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I]. 1. ..’]1.1h.]..-llllll- .31 g . .. 1.101.];1 ]a-' In] I]. . . . .. 1] 1511.1 . 1]-.. OJIlIIl. - |.11.l.lh] "Ioublllgfi . ] .v..i.\44.l.n .1 .vnl] voll- - ]- 11 (.0]]]] lo].]. 1.11”. 1|]: (“1] Ov'ull 1]] ]]l] . . .H..o.h..1..11:.1.5....r..,...,n....“.hno....u..np...r]14...1.].1..§?l]ul .]].I|I.|'.1| ] 1 .....0) 9'1"“ Fr. ("J M‘W‘WWEHQ‘Wilt!“ LIBRARY Mlchlgan State Unlverslty This is to certify that the thesis entitled AGRICULTURAL INVES'I‘MEN'I‘ DECISICNS BY HJRAL HOUSEHOIDS: WHAT ROLE DOES MICRD_CREDIT PLAY? presented by JENNIFER S. BURI‘ has been accepted towards fulfillment of the requirements for MASTER OF SCIENCE degree inAGRICIJL'IURAL AND EXTENSION EIIJCATICN Major professor Date IZ/If/qY 0-7639 MS U is an Affirmative Action/Equal Opportunity Institution PLACE IN RETURN BOX to remove this checkout from your record. TO AVOID FINES return on or before date due. MAY BE RECALLED with earlier due date if requested. DATE DUE DATE DUE DATE DUE JAM 5 m. 1M www.mu AGRICULTURAL INVESTMENT DECISIONS BY RURAL HOUSEHOLDS: WHAT ROLE DOES MICRO-CREDIT PLAY? A CASE STUDY FROM SOUTH-CENTRAL NIGER By Jennifer S. Burt A THESIS Submitted to Michigan State University in partial fulfillment of the requirements for the degree of MASTER OF SCIENCE Department of Agricultural and Extension Education 1997 ABSTRACT AGRICULTURAL INVESTMENT DECISIONS BY RURAL HOUSEHOLDS: WHAT ROLE DOES MICRO-CREDIT PLAY? A CASE STUDY FROM SOUTH-CENTRAL NIGER By Jennifer S. Burt Farmers in Niger, West Africa consider many different variables prior to investing in their farming system. Both environmental as well as human factors affect a resource poor farmer’s decision making process. As it is difficult to control for environmental factors when looking at a farmer’s decision-making process, this research attempts to examine a human factor, access to credit and the impact of micro-credit on a farmer’s investment decisions. This research posits that Nigerien farmers must be first insured of their basic livelihood, such as access to food and shelter, before making capital or labor intensive agricultural investments in the farming system Sixty-five farmers were interviewed in south-central Niger about uses of their farm and non-farm income and the impact of micro-credit on their investment decisions. Borrowers of a rural bank called BRK (Bankin Raya Karkara) and non-borrowers were interviewed, and visits were made to eleven farmer’s fields. Three research methods were used during a two month period to gain insight into Nigerien farmer’s agricultural investment decisions: survey interviews with farmers; semi-structured interviews with key informants; and participant observation. The findings indicated that there was a slightly higher percentage of farmers who received credit investing in capital intensive agricultural technologies than those farmers who did not receive credit. The non-borrower farmers in the research were more likely to practice labor intensive, sustainable agricultural technologies. ACKNOWLEDGMENTS To undertake original research requires a team of people. First and foremost, the sixty-five Nigerien farmers are to be lauded for their patience and understanding in speaking with me in my broken Hausa during the course of the research. Their dignity, pride, and consideration for their families and neighbors are an inspiration to me. Without the assistance of the CARE International Staff in the Maradi office, especially Cherbou Samna, Rekia Abdu, Pascal Marino, and Hainikoye, I would not have been able to accomplish half of what I did in such a Short period of time. My committee chairperson, Dr. Murari Suvedi must be commended and thanked for his persistent support with both my thesis and assistantship. The other committee members, Drs. George Axinn and S. Joseph Levine also deserve an acknowledgment for their practical and scholarly insight into my research topic. Apart from my committee members, I would like to give my most heartful gratitude to those people who stuck with me, day in and day out: my family, Charles, Laura, Kristen, and Elizabeth Burt; and my close friends at Michigan State University, John U. Davis, Beth Dunford, Kimberly York, Christoffel denBiggelaar and Cary Trexler. TABLE OF CONTENTS LIST OF TABLES LIST OF FIGURES LIST OF ABBREVIATIONS 1. INTRODUCTION TO THE RESEARCH Introduction to research Agra-economic environment of Niger, West Afiica CARE International and BRK, Maradi, Niger Importance of the research Statement of problem Research hypothesis and questions Operational definition of terms Assumptions of the study 2. REVIEW OF RELATED LITERATURE Introduction Non-farm and farm linkages and household food security A system’s approach Physical context Policy and economic contexts Social context Micro-credit’s role in non-farm/farm linkages Theoretical framework 3. METHODOLOGY Description and selection of research site: Maradi, Niger BRK in the Maradi department Data collection strategies Rapid appraisal Pro-testing procedures Sampling issues iv E: 15 17 18 20 21 24 26 30 31 34 35 36 Data gathering procedures Interview schedule with farmers 39 Participant observation 40 Semi-structured interviews with key informants 41 Archival research 42 Timetable of research activities 43 Data analysis procedures 44 Limitations of study 45 4. FINDINGS AND DISCUSSION Introduction 46 Description of respondents 47 Farm revenue and the household 49 Non-farm revenue from and for the household 55 Credit obtained from BRK: Amount, Utilities, and Results 60 Inferential statistics: Responses to research questions Research question #1 63 Research question #2 67 Research question #3 69 5. SUMMARY, CONCLUSIONS, and RECOMMENDATIONS Summary 71 Conclusions 74 Recommendations Administration of BRK 76 Other micro-finance institutions 79 Researchers studying the impacts of micro-credit 81 APPENDICES 83 LIST OF REFERENCES 119 LIST OF TABLES Table 1 -Use of farm revenue in the rural, family household (N = 53) Table 2 -Number of animals in the household between men and women Table 3 -Activities indicated by respondents for the non-farm activity (N = 59) Table 4 -Number of markets attended per week (N = 59) Table 5 -Uses of non-farm income in the rural, family household Table 6 -Use of BRK loans (N = 50) Table 7 -Adoption of agricultural improved practices by respondents Table 8 -Use of animal traction by borrower and non-borrower of the BRK Table 9 -Number of goats and Sheep by borrower and non-borrowers Table 10 -Number and size of land holdings by borrowers vs. non-borrowers Table 11 -Past and Present of the BRK 52 54 56 57 59 61 65 67 68 104 LIST OF FIGURES Figure 1 -Effects of credit in household system Figure 2 -Factors affecting household decision-making in farming system investments Figure 3 -Map of Niger Figure 4 -Number of wives per respondent Figure 5 -Seasons when farmers sell harvest 28 33 48 51 LIST OF ABBREVIATIONS BRK Bankin Raya Karkara NGO Non-Governmental Organization SPSS PC+ Statistical Package for Social Sciences Chapter1 INTRODUCTION TO THE RESEARCH The world's population employs diverse Strategies to obtain food. For people in more industrialized countries, food entitlement usually translates into using one’s salary to purchase food at the grocery store. But for the majority of the world's population, farming istheprimarymeanstoobtainfood,andwhenfarmingfails,averylargeshareofthe household income is used to purchase food. As agriculture still plays a largely subsistence and sometimes precarious role in many Sub-Saharan African countries, it becomes imperative to manage agricultural land correctly in order to ensure adequate production to feed a growing population. As agricultural land in Niger is subject to severe droughts and degradation, frequently causing food deficits, it is an appropriate site in which to examine the many attempts to ameliorate the lives of the rural poor. Some attempts have shifted focus away from the agricultural sector to the non-farm one in hopes of providing innovative solutions to people who have exhausted environmental resources. Although much attention has been paid to the physical causes of food Shortages, it is appropriate, nonetheless, to examine the root causes of decreased soil fertility in the context of the availability of alternatives for poor people to obtain food (i.e. purchase of food with a non-farm income source). The question then becomes, do people who have more alternatives to food entitlement, manage their land more sustainably? One solution to decreases in agricultural production is the introduction of improved farming technologies with the objective of enabling farmers to manage their land 2 sustainably. The success of an improved agricultural practice to increase farm revenues is dependent on the implementation of that technology by the population. In Niger, non- governmental organizations (N 608) and extension services have introduced a number of sustainable farming practices‘ to remedy decreases in agricultural production, but implementation rates have been low (Mariko 1991). Low rates have, in the past, been attributed to ignorance on the part of the farmer, but most recent scholarship on this issue has identified other impediments such as labor shortages, inappropriateness of technology, the binder) of poverty, risk aversion, and short-term perspectives of subsistence farmers (e.g., Stonehouse and Protz 1993). An alternative solution to combat low agricultural production is the introduction of micro-credit programs to assist in raising household incomes and disposable income to purchase agricultural inputs and sometimes in poor, agricultural years to purchase food as well. Hailu (1990) and Garba (1991) identified capital constraints as an additional major reason for low implementation of improved farming technologies in Niger. When capital is lacking, investment in agricultural inputs will be minimal and farmers will not risk implementing a new technology. Capital constraints have been alleviated in other parts of Sub-Saharan Africa through the introduction of micro-finance2 programs for non-farm enterprises3 (Reardon et al. 1995). Reardon et a1. (1995) posit that credit programs assisting non-farm enterprises can contribute indirectly to investment in the farming system. As the overall food security of the household is more secure, the farmer is more willing to take a risk to invest in an innovative farming practice. In order to examine investment in the farming system effectively, it is essential to take into account all the components of that system, both farm 1Sustainability in this sense refers to farming practices that manage the land for long-term use, for example, soil and water conservation techniques such as zai holes, rock bunds, windbreaks, trees planted in field, and various indigenous techniques. 2For the purposes of the research, the focus of micro-credit will be in the rural, non-farm sector, but there aremanyinitiativestakingplaceintheurbanareasandthefarmsector. 3A non-farm enterprise in this case is defined as an income generating activity implemented by a farmer to supplanent hitt/her income. Some non-farm enterprises are food processing, crafts, and commerce (Hopkins et a1. 1994). 3 components which includes agricultural production and animal husbandry and non-farm components which includes social as well as economic activities. In doing so, the amount of resource recycling taking place within that system becomes apparent. The lack of outside inputs into the household livelihood strategy is diminished as the recycling ratio increases.‘ If the recycling ratio is high which is usually the case in poor, rural households, credit may have a dual effect. On the one hand, credit may make a significant impact on the system by providing scarce working capital for important non- farm or farm investments. On the other hand, credit may disrupt the delicate balance of resources which exist in the farming household by causing the household to incur debt which they may struggle to repay by selling off their assets. These two dichotomous issues are examined in this research. Support for non-farm enterprises through micro-credit programs has been shown in some studies to contribute to increasing income hence decreasing both poverty and aversion to risk (Sebstad et al. 1996). Figure 1 illustrates the exchange between the non- farm, farm, and social sectors (i.e. community networks and social, solidarity groups) and the possrble effects of credit within that system ‘TherecyclingratioisaconceptdevelopedbyAxinnandAxinninwhich they identifiedtheamountof exogenous verses endogenous resources in a farm household. The higher the recycling ratio, the lesser the amount of exogenous inputs were coming into the system. Household Profit Debt Figure 1 - Effects of credit in household livelihood There exists a complex interaction in a poor, rural household between the farm and non-farm income, and the social obligations which exist within and outside the household. Credit plays a crucial role within this system, and although micro-credit programs may target a non-farm income, a farmer will diversify the utility of that credit in order to maximize the potential profits (profits could mean in this sense social, economic and financial) from that loan. It is impossible to control for fungibility of micro-credit programs. Microocredit programs, both formal and informal, have sometimes contributed to rural incomes by providing working capital for small, non-farm enterprises (Ashe et a]. 1992). There have been many successes and many failures of micro-credit programs. There are several determinants to a successful micro-credit program. Some of these vary from the capacity of the clients to repay the loan to the level of corruption which exists within the system. These programs have taken on many different forms with several different actors. In some cases, the credit is distributed through a financial intermediary, such as a non-governmental organization and seeks funding from donor agencies. Other 5 micro-credit programs are autonomous from an NGO, receive Start-up capital from an international donor agency, and eventually become financially independent, surviving on income earned from loan reimbursement (i.e. Banco del Sol). This research investigates how the farm family household uses micro-credit and its directaswellasindirectimpactsonthe farming system. Pastresearchhasexaminedthe role of increased income in overall household security including health and education, but very little on the investment in the farming system. The association between access to credit and overall household livelihood security, more specifically agricultural investments is examined throughout this research. The study determines the effect of micro-credit and non-farm enterprises on farm household incomes and subsequent investments in new technologies to improve agricultural soil and increase yields. This research posits that the economic and social well being of the farm household must be examined prior to the introduction of a new agricultural technology. This thesis is divided into five chapters. In the remainder of this chapter, backgrounds on the agro-climatic environment of Niger and CARE International’s supported micro-credit institution, BRK, set the scene for the presentation of a problem statement, statement of the importance of the research, and a statement of the research hypotheses and questions. Secondly, pertinent literature establishes the theoretical basis for the research, focusing in particular on previous investigations of the causes of decreased household livelihood security, more specifically agricultural production and micro-credit’s role in ensuring this security. Particular attention will be given to farm/non-farm linkages in the household livelihood strategies. The thesis continues with the third chapter and a description of how these questions are answered through sampling, data gathering procedures and other methodological concerns. The fourth chapter presents the findings from the recently conducted research with special emphasis on the impact of credit on household livelihood and non-farm/farm linkages. The thesis concludes with a summary of findings and recommendations for 6 future research on this topic as well as recommendations for firture micro-credit institutions. Agra-economic onvlronrmnt of Niger, West Africa Niger is a land-locked country located in the Sahelian zone of West Africa. The country covers 1,267,000 square kilometers of which seventy-five percent is the Sahara desert and twenty-five percent has a semi-arid climate with annual rainfall ranging anywhere between 250-450 mm (Garba 1991). Eighty percent of the approximately nine million inhabitants reside in the rural areas, where they rely on agricultural production and non-farm enterprise for the livelihood of their household (Mead et al. 1990). Farmers in Niger cultivate mainly subsistence, rainfed crops such as millet and sorghum, and also cultivate cash crops during the rainy season such as peanuts, cotton, or cowpeas (Niger Applied Agricultural Research Project 1992). Nigerians are primarily smallholder farmers, practicing shifting agriculture where it is still possible. Although it seems as if Niger is a large country geographically, the amount of arable land has been compared to the amount of arable land in Bangladesh. Even though it seems to be a large country with low population, it is actually a country with a small amount of livable land with a high population density. With a per capita GNP of 270 US dollars (World Bank 1995), agriculture is the primary engine of growth for Niger’s economy with non-farm activities such as small- scale enterprises also playing a major role (Mead et al. 1990; Haggblade et a1. 1989). The majority of economic activity, both agricultural and nonagricultural, takes place in the rural areas where most of the population resides. There are several multiplier effects between the non-farm and farm sectors. Much research has examined the expenditm'e linkages of increased agriculture production on the non-farm sector (e.g., Haggblade er al. 1989; Delgado et al. 1994; Liedholm et al. 1994), but much less research has focused on the 7 increased investment in agriculture as a result of increased income in the non-farm sector (e.g., Reardon er al. 1994). Niger is quite diverse culturally. The predominant religion is Islam with the primary ethnic groups being Hausa, Djerma, Fulani, and Tuareg. The Hausa people are formd in the central eastern region of the country and are the predominant ethnic group. Niger is bordered to the South by resource rich Nigeria. There is a high volume of trade between these two countries due to the highly developed infrastructure of roads, unlike the northern boundaries with Algeria and Libya. In the drought-prone areas of Niger, where capital is limited, micro-credit can provide invaluable working capital to jump-start a non-farm activity, contribute to an already existing non-farm enterprise, or more basically and more often the case, provide a buffer between famine and survival. Micro-credit can provide much needed capital for a flowering business, to buy food, or to invest in the farming system. It must also be noted that micro-credit is debt, and savings should be encouraged by the lending, micro-credit institutions to curb that debt.5 Access to micro-credit can provide essenu'al capital to nurture a growing business, but often micro—credit from commercial banks is not accessible to farmers. Micro-credit institutions such as Bankin Raya Karakara (BRK), which was created by CARE International in 1989, can play a key role in providing rural people with small loans for their non-farm business,and providing that often needed capital to keep a rural family household food security intact. CARE International 816 BRK, Maradi, Niger CARE International began operations in Niger in 1973 with food distribution programs. Their work in Maradi in south-central Niger comprises numerous projects, one of which is the Maradi Small Enterprise Development Project, which "works to develop ’Personal communication from Jennifer Isern on August 22, 1997, employee at the World Bank in the CGAP unit (Collaborative Group Assisting the Poorest) 8 the economy of rural areas throughout Maradi department with the goal of improving the quality of life for the rural poor. Rural credit systems and technical training are some of the tools used in this project" (www.CARE. org). Like the Grameen Bank in Bangladesh‘, CARE International created a micro-credit institution called BRK (an acronym in the local language meaning local, rural bank), which, in principle focuses on lending to the poorest of the poor through organized peer groups. A lending agent from BRK works in a specific region where interviews are conducted with potential borrowers. Once the lending agent deems a group of individuals to be creditworthy and has checked their credentials at BRK’S central office in Maradi, the loan processing commences. The assurance of loan repayment is increased as a result of group lending. There is mutual guarantee of loan repayment witlnin the self selected peer group. This form of lending also decreases some of the transaction costs for the BRK. Loans granted by the BRK are often times targeted to an individual’s non-farm enterprise, but ultimately the lending agent has very little control over how the money is spent so some may go to farming. The agent wants to be assured that the loan will be repaid according to the reimbursement schedule. This project does not earmark their credit for agricultural purposes as it has proven in the past to be quite risky as Niger is susceptible to periodic droughts. This micro-credit from the BRK is fairly short-term, with a repayment period of ten months or less with an interest rate of 18% per annum. These short term loans allow for a high turnover of loan portfolios. The largest percentage of the borrowers are found in the rural areas. Micro-credit can indirectly contribute to the overall household livelihood security by providing, in some instances, a source of capital to rural farrrners so that they can practice an income generating activity apart fi'om farrrning during the nine dry months of the year. 6'IheGrarrneenBank.oneofthe firstgroup,micro-creditlendingprojects wasfomndedalmost20yearsago by Dr. Mohammed Yunus. Mostly targeted to poor rural women, The Grarneen Bank boasts a 98 percent reimbursement rate and lends over 400 million dollars annually. Importance of the research Many approaches have been used to encourage farmer's implementation of new farming technologies, but very few have been successful. If the government of Niger or NGOs like CARE International want to ensure adequate food production by encouraging farmers to implement farming technologies, micro-credit may be an indirect answer to this end. This research isolates access to credit when examining the implementation of improved farming technologies by comparing those farmers who have received a loan fi'om BRK for their non-farm income witln those who have not. BRK will gain evidence of the length of the loan’s impact on their recipients. The government of Niger, especially the Mirnistries of Environment and Agriculture, will discover whether there is an indirect role of micro-credit on a farmer's long-term investments in his/her land management. If, for example, there is a sigrnificant difference in farmers who receive credit and their adoption of improved farming practices and farmers who do not receive credit, we can hypothesize that perhaps credit has a role to play in lowering a farmer's aversion to risk and raising that farmer's willingness to adopt an improved farming technology. Problem dominant The present research evaluates the role of micro-credit and its link to overall household livelihood security, more specifically agricultural production. Resource poor farmers are only capable of making agricultural farming investments if their household livelihood is secured. Credit can play that role of securing houselnold livelihood and increase agricultural investments. Poor management of natural resources, particularly soils, has been shown to stem from the persistence of poverty. Micro-credit has been proven to provide a wedge in that poverty by offering alterrnatives to resource poor farmers. 10 This research attempts to address the decision-making process of these resource poor farmers in dealing with problems of poverty in Niger and the role of credit that process. In order to ensure sufficient agricultural production, the management of the farming system is analyzed. New strategies to educate and encourage farmers to implement more improved farming practices will be adopted only if farmers, themselves, are ensured of their household livelihood. A variety of approaches have been used to encourage farmers to implement improved agricultural teclmologies, but many have failed 'lmproved agricultural technologies for the purposes of the research is defined as long-term, sustainable investments in a farmer's field (e.g. planting trees, implementing soil conservation tech). International and domestic research institutes have researched new technologies, NGOs and extension agents have implemented innovative communication strategies, and government policies have been adopted to encourage agricultural production. Despite these efforts, adoption rates by farmers have been low. Farmers in Niger must first be guaranteed their basic livelihood necessities (e.g., food, shelter, and health) before they are willing to take dne risk of adopting a new technology. Micro-credit which encourages increased revenue from non-farm activities and savings has a key role to play in ensuring household security, more specifically food entitlement in the rural areas of Niger. Research hypothesis and questions Food security cannot be examined in isolation by researching only agricultural practices, but as Blakie and Brookfield (1987) argue, poor agricultural practices alone do not cause land degradation, leading to poor agricultnual production. Ratlner it is a complex convergence of endemic political, social, and economic policies contributing to lack of incentives for farmers to experiment with new technologies. The farmer must be willing 11 totakeariskinordertoexperiment witlnanewtechnology. Thatriskwill onlybetaken if the Nigerien farmer is assured of a sufficient amount of food and income irn which to nourish his/her family. In order to assure sufficient amount of food and income, farmers often diversify their income. Micro-credit can assist in facilitating this income diversification by financirng a non-farm enterprise (Reardon et al. 1994). This research hypotheses that as a farmer’s non-farm income increases from the introduction of micro-credit arnd household income becomes more diversified, the farmer’s aversion to risk has the potential to decrease and adoption of improved farming practices possibly increasing. This research examines farming practices of those individuals who have received micro-credit through BRK , CARE Intemational's micro—credit project and those who have not, and determine whetlner tlnere is a difference in their innovative farming behavior. The purpose of this study is to assess the role of micro-credit in farm household security, namely food entitlement and the implementation of improved farming practices. Three research questions to be answered with the data: Are tlnere differences In the marnner by which those who receive micro-credit invest in their farming system and those who do not receive micro-credit? If so, what are they? ° As a farmer's income increases, does the willingrness to invest in the farmirng system increase? 0 What is the effect of increased investment in the farming system on the sustainability of the environmental resources (i.e. land and soil)? Operational definition of terms In order to fully appreciate the information presented, it is imperative to define some key concepts arnd provide operational definitions which are refened to frequently tlnroughout the paper. 12 MIcro-credh Institutlons: Micro-credit institutions offer a variety of services, but some of the most common are described in a recent IFAD publication. They write, “Advances irn financial intermediation and infrastrucmre, stimulated by deregulation of financial sectors and facilitated by modern technology, have also put the spotlight on participatory mecharnisms for integrating the poor into the economic mainstream. The advances in financial irntemdiation include recent efforts to design and deliver very small loans to poor borrowers, often women organized into small groups, providing more accessible deposit facilities, and much greater attentiorn to risk management” (p. 9). CARE’S BRK project does not yet offer deposit facilities for savings, but they do attempt to target the poorest segnent of the population which is often the women irn rural Non-fam Income: A non-farm income for the purposes of this research is defined as income earned by a farm household which is not earned from the farm itself. Delgado et al. (1997) defines non-farm income as the following, “off-farm activity of a farm household, including food processing for sale, are labeled as non-farm” (p. 1168). Reardon (1997) defines the sources of non-farm income as “income from local non-farm wage employment, local non-farm self-employment and migration income” (p. 737). Farm Income: Farm income is earned from the sale of agicultural production which includes botln crops, agicultural by-products (i.e. cowpeas shells), and animals. Delgado again illuminates this definition by writing, “Farm refers to agicultural items in the condition that 13 they leave the field” (p. 1168 ). Reardon (1997) writes, “Farm income is cash and in-kind income from cropping and livestock husbandry” (p. 73 7). The household: Preston (1992) defines household as the following: “Households are commonly defined as comprising those living arnd eating together arnd include other people, not biologically related, who are part of the sharing unit: this therefore excludes family members who live elsewhere” (p.l). He continues by writing that the household is “the main orgarnizational unit within the domestic mode of production” (p. 2). W of the sandy: To distinguish how a Nigerien farmer manages household expenses and more specifically investment in the farming system, requires examirning a very large number of variables. This research attempted to control for access to credit for the non-farm enterprise while examining investment in improved agicultural technologies. Some of the assumptions of this research are listed below. Non-farm Income and Farm marnagommt assunnptions 1. As a farmer‘s wealth increases, aversion to risk is decreased and the implementation of new farmirng technologies increases. 