Increasing resilience in the face of skyrocketing costs
In the last few years Kenya has seen a 70 percent drop in crop production, with an estimated 3.1m people in acute hunger, now in need of aid. As a result of the conflict in Ukraine, the situation has worsened, with disruption to global supply chains causing the price of grains, oil, gas, and fertiliser to skyrocket.
Hand in Hand Eastern Africa CEO, Albert Wambugu, explains how the country’s poorest are bearing the brunt of the crisis – and how Hand in Hand is supporting its members on the ground.
Poor yields and food insecurity
“There are a number of reasons why crop production is falling overall in Kenya,” Albert explains. “Growing conditions here are extremely variable. You might have pockets where the land is fertile – and then areas where the soil quality is degraded, and rainfall is low.”
Maize is the country’s staple crop – but soil degradation and drought is affecting the ‘breadbasket’ regions where it is grown. Some of the commercial fertilisers used here are extremely acidic, and have damaged the soil. Albert says: “When the crops fail, people become reliant on food aid. Some families survive on as little as 2kg of maize a week,” Albert says.
Ukraine war causes price rises for staple goods
Because of the crisis in Ukraine, Kenyans are seeing price rises across the board. “The increasing price of fuel is very noticeable,” says Albert. “There’s been a 30% increase in less than one year.”
People in poverty spend a greater percentage of their income on food. For the very poorest, food price increases will result in adults skipping meals, or subsisting only on staples. “Cooking oil has doubled in price. When costs go up like this, the only thing people can focus on is putting food on the table. You would not be able to afford a balanced diet,” says Albert. “Protein from fish, for example, would be inconceivable.”
Cost of living increases can impact members’ enterprises too. Albert explains it’s almost impossible for people to prioritize saving when times are tough, or to spare the funds to invest money back into their businesses.
To combat the hunger crisis, Albert’s team provide training on a range of sustainable farming techniques that improve soil quality as well as increasing yields.
“We tell our members there will always be things outside your sphere of influence, like supply chain volatility and weather changes. But there are things you can do to offset these – like crop diversification, or by using fertiliser that improves the soil instead of harming it. When you don’t know when the next rainfall will be, even something as simple as a water storage butt makes a difference. We teach people to adapt to their environment. Root crops like arrowroot contain more starch than maize and are easier to grow, so it might be a question of changing your dietary habits.”
They also focus on improving members’ financial resilience.
“We train people to set aside some of their income where possible, because savings are an important way of mitigating the impact of financial shocks. As we’ve seen during the pandemic, and now with the Ukraine crisis, this is vital. More recently, we have introduced our members to insurance. Only 3% of Kenyans have insurance,” Albert explains. “So we are working with providers to create new financial products that meet our members’ specific needs”
The team also encourage people to save in self-help groups. “When self-help groups are strong they can lend when things aren’t going well and, unlike some banks, don’t charge exorbitant rates of interest.”
Despite the challenging circumstances, Albert believes that the team at Hand in Hand Eastern Africa will continue to make a difference to the women they work with – and alleviate food insecurity.
“By giving women the tools they need to lift themselves and their families out of extreme poverty, we are able to strengthen their resilience so they can weather this global crisis.”
“The farmers we train will also have an important role to play in safeguarding food security within their communities, as well as restoring the soil so it remains productive for future generations.”
The Hand in Hand online auction is here!
That’s right, folks.
Starting today, you, your friends, your family, your friends’ families and your families’ friends – and your enemies – can bid on a huge range of super-cool items, from wine and original art to designer bags and wine to holidays, e-bikes and wine.
“Interesting,” you say. “But can I enter a raffle to win a stunning Orbit No. 1 diamond necklace from Swiss jewellers Montluc?”
And that’s not all. Every time you bid or buy a raffle ticket, you’ll be helping women in some of the most challenging places on Earth beat the odds and succeed as entrepreneurs, which is literally impossible to argue with.
So go ahead.
Finish Start your Christmas shopping or treat yourself to a presumably well-earned gift. Then forward our auction site to every single person in your address book, twice.
Happy bidding!Let’s do this
Hand in Hand Afghanistan: record expansion with UK aid from the British people
Hand in Hand Afghanistan is embarking on its biggest-ever expansion thanks to UK aid from the British people.
Funded by the UK government, the three-year, US $2.2 million grant aims to improve the livelihoods of 13,300 rural entrepreneurs in Sar-e Pol province. Some 9,500 microbusinesses and 13,300 jobs will be created.
