More than half of the population on the African continent works in agriculture. Despite its large economic share, the sector has failed to harness its full potential, due to a lack of modern tools, inability to maximize productivity and difficult access to financial markets. The Strengthening African Rural Smallholders (STARS) programme has improved the professional conditions for thousands of smallholder farmers and has given them a fair chance.
STARS is a partnership programme between Cordaid and the Mastercard Foundation. The five-year programme (2017-2021) develops market systems to improve access to finance and markets for over 200,000 farmers in Burkina Faso, Ethiopia, Rwanda and Senegal. In Ethiopia, STARS has improved access to finance and markets for 66,000 farmers, impacting a total of 330,000 household members.
To celebrate the end of the successful programme, farmers, government officials, representatives of civil society organisations, private sector partners and microfinancing partners got together last week in the Radisson Blu hotel in Addis Ababa for a closing event.
The goal of the event was to highlight achievements and to share useful lessons with those who would like to implement similar programmes in the future.
At the opening, Mr. Mengistu Tesfay, Agricultural Input and Rural Financial Service Directorate Director of the Ministry of Agriculture, said: “The outcomes deserve special attention and learning points will be used. Strong collaboration among actors will bring sustainable results.”
Women and youth
The results are encouraging indeed. The STARS programme emphasised the position of women and youth, who are the most disadvantaged when it comes to access to finance and markets in rural Ethiopia. The target group has been supported in two key areas: access to markets and value chain development.
Hélène van der Roest, Cordaid’s Cluster Director East and Southern Africa, spotlit the important role of each stakeholder in the project: “Now we can say we have nailed it and now we have completed it. But you, the farmers, microfinance organisations, private partners, and, of course, the government, are the most important players. We had plans and visions. Things have changed. You helped us bring us that change.”
Loans to 41,000 farmers
According to STARS programme manager Maurice Koppes, the numbers speak for themselves. STARS has funded microfinance institutions enabling them to provide loans to more than 41,000 farmers. 60% of the group loans and 43% of the individual loans have been granted to women.
Then it was time to talk about lessons learned and best practices. The professionals agreed on the success of the Agri-Credit Assessment Tool, or A-CAT, meaning tailor-made agricultural loan products for growing vegetables and the value chains.
The panel discussed how the STARS team invested a lot of time in getting to know its farmers and how that enabled the team to understand the cycle of the farmers’ agricultural activities, costs, risks, and benefits. This helps to better analyse their economic performance and predict their ability to repay their loan. This way, financing agriculture is no longer a risk but becomes a more appealing opportunity for microfinance institutions.
Ms. Akinyi Walender, Country Director of Cordaid Ethiopia, promised to use the successes of the programme to create more economic opportunities while focusing on tackling youth unemployment. “Unless we bring the private sector into our programmes, we cannot ensure sustainability”, Walender said. “We need the private sector to maximize our gains.”
Walender also expressed her gratitude to the organisation responsible for funding the programme. “We are very grateful for the Mastercard Foundation. It is through them that we were able to achieve these results and innovate in digitalisation. We will continue to look to work with them in the trajectory of linking agriculture and youth employment.”