2. As more labor becomes available in the rural areas during the off-season with the access to micro-credit to start-up a small enterprise, more labor-usingI technologies are implemented. ’Vernon and Ruttan classified various agricultural technologies as either labor using or labor saving where labor using means a more labor intensive activity. 14 Increased income leads to more purchasirng power which, in turn, leads to investment in agicultural inputs arnd more intensive farming practices. Implementation of improved agicultural land management will increase agicultural yields over time arnd eventually, decrease land degradation as a result of larnd intensification Chapterz REVIEW OF RELATED LITERATURE Introduction This thesis attempts to take a holistic approach in examining household food security by describing the social, economic, physical, and political aspects. This chapter cites previous research which has dealt with this issue from a more holistic perspective as well as the recent literatm'e on the impact of micro-credit on this security. Following the review of literature, the theoretical framework is described using a model adapted from Anoskie and Coughenour (1990). In examining household livelihood strategies in Sub-Saharan Africa, more specifically Niger, there are several differing viewpoints taken by previous research. Some of the literature has focused on food entitlement, health care and educational initiatives as related to long-term household security, and access to capital for small business development, to name a few. It would be limiting to simply consider any one of these factors in isolation when developing strategies for overall household food security. A farmer or any human being for that matter, is concerned about where their food is coming from, where their family can receive proper health care, and the educational needs of their offspring. Although this is the most logical and realistic way to examine food security, it is beyond the scope of this thesis. To examine food entitlement as one aspect of household livelihood already can provide an insight into the management of the farming system and allocation of income in the rural, farm household to obtain food As most people in Niger are subsistent farmers, strategies to increase agricultural production is one of the most logical steps to improve their access to food. If new 15 l6 technologies can sometimes prove to increase agricultural production, the determinants to adoption by a farmer must also be examined. The issue of technology adoption cannot be considered from merely an economic perspective but must be considered fi'om social, political and physical perspectives as well. Literatm'e concerning determinants to adoption of agricultural practices in Afiica alone is voluminous. Previous researchers have identified several determinants which include: opportunity costs for farmers; land tenure security; price stabilization; institutional development ; information systems; and ecological factors (Sanders er al. 1996; Keck et al. 1994; Clay er al. 1994; Anosike and Coughenour 1990). Other studies have noted the absence of capital as a major impediment to adoption (Hailu 1990) as well as government policies favoring cheap food prices for urban consumers and lack of access to favorable markets. A model developed by Anosike and Coughenour (1990) illustrates the infinite number of factors a farmer considers while making a decision in his/her household income and management of the farming system. An adapted version of this model is found in the section named theoretical framework. To begin this review of literature, both the farm and non-farm activities in a rural Sub-Saharan African household are examined. As economic activities become more diversified it is necessary to consider both the non-farm and farm incomes when examining household livelihood, more specifically agricultural production. Campbell (1990) writes, “economic diversity ofien extends beyond the realm of primary agricultm'e production into off-farm activity that provide additional resources that can off-set the effects of recurrent food shortages” (p. 148). The physical context, in the review of literature, illuminates the causes of decreased agricultural production which provides a clearer idea of why adoption of improved technologies plays a key role in ensuring adequate agricultural production. Agricultural production or the farm income is seen as one element to the household livelihood strategy. 17 A description of policy and economic perspectives follows to describe why a farmer may or may not decide to change or alter his/her farming practices. Exogenous variables which may seem to lie outside of the farmer’s day to day life actually have a real effect on a farmer’s decisions in the agricultural production system. The importance of the social context is later described to expand upon the agronomic, policy, and economic perspectives. In doing so, the roles of gender, religion, and ethnicity illuminate the importance of the social context in the domain of developing household livelihood strategies. Finally, literature concerning micro-credit’s role in the linkages between non-farm and farm activities demonstrates how income earned from a credit supported non-farm activity may contribute to the farm enterprise. If micro-credit contributes to raising household security and the non-farm income, the question then becomes does the readiness of adopting a new technology also increase? Non-fannandfarmflnkagasandhousahotdfoodsacurtty A System’s Approach Recent scholarship has taken a holistic approach in defining household livelihood security as related to agricultural production ratha than simply an agronomic or economic one (Tiffen er al. 1994, and Abel et al. 1987 in Dahlberg 1994; and Campbell 1990). These studies have combined the efforts of social and agricultural scientists to examine the issue of decreased agricultural production from cultural, political, physical, and economic perspectives by considering both the farm and non-farm aspects in a nual household. In doing so, it becomes apparent that a rural person’s farm management decisions are rational given his/her economic, political, physical, and social circumstances. If an aspect of the management system changes (e.g., access to micro-credit), agricultural production in the 18 household could change. Both the farm and non-farm incomes have roles to play in household livelihood, more specifically access to food. Just as the farmer considers all perspectives in food production, research focuses on all aspects within this system. As Campbell (1990) writes, “A remarkable feature of rural communities in Afiica is the variety of resources they may employ to off-set the impact of recurrent food deficits. These resources are based on social interaction, economic stratification and krnowledge of the physical environment” (p. 150). Diversification of household incomes is a well-known risk reduction strategy in many parts of Sub-Saharan Africa. Anosike and Coughenour (1990) write, “Divesification can be studied from a decision making point of view because the selection of a ce'tain combination of enterprises over others involves decisions which are inevitably rooted in social, cultural and economic factors” (p. 1). By examining a farmer’s agricultural investment decisions from a systems approach, it becomes evident that thee are several considerations one must take into account when developing interventions. If the issue of agricultural investment is taken from only one perspective, proposed interventions would most likely be inappropriate. Physical context In many parts of Sub-Saharan Afi'ica, household livelihood is often dependent on agriculttn'e. If thee is a poor agriculture year in Niger, for example, people will liquidate assets to buy food. Low agricultural production is still equated with high household insecurity. Previous studies noted that soil erosion along with lack of rainfall are the main physical causes of decreased agricultmal production in Sub-Saharan Africa (Stahl 1993; Napier and Somners 1993). Soil erosion threatens millions of hectares of land in developed arnd developing countries alike (Shaxson et al. 1989). As soil is eroded, fertility decreases and agricultural 19 production declines. Sandes (1996) writes, “The principal constraints to agricultural development in the Sahel and in other semiarid regions of Sub-Saharan Africa are soil fertility and wate' availability" (p. 2). Although soil erosion has long been cited as one of the main contributing, physical factors to low agricultural production, it must be noted that many of the techniques or ”solutions" aimed at combating erosion have not been adopted by farmers (Ashby et al. 1996). In unfavorable agroclimatic zones such as Niger, a farmer employs a variety of strategies to ensure food security. Some of these strategies may be to diversify income to purchase food while other strategies include the adoption of agricultural technologies to increase production. Reardon (1997) argues irn favor of income diversification as a means to ensure this household food security. He writes, “Households in the unfavorable agroclimatic zones need to diversify labor supply outside of the zone to manage crop income risk or to cope with crop income shocks” (P. 741). The risk of agricultural technology adoption can sometimes be too high for most farmers as they must be first insured of adequate agricultural production or access to food. McCorkle (1994) would argue that farmers are more readily to adopt a technology which is a combination of endogenous and exogenous innovations - a synergetic irnrnovation. She continues by outlining steps in which a farmer must take in order to adopt a new technology. These are the following: The farmer first gathers background information from other farmers. With this new information, the farmer then conducts field or trial tests. The farmer then tries to control for major variables. Finally the farmer monitors arnd evaluates the practice to assist irn deciding if he would like to adopt it as part of his farming system. 99!"? Campbell (1990) concurs with McCorkle, but recognizes that farmers for years have already been implementing coping strategies in their farming system. He writes, “in 20 West Africa, farmers plant drought-tolerant millets on well-drained sandy hill soils whereas sorghums, which can withstand water-logging, are the major grain crop in the wetlands” (Campbell 1977, p. 150). As the physical context is important to understanding low agricultural production, it is also imperative to comprehend this environment within the policy, economic, and social contexts of the region under question. Policy and Economic Contexts Soil eosion and decreasing soil fetility contributing to low agricultural production cannot be examined in isolation by looking at simply a physical conth as it is rooted in several human processes (Blakie and Brookfield 1987; Campbell 1990). Some of these human processes are: high population growth rates; poverty, unfavorable terms of trade; poor government policies towards farmes; exparnsion of agricultural land; land tenure insecurities; and lack of access to credit (Stahl 1993; Laing and Ashby 1993; Hudson 1993; and Douglas 1993). Much research has demornstrated that if there were structural changes made in tems of trade and capital flows then thee would be changes in the management of the farming system at each individual farmer level (Dahlberg 1994; Campbell 1990). External factors affecting management of the farm household are many which include prices, policies, technology, institutions, and community assets. (Reardon and Vosti 1995) Blaikie and Brookfield (1987) argue that the causes of soil erosion and low agricultnual production are intricately linked in a dynamic systen of human-environment interactions. Land tenure insectuities and lack of access to capital are two specific examples of human processes causing poor management of agricultural land for Nigerien farmers which, irn turn, leads to low agricultural production. These considerations are incorporated by examining lack of access to capital both for farm and non-farm sources arnd its effect on agricultural investment. Previous studies have closely researched the effects of increased income from agriculture on non-farm enterprises, but rarely the reverse 21 (Delgado er al. 1994; Liedlnolm er al. 1994), the effect of increased non-farm income on agricultural investment. Land tenure insecurities wee not closely examined, but it is evident that land is becoming more and more scarce in Niger.’ During the time of Seyni Kountche (President from 1974-1987), farmers could claim agricultural land by farming it continuously for more than two years. Kountché wanted to prevent large land owners fi'om leaving their land fallow for years on end, causing food deficits among the smaller landlnolding farmers.9 Consequently, many farmes were enconuaged to claim new land so as not to be lefi landless. It is a well known fact that the poorer an individual is, the more diversified his/her income will become (Anosike and Coughenour 1990). In regions of high food shortages, such as Niger, this divesification serves as a sort of safety net in extremely bad agricultural years. Campbell (1990) writes, “The most significant characteristic of the economy [in seni-arid parts of Africa] include: diversified subsistence production and market activity; a propensity to accumulate food and othe' assets in good years; to be liquidated in poor ones; and involvement in local and sometimes regional trade, which reduces dependence upon purely local resources” (p. 147). The importance ofthe social networks created both in the rmrkets and the communities is also an important coping strategy and reduces risk for the rural farm household in Nige. This is examined in the next section of the literature review. Soda contend It is also imperative to include the social context in order to illuminate some of the circumstances irn which people operate in order to obtain food, either by growing, buying, or trading. Characteristics implicit in this arena are the issues of ethnic group, religion, and ' Peaonal communication during a key informant interview with Tony Rinauldo, September 2, 1997 in Maradi. Niger. ’Pesonal communication from Tony Rinauldo, SIMS, Maradi, Niger. 22 gender, to name a few. These characteistics of individuals within a household arnd a community all play a role in managing how individuals allocate or delegate responsibility for difi‘eent aspects of household livelihood security, more specifically agricultural production. In examining the household and the community in the context of the importance of ‘ social relations, language or Hausa plays a significant role in social relationships and solidarity. Weber (19 writes, “Community of language, which arises from a similarity of traditiorn flnrough the family arnd the surrounding social environment, facilitates mutual urndestarnding and thus the formation of all types of social relationships, in the highest degree” (p. 138). The Hausa people, urnited by language arnd a long-standing tradition of trading and commerce depend on a complex set of social interactions for their household livelihood security. The social obligations witlnin the Hausa culture (i.e. baptisms and weddings) require people, especially women to manage their household resources carefirlly in order to not fall out of favor with other menbe's irn their communities. This characteistic of social obligation is a form of risk management and is not unique to the Hausa culture. As Campbell (1990) writes, “Help given at one time may represent repayment of assistance given in the past and/or a commitment by those being helped to assist the givers should tlney too encounter difficulties in the future” (p. 148). Thee are both risk management and coping strategies within any culture, but they become more apparent and more rigid irn cultures whee basic livelihood is threatened. The sharing ofresources within a community and the importance of social capital is especially important among the Hausa women. This sharing of resources can also deter the success of micro-credit institutions as it is more important for community members to uphold their social standing with their fellow commurnity members rather than repaying an impersonal micro-credit institution who may not possess social capital. 23 Like ethnic goup, gender plays a definitive role in outlining responsibilities within the farming system and more broadly the rural household. In many rural, Afiican households, women bear the burden of much of the household work as well as the field work. In some ways, their plight is exacerbated in Muslim cultures. As written in the Quran (ve'se 4:34), “Men have authority over women because Allah has made the one supeior to the other, and because they spend their wealth to maintain tlnem.” Women in their subservient role in Muslim culture are ofien subject to obeying their husband’s orders which sometimes require more work and hardship. In addition, the burden of the child care like in other polygamous cultures, falls on the mother which includes feeding, clothing, arnd finding prope health care for he children. Religion also plays a significant role in not only the organization of the household and the plight of women, but in the administration of micro-credit institutions. Islam plays a role in the interpretation and outlook of many micro-credit projects or other donor related work brought in from the outside. In an anthrOpological study, Shipton argues (1994) the Protestarnt work ethic of time equals money, so prevalent in the western cultures, does not apply in a lot of non-western cultures, specifically The Gambia. The concept of an interest rate goes contrary to many Muslim cultures as it says in the Quran, “interest-bearing loans in kind are sinful” (Shipton 1994, p. 299). People irn The Gambia conside the interest rate to be more of a function of an inteest ratio (Shipton 1994). This irnteest ratio is based on a portion of that which is being loaned. For example, if someone is loaned 1,000 fcfa, and they repay 1,100 fcfa, their undestanding ofthe interest rate is not ten percent factoring in time, but as one tenth oftlne total amount of the loan. Corruption has also played a significant role in the administration of the micro- credit institution uncle study. As the relationship between the credit agent and the client is hierarchical where the client is in desperate need for capital, corruption flourishes. Greed arnd corruption have a tendency to rear its ugly head in banking institutions as the access to 24 capital is much more facilitated. Axinn and Axinn (1997) write, “this problem of [corruption] is being addressed with systematic study by professionals, especially in international banking and business” (p. 80). They continue, “The issue of human greed and the resulting corruption have been central aspects of the human condition throughout history” (p. 81). Micro-credits role In non-fannlfarm linkages One solution to innpending poverty and food insecurity is making credit accessible to rural, farm households. It is difficult to assess the role of credit for rural, non-farm enterprises in many developing countries. There are two differing viewpoints on the impacts of credit in the rural farm household. On the one hand, credit can be valuable in providing working capital for rural, non-farm activities to meet transportation cost and purchase goods for resale (Mead et al. 1990), but as formal banking institutions do not lend to the rural sector in Niger, access to formal credit is limited (Burt and Issa 1993). The other prevailing viewpoint of the impact of micro-credit, in other studies, is that perhaps credit is not the panacea for solving poverty issues and securing household livelihood (Rogaly 1996). In fact it has been demonstrated in some studies that people are made worse off as a result of credit (Rogaly 1996). Rogaly (1996) writes, “Performance of micro-credit varies - the less poor the borrower, the geater the increase in income from a micro-enterprise loan. Some of the poorest borrowers interviewed became worse off as a result of micro-credit” (p. 105). One solution to lack of access to micro-credit is the development of rural banks or micro-finance institutions which are either autonomous from non-governmental organizations or are a project within an NGO. Several micro-credit lending initiatives (BRK, BRI, Grameen, BRAC) in developing countries presumably target the poor, rural 25 sector of society. As demonstrated in seveal previous studies, micro-credit contributes to the income generating activity of the borrower by providing working capital, hopefully increasing that individual's non-farm income (Remenyi 1991 in Rogaly 1996). As one participant in the rural credit project at the Freedom From Hunger Credit for Education project in Mali, stated, "Now that I am making more profits, I can pay people to cultivate for me" (Ashe er al. 1992, p. 31). Increased income, as a result of the loan, may be sometimes invested in the farm in the form of hired labor as shown by the above example as well as other household expenses. Reardon er al. (1994) posit, "Non-farm activities can be an important source of cash income, which can potentially improve farm productivity if it is used to finance farm irnput purchase or longer-term capital investments" (p.1172). Micro-credit can play a significant role in a nomfarm activity by either increasing or decreasing this income. If there is increased income inn the non-farm activity, tlnere may be eventual investment in the farming system (Sebstad er al. 1996). Reardon er al. (1995) write, “credit prograrrrs that help non-farm enterprise may be as, or more, helpfinl to farm investment than credit targeted to farnrning pe se” (p. vi.). What then becomes the role of credit in the rural farm household? Credit in the past has been valuable in bad agicultural years by providing anothe source of income to food deficient farm families. Credit can also be used to smooth income and food consumption patterns in bad years (Reardon 1992). On the other hand, credit must not be used as the sole blueprint to solve poverty in much of the developing world (Rogaly 1996). A supplemental income apart fi'om agiculture is required for most rural people in Nige, and credit can play both a negative and positive role in this income. Hopkins er al. (1994) state, ”Income fi'om activities other than crop and livestock account for 43 percent to 52 percent (across zones) of rural Nigerien household income on average" (p. 1221). 26 Nigeien farmers diversify their strategies to manage their farm household, one of which is non-farm irncome generating activities to meet basic food needs. Much research has sung the praises of micro-credit’s impact on the rural household while othe's the woes. When a micro-credit project, attached to a non-govenmental organization begins to transition hour a donor dependent credit providing project to an autonomous, profit-making micro-finance institutiorn, the objectives and the beneficiaries of the credit-provided are challenged. Adminnistrators of the project must begin to lower transaction costs and become more efficient to ensure its own survival, and ofien times this trarnslates into serving a few wealthie individuals in developing conmtries rather than the poorest of the poor (Rogaly 1996). Dichter (1995) argues that the role of NGOs’ in financial intemdiation is short- lived. He writes (1995), “The role of the NGO as a direct lender may therefore be best thought of as tennporary. The NGO contrnhution has been, as it should be, to take chance, to irmovate and experiment and to show the way to others. In micro-finance, that has now been done. At least some NGOs ought to have the courage to move back as it wee to the swamplands where the really difficult challenges have always lurked The frontiers of development today are institutional development, arnd as always social intermediation” (p. 9). There are botln institutional as well as household level consideations when considering the impacts of micro-credit. NGOs have initial role to play in financial intemediation but not a long-term one. Meal Framework This research examines the amount of investments and inputs in the rural farm household in Niger for botln the non-farm and farm activities. These investments or inputs are in the forms of credit, agicultural inputs, and non-farm material investments, to name a few. 27 An improved agicultural technology is any technology where net benefits occur in a farme’s agicultural production. These technologies can include but are not limited to fertilizers, soil consevation techniques, insecticides, and improved seeds. In Niger, the acquisition of capital intensive innproved technologies (e.g. fertilizers and insecticides) is often difficult due to the lack of markets and capital for the technologies. A farme must consider several factors before deciding to invest in a technology. This decision process is represented below in an adapted model fi'om Anosike and Coughenour (1990). The non- farm component has been added to the model. This model serves as the theoretical framework for the research. Figure 2 is a modification of this model. 28 | Human Factors I—l [Ecological Factors I f I Endogeneous J I Exogtnc uusil 9 Soil types/classes * I * Slopes & rannf' all Frodibility Markets Institutions Credit Onltural factors . . and Norms AWN Education Religion I‘m“ Gender Form of organization Farm and Non-farm scale decisions Diversification decisions Farm and Non-farm Resources Managenent Labor Production Capital and Sales Land , Figure 2 Factors affecting household decision-making in farming system investments Adapted from Anosike and Coughenour (1990) 29 Figure 2 illustrates the complexity of household decision making when it comes to investments in the farming system. This model is adapted from an earlier model by Anosike and Coughenour (1990). Non-farm activity and credit are two components examined in this research. The means by which these aspects are examined are descrnhed in the following chapter on methodology and data analysis procedures. Chapter 3 METHODOLOGY Dascrlptlonofrasaarchslta: TownshlpofChadakorl Research was conducted in eleven Gobirawa Hausa villages in the department of Maradi, county of Guidan Roumj i, township of Chadakori in South-central Niger to answer the four research questions found in chapter one. Before explaining how the data were collected to respond to the four research questions, the contextual fiamework for the research sitemustfirstbedescribedto setthe scene fortheresearch. TheMaradideparunent (seemaponpage33)hasofienbeencoinedthebread basket of Nige in the past, but in recent years, since 1980, the departrnernt has been suffering food deficits every two to three years (UNDP 1997). A recent report by the United Nations Development Progam (1997) described the Maradi department as follows: More than 90 percent of the population are farmers, continuously putting new land under cnrltivation at a rate of 10 percent of new land per year. Ove 80 peeent of cultivated land is millet, the main staple of the country. The area is densely populated with 36 people/km squared at the departmental level, 50 people/km squared at the county level of Guidan Rournji and 34 people/km squared in the township of Chadakori. The agicultural land is comprised of mainly sandy soils that are not conducive to intensive agiculture, but due to increases in population pressure and unfavorable agricultural policies (e.g. rise of fe'tilizer prices from Nigeria and closing of the phosphate mine irn northem Niger), people are required to farm continuously the land without leaving rrruch land fallow to allow the land to regenerate. As food deficits become more and more frequent and severe, farmers have begun to sell off or rent their land to wealthier farmers and merchants in order to buy food thus exacerbating the differentiation 30 31 betweertherichandthepoorintlreruralareas. Asaresultoflackoffarme ownership, long-tern, sustainable, agicultural investnnents are not readily errrployed by the rural population.'0 The major ethnic group in the Maradi department is Hausa, comprising 80 percent of the population with Fulanis and Tuaregs making up the othe 20 percent, and over 95 pecert of the population is Muslim Most people are non-literate (especially the women), sometimes attributed to the influence of Islam, and the infant mortality rate in this region is high (211 deaths/1,000 births) in comparison to the rest oftlne country (170 deaths/1,000 live births). Hausas have ofien been described as the dynamic merchants of West Afiica and have a rich expeience and history in intenatiornal trade throughout all parts of the world With Maradi’s proximity to Nigeria (3 hours south on a paved road), many Hausa farmers sell primary agicultural goods, namely cereals and livestock inn the large Nigerian markets, and purchase processed goods from Nigeria to market in Niger. BRK in the Maradi Department CARE Intemational's choice of initiating their micro-credit project (PN 07) inn the Maradi department was logical given the high volume of economic activity taking place between Maradi and the major markets in Nigeria, mainly Jibiya, Kano, arnd Katsina. BRK, the CARE furnded micro—credit institution has been in the County of Guidan Roumji (the county where the research took place) since 1988 and has provided credit in 50 villages, giving 82 million fcfa (approximately, 164,000 US dollars) for 100 goups of people (UNDP July 1997). The BRK has three primary objectives: 1) ameliorate the income of rural and urban populations in the Maradi 2) initiate the rrrearns by which individual men and women or goups of men and wonnen can obtain short-term credit for their micro-enterprises; 3) establish an autonomous, profitable, and lasting financial institution which meets the above objectives. '°Sustaimb1e,agiculun1pracficeindrissensememnsflnsewhicharebodnsustainabletothefanneras wellastotheenvirorlnent. Theyareheesplantedinfields,soilconsevationtecluniquessuchasrock brmdsandaailnles,md1eavingueeswhicheenaunanymgeneatedinmefield. 