“Now more than ever, government and civil society must work together for a safe, prosperous future in Afghanistan,” said Hand in Hand International CEO Josefine Lindänge. “This grant, our largest yet from a government partner, is a significant step in that direction.”
Hand in Hand is contributing an additional US $1 million to the project, bringing the overall budget to US $3.2 million. The funds come at a critical time. Last year, conflict killed 3,699 Afghan civilians and injured another 6,849 – a 22 percent jump from 2013, and the most since the UN began keeping records in 2009.
The causes of violence in Afghanistan are myriad and complex, but there is no doubt that poverty and joblessness play a crucial role. In a global survey conducted by the World Bank in 2011, 40 percent of insurgents interviewed said unemployment and idleness were their principle reasons for fighting. By providing business and skills training to thousands of Afghans, Hand in Hand and DFID are tackling poverty, and violence, at its roots.
For more information about the programme, please contact Programme Manager Agnes Svensson.
Worldwide media buzz for Hand in Hand member Frozan, 19
Late in March, Reuters profiled one of our members in Afghanistan: 19-year-old Frozan, who overturned convention and a lifetime of poverty to become the first young person in her village set up a beekeeping business.
Before long, Al Jazeera came knocking. Then the New York Post. Then BBC Persian, Russia’s Sputnik News and a whole host of others. When the dust settled a month later, Frozan had been featured by more than 100 media outlets worldwide, many in her native Afghanistan. It was, by some margin, our farthest-reaching media campaign yet.
The interest in her story, we believe, proves two things: one, our programmes are economically empowering young people in Afghanistan; two, the world is taking notice.
Thanks, Frozan, for sharing your success.
How efficient is Hand in Hand, really?
Founded by one of Europe’s best business minds, Hand in Hand has long put efficiency at the core of our work. But with a job creation model few others employ, benchmarking that efficiency has often been difficult.
Now, thanks to two new World Bank studies, that’s beginning to change. Published this year, both studies consider training programmes similar to ours – one in Kenya, the other in Togo – finding significant increases in profit in both cases.
Neither finds gains on par with Hand in Hand’s.
Study one, Kenya: Zero-sum gains?
Is one businesswoman’s gain another’s loss, or does a rising tide lift all boats? That, in effect, is what the World Bank set out to discover when it monitored an International Labour Organization (ILO) business training programme in Kenya broadly similar to Hand in Hand’s. With a sample size of 3,500 micro-enterprises, the randomised experiment measured the business incomes of ILO programme members versus their non-member neighbours, concluding that ”business training can help the overall market grow.” More importantly, for the purposes of this blog, it also discovered that monthly business incomes among programme members were 15 percent higher than among business owners that had not received the training.
Study two, Togo: The psychology of entrepreneurship
A second study, published in Science and featured in The Economist, considered another angle: psychology. Here, researchers from the World Bank, the National University of Singapore and Leuphana University in Germany partnered with the Government of Togo to follow three groups of small business owners who rarely kept books and almost never wrote business plans, earning an average of US $173 a month. The first group, a control group, received no training at all. The second group received training in conventional subjects such as accounting and financial management. The third group received training based on psychological research, designed to teach soft skills such as initiative and persistence.
Those skills, it turns out, are crucial: profits rose by an average of 30 percent among members of the third group. Perhaps more interesting, however, was another finding: the conventional training group saw no uplift at all.
Study three, Rwanda: Hand in Hand
So, how does Hand in Hand stack up?
In the ILO programme in Kenya, business profit was 15 percent higher for programme participants ($86) than non-participants ($75). In the World Bank’s partnership with the Government of Togo, monthly business profit was 30% higher for those that received the psychology base training ($224) compared to those that did not ($173).
And in Hand in Hand’s partnership with CARE in Rwanda, according to an independent study – the most recent, relevant research we have – monthly business incomes were 75 percent higher for those that received the enterprise training ($48) compared to those that did not ($29).
That’s more than double the World Bank’s programme in Togo, and five times the ILO programme in Kenya.
By the numbers
ILO, Kenya: 15% higher profit for enterprise trainees
World Bank, Togo: 30% higher profit for psychology-based training
Hand in Hand/CARE, Rwanda: 75% higher profit for enterprise trainees
Hand in Hand Country Manager Stephen Wambua was responsible for running our operation in Rwanda. He credits Hand in Hand’s dual-focus on hard and soft skills with the result.
