservation measurements) and in
business opportunities (storage facilities, marketing options, etc.).
Nonetheless, sustainable agriculture can help reduce the need for costly external inputs by
using locally available alternatives. Using indigenous seeds, organic fertilizers and local technologies,
farmers need less capital than if they engage in conventional farming.
Policy changes needed Even though they need less capital than for conventional farming,
farmers who practise sustainable agriculture still need access to credit at reasonable interest
rates. Registered farmer groups should be eligible to receive group loans (as in several countries
in Asia). The government should create framework conditions to enable farmer groups
to form saving and credit groups. The draft Micro-Finance Act, which excludes small-scale
farmers from proper services, should be reviewed and revised accordingly.
Extension services
Cases: All in Kenya
The problem Current agricultural extension services are demand-driven, and farmers have
to cover transport and other costs. Many extension officers are not trained in sustainable
agriculture, so have little to offer farmers who practise this approach. There are too few extensionists
to meet the rising demand, leaving most farmers without the services they need.
Current policies “Efficient and effective agricultural extension is perhaps the most important
service for increasing agricultural production, a key objective of the strategy. The
provision of extension services will therefore need to be strengthened… The government
will divest from the direct provision of inputs, mechanization services and marketing, and
instead opt for the indirect and efficient support to the non-government actors. Public extension
will play a facilitating and linking role between farmers… and research,… input and
service suppliers including marketing and quality control agencies” (KSRA, p. 33).
“The policy will address… the role of the private sector on providing extension services…”
(KSP, p. 18).
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