32 Both women and men receive credit fiom BRK, and the majority of the borrowers are organized into peer lending goups with a designated goup leader. The lending period is between eight to fifteen months with an interest rate of 18 percent per annum. The amount of the loans per person vary between 25,000 fcfa (equivalent to 50 US dollars) and four million fcfa (equivalent to 10,000 US dollars) (BRK promotional brochure). The credit is targeted to a person's non-farm activity, and is given to residents in both major towns and villages witlnin and smrounding Maradi. In the past, the borrower did not need a guarantee or a form of collateal prior to obtaining credit, but in recent years, the BRK has institnnted a new system of character-based guarantees fi'om neighbors arnd village leaders. Unlike other micro-credit progams, BRK does not require savings on the part of the client, but this appears to be changing.‘l The proposition is the following: if a client is not able to save, ten percent of the client's total loan amount from the BRK may be setasideasaformofguarantee. Thishasnotbeeninstitutedasofyet,butmaybeinthe near future. This guarantee, essentially collateral will be guarded by the BRK in the case of a person who defaults on a loan. In the past, the credit agent controlled the identification of potential clients and disburserrnent and recovery of the loans. As the loan portfolios gew between 1990 to 1995 and loans wee becoming larger, the temptation to accept bribes gew and corruption flourished. Some agents were fired from their jobs as a result of embezzling funds. One client commented, “Everyone knows that in order to obtain a loan, one must give a bribe.” This is still a very real problem for the BRK. The senior staff is currently attempting to find ways to control for this corruption which hits the client the hardest. Findings will illustrate the varying efi‘ects of credit on the people of this region It is certain that survival strategies in the Sahel demand a divesification of income sources and credit can provide anotlne financial source to these households. Figure 3 illustrates the different regions of Niger. "InarewntretreatwiththeBRKstaff(0ctobe1-3,1997).itwaspmposedthattenpercentoftheloan amountbesetasideasaformofmonetaryguarantee. 33 82: 83. .33 30:85 .m tone”— 3 “on? we 32 m am £892 85 : omen a.:_x=.m ~u°¢0( O .nom 2.25.2.3 o ...mm. .5338 :58 .....s...n.e_.oe.< e858 .8538 III. .__............ 50.2 no 033%.: \ 1% 34 Die collection W Several different steps and various metlnods were used to carry out this research This research is descriptive in nature, arnd comprises an ex post facto component as all the borrowers interviewed had first received a BRK loan five years ago. A variety or triangulation of research methods allowed the researcher to verify accounts fiom various sources and produce more reliable data. Multiple rrnetlnods of data collection have proven to give a more well-rounded view of the situation in question rather than relying on one source of data collection (denBiggelaar and Gold 1995). The processes and methods are described below. Rapid appraisal To commence this research, a rapid appraisal (Casley and Lury 1987; Chambers 1989) of the township in question (Department of Maradi, County of Guidan Roumj i, Township of Chadakori) was conducted. During the rapid appraisal stage of the research which lasted one week (August 25-Septembe 1, 1997), in-depth interviews were conducted and visits to the field wee made. These interviews wee conducted with key informants at both the departmental, township, and village levels (see Appendix A for list of key informants). Questions concerning the farming system, land tenure issues and the credit progams in the region, specifically CARI-3’s BRK wee asked in unstructured interviews in order to gain more up-to-date information to address local people's nwds and petinent concerns in the upcoming research. The information gathered from this rapid appraisal allowed the researcher to update and modify the data collection instrument. Several more questions were added to the interview guide after talking to the local BRK staff and the agicultural agent in the region. These additional questions were designed to meet their programmatic needs. Most questions on the BRK (see Appendix B for questionnaire example in English) consisted 35 of topics such as the conduct of the credit agent, bribes, the client's understanding of the inteestrate,arndwhetheitwaseasyordifficulttoobtainaloan. Questionspertainingto the uses of loans arnd the end result of the loandvee suggested by the agiculture and forestry extension agents located in Chadakori. Pro-techno procedures Once the questions for the interview schedule were designed, they were field-tested with a selected sample of the population. This sample was not representative in nature, but assisted in identifying questions that were perhaps not understandable by the general population. The inteview schedule was pre-tested with seven BRK borrowes and five non-borrower who wee not located in the research zone. For the purpose of this field test, the borrower’s sample was obtained by visiting the two BRK centes in Maradi, and the inteview schedule with borrowes coming to the bank to reimburse their loans. The non-borrower’s sample was obtained by talking to CARE employee’s guardians and neighbors. As a result of the field-test, some abstract arnd historical recall questions which the sample of respondents could not easily answe, were identified. For example, one questiorn asked respondents to explain what they would do with a profit of 50,000 fcfa, approximately 100 US dollars, fi'om their business. Most respondents said that they had never possessed a profit of 50,000 fcfa, arnd could not answer this question. It became apparent that the amormt of profit needed to be lowered in order for the respondents to fit the questiorn into their flame of reference. The revised question asked the respondents what they would do with 10,000 fcfa, approximately twenty US dollars, and this was more easily urnderstood. Thee were several recall questions on the survey designed to assess the longitudinal impact of the credit on the recipients. All recipients had begun receiving credit from CARE in 1992. It quickly becarrne apparent that it was too difficult for the 36 respondenmtorecanupmfiveyearsmanswequesfionspetainhngmtheirfarming system and number of animals they currently possess verses possessed in the past. Casley and key (1987) state, "If a long recall peiod is used the respondent, instead of attempting the impossrhle, will reply witln a figure that he believes approximates an average or normal level” (p. 79). To remedy this situation, the questions pertaining to investments in the farming system prior and afte receiving the loan were suppressed, and only investments in the current farming systen were analyzed. No longitudinal assessments were made in the enpirical data, buttlne qualitative data describe in more detail the loan’s impact. Afte corrections wee made from the feedback from the field-test exercise, the instrument was finalized and reproduced and in-depth on-farm interviews were conducted. Questions petained to farming practices; off-farm income sources; effects of micro-credit on the farming practices; and few demographic information. 380191109 The two target populations for this research were borrowers of the BRK and non- borrowes of the BRK who botln live in the township of Chadakori. To define the sample for this study, the BRK senior staff wanted to interview recipients who had first received credit in 1992. According to then, this allowed a sufi'ncient amount of time to be able to assess the impact of the credit on its recipients. The credit agents in the region where the research was conducted along with the head of the credit center were contacted and two visits were made to their offices to define the sample population. Two distinct goups were chosen for this study. The first group consisted of those individuals who received their first loan in 1992, and wee eitlne individual loans or g'oup loans, both men and women. The second goup consisted of non-borrowers. For the borrower goup, a stratified random sample was taken from the four borrower goups mentioned above; goup male, goup female, individual male, and 37 irndividual female. For 1992, tlnee wee a total of 25 loan portfolios with a total of 314 borrowers. In order to gain a representative sample, eleven loan portfolios wee chosen with a total of sixty-three borrowers or twenty pecent of the total number of borrowers. The calculation in choosing the eleven loan portfolios is found in Appendix C. From these eleven lona portfolios, two individual male borrowers, one irndividual female borrower, three female g'oup bon'owersd, arnd five male group borrowes were selected. Thee were three individual borrower’s loan portfolios chosen, and eight goup loan portfolios, comprised of botln men and women. In ce'tain group loan portfolios, there wee more than ten people pe lending goup while other loan portfolios did not comprise ten borrowers. In order to remain consistent with BRK’s current philosophy, which is to have ten borrowe's or less per loan portfolio, ten people from those goup portfolios with more than ten borrowes wee systematically selected by counting evey nth name on the list. Ten names wee chosen as this is now the standard set by the BRK. Loan portfolios currently are not to exceed ten borrowers. Otlner impact assessment studies of micro-credit projects have used a sample size of thirty as the minimum number of credit recipients in order to conduct significant statistics (Gaile 1996). In order to compare this goup with the general farm population, a second sample of 30 people was chosen randomly from farmers who are not BRK clients. This control group was identified as follows: Once the sample of long-rem micro-credit recipients was identified inn the villages, their closest neighbor who has not received a loan from the BRK and who is of the same gender was chosen for the control goup. This method of sampling procedure for the non-borrower goup proved to be reliable by an Ohio State Univesity research team doing similar research on credit unions in Niger. Unfortunately only seventeen non-borrowers wee contacted by employing the above procedure. This is a major limitation of this study. There are several reason for which only 17 were contacted, namely lack of financial resources, time, and an emphasis to contact more BRK borrowers to provide important data for CARE. 38 Of the 63 sampled borrowers only 54 were contacted. In some cases, the person from a cetairn loan portfolio group simply did not exist. Both the researcher and her co- researcher, Harouna, would ask many villages, the chiefs, arnd people would say that the name of the borrowe was fictitious. This was no surprise to BRK admirnistrators in the central office as it was well known that some eedit agents would make up names, take the loans, arnd a fictitious person would be default on the loan with no way to prove who was theborrowe. There wee othecaseswhee the borrowehaddied ortlne clienthad received the loan and left for Nigeria, and no one had heard fi'om him again. In total, 71 people wee contacted in and around Chadakori of which only 65 wee analyzed as six respondents wee not farmers. As this region is very specific for Niger, thee exists geat homogeneity among the population. All people inteviewed were Gobirawa Hausa, were fi'om this rural region, and practiced some kind of economic activity. This factor must be taken into account when considering the representativeness of the sample used. Data gather-Ina procedures Four different data collection nrnethods wee employed during the course of the two month research peiod. These are described below. It must be noted that in order to gathe relevant, reliable data, it is impeative to triangulate the information gatlneed to verify whether what is being reported, is correct. This multi-method research approach has been used in seveal similar studies (denBiggelaar and Gold 1995, Kiefer 1996). 39 Interview schedule with farmers Bette known as survey researcln, this data collection method consisted of 71 face- to-face interviews with both borrowers and non-borrowers of CARE's BRK project in South-central Nige. In total, 65 farmes were interviewed (tlne otlne six respondents were not farmers so these cases wee omitted from the analysis), and eleven on-farm visits were made. The researcher walked to all villages except for four, and she was accomparnied by a village fi'om Chadakori, a nephew of the traditional chief. The researcher visited eleven villages, arnd was guided tlnere by a co-researche who was the nephew of the townslnip chief. He proved to be invaluable as he was able to direct the researcher to the right houses, arnd legitimize he research as he was a co- relative of the much respected township chief. Seven villages were contacted by foot while the remairning four were reached by a motorcycle supplied by CARE International. Questions on the interview guide wee divided irnto four sections. They are: 1) description of the farming system and uses of farm income; 2) description of the non-farm activity and uses of non-farm income; 3) impact of credit in the household, household consisting of botln farm and non-farm activities; and 4) demogaphic information (e.g. educational level, age, number of animals, and wealth indicators). These interviews asked farmers botln quantitative and qualitative questions concernning their assets and wealth, whether they had a non-farm income, whether and how they invested inn their farm, arnd what kinds of improved farming techniques they chose to implement. Reliability was ensured by asking questions more than once to the same respondent. The questionnaires possessed a simple check-off design with some open- ended questions. The time frame for the agicultural questions asked was up to the previous rainy season. It was discovered during the pre-test that it was much harder for respondents to give accurate and precise answers for peiods longer than one year. Questions concerning the respondent’s loan history (i.e. uses and results of the loans) were asked up to five years previously as respondents were more confident in their description of the uses and results of the BRK loans. 40 The interview guide was administeed through pesornal interviews by the researcher in Hausa, the predominant local language. The researchers fluency in Hausa added much to the data collection. An anecdotal description of the data collection by the researcher is found in the postscript. In short, the researcher was able to probe more on cetain questions, to clarify cetain questions if it seemed as if the respondent did not understand or the answers seemed inappropriate to the question. Patlclpmt observatlon: As the researcher had been a Peace Corps volunteer in this region for over two years arnd is fluent in Hausa, she had observed many agicultural and social practices in the villages during this period of time. This two month research period gave he the opportunity to live in the villages with families, arnd observe specifically their household livelihood strategies. Participant obsevation has seveal advantages as a research tool. As Kiefe (1996) notes, ”This metlnod involves living with the subjects of the study arnd gaining their confidence so that the information they give you reflects the reality of their situation" (p. 1). This research was carried out towards the end of the rainy season, September 2- October 1, 1997, which was the perfect time of year to visit farmer's fields and observe their agicultural practices. In total, eleven farms were observed with each respective farmer and dozens more wee observed while the researcher was walking to and from villages. Apart from visiting farmers' fields and observing their agicultural practices, six days wee spent irn the BRK's field-office irn Tibiri where borrowers would corrne to either receive or reimbm'se their loans. Hee, the researche was able to observe first hand the interaction between how the credit agents and the clients, and the process by which a borrowereitlnerreceivedorpaidbackaloan. The fact of obsevirng rather than interviewing or interacting with the research subjects proved to be an invaluable expeience. To observe facial expressions and body 41 language and ovehear secondary conversations provided a wealth of information. Often times, people wee not aware that the researche could speak the language, and several interactions between the credit agents and clients illustrated the disrespect that sometimes existed between two. Benard (1994) in Kiefer (1996) lists seveal advantages of participant observation and they are the following: - Participant obsevation allows the researche to collect many different kinds of data. The fact that the researche integrates him or herself into the community allows for nmltiple opportunities to observe rare or private behaviors. 0 Participant observation also reduces the subject's ”reactivity" to being observed. This rrneans that the subjects are less likely to change their behavior as they become more accustomed to having the researcher present in their daily lives. 0 Participant observation aids the researcher in formulating relevant questions for othe data gatlnering methods such as surveys and interviews. 0 Participant observation gives the researcher a deepe nmderstanding of events and allows for geater confidence in the conclusions drawn from observations. (p. 3) Perhaps the most enriching part of the participant observation research in this particular case was being allowed to enter a farmer’s household and to observe the set-up of the concession or yard This usually consisted of animals tethered in one corner, various buildings scatteed througlnout for the wives of the family and the cooking buildings, and the garnaries, sometimes inside the yard or just by the doorway. As the researcher is a woman in a Muslim culture, she was allowed to enter the house which would not have been the case for a male researche. Wm interviews with key informants: These interviews were cornducted with BRK cenual office and field staff, government officials from the Ministries of Environment and Agiculture, other non- govenmental agency staff, and people in the traditional hierarchy (village and township chiefs). Information gathered from these interviews allowed the researche to complement 42 some of her findings, geneate fnnrtlne hypotheses, and gain a fulle picture of the history of the micro-credit institution. A list of all key informants is found in Appendix A. In orde to identify the key informants for the study, the researche used personal contacts from he time as a Peace Corps voluntee as well as othe individuals who wee recommended by other key informants. These interviews took place many times with one key informant. In orde to define improved farming practices and possible effects of credit on those practices, Tony Rinauldo with Sudan Interior Missions and Amadou Haya, who works for the Ministry of Environment, were interviewed. To identify certain obstacles in obtaining eedit arnd variables to include irn the interview guide, BRK senior staff as well as field agents were inteviewed, namely Cheibou Samna, Ross Croulet, Chima Miko, and Abdou Gadi. To determine the cultural context for the research as well as the opeation of savings arnd credit at the village level, agents from another credit project (Caisse Populaire) as well as staff fi'om a CARE project called Women on the Move and key villagers in Chadakori wee inteviewed Archlvd research: Prior to the data collection part of the research in Niger, seveal documents on micro—credit, household livelihood strategies, and documents of CARE’s BRK project were analyzed and many are cited in this work. The researche explored baseline data collected by CARE International. CARE’s data collected on their BRK clients at the loan processing stage wee minimal. The only data gatlneed by CARE on their micro-credit recipients consisted of gender, economic activity, and the village whee they resided. Previous research had recently taken place in Chadakori (Keife' June 1996) and the department of Maradi (Household Livelihood Survey, University of Arizona 1996) in general so the research was able to obtain important data from these two reports. 43 By enploying four different data collection metlnods, the amount of data collected was voluminous. This thesis attempts to answer the four research questions explained above, and draws additional data into tlne report which seem to be relevant, significant and interesting. Tlmetable of research activities Prior to traveling to Niger during the Summer of 1997, a review of the literature was done to descrnhe 1) characteristics of farmers in Niger who have received micro-credit loans for their non-farm business and the effects of this additional income on their farming system; 2) improved farming practices identified in Nige by previous research; and more generally 3) results of micro-credit lending and natural resource management practices in Sub-Saharan Afiica. Research began in Nige on August 19, before commencing the data collection at the research site in the Maradi department While in Maradi, the research focused on the rapid appraisal at the regional, conmty and village levels. Interviews were conducted with govenment officials in region as well as people inn the traditional power structures (e.g., chef de canton in Chadakori, Sarki Mahamarne, chef de village de Kouroumgassaou) as well as goups of villagers. Variables wee identified to be explored in farmer's resource marnagement as it pertains to agicultural production. Farmers wee identified who have received micro-credit for their non-farm enterprise and farmes who were about to receive micro-credit with the assistance of the BRK central office staff. For one month, interviews were conducted with farmers. While conducting these interviews, visits were made to farmers’ fields and implementation of farming practices wee observed. There were multiple visits to the same farmer in orde to clarify questions and issues. 44 At the completion of the research in the beginning of October, 1997, a compilation of findirngs wee communicated in French to the participant farmers, govenment agents, and NGO partners (CARE International and SIMS). Data wee analyzed by developing a descriptive framework relying on theoretical propositions that have led to the research. A four-page newslette was given to the CARE director, the Assistant director, and the central staff of the BRK in Maradi. Data analysts procedures Data wee first entered into one spreadsheet in SPSS PC+ (Statistical Package for the Social Sciences) at the CARE office in Maradi. A preliminary descriptive analysis was conducted in order to leave CARE with some preliminary findings. These findings were written up in French in the form of a bulletin and given to BRK staff who assisted with the research. Upon the researche’s arrival in the United States, the data were entered into three diffeent spreadsheets in SPSS PC+, and they were divided as follows: 1) household level data with one respondent per case numbe; 2) individual level field data; 3) individual level micro-creditdata. Spreadsheetstwoandtlnreewereanalyzedapartandtlnencertain variables were aggregated (number of parcels, field size, plantings, total number of loans etc.) in order to obtain household level data These aggregates were then merged into spreadsheet number one. Cross-tabs arnd t-tests wee run in order to analyze significant associations and differences irn how borrowes and non-borrowes invest in their farming system Multiple response cross-tabs were run with the independent dichotomous variable, Did the respondent obtain credifl and various investments in the farming system (e.g. fertilizer, pesticide, planted trees). The results of these tests are found in the following chapte. 45 um of the study: There were numerous limitations as there was an American researcher who hired a Nigerien, research assistant. She is an American who speaks Hausa fluently, but she is a foreigne all the same. This may have hindered the validity of some of the answers as the research deals with some sensitive topics. As she has lived in the region for three years, people knew he well so this assisted with the data collection. The researche had only limited financial resources and time so this resulted in not obtaining a representative sample of the non-borrowe population. To remedy this limitation, a more thorough data analysis was conducted between those who reimbursed their loans and those who did not. This proved to illustrate the distinguishing determinant of a creditworthy individual. A large sample of botln individual and goup borrowers and non-borrowes could have improved the precision of the hypotheses testing. As this research was conducted in one point in time and was not longitudinal in name, it becomes impossible to provide empirical evidence on the effects of the irncreased investment in the farming system on the sustainability of the environmental resources, mainly land and soil. What this research can provide is the expressed views of farmers interviewed, and examine the effects of each of investment on the agicultural production as a whole. Chapter4 FINDINGS AND DISCUSSION Won People view the world through different filtes, arnd it is through these filters irn which people make various decisions. Some of tlnese filters can be controlled through quantitative research, but otlnes cannot For tlnose filters such as opirnions, feelings, and outlooks on life which influence people’s day-to-day decisions, qualitative research fills in the blanks whee quantitative research cannot. Botln qualitative and quantitative data are analyzed and described in this chapte. Quantitative data are analyzed using SPSS PC+ (Statistical Package for the Social Sciences) software. Descriptive statistics arnd tests for associations and differences were used to analyze the data. The descriptive analysis comprises a description of the respondents, their farm and non-farm incomes and the amount and kinds of micro-credit in their household. Comparison between credit recipients and those who did not receive credit is made using cross-tabs and t-tests as appropriate for the type of question. The data from respondents who received credit and tlnose who have not will be analyzed and compared for differences and similarities. The non-farm activity arnd implementation of agicultnrral technologies is examined to see whethe credit for a non-farm activity plays a role in investment in the farm. The qualitative data are analyzed by including information gained fiom the surveys (see Appendix E for open-ended answes), semi-structured interviews and the researcher’s 46 47 field notes (see Appendix F). These data complement the findings from the quantitative data. To measure improvement in a farmer’s field is a difficult task, and much of the data collected to answe this question are qualitative in nature from informal conversations with both the farmers and key informants. Description of respondents In total, sixty-five people wee inteviewed, face-to-face, using an interview schedule. These people conne from eleven diffeent villages arnd they are found within a ten kilometer radius from the township capital of Chadakori. Of the sixty-five respondents, seventeen were women while forty-eight were men. The mean age of all respondents was 45.6 years old with a standard deviation of 12.1 years, a maximum age of 78 and minimum of 25. The mean number of children is six pe respondent. As polygamy is a common practice in this predominantly Muslim culture, men answeed as having more children (six children as compared to five for the women) than the women This could be due to the fact that the women could have only counted their own children while the men counted their children from all of their wives. Figure 4 illustrates the frequencies of response to number of wives per household. 0 1 2 3 4 Figure 4 Numbe of wives pe respondent Forty-six percent of respondents have not gone to school while fourteen pecent had some primary school, but had not continued to middle school. Two percent responded that they had had eitlne a middle school diploma , nineteen percent indicated qnnranic school, and twenty pecent furnctional liteacy classes. All respondents (N = 65) are farmers, and have small land holdings. The average number of parcels pe farmer is 4.37 and the aveage farm size is 6.51 hectares.‘2 Once again tlnee is a significant difference between the numbe and sizes of the holdings for the men and those for the women. On the aveage, the men have a mean number of parcels of 4.83 while the women have 3.06 parcels. These number of parcels translates into a mean farm size of 7.74 ha. for the men and 3.27 ha. for the women. Men have more holdings which are significantly large than the women. This difference is significant at the .05 level (p= .01 for total numbe of fields and p= .001 for total number of hectares). The farm size in hectares was calculated by translating the number of rrneasures into hectares. A measure or tiya in Hausa is a bowl full ofseed, a universal measurenent for the planting and selling of seed for all farmers in Niger. Most farmers were able to respond to the question concerning the seed rate used pe field, and tlnen the researche simply added up the total number of measures to calculate the total farm size. "Onehectaneisequalt02.47 acres. 