“Yes, Hand in Hand teaches conventional business skills – our members would be lost without them,” says Stephen. “But our trainers’ capacity to inspire and motivate, along with mutual support among group members, is what makes our model work. It is, for lack of a better term, our ‘secret ingredient’.”
Hand in Hand will continue to seek out quality research to benchmark our programmes. And just as we always have, we’ll keep putting efficiency at the centre of our work.
Hand in Hand partners with German government in Afghanistan
Imagine if during the 2015-’16 migrant crisis some 50 million people, not 3 million, arrived on Europe’s shores, hungry and desperate for work. Now imagine if Europe was one of the poorest places on Earth, lacking even the most basic services required to keep up.
That, proportionately, is the problem facing Afghanistan, the world’s largest source of refugees for more than three decades, which today faces the inverse problem: the world’s largest returnee crisis, with some 2.5 million people expected back in the country this year and next.
Last month, Hand in Hand partnered with Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), the German government’s development agency, to help 500 such returnees and internally displaced persons work their way towards a prosperous, sustainable future in the country’s growing poultry value chain. The four-month project is, admittedly, a drop in the ocean. But by working with GIZ to tailor our programmes to the specific needs of returnees and IDPs, Hand in Hand is setting the stage for future work with this rapidly growing and chronically under-jobbed cohort.
By the numbers
Project budget: US $230,000
Jobs created: 500
Lives improved: 2,875
Insights from Participatory Evaluation Processes: Adapting to Local Demands
Your proposal was so scalable, it made USAID weep. Your logframe, so flawless it was exhibited at MoMA. Bono himself called to congratulate you on a “totally rockin’ independent baseline study”. But one year into program delivery, credit uptake is waning and dropout rates are creeping higher by the week.
What went wrong?
That’s the question new SEEP member Hand in Hand was forced to confront when two of our programs – one in Afghanistan, the other in Kenya – were threatened by similar issues. Despite more than 10 years’ experience training Savings Groups members how to launch their own microenterprises – resulting in more than 3 million new and improved jobs – we found ourselves humbled by an inescapable truth: nothing gets in the way of a masterfully designed program quite like reality. Adaptive management isn’t merely crucial to success – it’s necessary to survive.
This blog, and our session at the 2017 SEEP Annual Conference – ‘Insights from Participatory Evaluation Processes: Adapting to Local Demands’ on Tuesday, October 3 at 2:15pm – ponders a central element of adaptive management: feedback. In doing so, it posits a package of feedback mechanisms that can be (more or less) universally applied to produce useful learning, drawing on examples from the aforementioned cases, plus a third from VisionFund in Tanzania.
The learning that these mechanisms produced varied across contexts, but in each case the results were transformative, compelling Hand in Hand to redesign its theory of change and exit strategies in Afghanistan and Kenya respectively. Meanwhile in Tanzania, VisionFund applied a similar package of mechanisms during its pilot phase, and shares its experience of taking learning to scale.
The Big Five: Feedback Mechanisms for Useful Learning
Feedback is only as good as the sources that provide it. In order to obtain the fullest picture possible, our package of mechanisms draws on the following sources and methods:
Each of the following cases employed our package of mechanisms. All have been edited for brevity. For the full picture, please attend our session on October 3.
Case One: Hand in Hand, Afghanistan
Occasionally, sources of feedback are in perfect harmony. Such was the case for Hand in Hand Afghanistan, who administered an Enterprise Incubation Fund (EIF) to finance members’ microenterprises where other institutions wouldn’t. Increasing numbers of beneficiaries said they were loath to take loans in remote rural areas where the Taliban had identified credit programs as an opportunity to disrupt NGO activity, branding them as a Western imposition. M&E data showing reduced uptake confirmed their waning interest. Other NGOs had by and large abandoned cost-recovery models in favor of flat-out grants, rendering microfinance even more unattractive. Field staff reported difficulties in recovering loans (and in some cases received anonymous threats). And strategic information pointing to a resurgent Taliban provided scant hope Afghanistan’s credit environment would improve anytime soon.
With all sources of feedback pointing in the same direction – decisively away from our microfinance component – Hand in Hand closed the EIF, adopting productive asset transfer in its place. In the time since, we have distributed some 21,300 Enterprise Startup Toolkits containing all the necessary inputs to launch a business in nine accessible, high-margin sectors such as beekeeping and tailoring, designed to maintain the self-help ethos that lay behind the credit component. Feedback has again been unanimous – this time in our favor.