49 Ninety-one percent of the respondents also had a non-farm activity which varied from sewing clothes to making farming implements. For the most part, respondents had been conducting their non-farm activity for a long time with a mean of 12.19 years and a standard deviation of 10.03 years. Farm revenue and the household In order to examine the household livelihood strategies, it is impeative to take characteistics of the household first in isolation to gain a comprehensive nmderstanding of this element’s contribution to the whole. Agiculture obviously plays a significant role in these household livelihood strategies, and this section describes the income gained from agiculture and how it’s used in the rural, Nigerien household. Following an urnderstanding ofthisincome, the sources ofnon-farmincomewillbe examinedanditsuseintlne household will also be descnlned. In conclusion, a description of rural, household credit activity and the impact of this eedit in botln the farm and non-farm activities will be examined. Fifty-three farrrners of the sixty-five farmers interviewed sell some part of their harvest. Of the fifty-three farmes, about three-forths of the respondents (75.8 percent) sell their peanut harvest. Othes sell hibiscus (3 pecent), millet (1.5 percent), and other (1.5 pecent). The remaining or 18.2 pecent of the respondents replied that they did not sell their harvest. This fact of not selling their harvest is mainly due to poor agicultnrral yields for the 1996 crop year. Thee was not enough agicultural production surplus to market. For the peanut harvest sales, the mean numbe of one hundred kilogam sacks sold is 8.52 sacks per year with a standard deviation of 8.16 sacks. The large variance is due to the fact that some individuals sell very few sacks (one or two) while others sell a lot (fifteen or more). The farming of peanuts is mainly a male activity as thee is a significant difference in the mean numbe of peanut sacks a man sells (9.92 sacks) and the mean 50 numbe of sacks a woman sells (4.08 sacks). This difference is significant at the .05 level (p = .013). The mean price per peanut sack sold is 5,926 fcfa (500 fcfa = one US dollar) with again a high standard deviation of 3,021 fcfa per sack. There is a high standard deviation as some farmes will sell their peanuts immediately following the harvest in October when the prices are the lowest. They are forced into doing this for various reasons, according to respondents. They may have a social obligation in their family, pay taxes which are collected during the harvest time, or repay their loans, botln informal and formal, fi'om CARE and villagers. The informal and formal credit markets offe different forms of credit at diffeent interest rates. The most common form of informal credit discovered during the course of this research was seed, both millet and peanut. The borrowe is then required to reimburse the seed in-kind at a rate of one hundred and fifty percent. For example, if farmer Abdou received four sacks of peanuts on loan from farme Magagi to plant during the rainy season, at harvest time farmer Abdou is required to reimburse the four sacks with six sacks. Thirteen percent of farrrners indicated that they are able to wait for the price to rise, and can sell their peanuts at a much highe price in eitlne January or February. Of the seventy-five pecent of farmes who sell their harvest over one third (33 percent) will keep a portion of their harvest or one or two sacks in storage to plant for the following rainy season. Figure 5 illustrates when farmes sell their peanut harvest. This is indicated by the inteviewees’ responses to the time of year. Often, the fame indicated selling their agicultural production immdiately after the harvest, immediately before the rainy season, or during the dry season. As these are three very distinct seasons as defined by the farmers, Figure 5 illustrates these three seasons ratlner than by each montln as the farrrners do not refer to the year by months in the traditional calendar year. 51 Figure 5 Seasons when farmers sell harvest As illustrated in Figure 5, seventy-three pecent of the farmers sell their peanuts immediately following the harvest. This is mairnly due to the reasons stated above. There may be sonne social obligations in the family, to repay debts incurred before and during the rainy season, or to buy additional food to stock as the price is lower immediately following the harvest. The farmers were then asked about the use of the money from the sale of their peanuts. Table 1 indicates their responses. 52 Table 1 Use of farm revenue in the rural, family household (N= 53) Useofiu'm income Nunnber Percent oftotal or 20 37.7 on pecent an taxes Many respondents (3 7 .7 percent) use their income hen the sale of their agicultural production for baptisrns or weddings. This fact represents the importance of social obligations which exist inn Hausa culture. No matter how little resources someone may have, the social bonds and solidarity made in the villages is extremely valued both culturally and economically. If, for example, a woman gives birth, the monetary or in-kind food gifts brought to her baby’s baptism must be reimbursed at twice their value to the bearer of the gifts when she gives birth.'3 Giving at social events becomes an informal kind of innvestnnent for these women. As a visit to one of the research villages illustrates, women interviewed said that they would use money from their non-farm business for baptisms. The following is taken fiom the researcher’s field notes", Ganin Boueye is an inteesting village. The food situation inn this village is pretty seious. Last year they had a bad harvest and it looks like this year will be bad as well. The women in this village have a lot of animals as a form of security, and almost every woman said that she would use the profits from her business in baptisnns. Baptisms are big in this region. Other women who did not receive a loan [from BRK], really do not have business for which to put the money. Nevertheless, they really want a loan in this village. Apparently the men are really motivated and are part of the good clients committee. '3 Key informant irnteview on Monday, Septembe 1, 1997 with tlne Project Assistant, Women On The Move (PN 22), CARE International, CARE/Nige, Maradi. " Taken from researche’s field notes dated Monday, Septembe 22, 1997. 53 As Charlick (1991) writes, “Patronage and gift exchanges are firmly rooted in most of the cultures making up contenporary Nige arnd are at the ve-y heart of the Nigerien way of conducting social and political affairs “ (p.23). This will be a cormnon thene in this tlnesis as it is impossible to conside the impact of credit on the household if the cultural and social aspect is not taken into consideration. Thee is a marked difference in the manner by which women and men use the income from their farm in the management of their household. Most women (50 percent) use the innconrne for baptisrns and weddings while men invest in their enterprise (20 percent) or spends on household expense such as buy food for the family, pay taxes, or build a house (35 percent). As is the tradition in Muslim culture, it is the responsibility of the head of the household to nourish his family, and if he is not able to do this, his wives have the right to divorce him A man is not allowed to take more than one or two wives, if he is not able to nourish and clothe them. This goup of Hausa men, the Gobirawas, are notorious for not providing for their wives, and taking many wives even when tlney cannot provide for them. Some men will even go so far as making their wives work in their fields, and not compensating them for that work." Women are also sometimes required to feed and clotlne their families while their husbands travel to the Coast or take other wives. Apart fiom the inconne gained from agricultural field production during the rainy season, thee is also the farm income hen the raising and sale of animals. As the last few years have produced poor agicultural yields (see Appendix D for copy of rainfall chart for 1961-1997), many individuals had sold off their animals to buy food. A significant difference in the numbe of animals held in the houselnold exists between the men and women. Table 2 illustrates the number of the different kinds of animals held by the women and the men at the cnnnrent point in time. To verify the numbe, the researcher asked to see the animals inn the yard. "Ibid. 54 Table 2 Number of animals in the household between men and women Animus N Mom Standad melon t-vslue p = Cows: men 48 1.17 1.53 .10 .69 women 17 1.47 1.33 Donkeys: men 48 .50 .62 2.31 .001“ xomen 17 .24 .44 Goats: men 48 1.52 2.50 3.81 .004“ women 17 5.41 4.29 Sheep: men 48 .73 1.40 2.52 .03“ women 17 2.53 3.73 " Indicates significant diffeence at the .05 level. Table 2 illustrates the difi‘eerces in annimal holdings between the men and women interviewed. Traditionally men raise the horses and cows while the women raise the smaller ruminants such as goats and sheep. The goats and sheep are especially used as a sort of savings account for hard times. If the harvest is not so good one year, they (the women) are able to sell offtlneir goats or sheep in order to buy millet, the main staple. A large standard deviation exists with the goats annd sheep indicating that the variance of the sheep and goat holdings is quite large. Some women may only have one or two sheep while others have many more. Thee is not a significant diffeence between the men and women and their cow holdings. Some worrnen borrowers indicated that they were able to purchase cows with the profits from their loans. This will be examined in the late part of the tlnesis. Botln men and women wee asked about their horse holdings, and none of the women indicated that they had a horse while the mean numbe of horses for the men was less than one. 55 Originally the diffeence in annimal holdings prior to receiving a loan and the present number of holdings was going to be examined, but this factor did not prove to be indicative of the impact of the loan. There were two reasons for this lack of indication of loan innpact. Firstly, several people had to sell their animals last year to buy food as it was a poor agicultmal year (300 mm. of rainfall). Secondly, thee was an animal epidemic, according to the respondents which affected the goats and sheep two years earlier. This epidemic was veified by the agiculture agent in Chadakori. The agiculture extension agent explained that the animals, both goats and sheep, contracted sometlning called carbon bacteidian." The symptoms of the disease were shortness of breatln and loss of appetite with the goats and sheep. When the animals’ owners began to see these symptoms of the disease, they would eitlre sell the animals off right away, consume them in their homes, or simply let the animals die. During the course of the research, one respondent provided the following description. All names are pseudonyms. “Hadiza had no cows previous to receiving he loans, and now slne has two and a plow. He sons do all her work, and she no longer works in the fields. She sold off five goats before the rainy season because they were sick, but as a result of the loan she was able to buy five more. She has two fields whee she plants millet and peanuts.”" Non-ism Income from and for the household As previously stated, most respondents (N = 59 or 91.5 percent) indicated that they do have a non-farm income in addition to their farm one. This finding would be consistent with otlner findings on houselnold livelihood strategies in low-income countries, especially in Sahelian West Afiica (Reardon 1997; Campbell 1990). People tend to “ Key informant inteview on “My, Septenbe 11, 1997 with the agricultural agent in Chadakori, Nige. ‘7 Taken from researcher’s field notes, Friday, August 29, 1997. 56 divesify their income generating activities as much as possible in order to capitalize on profits from various sources in an unpredictable environment. Charlick (1991) writes, “the rural people [in Nige] are not exclusively farmers and heders. Historically, they learned to also produce crafts for the market; engage in local, regional, and even long-distance trading; and practice non-farm professions, including raiding, to divesify the economic risks of a harsh environment” (p. 98). People indicated practicing a wide variety of non-farm activities. Table 3 indicates how people interviewed responded to the questions concerning what they did for their non- farm income. Table3 mmwmhmmmy A large portion of respondents indicated that they traded some kind of commodity while othes fattened sheep for Tabaski, the biggest Muslim holiday, produced peanut oil, or processed food. Both men and women indicated as having a non-farm business and the number of years and employees of the business varied tremendously. Of the men who stated that they have a non-farm business, they have been practicing this activity, on aveage, for 14 years (SD = 11 years) while the women have been in business, on average, eight years (SD = 7 years). 57 Over one third of the respondents (35.6 percent) practiced some kind of trading in which they bought something, usually an unprocessed. primary, agricultural product and resold the product at, hopefully, a higher price. The money from the sale of these goods was either used to buy more of the same good, was invested in processed goods, or was used for household expenses (i.e. food and clothing) or social events (i.e. marriages or baptisms). These primary, agricultural products ranged from animals to skins and hides to mangoes to millet. Regardless of the product, the farmers, primarily men, are required to travel to several markets in order to buy and sell the product in question. Sometimes markets even bring the farmers to Nigeria where the primary good from Niger is sold, and then the farmers buy processed products (i.e. plastic pots, sauce condiments, gasoline) to sell in Niger. Traveling to Nigeria brings with it an assortment of transaction costs in the forms of transportation and paying bribes at the border crossing. Respondents indicated that their non-farm activity is either done alone or with the assistance of a family member. On average, men have more employees (one employee per business) than the women business owners (not quite one or 0.72 full-time employees). The businesses are either run out of the house or from a market stall. Table 4 illustrates the number of markets attended and approximate location by number respondents (see Appendix G for list of markets’ names attended by respondents). Tab|o4 Numbarofmarkets attended parwoek(N =59) Number of markets attendodlmek N PM P“ WORM One market 26 44.1 Two markets 6 10.2 More than two markets 12 20.3 i Attend markets in Nigeria I 2 I 3.4 i [Work out of my house [ ' l3 [ 22.0 l 58 Table 4 indicates that most of the respondents (54.3 percent) attend one to two markets per week. There is also a large portion of respondents who attend more than two markets per week (20.3 percent) or work out of their homes (22 percent). There tends to be an association (r = .37) between gender and whae the product is marketed. There is a higher percentage of women (40 percent) who market their products out of their home than men (18 percent). While 78 percent ofthe men will attend one or more markets per week, 60 percent of the women respondents will attend no more than two markets per week. No women indicated attending markets in either Nigeria or more than twice per week. The remaining respondents not listed on this table do not have a non-farm business and therefore were not asked this question. The second most common non-farm activity of the respondents (25.5 percent) was food processing. This activity is exclusively found amongst the women and comprises making peanut oil, selling already prepared food, and preparing green leaves to sell. Like the men who resell primary, agricultural products, the women only practice their activity dming the dry season. A large portion of women (40 percent) do not attend markets to sell their products. In the traditional Muslim culture, married women are not allowed to go to the market, unaccompanied by their husbands. The women do not have paid employees for this business, but the burden of marketing the processed food falls on their school-aged daughters. This is ofien another reason for which there are not a lot of educated women in Niger. The necessity to assist in earning money for the household tends to prohibit the girls from attending school. Arts and crafts work was indicated as the third most common non-farm activity of the respondents (16 percent). This entails sewing cloths, embroidery, and making decorations for horses. This activity was not dominated by either men or women as it could be conducted either at the market or in the home. The location of an activity plays one of the largest roles in determining whether a women can participate in that activity. As 59 Islam in Niger prohibits married women from leaving her household and attending public gatherings where other men may be present, this factor limits women’s participation in various economic activities." In order to discover role of the non-farm income in the household, respondents were asked how they used their income from their non-farm activity. Like farm income, the small business owner has a variety of uses of his/her non-farm income. Table 5 illustrates the uses of the income earned from the non-farm activity by those respondents who indicated that they have a non-farm income. The remaining respondents indicated as not having a non-farm activity. Tables Usaofnon-farrnlneomahtherural,fanilyhousehold Uses of non-tam income Numberof Parcentottotal S m 20 33.9 in non- 7 on events ( respondents 13.6 percent and Put into 1.7 As illustrated in Table 5, many people responded that they would invest their income earned from their non-farm activity in that activity. Others responded that they would invest this income into their farm. This could be in the form of agricultural inputs, purchase of a field, or animals for animal traction. A large share of income from the non- farm activity is also spent on household expenses such as food, clothes, and shelter. " Key informant interview on Thursday, September 3, 1997 with a female school teacher in Chadakori. Niger. 60 CmdfiobflnedfiomflnBRKzAnmntUfilmmResults Loans from the BRK can vary from between 2,500 fcfa to five million fcfa. The sample of respondents was not distinguished by amount, but by the first time they obtained a loan. In this case, the year of 1992 was chosen to allow enough time in order to examine the impact of the loan over a five year period. There is a significant difference between the number of loans and the amount of those loans received between men and women. Men, in general, tend to receive more loans with larger amounts. On average, men reported receiving 2.4 loans which totaled 214,189 fcfa while the women received 2.3 loans which totaled 74,615 fcfa. Although the men and women received on average the same number of loans, the amounts varied tremerndously. Women have proven to be better credit risks than men, and this research affirms this fact. In fact, after conducting a crosstab between gender and a dichotomous variable, has the loan been repaid, there is some association (r = 0.25). More womern (82 percent of the total number of women) have reimbursed their loans whereas 57 percent of the total number of men have reimbursed their loans. Not only are women more creditworthy, but may also be easier to work with. In response to the question concerned with was it easy to obtain a loan from BRIO, there is a some association (r = .25) between this variable and gender. Women, in general tended to agree that it was easy to obtain a loan from BRK while the male respondents did not agree. Respondents used the loans for various purposes, and 50 percent used the loans for what they told the credit agent, they were going to do. The remaining 50 percent of the respondents did not use the loan for what they indicated to the credit agent. Table 6 illustrates the uses of the loans as described by the respondents. 61 Table 6 Use of BRK loans (N= 50) to events n.e. to to As represented in Table 6, the majority of respondents used the loans for trading (24.0 percent), buying animals to fatten (20.0 pecent), or gave to other people as loans (16.0 percent). This third category of giving others loans is an interesting, unexpected use for the loan. This factor illustrates the argument that the social obligations within this culture are extremely important to the point that an individual borrower would risk not being able to reimburse the loan by giving all or a portion oftlne loan to a friend or family member. In doing so, s/he stays in good standing with his/her relatives within the community who weren’t able to receive the loan. There is also a differentiation in Table 4 between bought peanuts and bought seed to stock. The peanuts were bought by the women to use in the production of peanut oil while seed to stock was purchased by both men and women to sell at a later date. The results from these loans varied from respondent to respondent. When asked if the loans were usefirl nearly every respondent replied immediately that they were, but upon further examination and probing on the part of tire interviewer, there was a difi‘erent story underneath. The open-ended responses on the utility of the loan can be grouped into four general categories: respondents emphatically insisting that the loan was useful, certain 62 borrowers expressing that they had some difficulty in repaying the loan, the loan was useful for the short term but its utility did not last a long time, and the loan is not useful for someone who does not know what to do with it. One respondent stated, “The loan was useful, but I wish I had some kind of training on how to manage the money. I didn’t krnow what to do with it at first.” Another stated, “The loan was incredibly useful. With the 40,000 fcfa loan, I think I made about 20,000 fcfa.” While still anotlne said, “The loan was useful irn the beginning, but it was also a big burden because the rainy season did not go well. If the rainy season is not good, we have a lot of difficulty in repaying our debts. ‘ There also seems to be a threshold point where borrowes who have received more loans, are able to distinguish the impact more clearly. In two interviews, the following was noted. Zenabou is an amazing woman. She started out with nothing, and as a result of seven loans from CARE she was able to buy two sewing machines, four cows, and two peanut shelling machirnes. It seems that in order to see the impact of these loans, the person has to have received the loan at least five times. Another tailor borrower thatI spoke with late in the afiernoon has had the same experience. The more loans he received the more people he was able to hire forhis business. Thee seemstobealimittlnatacertainnumberofloans provides a limited number of opportunities for the recipient. On the other hand, borrowers who weren’t able to receive many loans like these tailors often struggled to reimburse their loans. As one interview with a farmer demonstrated, sometimes people had lost money in the process of reimbursing these loans." We were able to talk to six people in Boungougi (three borrowers and three non- borrowers). The most interesting interaction was with a “saan noma” (irn Hausa for best farmer). He had received a loan, arnd in order to reimburse the loan, he sold his store of peanut seeds at 6,000 fcfa/sack. When it came time to plant his peanut field, he had to repurchase the peanut seed at 7,000 fcfa/sack. He lost 2,000 fcfa as a result of selling his peanuts earlier to reimburse his loan. The question now, is would he have had to sell those peanuts " Taken from reeearche’s field notes, Thmsday, September 18, 1997 63 regardless? Maybe not, but maybe the loan allowed him to meet some immediate needs without thinking about the long-term. This seems to the overriding reasorn to take out a loan. lnferentldStetlefleemesponmtoreeearehqueetlons A combirnation of t-tests and crosstabs were rnm to compare non-borrowers with borrowers for significance and association and their investments in the farming system to respond to the four research questions. WW“: Nemmeeesinflembywlichflnosewhoreceiveniaccredit Minfleirfarringsysbmandflnosewhodonot? In order to discover if there were differences in the manner by which those who received micro-credit and those who did not invested irn their farming systen, a number of variables had to first be considered. To analyze these variables, both tests for differences arnd relationships were run. The variable, did you receive micro-credit? with a possible answer of yes or no was considered the independent variable and crosstabs and t-tests wee conducted The dependent variables became the possible investments in the farming systen (e.g. fertilizers, insecticides, planted trees, applied marnure, practiced either natnual regeneration or drs). W inputs The data showed that there were slight differences and relationships between borrowers and non-borrowers and investment in inputs for the farming system. A multiple response analysis was conducted for a series of dichotomous variables. These variables asked farmers whetlner they invested in the following agricultural inputs and practices: fertilizer, insecticide, planted trees, left already existing trees, and implemented soil conservation techniques. Overall, both borrower and non-borrower respondents indicated having practiced natural regeneration (32.2 percent), planted trees (11.3 percent), 64 practiced soil consevation (1 1.9 percent), applied fertilizer (6.2 pecent), insecticide (4.5 percent), and manure (33.9 pecent). As tlnese farmes are short on capital, it is no mistake that those technologies that do not require capital were most widely used by botln goups (e.g. natnn'al regeneration, applied manure, planted trees, and soil consevation techniques). As farmer recognize their decreasing soil fetility in their farm fields, tlnese practices were implemented as all tlnree of these activities contribute to improving the soil quality. In othe words, no signficant differences wee observed between BRK borrowers and non-borrowes irn the adoption of most of these practices. However, comparing the borrowers with non-borrowers, there is a slight association in how they invest in their farming system when considering the above mentioned irnputs which is significant for the plarnted trees category (p= .02). Table 7 represents the two goups responses to their investment in the following agicultural inputs. Table? Adoptionofagflcuibrrdinprovedpmcticesbyreepondents Did not receive credt Did receive credit 40% 30.6% 1 l . 6.7% 14.3% 38.8% As a respondent arnswered yes or no to all categories, the percents comprise more than 100 pecent. Thee is a slightly highe pecentage of borrowes who invest in eithe fertilizer, insecticide, or planting trees than non-borrowers. There seems to be a slight association (r= .28) which is significant (p= .02) between receiving a loans and planting trees. Those who have received loans tend to plant trees more often than those who did not 65 receivealoan. Sometirrnes farmesarerequiredtopurchasetreessothiscouldbeattributed to a capital intensive farming practice. Both the insecticide and fetilizer are also more capital intensive so perhaps the borrowes of credit from BRK eitlner used their loans to invest in this technology, had added capital to invest in this technology from their non-farm business, or decided to intensify their land with these technologies as a result of having less of it. One could also argue that farmers who receive micro-credit are self-selected and already are better off even prior to receiving the loan. They have the capital to invest in their fields in the form of fertilize arnd irnsecticide. Anlmd traction Investment in animals and animal traction represent often times a significant expenditure in the farming system Farmers wee asked if they used animal traction and if so, what kind. The variable was defined where thee were four possible answers: none, oxen, donkey, or botln. Table 8 illustrates both borrowes and non-borrowers responses to the four choices. Tables Useofanimaltractionbyborrowerandnon—bonoweroftheBRK of animal nation Did not receive credt Did receive crth 1 not use tractnon. 1 38% oxen. 5 a a cow 13 12% 66 Table 8 illustrates that thee is no significarnt association between receiving credit and whetlner one uses animal traction or not. In fact, a highe percentage of non-borrowers use oxen animal traction than borrowers. A slightly highe pecentage of borrowers use donkeys for animal traction than non-borrowers but this difference is not significant. Oxen and donkeys are primarily used in animal traction, and a t-test was run to examine whether thee is a significant diffeence in the number of oxen and donkeys and borrowes veses non-borrowes. Non-borrowers possess a mean of 1.41 oxen while borrowes have a mean of 1.07 oxen so practically no difference. As far as donkeys, non- borrowers possess .44 as the borrowers have .40 donkeys so again practically no diffeence. Hired labor To hire labor illustrates another indication of a farme’s wealtln and pehaps the impact of credit on the farming system. There is no significant association, as a result of this study, between having received a loan or not and having the capacity to hire labor. Thirty-eight percent of the borrowes indicated that they hire laborers while only twenty pecent of the non-borrowers indicated that they do not hire laborers to farm their fields. There is a slight diffeence but this is not significant. For those farmers who are not receiving credit, they are investing somewhat less in the capital intensive farmirng inputs such as fertilizer and insecticide than those farmers who are receiving credit. Thee tends to be a weak association which is significant between those who have received credit and plarntation of trees in their fields. Those who have received credit indicated more often as having planted trees in their fields than those who had not received eedit. On the othe hand, recipients of micro—credit have, on aveage, smaller land holdings than non-recipients. The reasons for the this fact are many, and could also explain why tlnee is more investment in capital intensive technologies. The smaller land 67 holding farmers want to intensify their farm in orde to maximize potential profits from their land. This intensification translates into making investments in fertilizer and Recipients of micro-credit may also be more occupied with their non-farm activity as their loan was designated to this activity. Profits from this activity may far outweigh profits from their farm so they have decided to concentrate their efforts on the non-farm activity. Rmchqueetionlz: Asafamei‘sincomeincreases, doesthewilingneetoinvedinthe immanent oi taming sysbm also increase? Several wealth indicators are used to define a farmer’s income. Some of tlnese, for the purposes of this research, are the numbe of animals, farming implements, the kind of house, arnd the farm size. For the purposes of not being redundant, the differences in goat and sheep holdings will be compared between borrowers and non-borrowers as cows and donkeys wee analyzed under research question number one. Table 9 illustrates borrowers and non-borrower’s responses to this question. TablaD Numberoigoatsandsheepbyborrowersandnon-borrowers IKindoianimal [Didnotrecelvecredt IDidreceivecredt Avera number of goats [2.20 (SD = 2.81) I 2.64 (SD = 3.69) Avera number of sheep F67 (SD = 1.23) | 1.36 (SD = 2.59) Borrowers and non-borrowers are no different in the number of goats and sheep they possess. As the loan may have been used to purchase necessary household goods such as food and clothes, there was not a significant long-term impact of the loan on the 68 numbe of arnimals. As the environnnent is so precarious in Nige, poor agricultural years lead farmers to sell off all assets, including animals to buy food to nonuish their families. One indication of wealth is also the numbe of parcels and farm size possessed by respondents. Interestingly enough, it was discovered after running a Meet between numbe and size of fields that the non-borrowers possessed more land and large holdings than the borrowes. Table 10 illustrates this t-test Table 10 Numberandeizeoflandholdingsbyborrowersvenon-borrowers | Total numberoipecels 1Totalfarm size [BRK borrowers [ 4.18 fields 1 6.35 hectares [Non-borrowers I 5.00 fields | 7.07 hectares Non-borrowers have slightly more fields than the borrowers. One would imagine this to be the reverse as some borrowers also purchased land with their loans or the profits from the loans, the largest investment that a farmer could make in their farming systen. On the otlner hand, several key informants mentioned that former borrowers of BRK had to actually sell their land to reimbm'se their loan.20 A cross-tab was also conducted between access to credit and whether the respondents had a non-farm business, anotlne form of income in the farm household. Some individuals who did not receive credit had a non-farm business, but it was apparent that a person who received credit was much more likely to have a non-farm business than a non-borrowe. This association was moderate (r= .42) and significant (p= .00) at the .05 level. Numbe of employees iii a micro-enterprise has also been used as an indication of the financial health of the enterprise (Mead et al. 1991). The borrowes tended to have ’° Key informant interviews with Amadou Haya, Ministry of Environment and Tony Rinauldo, SIMS. 69 more people working for them in their non-farm business (1.20) than the non-borrowers (.33). This diffeence is significant (p= .016) at the .05 level. The capacity for an individual to save is also an indication of their economic health and income stability. Thee were no significant diffeences between borrowers and non- borrowes and their capacity to save. Both goups did not save consistently, end the pecentage of borrowes who saved (38 pecent) was slightly lower than non-borrowers (41 percent) who also indicated that they save. Of the respondents who saved, they indicated savirng in the form of money (53.6 percent), seed (32.1 pecent), and arnimals (14.3 pecent). Reeponeetoreeeeclnquestionfl: Mnaisflnediectoiinueasedimreemntand[otineaxogenous vaidrles] htefanimsysbmmteaeta’ndiilydfleewiumntamaeJandandsoi)? Farmers who received loans from the BRK wee more likely to invest in capital intensive and less sustainable farming practices, such as fertilizers and insecticides. On the otlne hand, borrowers indicated more ofien than non-borrowes that they planted trees in tlneir fields. Planting trees in field has been proven to increase soil fertility arnd the sustainability of natural resources. Implicit in this description of the effects of these investments on long-term sustainability are examples of problens encounteed by the farme respondents in the management of their farming system. These examples are physical, economic, social and political in nature. An example of the effects of poor government policies as contributing to soil eosion arnd decreases irn soil fetility was discoveed dnning the course of this research. Nigeien farmer's lack of fertilizer use in their farrrning system was as a result of elevated prices due to Niger's economic neighbor Nigeria. The government of Nigeria suppressed their fertilize subsidy which then caused the price to rise drastically. This increase in price 70 prevented many of the farmes irnterviewed from investing in fertilize when many of them had invested in past. It was demonstrated throughout the course of this research that rainfall is the main determinant to agricultural production. As last year was a poor year (see Appendix F for rainfall chart), many farmer interviewed wee required to sell ofi‘ any previously acquired assets to purchase food. If farmers do not have sufficient food to eat, they are not going to purchase agicultural irnputs urnless they can receive some kind of credit. Access to credit does not guarantee that investment iii the farming systen will increase as this research demonstrates. Chapter 5 SUMMARY, CONCLUSIONS, AND RECOMMENDATIONS Summuy Research was conducted in South-central Nige, West Africa during September and October, 1997. The purpose of this research was to examine the small holder farmer’s agicultural investment decisions and the impact of micro-credit on these decisions. It was hypothesized that farmers must first be assured of their household livelihood, more specifically food self-sufficiency prior to investing in their farming system. A farme may be less risk averse due to access to micro-credit by eithe assuring food security or providing extra income to invest in the farming system In order to examine this hypothesis, four research metlnodologies were employed. These research techniques were an interview schedule witln sixty-five farmers, semi- structured interviews with key irnformants, participant obsevation in eleven villages, and archival research of key documents. This research was descriptive in nature, and data fiom the interview schedule wee analyzed using SPSS PC+ to test for differences and associations. Four questions wee examined through the course of this research. The purposes of which wee to arnswe an overriding question on the impact of micro-credit in the rural Nigerien’s household and expenditures in the farming system. To examine the impact of an intervention ex posrfacto such as access to micro-credit elicits seveal considerations 71 72 and questions for fnnrthe research. This research illustrated that tlnee were only slight differences between borrowes of BRK and non-borrowers and the meme by which they invested irn capital intensive agicultural technologies (e.g. planting trees, applying insecticides and fetilizers). In an economy where the majority of the population are subsistence farmers who depend on an unpredictable rainfall for their livelihood, the role of micro-eedit on the farmirng systen has a dual effect. In good rainfall years, investments made on the farm have enormous pay-offs. The farmer produces a sufficient amount of food, and is not required to liquidate non-farm assets to purchase food. This fact allows the farrrner to continue to practice a non-farm activity during the nine dry months of the year. Ontlne otlnehand, inpoorrainyseasons, the farmerfalls fnnrtheinto debtasthe household is not able to produce enough food and is required to sell off their assets (e.g. goats, sheep, non-farm activity products) to purchase gain stocks. The late case is more oftenthe scenario inNigewheretherainfall hasnotbeen adequateduring consecutive years. To examine the role and impact of micro-credit over a five year period becomes a difficulttaskastherehavebeenbothgoodrainy seasonsaswell astlne latestpoorrainy season in 1996. People irnteviewed were still recovering from a poor previous agicultural year, and it was difficult for tlnem to express the impact of credit received even just three years previously on their household. Any assets acquired, as a result of the impact of the loan, were sold last year to buy food. The data M tlnis research indicate that there were significant differences in how men and women opeated in their respective household activities, botln non-farm and farm. These diffeences stem from traditional social We built on mainly religious understandings of the roles for men and women. Their different economic activities contributed differently to their understarnding and management of their credit. Men were 73 more likely to look outward, beyond the household for more risky income generating activities, arnd trade at distant markets On the other hand, women wee more likely to operate out of the household, and spend more money on social obligations. Women proved to be more creditworthy than the men, and also more pleased with their inteactions with the BRK. In response to the first and secornd research questions, there is a slight association between credit and investrrnernt in capital intensive agricultural technologies. Those who received BRK credit wee more likely to invest in fertilizes, insecticides, and planting trees. Thee is no diffeence between bonowes and non-borrowers and investment in labor intensive technologies such as soil consevation teclnniques, applying manure, and practicing natural regeneration. For other farming investments such as hired labor and animal traction thee is no association between credit and these investments. This research disproved the assumption that as farmer’s income increases as a result of micro-credit, he/she will more readily invest in the farming system. In fact it appears as if credit plays a small role in a farmer’s decision to invest in his/her farming system. One farmer said, “I have been practicing natural regeneration and applying fetilize prior to receiving a [BRK] loan. One or two loans is not going to cause me to changemy farmingpractices. Iflwanttoinvestirnmy farm,Iwill findthemeanstodo it.” The third research question asked if the willingness for a farmer to invest in the farm increases as the non-farm income increases. This research used several indicators of wealth to distinguish tlne diffeences in income between borrowers and non-borrowers of BRK. It appears that there is no difference nor association between the two goups. There is a slight difference between credit and numbe of goats and sheep, but this difference is 74 not significarnt. Thee was also a slight association between number of people who planted trees and credit. As one farmer explained“, If a man earns a profit from his non-farm income, he is able to farm more land, because he can hire people to farm his field. If he has rrnore land, he will plant trees/leave trees in his field because he already has a lot ofspace to plant his crops. He is not wonied about lack of food as he has both his non-farm income, arnd a large farm. He will gain enough food during the harvest regardless if he plants trees in his field or not. If arnothe peson does not have a non-farm income, and depends solely on his farm income, he probably does not have extra money to hire workers so he is constrained by labor and how much land he can farm. Ifhe is constrained by the amount of land he can farm due to shortages of labor, hewillnothavealotoftreesinhis fieldbecausehemustgainallhecan out his field for his household. According to the guardian and his friends, trees takeup spaceinafieldandproduceshadesotlneplantscannotgow. Duetotlnis fact, a srnalle, less wealtlnier farmer will not plant a lot of trees in his field. Conclusions Micro-credit has been tooted as a quick fix to poverty (Rogaly 1997), but as this research illustrates micro-credit is only a small solution to a rmnch large problem. This problen is political, social, arnd physical in nature, not simply economic or financial. This research rejects the hypothesis that thee is a difference in the manne by which borrowes of the BRK moject and non-borrowes invest in their farming system. Production irn the farming system can have an effect on the credit recipient’s ability to reimburse the loan, but credit does not have a primary role irn the borrowe’s ability to invest in the farmirng system. Thee are two distinct types of credit borrowers which were discoveed tlnroughout the courseofthisreseerch. Theearetlnoseborrowers who fonnndtheloantobeuseful in tire short-term. It was more difficult to distinguish the longe term impacts of these loans. As credit is a burden, borrowes have struggled to pay ofi‘ their loans, and in some instances wee forced to sell off their assets (i.e. animals, fields etc.) in order to reimburse 1' Taken frornn researche’s field notes, Saturday, August 22, 1997. 75 their loans. As Nigerien’s livelihood is agicultnnrally based, a poor rainy season translates into a struggle to find enough food to nourish gowing families. On the other hand, those farrrners who produced enough during the rainy season (either their land holdings wee large or they invested in agicultmal inputs) wee able to reap a profit from the loan and did not struggle as much to reimburse the loan. The major determinant to a creditworthy individual is that person’s agicultural production in this region of Nige. At the commencennent of BRK’s work inn the Maradi department, credit was warmly welcomed by the recipients as it acted as a buffe between subsistence and starvation. Many individuals who were in a crisis food situation borrowed money to act as this buffe. After awhile it became evident that the utility of the credit was only short-lived. Thee wee not tight controls on the disbursement or recovering of funds and the rural bank fell farther arnd fartlne into debt. A combination of bad agicultural years and animal epidemics resulted in making it almost impossible to see the impact of credit during the course of this research. Assets acquiredduringand shortlyaftertheloanpeiod,wee sold offto purchase foodinthese poor agicultmal years. All respondents indicated that last year’s rainy season was as bad as the famine in 1985. As the crops are dependent on the amount and time the rains fall, lesser rains can have a devastating effect on agicultural yields. The timing of the rains must be impeccable in orde to ensure a sufficient harvest. Last year’s rainfall was comparable to the rainfall in 1985, but the timing was somewhat better. Nevertheless, people were required to sell off their assets in order to buy food or even in some cases to pay back the BRK loan. This fact illustrates the assertion that credit is not a panacea for rural development. There are significant environmental considerations and constraints that must be examined in a rural farm household’s livelihood prior to 76 allocating funds to micro-credit in households. Agricultural production seems to be the major determinant in whethe or not a farme is creditworthy. Not only did bad agicultural years translate into sellirng off assets, it also was disastrous for some borrowers who invested their loan money in their farming system If all the loan money was invested in the field, and the rainy season was not adequate, this farme had no reseves to reimburse the loan. Ove tlnirty percent of borrowers used the loan for agicultnnral pnrrposes or to raise animals. This endeavor is just too risky in this delicate, Sahelien environment Charlick (1991) writes, “Perhaps an inescapable fact of life in the Sahel is now obvious: In such a fragile environment, people definitely influence soil quality through their activities, and any development of the region must be based on an awareness of the . limited nature of the resources” (p. 5). As soil quality decreases, the farmer’s agicultural production decreases. This factor combined with low rainfall results in food deficits and shortages of capital to repay loans. Recommendations This recommendation section is divided into tlnree sections: the first part is on recommendations to the admirnistration of the BRK; the second section offers; recommendations for the formation of firture micro-finance institutions the Sahel region of Africa; thirdly, recommendations for future research which deals with the impacts of micro-credit are described. Administration of the BRK Altlnougln a borrower of the BRK is ultimately responsible for reimbursing the loan, the administration of a project can also play a significant role in that individual’s capacity to reimburse the loan. Lack of information and corruption are botln major costs to 77 the borrowe which wee prevalent in the BRK project. Some borrowers did not have a clearideaofwhattheyweegoingtodowitlnloarn, buttheyweeinneedofcapitaltomet household needs. In other cases, borrowers were told that in order to receive money, one must give morney in the form of brnbes. This provided to be anotlne cost to over forty percent of the borrowers. Otlne borrowes mentioned that they had many unnecessary transportation costsofgoingtothecreditofi'ncetoobtaintheirloansandweretoldtoreturnatalaterdate. Ofientimeswhenthelaterdatecame,theyweeagaintoldtoretnnnnatalaterdate. The original design of the BRK project was to limit transaction costs and increase the numbe of borrowers so as to make the transition from a financial intermediary under CARE to an autonomous credit and savings institution that much easier. To do this, the eedit agent, in the beginning, was given much autonomy to conduct his/her job. This systen had its advarntages arnd disadvantages. The advantages were nnostly financial in nature, limiting both the transportation and labor costs as the agent was the sole contact with the borrowes in the specified region. The main disadvantage of having an autonomous credit agent was the lack of controls and follow-up. It was later discoveed that agents were giving villages loans without doing thorough backgound checks on the person’s potential to repay the loan. As one key informant stated, “there is not enough research on the assets of the potential BRK client prior to giving him the loan. You take a lot of risk, and give money to whomeve wants it.” This fact allowed the turn aronmd time of a loan to be fairly short arnd efficient irn the beginning, but not effective in identifying creditwortlny clients. This expedited process was not conducive inn educating the borrowes about the importance of credit and instilling a firm commitment to reimburse the loan. Rathe, as several borrowes mentioned, credit was distributed freely to whomever desired it. 78 Irnitially, the time from completing a first borrowers loan portfolio to this person actually receiving the loan was fairly short (two-three weeks). As the volume of loans increased, the reimbursement rate decreased, and the controls ove the loan processing tightened. Loan delivey slowed down considerably. Approved borrowers were told many times to contact the loan office to receive their money, but when they arrived they were told to return. For a poor farmer this presents a considerable expense in transportation costs and tlnus, encouraged bribes. The corruption in the banking systen became rampant as there was more and more loans going out to borrowers and less and less controls over the credit agent. Some administrators of BRK and CARE International argue that this burgeoning corruption is as a result of the poor wages and low educational level of the agents. Of the seventeen credit agents, five agents do not have highe than a fifth grade education while six have a ninth grade education, and the remairning six have some high school or a high school degree. Agents made up fictitious names of borrowers, were accepting brnhes from potential borrowers, and for the most part, were not conducting sufficient backgound checks on the potential borrowes. A culmination of these factors resulted in lower reimbursement rates for the BRK. Not only was the BRK worse off as a financial intermediary, but villages who had paid bribes and transportation costs were also suffering. As this research clearly denonstrates, there is no follow-up after a client is approved for a loan, receives it, and is in the process of reimbursing the loan. The BRK staff doesrn’t know what the purpose of the loan is and whetlner or not borrowers can manage large sums of cash. The indication of a successful micro-credit project is the reimbm'sement rate (Rogaly 1997). This fact could be misleading as people may reimburse a loan, but at the expense of what?, one must ask. In fact, very few borrowers could 79 identify from where they received their loan. In their undestanding, the loans came from the eedit agent in Tnhiri. The idea of a financial lendirng institnntion is foreign to many nonwestem societies, especially in predominantly Muslim cultures. Shipton (1994) writes, “The diffeences in assumptions underlyirng Islamic law about usury and the nnore secular European rnnles are not just philosophical or religious. They also influence real behavior and tlnus resource flows. Project and progam designers interested in issuing or recovering loans in the western Sahel, or irn mobilizing savings there, should pay attention toboththesesetsofrules,aswellastolocal customs onwhich they are superimposed” (p. 309). Credit has addressed a segnent of a much large undefined problem in Nige. Poverty, asviewedinwesterntermsisinte'msofincome, andcreditisusedtoincreaseor hopefully positively impact this income. Poverty is not viewed in tlnese terms in several nonweste'n countries so credit serves only a short-term purpose of providing short-term capital for household expenses. Hulrne arnd Mosley (1996) write, “Chambers (1983, 1995) has recorded the many forms of deprivation that very poor people identify themselves in experiencing that are not captured by income-pove'ty measures. These include vulnerability to a sudden dramatic decrease in consumption levels, ill-health and physical weakness, social irnferiority, powerlessness, humiliation and isolation. Such dimensions of poverty are significant in their own right and are also essential analytical components for the understanding of income poverty” (p. 105). Recommendations to other Micro-finance institutions: Education from the micro-finance institution is critical to first-time borrowers. This education should include how to manage their finances, the importance of credit, and the concept of a banking institution. For all borrowers, tlnere was a lack of information on the BRK as an institution. This concept of an institution possessing money is foreign to 80 most, rural Nigeiens. An obvious gap in understanding emerges between the source of morney and the client. Many individuals interviewed had never heard of the BRK, some had heard of CARE, and everyone krnew the credit agent “with all of the money”. This inevitably led to corruption as one person appears to possess all the money. The credit agent must possess less powe and autonomy. Perhaps with the creation of fine good clients committees (recently instituted in Septembe 1997), fine decision making powe will be diveted solely fiom fine credit agent and put more in fine hands of the committee membes. On fine ofine hand finee is also fine danger finat finese committees can become too political, choosing only close friends. More questioning and education need to occur irn order to obtain creditworthy borrowes who are aware of fineir rights. Credit provides a short term solution to poverty by providing important capital for Nigeien farmers to purchase food in fine poor years and long-term capital for the wealfinier Nigeriens. By decentralizing fine accounting procedures of the BRK a sense of ownership in how to manage money will be encouraged In a recent study in World Development (Vol. 24, No. l, 1996), Pankaj S. Jain outlines eight points to ensure success after examining fine Grameen Bank model in Bangladesh. Most of these points are applicable to the BRK a) Repeated supervision and cross-checks of field firnctionaries on fineir performance. b) Making “administration” locally responsible to problems of field fnmctionaries. c) Clear community commitment and repeated explanation of fine rationale and justification of organizational policies. d) Conceptual/ideological articulation of the significance of routine field-level tasks. e) Smooth flow of services. f) Protection of field functionaries. g) Training arnd induction of field fnnrnctionaries. h) Boosting fine self-image, pride in task of field functionaries. (p. 88). 81 Clearly,finesearesevealpointsthatarecrucialtofinesuccessofannal-based, micro-finance institutiorns. Many of which are not currenfiy being irrnplenented by fine BRK. Reconmendatlons for researchers studying the inpacts of micro-credit There have been seveal studies on the methodological concerns when looking at the impacts of micro-credit on fine household, but not on the impact on fine farming system (Gaile and Foste 1996). This research tries to fill finat gap. Does micro-credit have a role to play to encouraging more investment in the farming system finrough increased income in fine non-farm sector? 1. The year a person first received a BRK loan defined fine sampling fiame for finis research. These sampling fiarne parameters were not appmpriate. It is more appropriate to determine how many loans and fine monetary amount one person has received and conduct a stratified random sample of different loan amonmts received per each sampling goup. To consider time as a parameter for fine sampling frame is not appropriate in finis case. Those who had received one or two loans experiences short-term impacts, and later defaulted irn fine finird or forth loans. Those who had continued to receive up to five or six loans were able to pass an important finreshold in which they were able to experience more long-term impacts from the loans. It was also recommended to take three sampling frames in which thee were cases who had been long-term borrowes, ofiners who wee about to receive a loan, and still ofiners who had not been in contact wifin fine BRK. This sampling frame would have helped to control for self-selection bias. This technique is found in other micro-credit impact studies. Gaile and Foste (1996) argue, “Because of fine issues of fungibility and selectivity bias, sample design and execution in micro-enterprise impact studies is complex 82 and critical. Selection bias arises bofin in terms of fine progam clients and the location of the progams” (p. iv.). 2. To distinguish credit’s innpact on the recipients, the researcher must have a longitudinal data. Unfortunately, fine BRK gathered minimal data (age, economic activity, village resided) on fineir clients so it was difficult to conduct a pre- and post- study of the credit recipient’s farming practices, non-farm business, and overall household livelihood to The researche for this study asked several recall question, but fineir reliability should be scrutinized. In asking fine questions on fine impact of fine loan, fine respondents were required to remembe five year previously, and finis was nearly impossible. BRKml'irnembers: Ross Croulet Cheibou Samna Hainikoye Pascal Merino Tengy Gravot BRKFieldagents: Elise Hama Fati Omar Kimba Chima Miko Abdou Gadi Government agents: Hassan Labo Almadjir Amadou Haya Yacouba Sangare NGO representatives: Rahila Dare Halima ldi Issa Mariama Kwame Brian Larson Zakari Maidougou Salarnatou Seydou Tony Rinauldo Rabiou Mummon Yarn Schoellart APPENDIX A LIST OF KEY INFORMANTS CT P, Principal Teclnrnical Advisor Contentieux and Interim Director of BRK Auditor Controlle Past CTP Cente chief for Trhiri Center chief for Tessaoua Agent in Maradi Agent in Tibiri Agicultnnral Extension Agent in Chadakori Forestry Chief in Maradi Extension trainer based in Niamey CARE/Maradi, Women On The Move World Food Progam, United Nations Caisse Populaire representative in Chadakori CARE Assistant Director, Nianney, Niger CARE Regional Director, Maradi, Niger CARE/Maradi, Women On The Move SIMS, Project Director SIMS, Project Agent CARE Director, Niamey, Niger 83 APPENDIX B INTERVIEW INSTRUMENT Baldn Raya Karkara and Michigan State University Questionnaire on Farm and Nonfam Practices in the Canton de Chadakori, Niger Tumbaiyoyi bisa aikin gona da aikin sona’a cikin Jihar na Chadakori, kasa Niger. Date of interview: Respondent ID #_ Time Began: Village ID # Time Ended: I . Introduction Sallam aleikum. Sunana Jamila ltuma ina so in yi maka wasu tambayoyi gane da aikingonakadaaikin sona’aka. Miyanmakarantacecanamerikakuma inakarantasana'ar aikin gona, lama zan rubuta takarda a Iran horkokin aikin gona da sona ’a. Wannan takarda zatataimaka mnjama’atowurinsamunkayannoma irinnazamanidamasuaikindadan kasuwan ce. Sar' kun ba ni labari, latma kun koya mini akinku. Za ni yi maka wasu tambaiyayi ltuma ina so in shaida maka cewa duk amsoshin da kabayarzasuzama. Idan alturaitambayoyindabazaka iyabadaamsaba, donAIIahka fada mini. I am going to ask you a series of questions. I want you to krnow finat participation in this study is voluntary and all of your answers are kept confidential. If for any reason you do not want to answe any questions, please let me knnow and we will go on. You indicate your voluntary agreement to participate by answering finese questions so if at any time, you do not want to answer a part or all of a question, please let me know, and I will go on. Would you like to participate in this survey? Circle only one, [0] No [1] Yes If yes, begin interview ..... To Bismillah, zan fara yi ma ka tamboyoyi. II. Background information on farm income Tambayoyi bisa ga aikin gona. In finis section, I will ask you questions about your farm, number of crops you plant, and what you do wifin your crops. Yanzu ina so na yi maka tambayoyi, bisa ga aikin gonarka. da yawan shibka da ka keyi, da kuma irin abubuwan da Ira ke shukawa, da lokacin girbe. 