Case Two: Hand in Hand, Kenya
Things would not be so straightforward in Kenya, where Hand in Hand’s EIF faced the opposite problem: it was too popular. Prior to October 2016, we provided three cycles of subsidized microcredit to members. Not surprisingly, beneficiaries were happy to continue borrowing at slightly below-market rates. But field staff complained they were overworked – tied to old members by cycle after cycle of credit while juggling ambitious recruitment targets for new members. The M&E data agreed: recruitment was indeed slowing down. Strategic information meanwhile pointed to a robust ecosystem of local MFIs, suggesting credit was available from other institutions.
Staff and management met in September, 2016 and immediately embarked on a set of program reforms, reducing the number of loan cycles from three to one. A 27-month phase-out strategy was also agreed, whereby groups would receive nine months of intensive training, 12 months for the EIF credit cycle, and six months of support on market linkages for commodities and loans. Finally, it was agreed that after 27 months, we would help mobilise members into co-operatives known as Community-Based Organisations that would help them lend to each other and gain access to bigger markets and value chains.
Initial feedback suggests the changeover is working favorably.
Case Three: VisionFund, Tanzania
From October 2016 until August 2017, VisionFund Tanzania, World Vision Tanzania and private sector grower/exporter the Great African Food Company (GAFCo) partnered to run seven pilots in different regions of Tanzania with more 3,000 smallholder sunflower and kidney bean farmers. The goal was to improve these beneficiaries’ outputs and, ultimately, their livelihoods.
Involving technology, crop insurance, loan credit processes, payment to farmers, and beneficiary engagement and education, the pilot was highly complex, and field staff reported challenges testing so many combined elements in a variety of locations. But partners had identified both a need and an opportunity: GAFCo needed to generate and test volume and quality for its European buyers, and there was an opportunity to test the approach in parallel across regions.
A major review took place in July 2017, following a review process experiment in June. Senior management from the three partners met with beneficiaries and external stakeholders, including village elders and local and regional government, as part of a 10-day M&E trip visiting each of the pilot locations and engaging in detailed conversations. The process resulted in identifying improvements in beneficiary education, explaining better to village authorities the detail behind areas such as crop insurance, and generating buy-in from local officials.
The model has now been adapted for a wider rollout from October, with an ongoing monitoring of the engagement with beneficiaries and other stakeholders to test the scalability and acceptability of the updated model and improvements in client training.
Hand in Hand creates 3 millionth job
Fourteen years ago, Percy Barnevik and Dr Kalpana Sankar joined forces to expand a small charity in southern India that provided free schooling to children working in the local silk trade. It was called Hand in Hand.
They soon realised the real problem wasn’t a lack of schools; it was the desperation that forced parents to send their children to the factories in the first place. “We had to attack the root cause of the problem: poverty,” says Barnevik.
Fast-forward to today and that’s exactly what Hand in Hand has done, fighting poverty with business and skills training from Afghanistan to Zimbabwe and in eight countries in between. Today, we’re proud to announce a major milestone in our story: the creation of Hand in Hand’s 3 millionth job.
“Even when they’re undernourished, downtrodden and illiterate, Hand in Hand’s entrepreneurs have an enormous will,” says Barnevik, now Hand in Hand’s honorary chair. “When they get a chance they’re not letting it go by. These women can move mountains.”
Here’s to fourteen more years, millions more jobs and more moved mountains.
Hand in Hand must ‘prioritise income diversification’ in Tanzania: study
Hand in Hand’s programme in Tanzania will hinge on two key factors, according to a new report from Ipsos: changing the way people think about Self-Help Groups and helping our members diversify their incomes.
Published this month, the report surveyed 4,000 adults in Arusha and Kilimanjaro, providing Hand’s in Hand’s clearest picture yet of life in our target areas and establishing the baseline by which future progress will be measured. With the report finished, group mobilisation can begin later this year.
Our target districts
There is no shortage of districts in Tanzania that could benefit from Hand in Hand’s training. To begin with, we’re focusing on five: Ashura Rural and Meru in Aruha, and Moshi Rural, Hai and Rombo in Kilimanjaro. Besides their proximity to our headquarters in Kenya, the districts were chosen because each has a population density of at least 150 people per square kilometre, the minimum required to make our programme viable according to Ipsos.