1. Do you farm annual crops? Ka na yin aikin gona? [0] No, if no, go to question # 7. (In onon, zaka ga tambaiya bokwe) [1] Yes 84 85 If yes to #1, see attached table for questions about crop production. When did you sell your crops last year? Yaushe lmke saida abinda gonaka? Amount Nawa? not my crops. Ba ni na gona. What do you do with the income from the sale of your agricultural production? Mi kakeyi da reeba daga aikin gona? [1] Buy other cooking products (oil, sugar, spices) (Sayan kayan abincz) [2] Buy an animal (Sayan bisashe) [3] Buy clothes or other textiles (Sayan kayan sawa da zannuwa) [4] Spend on family events (weddings, baptisms) (Kashe kudi ga bikis da armes) [5] Buy other goods (e.g. bicycles, radios etc..) (Saya wasu kaya kuma keke, radio) [6} Put in savings (a sa ga ususu) [7] Invest in nonfarm activity (a sa ga sana 'a) [8] Other: Backgound information on nonfarm income In this section, I will be asking you questions about your nonfarm income. Nonfarm income is income obtained through activities beyond your agricultural ones. Some of these can be commerce, food processing and selling, tailoring, metalworking, and crafts. Please answer every question to the best of your knowledge, and do not hesitate to ask for clarifications if necessary. Yanzu, za ni yi maka tumbaiyoyi bisa ga albashin da kake samu to hanya daban, bandatahanyaraikingona. Watauinama’mwhwgnrwatasm'awandabatashqi aikin gona ba, kama sana ’ar dinki, kasuwanci, tukin mota, k0 makeri. Don Allah ka bada amsoshin ka iya gwargwado kuma in Ira na da tambayoyi, ina so ka gaya mini. 5. In the past year, have you had any income besides your farm income? Tin dagabara, kakesamu hiditahanyarwatasana’a mndabatashafiaila‘ngona ha? [0] No, go to question #20. [1] Yes From where did you earn most of your nonfarm income in the last year? To hanyar wace sana ’0 cc ka kesamun kudi? Activity How often? Investment? Profit ? 86 7. How long have you been doing this activity and earning an income? ___Y1'8. Shekara nawa kake/kike yi wannan aiki? shekaru. 8. How many people work in your business, including yourself? Mutane nawa, sake aiki cikirr aikinka/ki, tare da kai? ____mutane. 9. How much do you pay them? Nawa kake biya su? 10. Where do you market your products from your business? Ina kakesaida kayadagasana’a? 11. Do you have a savings? Kane da age? Karhin Bashi Bayan bashi Before loan After loan If yes, what? Mi kake age? 12. Have you received a formal and/or nonformal loan for your nonagriculture entreprise in the past five years? Cikin shekaru biyar da suka wuce, Ira taba samun rancen kudi daga wurin hukuma k0 banki domin wannan sana ’ar taka? [0] No, if no, go to question #20. [1] Yes 13. From whom did you receive your loan, when, and for how much? Daga ina kake/kike samu bashi, yaushe kake samu kuma dan nawa ka samu? source er Use may receive a are F gidana); CARE International; BRK; PN 36; Friend (daga abokai); Formal Bank like BIAO (banki); Community tontine (daga asusu); Another NGO. NOTE: [I loan was receivedfiom Baldn Raya Karkara, proceed to BRK questions. 13a. What are your impressions of the BRK/CARE and the agent who works for BRK? Is s/he helpful? Yaya kake gani aikin na CARE da BRK? Hina tahiya da kyau koko akwai wannun Iahi anka samu? 13b. How much did you reimburse? cfa. Kudin nawa, ka meda musu bayan ka samu bashi? l3c. 13d. 13e. 13f. 13g. 14. 15. 16. 17. AmuntnfimcneyYIEqudm? 87 Do you know why you paid more than you received? [(0 gani mia sa biyaka ta hi bashiyawa? Reeba na bashi da kudin takardu? [0] No [1] Yes Did you give money or a present to the agent before receiving the loan? Kake bada kudi koko tamaka ga agent karhin kake samu bashi? If someone does not repay their loan right away, how should they penalized? In mutun bashi bia tin da wuri, yaya za mu shira da shi? If the agent was going to offer you a loan how would s/he know if you could reimburse the loan? In mushebashin ya 20 wajen ku in balcu bashi, yaya za shi sani za ku cika alkowali? Why do some people not reimburse on time? Dommi mutane ba su bia bashi tin da wuri? Ifrespondcntdidnotreceivealoan from BRKaskthemiftheyhaveheardof BRK and why they did not receive a loan fi'om them? In balm samu bashi, ka tebajin Iabarin BRK In eeee, ina sukejin Iabari? What has happened to your nonfarm income aficr receiving the loan? Miya samu ga sana 'alva tin da ka samu bashi? [l] Stayed the same (zamna dai dai) [2] Has grown (ya kara) [3] Has diminished (ya zamna karami) [4] Other (W asu): What do you do with the income from your nonfarm activity? Mi kakeyi da reeba daga sana ’aka? Check al tint apply: [1] Reinvestment in business (sa kudi aikin sana ’a). If yes, how? [2] Invest in farm (sa kudi aikin kaya gona). go to question #18. [3] Spend money on household expenses (Kashe kudi cila’n gida). If yes, how? [1] Buy more clothes for him/herself since the loan. [2] Buy more clothes for children since the loan. [3] Buy books for school since the loan. [4] Buy medicine at dispensaire. [4] Give loans to family and friends (Bada kudi ga gidanna) [5] Other: For example, if you were to receive 10,000 cfa in profit, what would you do with this money? Mun yi Iisahi, in kin samujika hamsin na reeba, mi za ki yi da shi? 18. 19. 20. 21. 22. 88 thmnfromnonfannincorm Has nonfarm income made it possible to buy something you couldn’t buy before in your farming system? [0] No or [1] Yes, if yes, what? Reebadagaaikinsona’a, tana iyawasaya waneabugonabaka iyasayatin dagada? Karhin bashi Bayan bashi Check if yes Before the loan After the loan [1] Hired labor _ _ [2] Fertilizer _ __ [3] Improved seed [4] Rock bunds or other soil conservation techniques. [5] Manure [6] Plant trees [7] Obtain more land to farm [8] Other: How have these investments affected your profit from your agricultural work? Yaya, Irake gani wannan saysay, kana samu reeba gare su? Wane irin reeba? information on persons cimcteristics of farmer In this part of the interview, I want to ask questions about you as a person. If you don’t know the answer, please let me know and if you need more clarification, let me know. . Cildn wanung magana Iokacin, za niyi maka tombaiyoyi da wata kamar karatu da kayi da sauran su. Whatisyomgendel’?(obscrveratherthanask) [1] Male (mi/'1') [2] Female (mace) What is your educational level? Wane irin makaranta ka yi? [1] Some primary school [2] Diplome dc CEO [3] Baccalaureet [4] Diplome d’universite [5] License professional school (accounting, ag. tech. etc..) [6] Koranic school [7] Nonformal education/fimctional literacy classess What is your age? W nawa gare ka? 23. 24. 25. 26. 27. 28. 8 \0 What kind of house do you own? Waneiringidagareka? (observemtherthanask) [1] Square mud but with thatched roof (gidan kasa da zana) [2] Square mud but with metal roof (gidan kasa da ngfin kwano) [3] Round mud hut (gidan kasa karai) [4] Cement house (gidan siminn') How many animals do you manage? Dabobi nawa gare ka? [1] Goats (awakz) [2] Cows (shanu) [3] Sheep (r080) [4] Horses (dokr) [5] Donkeys (jab) [6] Camels (rakumi) What kind of farming implements do you own? Waneirin kmmaila’ngonagareka? (check al that apply) [1] Plow (chariot) [2] Hand hoe (kwache) [3] Upright hoe [4] Other: How many children who work in the fields live in this household? Yaranawagareka wandasunaaikingagona? How many wives in this household? Mara nawa cila'n wanung gida? Are any people from the household on the coast who send remittances back? Akwai yara na gidanka Icuma basu nan yanzu? [0] No [1] Yes Commentaire: APPENDIX C SAMPLING CALCULATION FOR BORROWER GROUP Individual male borrowers = 4 l.p./25 l.p." = 16 % X 10 = 2 l.p. Individual female borroers = 1 l.p./25 l.p. = 4 % X 10 = 1 l.p. Female group = 8 l.p./25 l.p. = 32 % X 10 = 3 l.p. Male group = 12 l.p./25 l.p. = 48 % X 10 = 5 l.p. Total: 11 loan portfolios ‘ l.p. = loan portfolio There were a total of twenty-five loan portfolios for 1992. In order to obtain a representative sample of each of the four loan portfolio types, they had to be weighted accordingly. For example, there were four individual male borrowers postfolios for 1992 so four was divided by twenty-five to determine the percentage to take from ten as the sample would be ten loan portfolios. APPENDIX E OPEN-ENDED ANSWERS Question#13: Resultsoitheloans: howweretheyusad andweretheyusaful? “The loan was useful because with the profit from the loan, I could buy animals, and sell the animals in a bad rainy season to buy food.” “The loans was useful because I was able to buy a millet grounding machine and peanuts to stock. It has been though to repay the loan.” “With the loan I bought animals to sell in other markets. I also gave some butchers loans of animals and now I am having problems paying back the loan. I have at least 100,000 fcfa worth of loans with butchers, and they have not paid me back.” “The loan is not too much of a burden. The brunt of the burden is borne by the borrower not the lender. I have had some problems paying back the loan as I still have six payments to make on a loan given to me in 1993.” “I have had a hard time to repay the loan. I invested my loan in field work, and the rainy season was not very good.” “With the money from the loan, I bought a field and I have reaped a lot of profit out of that field so obviously the loan has been useful for me.” “The loan was useful for me, but I don’t feel good about not reimbursing the loan right away.” “The loan was useful in the short term, but bad rainy seasons have prevented him from repaying the loan. There is a lot of hunger here.” “The loan was very useful because you could control your own money to buy and sell stuff.” “This money was very useful to have something in my pocket that I could use to pay every month.” “I felt good about the loan because I was able to buy a donkey with the money.” “I was able to have a stock of money with which to do my commerce. I really appreciated this.” “The lack of food/millet has caused my profit to decrease for my business. It was useful for a short while, but not for the long term.” 92 93 “Prior to receiving the loan, I did not understand what to do with the money. Now I understand what I would do. I bought a field with the money, and this did not help to reimburse the loand immediately.” “I still have not reimbursed my loan, but the loan wasn’t so much the problem. It was how I managed the loan which was the problem.” “The loan was incredibly useful. With the 40,000 fcfa loan, 1 think I made about 20,000 fcfa.” “There was a profit with the loan, but it did not last until the next loan. It is necessary to keep giving loans.” “It was useful as I was able to get married. Ifa person does not know what to do with the loan, they must not take it and CARE must not give them a loan.” “There is no burden with the loan, but if there is no millet (food) then there is no stock left in the household because it all goes to buying food.” “If you are able to do something with the money, then there is no problem and the loan is worthwhile.” “There is no problem with the loan, but I did not use it for my business.” “The loan was useful in that it provided me extra money with which to feed my family. I used the loan also to buy animals and there are a lot ofexpenses in raising animals (special food). The profit did not last a long time. “The loan was useful, but I wish I had some kind of training on how to manage the money. I didn’t know what to do with it at first.” “I was grateful for this money because it gave me my own money with which to do commerce.” “The loan was useful as I was able to buy a field with the profit from the loan.” “1 had no problem paying back the loan as I have a business, but those people who do not have a business have a very hard time paying back their loans. A person must have a nonfarm activity prior to receiving any kind of loan.” “This loan was useful because I was able to buy cows with the profit from the loan.” “This loan was useful because I was able to buy animals to keep in my house.” “Yes, the loan was useful because I bought a goat with the profits from the loan.” “With the srmll loan I have received, I have been able to buy animals, and they have now given birth.” “Yes it was useful and we want more.” 94 “This loan was useful because I have been able to buy more sewing machines and increase the amount of work I do. When I increase my amount of work, I increase my profits, and then I can keep investing in my business.” “With this loan, I am able to keep working as a mechanic and keep buying equipment to make my shop more modern.” ‘Thc loan was useful for about five months, and the market did not go well. After the five months most of my profits from business were gone.” “A lot of people thought they would make a lot of money off of these loans, but unfortunately their market activities did not go well. There were a lot of people in my group of borrowers who did not like this loan. It was too much to give, and not enough market opportunities.” “Itwasuseful inthebeginning,butitwas alsoabigburdenbecausethe rainy season did not go well. If the rainy season is not good, we have a lot of difficulty in repaying our debts.” “These loans are useful for those peole who are used to the market, but those who have never had a small business, the loans are not very useful and it is very difficult for these pe0ple to repay the loans.” “I spent my loan on my family and this money lasted three months (a loan of 25,000 fcfa). I have not repaid all my loan, and the only place I will receive the money to repay the loan will be from my fields. Right now people do not have money, and when pe0ple do not have money, there is no market.” “I have received many loans, and used to receive many trainings as well to improve my forging skills. Ifeelasifldothemostmodernkindofworkintlrisareaasaresult of these trainings, and I don’t have to ask others for advice or for money. I feel really good about my work right now.” “The loan was useful as I was able to eat and drink with this money. I was also able to have a baptism for a family member with the money from the loan.” “This loan was useful to me.” “It was useful to me because everyone is in need of food and clothes.” “We feel good about these loans because they help you to provide for your families with food and clothes.” “This loan was useful because it gave us a piece of mind.” “These loans are a good idea because you don’t have to ask someone else for a loan.” “These loans are a good idea.” 95 “I have received loans over eight times and it has helped me out tremendously. I now have my own money fi'om my own business and I don’t have to ask my husband for money. I no longer need loans because I have enough things and assets.” Queetionflmmdoessomeonedowith profltfromanonfannbusiness? AndHowdresekweflmntsaflectedyourpmfltfromyouragriculhrralwork? “I invest all my money in both my business and field.” (4 respondents) “I would put all the profit into my field.” (3 respondents) “I would invest my money in business.” (3 respondents) “I put my profit in my business, and I buy peanuts which I am going to resell later.” “It depends on the time ofyear when I earn this profit. lfI earn it before the rainy season, I put the money into my field. If I cam it after the rains, I buy seed to stock.” “This has had a positive effect on my agricultural wo .” “ My worh'ng capital has only increased as a result from the loan.” “1 have put all of the profits into my home.” “I invest any extra money into my farm as this is where I make most of my profits. I make profits from my nonfarm business, but not as great as my farm” “I invest profits into animals for animal traction on my farm.” “1 put more money into my farm as there is a greater pay-ofi'. There are a lot of people and less land so I try to buy more land when l have more money.” “I will always farm and there is a profit if there is rain. The next best activity is animal husbandry. After animal husbandry there is commerce which replace lack of food in bad years.” “If rains come, profit will come, but if rains don’t come, no profit.” “I make more investments in peanuts as a result of profits.” “There is more profit as I bought another field with the money, and from that field have obviously made a profit.” “I definitely made a profit from this loan.” “If all of my household expenses are met, I will put more of the profit in my business.” “I will usually invest more money in my field as this shows more of a profit.” 96 “There is a profit from these loans.” “Any profit I make will go towards baptisms and household expenses.” “I would use any profit to put into farming and to buy animals.” “I would invest money into improved modern farming tech. rather than my business.” “If I earn the profit before the rainy season then I invest the money into my field.” “I would reimburse my loan with the profits.” “1 will invest my money in both peanuts and my business.” “I buy clothes for myself and children.” APPENDIX F RESEARCHER’S DAILY JOURNAL Tuesday, August 19, 1997 I left Lansing at 6 am. on a flight to New York. I spent about three hours in the airport of JFK before taking my flight to Niger. This Air Afrique was an experience. We first landed in Dakar, Senegal and we had to get off the plane for an hour before continuing on the same flight to go to Abidjan. In Abidjan, I had to wait for at least eight hours before taking the next flight to Niamey. It was a crazy flight, I have to say. Wednesday, August 20, 1997 Luckily, there was a CARE vehicle at the airport to meet me, and they took me off to Brian Larson's house in the middle of the city. There, I met BRK’S Director who is currently CARE's director of the BRK even though the BRK is trying to become more autonomous. I found out that there are quite a number of agents who are taking money from the BRK, and that the former director had a different management style and how he ran the BRK. This attitude may have been detrimental to the success of the BRK as people wee not held accountable to the organization. Currently they are in the process of trying to decide how the BRK project should be organized and if they should close their doors altogethe. There just arer't enough qualified people who can handle the volrnne of clients they are receiving The director worked for the OIC prior to coming to CARE. The OIC works on small erterprise development in developing countries, and he worked on projects in Lesotho, Ghana, Guinea, and Burkina. I am not sure which ones he worked on. Anyway, he then lived and worked in Benin for several years. Thercwillbeameetingwithtlre CARE certral staffaboutthe future ofBRK A former director believes that if the situation does not brighten before November tlrer BRK should definitely close their doors. The forme director will be commencing a credit mutual in Binrin Konni before the end of this year. He has received frmding from the Credit de France Pour le Developpement. Some documents wee given to me that look very useful and I am in the process of reading through these. The more I am here, the more I realize how little time I have. The BRKdirectorwillreturnonSept. l7,andwillthenbeoutinMaradi. Intheinterimeill be talking to the comptroller and the interim BRK director. Should the BRK stay open? This is the big question. The BRK director wanted to see some questions on the survey concerning BRK and people's impression of its work I may add these also. This survey may be getting very large although questions pertaining to the BRK will only conce'n those recipients of loans from BRK. The BRK director also reminded me to make sure I ask about other loans people may receive from other projects/ family members. My focus of this work is on the adoption of agricultural technologies and not so much on the loans, but I fear it is becoming the reverse. How can what I find out profit the agents in the field that they are more effective in their work? We'll see. As I talk to more people, it may become more necessary to focus on household security as a whole and the role of the loan. The BRK director has also mentioned this question of fungibility. It doesn't seem as if BRK really knows whee the loan is going although they may try to reclassify the loans as targeted for agriculture and other places. This will affect the repayment schedule 98 as agricultural loans are more long term or the repayment doesn't begin until after the harvest. For dinner, the BRK former director and I went to the Marquis 2000, and we were able to talk some more about the BRK. He worked on the BRK for a couple of months prior to the BRK director. He was the director interim between the BRK director and Michel Duvall. Apparently, M. Duvall was also disheartered about the BRK, and recommended to CARE that the doors be closed. The director of CARE, asked Michel to find other solutions besides closing the doors. Thursday, August 21, 1997 Today, the chaufl‘eur picked me up at 8:30 am, and took me to the bank. After changing money I went to the Peace Corps office. There I met some volunteers and also saw some chauffeurs and the CARE directore Bonin. After seeing people at Peace Corps, I was brought to the CARE office. Here I met with the country director, and he seemed so so about my research. I didn‘t feel as ifI was very assertive about what I want to accomplish, and he recommended several different things. First he recommended that I keep the impact of BRK broader than just on the farming system. He feels that people will probably invest nrore into their nonfarm business rather than into their farm, and may get out of farming altogether. I think this may be the case, but I also think people will continue to farm more than he may think. They may not feel completely secure with just their nonfarm activity so farming provides another kind of safety net, another means to obtain food. He recommended that I choose people across all social strata I am not sure if I will do this. I may try to focus my research on those who receive small loans/group loans. He said that those who receive loans are divided into several categories: small group loans, small individual loans, large group loans, large individual loans. He would be interested in seeing something across all sized groups. I will have to discuss this with the comptroller or the interim BRK director. Questions for BRK: 1) What are the criteria for selection of clierts? 2) Are there different categories of loan portfolios (e.g. small loan, large loan, and large group loan)? 3) How are the clients entered into computer? What kinds of information? 4) Is the canton, arrondissement, dept. etc.. in their dossier? 5) How can I get a list of recipients in the Canton de Chadakori? 6) What partner agencies do you work with? Both governmental and nongovernmental? In some way, I think he sees my survey as kind of unrealistic. What did he say? He asked what my hypothesis is? I said that it is, as farmers income increases, then investment in the farm increases as well. First of all, how can I attribute increased income to the credit? And if the income increases, who is to say that it is invested in the farm? This was Murari's question before I left also. I may have to make the impact even broader. In fact, I am sure I will. So he asked the so what question? So why I am doing this research? To what will this contribute? I answered by saying if an extension agent brows what causes a farmer to invest/adopt a technology then s/he can better target his/he programs. Maybe there could be a link-up betweer CARE and the ag. service. Is there already this connection? Does 99 BRK partner with any other NGOs in the region or other govenmental services? I must talk to the ag. agent in Chadakori. Also in knowing the complete impact of these kinds of loans on the client, is it worth keeping the rural bank open regardless of the administrative mess is it in? BRK may be justified in the face of all of the administrative mix-ups. We'll see. The CARE director also mentioned several studies that have been completed in Maradi, and I could look at the data. First thee was a household security survey canied out in the Department in Maradi and will be carried out in other regions of the country (T ahoua, Agadez, and others). These data were entered into SPSS PC+ and is all found in Maradi. Zachary will brow where this is, and I should ask him, according to the CARE director. My study could actually fall nicely on the coattails of that data, and just be more concentrated in the region. Like the volunteerism survey in East Lansing. In fact, I will start to make a list ofquestions for Zachary. 1) Where would I find the household security survey data? 2) Where would I find the natural resource managrnent survey data? 3) What are his pe'ccptions of BRK? 4) Should BRK stay oper? CARE evaluated all of their natural resource projects also that they have ever conducted in Niger, and all oftlris data is also found in Maradi. Maradi is the place to be. I will head out there tomorrow with the former director in his car. There may be questions on this survey from the efi‘ects of nonfarm activity on land management or what are the determinants to adoption of certain technologies (e.g. soil conservation etc...). The CARE director also mentioned to ask people what they think/brow about the interest rate. Do they understand what this is based on the opportunity cost of capital and defined by the central banking systen etc..? It is interesting to see the institutional structure of CARE where you have the natural resource management project apart from the credit project apart from the health project. If the interest rate is high, people will save more, but this isn't always the case. Even though the interest rate is high, people in Niger will still take out loans to invest in their non-farm business. Administratively, this makes sense, but from the point of view of the farmer, it may not make sense. BRK almost gives me some kind of structure to work under in order to talk to farmers, but the questions will no doubt spread out from beyond the loan structure and the farming systen to a farmer's management of his/her household. They all have their own separate roles while farmers are thinking of everything together. This is something I have never explored, and it would be interesting for me to see how people handle their finances and assure food secrrrity in their household. What else did the CARE director say? He would like some kind of debriefing before I head back to the US, and he was also wondering if there would be anyway to extend my travel. I brow there is no way that this could be possible. I must work for Murari wher I return. I just hope I can complete all of this work before I leave. I will spend next week in Maradi, and perhaps part of the following one. I would like to sperd the week of August 25 in Maradi defining my sample and I may go to Sabon Matchi that Tuesday, August 26 to attend the market and test some of my questions. Then I would refine my questionnaire. I will also have to send a letter to Chadakori about staying out there for six weeks (from Monday, Sept. 1 to Friday, Oct. 10) carrying out my research. I would like to pay rent at a house that has a bed. I would also like to pay someone to cook for me. I will ask Sarki where mightbe abetterplaceto stay intlre armndissement. We'll see. I needto figure out how much I can afford. If I have 240.000 cfa with me now, and I am staying 100 for 35 days in Chadakori, I can spend 80,000 cfa on rent and the same amount on food. I don‘t think it will be anywhee near that amount, but we'll see. All of this can be figured out next week. I just have to get through this one day at a time. I also must be in touch with John. That's all for now. More notes later ..... Friday, August 22, 1997 I drove to Maradi with Bindi, an Australian woman and former director, a French guy who was the director of BRK before the BRK director. The former director has a wealth of browledge about microcredit and the effects of microcredit. He will be starting up a credit mutual in Konni pretty soon. He would like to see questions on the survey concerned with the BRK and what people think about the bank/organization etc... We arrived in Maradi around 8:30 PM., and I was so glad to see Gado and Oro and Mariama and duka mutane wanda sun zamna nan Maradi. Saturday, August 23. 1997 On this day, I pretty much hung out with Gado, Oro, and Mariama. I met some of the volunteer. staying in the hostel, and they filled me in on all of the news taking place around Maradi. The biodiversity team is now called the NRM team They are moving further and frrrtlrer north from the border with Nigeria. They still work with Bawa Mati, andl amgoingtotryto seehimbeforelheadouttoChadakori. We'll see. We drank tea, and caught up on all of the news. I practiced my survey with Gado and Oro, and they understood eveything that I was asking. Thee wee a couple of issues that arose. First, all the money that Gado earns doing the guardian work and the sewing, he invests in animals. When he started working at the hostel six years ago, he had only three cows, and now he has thirteen. He was able to save enough money to buy more animals. He also has at least twenty goats and sheep that are up north with Hassan. Oro received a loan from BRK of 50,000 CFA. With that money, he bought cloth and had clothes made to embroider. With every bolt of cloth, they (Gado and Oro) figured they can make 38,000 CFA in profit after paying the tailor and for the cloth. Oro saw two problems with the BRK. One was with the reimbursement. He thought that the reimbursemert was too fast. He would have liked to have waited for a couple of months before beginning the repayment In the initial meeting with the credit agent, he had to pay 1,000 CFA and he didn't understand what that was for. The agent did not explain why he had to pay that 1,000 CFA. In total, he said he reimbursed 54,500 CFA. He really wasn‘t sure about why he paid the extra 4,500 CF A. Another aspect of the operations of the BRK that they were not satisfied was the fact that they had to opeate in a group. It is hard for them to find a group of people to work with. The nrinirnum number of persons with whom BRK will give a loan is five people. Both Oro and Gado do not want to operate in a group. They would prefer to work among themselves. After hanging out with Gado and Oro all moming, I headed over to the fame BRK’s director’s house to get Bindi's phone number. He and his wife wee napping so I hung out with the guardian and asked him sonre questions about how he manages his household. This was another practice for my upcoming interviews. He gave me a lot of useful information, and did it very readily. I also asked questions about what kind of difference a loan would make in his life/his farming system. He and some other folks wee saying that if profits from a non-farm activity increase, the investment in the farm increases. They gave the following example: 101 If a man earns a profit from his non-farm income, he is able to farm more land, because he can hire people to farm his field. Ifhe has more land, he will plant trees/leave trees in his field because he already has a lot of space to plant his crops. He is not worried about lack of food as he has both his non-farm income, and a large farm. He will gain enough food during the harvest regardless if he plants trees in his field or not. If another person does not have a non-farm income, and depends solely on his farm income, he probably does not have extra money to hire workers so he is constrained by labor and how much land he can farm. If he is constrained by the amount of land he can farm due to shortages of labor,hewillnothavealot oftrecsinhis fieldbecausehemustgain allhecarr out his field for his household. According to the guardian and his friends, trees take up space in a field and produce shade so the plants cannot grow. Due to this fact. a smaller, less wealthier farmer will not plant a lot of trees in his field, according to these men. This discussion was very informative, and gave me some other ideas for my research Maybe the fact that someone receives a loan and his/her income increases, this means that s/he is able to hire laborers to work on more land. More land is used for agricultural purposes (possibly leading to degradation), but more trees may also be planted as a result of not having a fear/need of not having food to eat. The more land someone has, the more economically secure they areas they are able to produce their own food and have some to sell. They can also more readily plant trees or practice sustainable agriculture because not every bit of land needs to be taken up by crops. A poorer farmer must reap the most out of his field as this may be his sole source of income. He may less readily adopt planting trees or implementing more sustainable practices that take part of his field out of production. Following this discussion, I went to BRK, and I met comptroller and the other accountant. We spoke a little about the upcoming schedule for the agents at BRK. There is a big meeting with the CARE director onTuesday, August 25th. I asked them the kinds of information that are collected by the agerts, and they said I can find out the exact village and the canton. I returned to the hostel and spert the rest of my time over there, hanging out with Oro and Gado, andIalso spoke some withthecoordinatorfortheNRMteamin Madarounfa. Sunday, August 24, 1997 There was an amazing storm during the night, and then also during the early morning. I didn't wake up until around 10 am. After waking up, I jumped up and went outto Chadakori. Itook ataxi outtheretotheroadto Chadakori, andthen I headed outto the village by way of a small motorcycle. When I arrived I was told that the chef de canton wasn‘t thee, but his wives were there. I found Chima there, and she wasn‘t feeling very well. She was complme shocked to see me out there. I hung out with her for a couple of hours, and I explained what I was doing there. She said that I could stay in her room with her. I was so glad she said that. I will move out there on Sept. 2. and stay for about 4 weeks, until the end of the month. Sarki wasn't there. He was in Dosso for a meeting with the new govenmert. The moto taxi came back and picked me up around 3 pm., and I headed back into Maradi. 102 I arrived in Maradi around 5 pm, and then I headed over to Bindi's house. I hung out with he for a couple of hours, and she invited me to eat dinner at the guest house. I also spoke with Debo about staying thee for a couple of nights. After Bindi's I went to the hostel and hung out with Gado and Oro for a little while, then headed ove to the guest house. Sadio, former director's wife invited me to stay with her after her husband leaves. I will go ove there on Tuesday until the following Monday, I think? Monday, August 25, 1997 Todayhasbeengreatsofar. ImettheinterimBRKdirector,andheseemstothink he can find me a moto to use for my research. He would like me to do this study in more areas than just Chadakori. We'll see. He gave some interesting information. He is spear- heading this effort to form village committees to receive advice on who should get credit hour the BRK. He also thinks that the information that I gain from my interviews will be useful for the agents to brow whee their communication is not getting through, and where it is. He would also like me to cover more areas than just the Canton de Chadakori. I told him that I really couldn't without some form of transportation. As far as the reimbursement rate and the number of borrowers, the inteim BRK director is in charge of recuperating loans that have not been paid. He explained that tires are at least 1200 dossiers that have not been reimbursed Some of then are as old as the project. These 1200 dossiers comprise approximately 4000 people. In total, he thinks at least 10,000 people have been affected by the BRK. He sees many problems with the repayment schedule, and thinks he will recuperate a lot of the loans afte the rainy season ends and people have harvested their crops. He also implied that maybe they should designate where the loans are going for, and then this would affect the repayment schedule. He seemed to imply that they wee going to give loans to people who just farmed, and I respondedbysayingthatitseensthattheeisarealdangeintlris. Ifapesondoesnot have another income source (i.e. sona'a/market something), it seems like there is a slim chance that they will have extra money around to repay the loan. The disbursement of funds has also been a problem in the past. Apparently there are no banks or a post office to disburse funds, and an agent from the BRK has to travel with millions of cfa and bring that out to the villages. He would prefer to set up some system where the client could obtain the money by him/herself with a promissary note or something. He wants to try to make this happen as well. In the past, people would receive funds from the traditional moneylenders, but now more and more are receiving loans fi'om BRK. This is infuriating the moneylenders as they are losing business. Often times, people who have taken a loan fi'om BRK, and have difficulty in repaying the loan as thee are several social obligations in the villages. Money that was supposed to be reimbursed the next day is spent on bringing someone to the hospital. The inteim BRK director gave me an earfrrl when it came to the loans to people in Chadakori. Apparertly, there were three groups of people comprising at least 15 loan recipients. These loan recipients gave the reimbursement money to the only guy who had a moto in the village. That guy pocketed all the money. He now owes at least one million cfa, and the interim BRK director has set up a repayment plan with him. I guess Chadakori is not in good shape?!!? We'll see about the surrounding areas as well. That was all with the interim BRK director told me. I passed on a copy of my questionnaire to him to look over, and add any questions if he has them. I think he probably will add something. I saw a lot of pe0ple who I knew -- Elise, Aissatou, the drives, the money dispenser, Mme. Chima Miko. A lot of folks. The rest of the day I 103 worked on the two commuters, typing in my research notes and defining my theoretical framework. This whole study is becoming more and more interesting, I am finding. For lunch, I was invited to Bindi’s house, and then I came back here around 2:30 until 4:30 pm. I also worked on typing in another copy of my questionnaire. I can't seem to bring my copy up on this computer. I guess I did everything on a level that was much highe than this one hee. A drive brought me to the market and I bought a pagrre, some cloth for pants, and a fularri pagne. I will pick up the pants on Friday at the market. They are black with embroidery on the bottom. I returned to the hostel and hung out with Gado and Oro and Mariama. Eveyone. The comptroller was coming to pick me up at 7:30 am so I went to bed fairly early. Tuesday, August 26, 1997 Bright and early, up and out of there. I checked out of the hostel and now I will go stay ove at Sadio and the former director's house. This should be nice. I am sure it will be super clean and nice. I will stay there until Monday, possibly Tuesday, Sept 2 since this will be when Chima will return. The administrator of the BRK is going to find me a moto touse,andhewill also findme acartogotoTsibiri. Ireceiveda fax this nrorning from my mom and now I should go to the post office to send my mom and John faxes. I will pass by the sous-bureau du CARE to see the director of Mata Masu Dubara. This afie'noon I will meet another CARE project director and Marnadou and show them how to operate SPSS PC+. I will go to Tsibiri on Thursday as Elise will not be thee tomorrow. I erded up working all moming in the oflice. What drd I accomplish? I was working on the questionnaire and trying to incorporate a bunch of questions. I was a little discouraged when I went to lunch because, apparently, the CARE director wanted to brow what I was going to contribute to BRK if they were going to support me with a moto. At lunch time, I told him what I could contribute, but there was a whole issue of insurance and if I got into an accident. I will now show him all the membe cards I have for insurance purposes. I was a little discouraged when I left the BRK office for lunch, and then I walked down to the road. On my way to the road, someone called out my name, and there was Idi, the egg man. Well, he is no longe selling omelettes, brrt he still has a coffee stand. We hung out for a half an hour, just talking. I ended up leaving his place around 1:15 to head ove to conrptrolle and Bindi's for lunch. We ate lunch and then I headed over the CARE's office. I was at CARE for the rest of the aftemoon, and I missed my rendez-vous with the assistant director of, Mata Masu Dubara. She was a little bit upset, but we are meeting next Monday. I was able to meet with another CARE project director and Mahamadou. This CARE project director explained the HHLS (household livelihood security survey) that was conducted by University of Arizona. He didn't brow too much about it, and said I should probably talk to Zachari when he returns. Mahamadou was a huge help and showed me the files on SPSS. There had to be at least ten files just for SPSS. It was unbelievable!! He then showed me the draft of the results from the survey. They were really interesting, and I was especially inteested in seeing their methodology ( see attached files with notes from report). I was also able to see the final report on MMD and this is easy to read as it is in English. She did an interesting report, but you can really tell that she is an anthropology major. I like how she incorporates all the stuff together. I left CARE around 5:30 pm and headed over to the poste to send two faxes (my mom and John). I miss John and I have not heard from him yet. I may send him anothe today with my fax numbe. I should buy some postcards also. I returned to Sadio's house, changed my clothes and ran down to the club. I played tennis with the CARE 104 l director, comptroller, and anotlre CARE project director until around 7 pm, and then we wert to comptroller and Bindi's house for dinne. That was really nice. Wednesday, August 27, 1997 Today started out with a meeting with the interim BRK director responsible for legal matte for loan recovery (contendeux). I asked him a bunch of questions about the BRK. I wanted to brow what are the primary objectives of the BRK. If the BRK was a successful project, what would success look like? He said thee are two objectives: 1) increase the standard of living for people in the Maradi department; and 2) that the loans are repayedinatimelymanner. Ithen askedhimwhatdothe Danes wantto seeafterfive years with BRK if they are giving all of this money? He said that the BRK is self sufficient, does not need financing, and is making a profit. In the beginning, the BRK had a more humantarian and social role, and this is changing. In order to continue to have an impact on the people, a sustainable institution must be in tact. He gave a little history of the BRK, and he said that in the beginning, agents gave credit to everyone even those people who did not have any commerce, and sometirrres they gave too much credit to the point that the amount they gave depassed the means of the individual. The BRK must be managed very strictly if it is to be sustainable. Can the bank be sustainable and also have a humanitarian calling? Table 11 PastandPresentSituationoitheBRK PastsituationofFRK Current situation oi'e'r'tK Credit was granted to all and for any anrount without any consultation by other people in the The agents write a dossier, go to the chef de centre which then is preserted to the 3gency nor othe villagers. contertieux and the auditor. Time took two weeks Time takes two-three months. Salary based on repayment rate. A set salary all the time. Members of a group are from all over. Members of a group must be from same village. Salary based on repayment. Much rrrore detoumement of money by the agents which means that maybe the clierts have reimbursed more than what is believed the interim BRK director thought that maybe 10-15 % of the cummdmgdebe are fi'om the agents. The more accountability there is among the agents, the lowe the transaction costs. If the agert has clients who are responsible and reimburse fairly quickly then the agent doesn't need to go out to visit the client. In the beginning, there was also a lot of sensibilization with people in the villages, encouraging them to take credit. The idea of eedit practically meant cadeau and did not have to be reimbursed. the interim BRK director attributes the fact of low repayment rate to this fact. He thinks that there should have been much less sensibilisation and more organization in the office. I see this as leading to high transaction costs, and not much profit from the sale of money. Essentially, this bank wants to see money to as many people as possible and gain interest. As far as the interest rate, the interim BRK director said this is a little bit lowe than nroneylender in the village. This is an interesting fact, and one wondes if they folks are a little bit upset. The interest rate is compounded at 18 %. 105 This means that the longer one waits, the more the interest rate decreases, and pays more in the long run. As far as giving loans, the agert must now veify that the potertial client has an activity and then verifies this person with the chef de centre. The chef de certre then sees the contertieux and the auditor to check this person out. This interview with the inteim BRK director was vey informative, and even though he has not been at the BRK very long, he has instituted many things. There are now a bunch of forms that the agent must fill out to guarantee the loan. There are now at least three steps that the agent must cross before the client actually receives the loan. This is what is leading to the high transaction costs, and is taking at least two months. Hopefully they will reduce this time. Later in the morning, I spoke with the auditor. He is going to conduct un etude d'impact fairly soon of the BRK. We spoke some about the different sampling groups, and I explained to him about my work with the BRK. I offered to add some questions to my survey that could be useful to BRK, and possibly, could complete the etude d'impact for the agence in Tsibiri. He really liked this idea, and we started brainstorming some questions togethe. He thought having some questions about the fi'ais dc dossie and the taux d'irrteret would be a good idea to see if pe0ple understand these. If they do not, then there needs to be more training on the part of the agent. He thought it would be interesting to compare credit received from BRK to credit received from other places. He also wants to brow if people understand the consequences of not paying their loan. For the sampling issue, he was imagining 10 dossier/agence. A dossie could comprise from 1-10 people. He would like one third of the sample be a women's group and the other two thirds will be made up individual womer, men, and groups of men borrowes. We ther tackled issue concenring what groups to interview and we came up with four differert groups: 1) Groupl:ilsonteuducreditdepuis$ans; 2) Group 2: ils ont fait leur dossie, mais ils n'ont pas eu un pret; 3) Group 3: ils vont recevoir un pret bientot; 4) Group 4: ils n'ont jarnais fait leur dossie, et ils n'ont pas en un pret. For one sample in one agency, the most respondents we could have would be 46 pesons, and this was calculated in the following manne. 3 dossier des femmes: 30 pesonnnes l dossier d'homme: 10 personnnes 6 dossies d’individu: 6 personnes 46 personnes If the sample group of borrowes is 46 persons then the other groups would have to be 46 as well, and this would mean a total of 184 people. This would be in an extreme case, the most I would have to interview. I would have to do at least 40 interviews/week, and this just may not be possible. I will have to see when I go out to Tsibiri tomorrow with the auditor how many on average are in a group. What else did we discuss? We talked about all of the paper work someone must do before receiving a loan. This is incredible. He even gave me cOpies of everything which was really nice. He also explained that the reimbursement that somne pays depends on how long they take the loan out for. 106 We will go out Tsibiri tomorrow, and define the sample. This should be inteesting. I will be able to see how this whole thing is organized, and will be able to make a comparison between those who had a loan six years ago and who are about to receive a loan. Another CARE project director had a small fete chez lui, and we all went to this. It was in honor of Odile who is leaving to work at CARE's headquarters. There was tons of food, brrt not too much dancing. We played ternis on Tuesday and Wednesday also. It was fun. the CARE director and I won everytime. Thursday, August 28, 1997 The trip toTibiri went really well. The auditor road his motocycle out thee with me on the back, and we worked pretty hard all day (9:30 am to 3:00 pm). We spoke with Elise for awhile about the BRK and how the work is panning out. She gave us a lot of news. He region covers from Guidan Roumji to Dakoro to Tsibiri to Chadakori. It seems like quite a large area. In total, there are currently 181 dossiers with excess of at least 500 individual clients. Some of these dossiers are individuals and the majority of them are groups of five or more usually. Elise is in charge of supervising three agents (Zara in Tibiri, Abdu in Dakoro, and Idrissa in Grridan Roumji). She also gave me a little about the history of the BRK. First clients would come to the BIAO to open a caisse d'epargne, and they would receive a loan. In the loan, they would pay half and CARE would pay the other half. This system went on for a few years, and then CARE bought out all of the loans at the BIAO, and put it all in the CCP/Poste. People would receive loans, and then go to the poste to pay the loan. After a while, CARE wanted to take money out of the posts and then the post had no money to give them. All the money from the post was gone. The money was then taken from the posts and put back into the BIAO and the BRK was created. BRK now loans money from the bank, and then gives this money to the people. The people reimburse BRK for the loans. As far as selection, previously the agent would put a group of people togethe, and then they would receive the loan. Now the people decide who will be in their group rather than the agert. There is much nrore of a process to guarantee the loan, especially for individuals. Before, there was not much of a guarantee for the repayment of the loan and this caused problems. Elise admitted that clients now are much more serious. I then asked he about the committee of good clients, and she said that this had been tried in the past, but it became too political. People who were creditworthy were not receiving loans because they were not in the same political party as the president of the committee. In order to ensure that the committee chooses good chants, thee must be some incentive. What is their incentive to choose people who will pay back the loan? For then, they will want to have their relatives/friends in the bank, and they will get kickbacks from these folks. There ismoreofanincentiveforthem togivemoneytotheirfriendsand family ratherthanto someone who can really pay back the loan. She explained that in the past, she and he assistant had people who were trustworthy and could pay back the loan rather than having a committee choose the person who would receive the loan. Elise then told a whole story about how in the past there used to be an esprit d’equipe, but now there really isn't this feeling. Before everyone would talk about what was happening even the drivers and agents together. Now it seems that things are discussed and told to the agents in the field to irrrplement. She feels like it should not be this way, and that those who are on the terrain brow best how to operate the bank. There are directions from the office without consulting people, and this causes the agerts to not work well together. Before BRK really was aggressive about looking for clients, and when 107 they first approached Chadakori, they asked a frierd of theirs who would be a good peson to give money to. This guy pocketed all of the money, and the villagers blame BRK for this fact. Another complaint that Elise had was about carbrrrant. They definitely do not have enough money for gas per month. The chef de centre has a little bit more money for gas, but it is definitely not enough. The last t0pic we spoke about was this whole thing about penalties. If someone does not pay right away ther for everyday they are late, they pay a 2% penalty against their original loan. They actually only pay this peralty once, and ther they only pay again if they are late the next month. We left Tibiri around 3 pm, and travelled back to Maradi. I typed up the sampling frame and the method we used to obtain the sample. Everyone has always talked about howharditistoobtainasample,butitseenedprettyeasytome. Iguessbecause wehad good lists of people to choose from. Friday, August 29, 1997 I had a leisurely morning. I wert to the post office at 9 am, and received a fax from John. From there, I went by and visited with Gado and Mariama for a little while. After visiting with them, I headed ove to the BRK office downtown to meet with Chima at 10:30 am She was in a meeting with the interim BRK director, and they were forming the Comite des Bons Clients. This whole meeting seemed pretty animated. I hung out and talked to some agents and women who wee paying back their loan like the one in Tibiri. It's so funny because at first they totally don't understand what I am saying, and then she awhile they get it then they start talking. Two women were giving me news of their small erterprises, and the impact of the credit from CARE. They kept referring to the credit institution as CARE and not BRK. It was so funny. Anyway, one woman has received a loan five times since 1995, and since that time she has been able to buy two cows and a plow, four goats, and another field to plow. She bought the field for 60,000 cfa. She plants peanuts, millet, beans, and sorghum on he fields. If she plants one measure of peanuts, she receives 14 measures. So for every sack of peanuts she plants, she is able to harvest 24 sacks. The othe woman, Hadiza, had no cows previous to receiving he loans, and now she has two and a plow. He sons do all her work, and she no longe works in the fields. She sold off five goats before the rainy season because they were sick, but as a result of the loan she was able to buy five more. She has two fields where she plants millet and peanuts. Both ofthese women used to go to Nigeria to buy goods and bring them back up to Nige to sell, but they said they are afraid now of having their things confiscated at the border. These women sell pagrres, flip flops, cola nuts, omo, earrings, blouses, and scarves. They said they gain the most profit from the sale of cola nuts. When asked what they would do with a 50,000 loan, they said they would buy stuff (named above) with all the money. They wouldn't spend the money on anything else. After speaking with these womer, I met with Chima for about an hour. I asked her questions about the history of BRK, and changes she has noticed Before there wee much less people between the chef and the agents. Now the agents report to the chef de centre who reports to their superior in the main office. Sometimes news bypass the chef de centres and goes directly to the agents, and then the chef de certres do not understand what is going on. There seems to be too many steps in between in order to accomplish anything. Initially no one knew about BRK so it wsa the job of the agents to sensibiliser everyone and work with them in groups. A lot of loans wee given out without a lot of suivie. The drive even explained to me that sometinres loans were given to one person 108 out in the middle ofnowhee and it wasn't worth the gas to go out there to collect on the loan. There are definitely problens with transaction costs. As far as the situation with the good client committees, Chima saw this fail miserably in the past. Committee members would not choose good clients and it would become too political. The situation as it stands now may work if there are enough people who have a voice and help in the decision making process. In reponse the question about whethe or not, CARE should leave the BRK on its own or not, Chima thinks that they are not ready for this right now. This could happen, she thinks in a couple of years. I ther asked her if she had any specific questions she would like to include on the survey, and she said that she would like to brow what people brow about the penalties that are new (tara). I invited the comptrolle, Bindy, and Sadio out for food and drink at the jardin publique. I had invited the interim BRK director also, but we didn't come until later so he missed us. I was sort of bummed, and felt badly that we gave him a faux rcndee-vous. He is so nice, and has been so helpful that it was too bad we stood him. For some reason, I thought he would wait for us for a longe period of time. Oh well. Saturday, August 30, 1997 I erded up working in the morning because I wanted to finish up with my questionnaire. I worked from 9-noon, and then I was invited to Rekia Abdu's house. I went back to Sadio's house, and waited for Rekia, but she didn't come. Finally she called around 2 pm, and she was waiting for me at he house. There was definitely a lack of cormnunication. I went ove to he house until around 3:30 pm,and then headed over to Gado and Mariama's place. Since I have been working at CARE, I haven't had time to go ove to see thm Gado, Oro, and I went out to buy drinks for the party for another NGO person that the volunteers organized. This began at 6:30, and ther I was invited over to comptroller and Bindy's house at 8 pm. I hung out with the volunteers and another NGO person and Liz until around 7:30 and then headed back to Sadio's house. Sadio and I went to Bindy's house from 8 pm. until around 11 pm. I just love hanging out with them. Sunday, August 31,1997 1 spert the whole morning at Gado and Mariama's, drinking tea and him. At noon, Saidou came to get me to bring me to Rahaila's house. We drove over there,and she wasn't thee. She was still in Danja, but one of her sisters wanted to go there. Saidou brought us to the post dc police, and we took a taxi fiom thee to Danja. Rahaila was shocked to see me. We hung out and she showed me photos of Norway. Upon my return to Maradi, I went over to the BRK to print out my questionnaire. I couldn‘t figure out how to turn on the computer where I print things out all the time so I didn't stay that long. After BRK, I went home and hung out. It was so nice to be in one place, just chilling. I organized my stuff, and I will leave a bag of clothes at Bindy's house. I will head out to Chadakori tomorrow afternoon to start my interviews. Monday, September 1, 1997 I feel like I have accomplished so much already. I completed my questionnaire and made 30 copies to start. I will probably come back down to make some more. I also bought some strrff at the store for Chima, and interviewed the ass. director from Mata 109 Masu Dubara. She gave me sene inteesting information about the traditions of men and worrren in this departrnert. Apparently, the men do not help out in the expenses of the household very much. The women use their money for feeding and clothing their families. The men pretty much do as they please with their money. Mer will also ask the women to give them loans wheeas men in Tahoua would neve ask this. They are too ashamed to ask their wives for loans. I also finished the survey in French. I will make the