More than half of Arushans (55 percent) and one-third of Kilimajarans (34 percent) live in poverty, according to the UNDP 2014 Human Development Report. Across our target districts, the estimated rural adult population living in poverty is 293,110. If Hand in Hand achieves our goal, a significant majority (68 percent) of impoverished adults in our target areas will see their lives transformed.
By the numbers
Rural adult population living in poverty in Hand in Hand’s target areas: 293,110
Number of jobs we aim to create: 200,000
Percentage of target rural poor with improved incomes: 68 percent
Before we can start to mobilise in earnest, we need to know everything we can about our future members. What are their livelihoods? How can we help them most effectively? What threats do they most consistently face? Only 9 percent of households surveyed by Ipsos earned their income solely from business – owning a shop, say, or transporting people and goods on motorcycles (known in Eastern Africa as boda boda). An additional 15 percent earned a portion of their income from business. The rest, 76 percent, relied entirely on farming to see them through, many at the subsistence level. It’s no surprise, then, that only 57 percent of respondents are putting money aside as savings. Perhaps more surprising was the degree of organisation among those surveyed: 34 percent of respondents already belong to Self-Help Groups. The groups exist chiefly to support members in times of trouble (46 percent) and occasionally as a source of microfinance (20 percent), and are registered with local government.
There are two seasons in northern Tanzania: rainy and dry. For the 91 percent of adults who rely on agriculture for some or all of their incomes, says Ipsos, the resulting boom-and-bust crop cycle means periods of relative abundance followed by periods of scarcity and hunger.
Making matters worse, ‘rainy’ and ‘dry’ can often mean ‘flooding’ and ‘drought’, and depressed incomes and food insecurity are perennial risks. In an environment where almost half of households (43 percent) regard saving as an impossibility, “fear and mistrust” of savings-driven Self-Help Groups are common, warns the report. Microfinance is considered even more dangerous and avoided for fears that climatic shocks will wipe out crops and livestock, leading to borrowers to default on their loans.
Only 5 percent of survey respondents who belonged to pre-existing groups said they were being supported by NGOs. To begin with, says the report, Hand in Hand should focus on the other 95 percent, filling gaps in skills training, the provision of microfinance and links to larger markets. Mobilising the ‘un-grouped’ – the 66 percent majority who worry they cannot save – will require a softer touch, says Ipsos. Here, initial efforts should focus on “community sensitisation… to change negative perceptions”, and “may require a pull factor, e.g. market linkages, to bring people together.” It will also require a programme that addresses climatic shocks head-on, reducing risk in order to incentivise savings and credit. This “can be achieved through Hand in Hand’s entrepreneurship training” in two ways, Ipsos concludes. For starters, early training modules should promote farming practices that mitigate the effects of climate change: irrigation, planting trees to reduce soil erosion and so on. Secondly, once groups are firmly established, training should “prioritise income diversification” and encourage members to launch businesses that generate income all year.Download the report
Hand in Hand speaks at World Bank
Washington, DC – The world’s poorest residents are doomed to stay that way until governments do more to nurture them as entrepreneurs. That was the message delivered by Hand in Hand Eastern Africa CEO Pauline Ngari to hundreds of MPs from dozens of countries at the World Bank last week.
Speaking to the Global Parliamentary Network, a group of policymakers who meet each year as part of the World Bank-IMF Spring Meetings, Pauline urged parliamentarians to:
- adopt accelerator programmes to help grow SMEs;
- put entrepreneurship studies front and centre in national curricula;
- foster relationships between microfinance institutions and training organisations.
Her session, ‘Fighting Inequality Through Job Creation & Growth’, also featured speakers from the World Bank, IMF and Peace Child International. It preceded a roundtable discussion featuring Christine Lagarde, Managing Director of the International Monetary Fund, and Jim Yong Kim, President of the World Bank.
“Delivering programmes is what we do – and advocacy helps us do it,” said Hand in Hand International Co-CEO Dorothea Arndt. “The World Bank is the perfect venue to share our message, establishing jobs and entrepreneurship as key planks in the development agenda. Thanks, Pauline, for sharing it so ably.”
Youth Job Creation
The conference also hosted the launch of the ‘Youth Job Creation Policy Primer – 4th Edition’, a document outlining the problem of youth unemployment and proposing solutions for policymakers. Hand in Hand figured centrally, not least for our Entrepreneurship Clubs and four-step ‘systems approach’ to job creation. Several case studies featuring our members were also featured.
Click here to visit the policy primer website.