corrections tomorrow and print that out as well. I must get started on the report. I should try to finish an introduction today before I head out to Chadakori. I had everything made that I wanted to have made, and now I just have to go out to the bush for a couple of weeks to work with Sarki and folks out thee. I think I will hang out and talk to Sarki today and tomorrow and get his feelings on the study, and find out where the villages are. I also nwd to find out wher is the best time to reach people. I think I would probably head out after lunch to go meet folks. Tuesday, September 2, 1997 WelltodaylheadouttoChadakori. Beforelheadoutlwillstartonthereporta little bit. Some of the stuff I have gathered I think will be useful for people hee at BRK I won't have this computer with me as I will be out in the bush for a while. I wonder if I should leave it right hee on the desk. I will ask the interim BRK director or comptrolle. I need to stay pretty deligent with keeping my notes. Last night I went to dinnner at another NGO person’s house. This was really good to be able to talk to another NGO peson about his work. He is doing a lot of experiments with zai holes, natural regen., and other stuff like that. He wants to also figure out ways to attract birds to the fields, and have them nest there. If they are nesting there, their manure will help to fertilize the soil. The soils here are lacking in phosphorous, and bird manure is high in phosphorous. I guess they were doing some work with rock phosphate, but it is too expersive, and the mine here in Niger is on strike for some reason. He has said they have also pulled out of several villages where the people just were not motivated. Apparently, people are just too spoiled from other projects, and anothe NGO person suggested CARE really be careful to whom they give loans. He suggested that I go and talk to Rabiou about his work with zai and natural reger. to find out what motivates people to actually put these into their fields. In passing my hypothesis by this person, he seems to think that it is more when someone is in a crisis situation that they would actually decide to irnplenent DRS work. If their soil has been totally exhausted ther they see the advantages of implementing soil consevation tech. I passed by him the whole idea of someone's income increasing,and increased investment in the farming system. It's true that there will be increased investment in the form of cattle and plows, but there may not be more adoption of "more sustainable practices". In fact it may be the revese. If, for example, someone has more money, they are able to purchase more fields, then they can farm more areas. This doesn't necessarily mean that they will practice more sustainable agriculture. What does sustainable mean anyway? They care for the soil with chemical inputs or they conserve the soil with zais and trees. I conside it more the latte. The only people, according to anothe NGO peson who pay to have zai holes dug in their fields are his agents. They are already convinced of the advantages of zai holes, and they have the means to pay someone to dig them. Someone who is not convinced of their utility will not pay someone to dig them for them. This whole question of land tenure is pretty precarious in the region where I will be doing my research. There is no longe land left over. During the time of Kountche, he 110 declared that anyone who stayed on land longe than three years, then that land belonged to them. He did this to discourage the large landholdes who had a lot of land, but neve farmed it. He wanted everyone to have a chance at having land. Now that land is scarce in this region, people sell off their land, and in fact, thee are quite a number of people who are landless. In times with lack of moyer, people sold off their land to buy food, but this NGO person said that people even sold their land to take another wife. He said that large landholders may rent parcels of their land, but they will not allow one peson to farm that parcel for more than two years. People are paranoid that if someone farms that land more than two years then they will declare that land as theirs. As far as inrplenenting improved farming tech., people who own their land are somewhat hesitant as they are neve sure who gets to profit from the trees on the land If they want to cut their own trees, they are supposed, en principe, get a permit from Eaux et Forets. Often times people do not do this, and if they get caught will receive a peralty by being fined. If someone is renting land, the landlord highly discourages that person from planting a tree as this represents putting down stakes and claiming the land. People do not like this. This will have to be a major question on my survey. If someone does not own land, then they surely are not going to invest in the soil. This was like the situation in Guidan Karo and the women who planted cowpeas on one field. They had invested money into fertilizer, planted cowpeas, and now the chef de village was going to reclaim that land. He probably is lacking in land, and that land is now pretty fertile with the fertilize and the residue from the cowpeas. The dinner at another NGO person's house was informative as usual, and it was great to just hang out and hear what he had to say. I don't imagine doing any of my surveys before the weekend. These next few days will be for me to hang out, and get to brow the area again. Maybe I will walk over to Guidan Karo and say hi to Mari. She may also come to the market on Thursday. We'll see. Today two voluntees came ove to talk to me at the office about their lives afier Peace Corps. You could tell they are just a little bit worried about what they will be doing afterwards. Life only gets easie from here on out. It's so frmny. The older one gets, the more cleve one is about how one does things. I will take good notes in the village and then ente these in the computer wher I return in two weeks time. I think I may not stay out there longer than two weeks. We'll see. Two weeks from today would be the sixteenth and the weekend would be the nineteertlr, twentieth, and twenty-first Maybe I will come in for that weekend. I headed out of Maradi around 3 pm, and anived out here in Chadakori around 3:30 pm. Chima wasn't here and neitlre was Sarki. They are both in Niamey. It's no problem because Harouna came ove and brought all the stuff in the house, and said for me to just make myself at home. IntalkingtoHarouna, hebrowseveyonearoundtlrisareasoltlrinkwewill start working togethe tomorrow. He said that you can usually reach people around 1 1 am. or after. I will probably hang out in the mornings talking to people, and ther head out right after lunch. Hopefully I can do about 3-4 interviews/day. It seems like all the villages are fairly close by. I will be able to go to a lot of them on foot, and then when I have a moto, Iwillgetonthemotoandgotothose. Hopefirlly Chima will come back tonight. If not, I will see he later in the week. Sarki should be back here on Thursday. I think I am going to like staying here. This house is all hustle and bustle and I guess there is always someone around. 1 1 1 Wednesday, September 3, 1997 Well, I did not sleep well the first night I was here. It was just way too hot, and there were too many mosquitos. Needless to say, I woke up early and did not feel well rested Howa asked me if I wanted to go over to Hajia's house. It was more of an order than an invitation so I wert over there with her. There were so many flies. It was so gross. I am definitely not used to being here at the moment. At 9:00 am, Abou and I reviewed the questionnaires and all of the questions. I figured I would take Abou and Harouna as research assistants for this job of interviews. I think I will pay then about 20-25,000 cfa for the month. We'll see. Harouna came over around 10 am., and I reviewed the questions with him. We left Chadakori at 10:45 am for Don Madotchi. It took about 30 minutes to walk there, not too long. The sun was beating down pretty hard though by the time we arrived We erded up interviewing five people (one man and four women). Luckily I have Abou and Harou here to help me out with interviews. People just don't get my Hausa. I feel like I am not getting the answers I want. It is hard to distinguish this impact. Thee are a few things that have been pretty useful. 1) Thetimebetweentlreloansistoolong. Loansaremainlyusedasa safety net and do not necessarily make a huge impact in people’s lives. 2) As far as possessing more animals or having none means to market stuff, so much of people’s welath is based on the rainfall and good health with animals. Apparently last year was a bad one for rain and two years ago thee were a lot of sicbresses with the anirmls. There definitely to be some trends emerging. People sell their peanut harvest, eat their millet and meet other household needs with their nrillet. Last year was not a good year for either crops or animals so any profit people received from their loan was eaten up by last year’s bad harvest. As far as BRK is concerned, people are pleased with its work and would like to continue to receive loans. Many realize that it is as a result of othe people’s lack of payment that they are not receiving a loan. Thursday. September 4, 1997 Againtodaywewentoutaround ll amtotrytoreachpeopletotalkto. Intlre morning we just hrmg out, talked and I looked ove what I had done yesterday. I think the more I do, the more I will be able to see how much people are in common. Today we pretty much stayed in Chadakori. We wee able to talk to seven people so this makes 12 people er tout. Some interesting things: 1) people give penalties to one arrotlre. If people do not pay right away when it comes time to repay the loan, a penalty of 500 cfa is enforced. 2) money lenders charges an interest rate similar to BRK If a person receives 7,000 in a loan, he has to repay 8,500 cfa. 3) one group of ten is still waiting for their third loan. They gave 7,500 cfa to one peson (chef de groupe) to give to the agent, and they sill haven’t heard anything. 4) people have realized that if they give money to the lerding agent that they aremcrelikelytoreceive aloarr. 112 People really do tell the truth during these interviews, and it is obvious that they enjoy talking about their crops. Friday, September 5, 1997 Today was a productive and tiring day. Harou and I left around 10:30 am for Don Madotchi and I did 3 interviews with pe0ple thee. I then wet on toGarin Mountoundai with Harou. It was about a 2 km. walk from Don Madotchi which wasn’t so bad, but we didn’t eat anything. People in Guidan Mountoundai were scared of me. I guess I can’t blame them that a woman, white fiom America drops into their life, totally unexpectedly. I guess this would be a little scary for folks who aren’t used to seeing a bature. The first guy we spoke to would barely give us a response. We had to ask questions over and over again in orde for him to respond. Kumya, ta yi yawall After finishing our questions with him, he brought us to the guy’s house who was in charge of their group. He was also hesitant at first, butafterlassuredhimlwasn’ttheretotake anything fiomhim, hewasdefinitely more responsive. Harou and I wee so hungry that I asked the guy if someone sold garin rogo. We ended up talking to fan people. A lot of people who have received a loan from CARE were no longe in the village. One guy actually took the money and wert to Nigeria. We finished up in Guidan Mountoundai and started our trek back to Chadakori. We ended up getting back to Chadakori around 5:30 pm. Both Harouna and I were pretty tired We are and wert to sleep. Saturday, September 6, 1997 Today I was going to work with Harou, but then Howa asked me to go with he to Tomroro. I told Harou that I was going to accompany Howa to Tomroro so he told everyone that I wasn’t coming. It turned out that the carriage that was going to bring us was broken. I ended up hanging all day with Amina, Howa, and the girls. I went ove to Hassana’s house, and we joked around. They tried to put braids in my hair, but it didn’t work. It was nice to relax, but I was hoping to be able to do some work. Sunday, Sepbmber 7, 1997 Harou and I were able to talk to eight people today. Some were very informative, and other interviews weren’t as informative. Somtimes I feel I am imposing in on people. There was one guy who really didn’t want to talk to me. His life seemed so hard. Last year was bad for Irim, and then his baby died. Life is hard for these folks. The topic on which I am talking to people about is definitely kind of sensitive. People are scared that I am coming to them because of some problem or maybe it isn’t this. I guess I’ll have to live with it for awhile. We’ll see what happens. Monday, September 8. 1997 Today is a big celebration for the Day of Literacy. People have beer preparing for this for two days. It should be really firn. I am not going to work today as everyone will be involved the festivities. I only have one survey left. Last night I tried to complete a ninth inteview, but thee was just toornrrch noise. I will complete this interview today with Tsahiro. They sent me a moto yesteday so I will be able to start going out en brousse. It should be fun. 113 Tuesday, September's, 1997 I wertto Maraditodaytomakecopies ofmy survey. Ilefifirstthinginthe morning so that no one would see me on the moto. As I was leaving, flre moto just would not go vey well so I ended up stalling about five times. Afte stalling so many time, 1 road the moto to En Kouka and left it there. From En Kourka, I took a taxi from there into Maradi. I arrived in Maradi around 9 am, and went straight to the office. I made copies of the survey, and ther gave an update to the auditor and the interim BRK director. They were definitely interested to hear what I had found out. What have I discovered? Some inteesting stuff, but no a helluva lot for my research. Credit does not make a huge diffeence in people’s lives. Thursday, Semnrber 11, 1997 Yesteday was an unevertful day. We left Chadakori around 10 am. for Sonmaili, and we didn’t see anyone that we wanted to talk to. People wee eithe not there or they did not live in that village. We ended up talking to three people who had neve had loans, and one person who has had a loan. They gave some good info, but I am still wondering if there will be any sort ofdiffeence between the two groups. I think there will be by the mere fact that those who received a loan are probably already better off that those who have not received one. It’s so hard to tell the kind of impact that this credit project has had in the long term in people’s lives. As it was fairly long ago, any profit made off the loan has probably been eater up by buying food. People liquidate their savings in times of famine or drought and as last year was a bad one, they can never quite get out of this vicious circle of povety. Agriculture rs definitely seen as the primary activity with animal fattening/raising as second and commerce as third. People definitely see that they make more off the land than any other activity. They will invest all their savings and everything in agriculture before augrnerting their non-farm activity. In asking the question about where people would invest their profit from their non- farm activity - in agriculture or non-agriculture, everyone said that they would unequivocally invest in the farm. This is interesting because in working so hard in farm/non-farm activities it becomes apparent that for much less owrk, there is much more profit in the farm than the non-farm activity. We returned to Chadakori around 4 pm, and we were so beat. I went ove to Mariama Kwame’s house in Chadakori. Sec key informant interview notes on Mariama Kwame. Saturday, September 13, 1997 I feel like I have not been as productive as I would have liked to be. I think since Wednes. I only interviewed five-six people. I guess that’s not too bad considering BRK folks came out to Chadakori on Thurs. I really wasn’t able to talk to too many on Thurs. because I think when they saw the CARE car, they fled out of the village. Yesterday I was able to talk to Hassan, the ag. extension agent and Marima Kwame fiom the Caisse Populaire. These two inteviews proved to be very useful. I obtained some interesting info. Hassan thought that people weren’t telling the truth about investments in the farm. He thought more people would spend money on bikis and their petit cnteprise than on their farm. He ther proceeded to explain the loans he has given out for fert and seed. These loans wee over five years and they began in 1994. They will end in 1999. We 114 talked for awhile, and Ire proved to give vey interesting information. I should type these up so they are more legible. I talked to Marianra in the aftenoon, and she also gave some good information. The Caisse definitely requires more of a guarantee, and she said she would prefer to obtain a loan from the BRK than the Caisse. If you save 15,000 fcfa in the Caisse, you can only receive a loan of 30,000 fcfa, but if you want more that this then you have toask othes to be your witness or back you up in your loan. BRK has nothing like this in place, and it also may be difficult for certain people to obtain a loan if they cannot save. She believes eveyone is able to save, and it is just a change in mentality. Over and over again she kept saying how the Caisse does not take a risk. BRK does take a lot of risks, according to Mariama. Sunday, September 14. 1997 Afte an incredibly tiring day, I am now at Hindi and the corrrptroller’s house. It is a bit of a culture shock to come here, and be waited on hand and foot. What a day!! I left Chadakori, and got totally lost in the bush outside of Chadakori. I then ran out of gas just before the road to Dakoro. I was so bummed, swearing like crazy etc.. Ugh!! I finally anived in Beta Fadoua, and was able to talk to two people. I have actually finished my interviews in Bata F adoua, and figured out where the othe people live from the chef de village. People just have such a bad attitude. When I finished up my interviews, I wert to get back onto my moto and the clutch cable snapped. This was definitely not my day. All in all this week, I did find out some interesting stuff, and I realize how intricate this whole system of management of household expenses has become. People try to get their money to buy food if it’s been a bad year which it normally is in Nige. Niger is just in bad shape agriculturally. Peaplc are so desperate for food to survive, it is almost unfathomable that people could live like this here and also live in a whole different state in the US. There is just such a disparity between the haves and have-nots. It is so unfairl! What have I found out? A loan contributes to the management of the household economy in the short-term it seems rather than the long-term. The laons seems to help the farmer lesser risk in the management of the household economy. Leatlre traders do not need to take a loan from a bigger trade from Maradi where tehy do not earn much ofa profit. Thursday, Septembe 18. 1997 I spent all-day in Maradi on Sunday. I called Jane B. in Niamey to see what she wanted to talk about, and she filled me in on thejob and what PC/WDC was up to. We spoke for about 30 min. I tlrien called Zakari at the CARE office in Maradi. He said he wanted to meet with me in the eveining before he heads out to Niamey on Mon. I spent sometime with Gado and Mariana before meeting Abdu and Cheibou for lunch at the Beolina. We had a good discussion about privatization in Niger. I went to the CARE office to meet with Zakari. He and I hung out for about one hourtalking aboutthe training I will be doing fortlrem. Right afterthis, I headed outto Chadakori. I spent the night on Sunday and Monday in Chadakori. We went out to Boungougi in the am. on Mon. to talk to folks. We wee able to talk to six people, three who had received a loan and drree who had not The most interesting interaction was with a sarkin noma. He recieved a loan, and in order to reimburse the loan, he sold his store of peanut seed at 6,000fcfa/sack. Wher it came time to plant his peanut field, he had to 115 repurchase the peanut seed at 7,000fcfa/sack. He Ice 2,000 fcfa as a result of sellling his peanuts to repay the loan. The question now is would he have had to sell those peanuts regardless? Maybe not, but maybe the loan allowed him to meet some immediate needs without thinking about the long-term. This seems to be the ove-riding reason to take out a loan. Othe's mentioned the difficulty of having to give bribes in order to receive a loan. Why would an agent do this? This is my big questions. Harou and I headed back to Chadakori around 3 pm. I was really beat by the time I retumed. Tuesday morning I headed out to Maradi on the little nroto in hopes to switch motos. I met up with the interim director on my way into the office, and he said he would give me a new one. I typed up the program for the SPSS training and the letters to Murari and John. I wert to the Sous-Bureau to fax the two letters, and then I went by Sadio’s houes to pick-up my cloth. She was asleep so I just gave the money to Issa. From there I wert ove to the Liteacy office to check out the cloth thee. Thee were no more left so I ordeed one. They said they would bring it out to Chadakori. I ate lunch and then returned to the office. At the office, I tried to complete the program for the SPSS training before receiving the phone call from WDC. They called me at exactly 16h00, and there were three people on a speaker phone who asked me questions for an hour. Some of the questions wee pretty hard. For example, Nige is the considered the poorest country in the world and USAID is no longer hee. should Peace Corps even be here? A good, but difficult question, I think. After finishing the inteview, the folks at BRK asked me how it went. They are all so caring about stuff. At the office on Wednesday morning, I called Jane Bonin, and she said she heard tlreirrterview wertreally, really well. Itwasnowuptoheto interviewmc andto seehow itgoes. We setup atime forherto call me and intlre meantinre I finished the program for Zack. J ane called me and we spoke for about an hour. She asked about my experiences between Peace Corps and now. I then spoke with Nelson, and this was great to hear what he was to. I will probably stay with him and his family when I come to Niamey. Monday, September 22, 1997 Well this weekerd was pretty crazy. Harou and I went to Garin Boueye to talk to the women out thee. We were able to meet with six women, and found out some interesting info. While we were in the middle of talking to Chima, Jacques and Oro walked up. We spoked for a little while and I said I would meet them in Maradi late that night. Harou and I left Garin Boueye around 3:30 pm, and we ended up getting a flat tire on the road to Chadakori. We had to push the moto for about five km. Actually Harou pushed it the whole way. It was quite the pain. I ended up getting the tire patched up, and driving into Maradi. Jacques and I wee able to talk a little bit. He has a new woman who is Tuerag. His work has ended here and he will try to find more work. He really wants to stay here. He said something interesting. He said that the system of animal husbandry that was set-up for fire Hausas cannot be transposed in the pastoral zone. He asserts that no one brows how to work up in the pastoral zone right now, and he thinks it would be an inteesting experierce to work up there. I think it would be interesting too, but what can he provide for people up there? This is my question. He seems more infatuated with the fact of working with tlrem then doing sonretlring that really makes a difference. Maybe this isn’t such a bad thing. We went over to a CARE proj. director’s house so he could meet him. We stayed there for about one hour, and then went out to look for something to eat. We ate around 10 pm at the Jardin Publique. We didn’t go to sleep until around nridrright or 1 am, and woke up at 6 am. It was pretty early, and I felt like I definitely did not get enough sleep. Jacques left for Zinde around 7 am, and I hung out with Gado, Oro and 116 Fati until aboutnoon. Ithenwentto BRK, andthenofftomakephotocopies. Imade 30 copies, bought an inner tube and brought messages for Chima from her brother. I then headed out to Chadakori. I arrived aroun 2 pm. and hung out all afternoon with Chima and Abou. Today I am off to Kadata with Abou and then Wareau. Hopefully we can finish these two villages today. Tomorrow and Wednesday I will go to Tibiri and Thurs. I will meet Rabiou. Garin Boueye was interesting. The food situation in this village is pretty grave. Lastyeartheyhadabadharvest andit looks like this yearwill alsobe bad. The women in this village have a lot of animals as a form of security and almost every women said that she would use profits fi'om her business in bikis. Bikis are big in this region. Other owmen who did not receive a loan, really do not have a business to work for. They really want a loan in this village. Apparently the men are really motiviated and are part of the comites des bons clients. I will stpy by Zara and Elise’s today to see if there is a place for me to stay in Tibiri. I think I have almost finished with most of my interviews. I will havetotalktoChima’sneighbor,andifwecangetacartobringustoInwala Sarkin Toudou, this will be good. Wednesday, September 24, 1997 Well I spent all day in Tibiri yesterday. I arrived at 8 am to meet Hainikoye, and of course, he didn’t come. Abdu and I went around Tibiri, and he showed me where I can find all of the clients in Tibiri. I went back to the office and spoke with Salarnatou and her c-epouse. Slarmtaour is an amazing woman. She started out with nothing, and as a result of 7-8 loans from CARE she was able to buy two sewing machines, cows, and two peanut shelling machines as well. It seems that in order to see the impact of these loans, the person has to have received the loan at least five times. A tailor that I spoke with later in the afiemoon has had the same experience. The more loans he received the more people he was able to hire. There seems to be a limit of a certain number of loans provides a limited number of opportunities for the recipient. For some reason Wednesday was a tiring day. I didn’t slepp very well at Balki’s house. Her son kepy waking up and crying. I dropped her off at work, and then I went to interview Laouli brefore the auditor showed up. This went well, and he gave some interesting information on the BRK. Sunday, September 28, 1997 WellIambackinMaradi, andlthinkl willheadovertotheBRKofficelater today. My stay in Chadakori was definitely worthwhile and I will go back out there one more time to say goodbye to folks and to see Sarki, I hope. I can’t believe the whole time I was out there, I never saw Sarki. since last Wednesday, I went to Kourourmgassaou. Friday, October 17, 1997 Well, today rs the depart for the US. I can't believe how quickly my time has passed here. I am definitely satisfied with my visit, my research, seeing fiiends, and winning the job at Peace Corps. Apparently, there was stiff competition so I was lucky to win out. Yeah!!! My outlook on life and the work of development has changed dramatically also. I thought I would love to work for CARE, and this was my dream to work on a project or as a project manager in Maradi, but now I can't think of something I would like least 117 Since I have been in Niamey, I have been able to meet up with some friends and people. I have seen Halima, Chris Mathis, Soumana, Moussa, Yacouba, and folks at Peace Corps. I am so glad to be working with Peace Corps, it's unbelievable, and to be able to work with the CARE director also, I am really glad about that. Halima had some interesting things to say about CARE and the changes it has gone through since the time of Mike. I guess when I left Charles Tapp was the Country Director, he was very good at being respectful towards the staff, and giving advice and allowing the staff to remain autonomous. When Mike came, he didn't quite understand the system of the BRK, and apparently wasn't very respectful towards the staff. He would hire consultants without letting the chef de projet know what he was doing. Halima said this really frustrated her with Mike and the CARE director. According toa previous BRK director, he said that the whole philosophy of the BRK has changed drastically as a result of different Country Directors. Each time CARE itself changes country directors, the whole management style and politics of CARE changes as well. Moussa and Yacouba were great to see, of course. They just come from such a good family. I really appreciate their attitude and background etc. Moussa brought me to his house before I lefi, and I was able to see his wife and kids and everyone. It was really mce. What else? I tried to call the BRK and say goodbye to folks there, but I couldn‘t get through. Hopefully they will hear news from me from Seydou. My work at Peace Corps rs going to be chockful of stuff when I return. It should be 800 great, busy, a learning experience etc. I really feel up to this challenge. Well I am out of here tonight. I can't believe rt. What a shock! Back to the good 01' US of A. To see John and see fiicnds and family. It has been so hard to keep in touch with eveyone. It will be a small miracle if I actually get in touch with everyone during this weekend. Goodbye Niger until 1998. mummified Maradi Tibiri El Kolta Chadakori Sabon Matchi Kornaka En Gobirawa Dadin Kowa Age Kwaria Guidan Roumji Kano, Nigeria J ibiya, Nigeria Katsina, Nigeria APPENDIX G MARKETS ATTENDED 118 Day of Week Mon, Fri. Wed. Sat. Thurs. Tues. Sun. Sun. Mon. Sat. Sun. Daily Sun. Daily LIST OF REFERENCES Anosike, Nnamdi and C. Milton Coughenour. (1990). “The Socioeconomic Basis of Farm Enterprise Diversification Decisions”. WM. 55(1), pp. 1-24. Ashe, Jeffrey, Madelaine Hirschland, and Jill Burnett. (1992). AW roar-10' . .- rt 0 'eu'var "1'01 I reg...“ toner-1r WGEMINI Technical Report no. 33. March 1992. Ashby, Jacqueline A., Jorge Alonso Beltran, Maria del Pilar Guerrero, and Hector Pablo Ramos. 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