6.1 Conclusions
The findings from this study suggest that the goals of the Marrambajane project (refer to logical framework, Chapter 3) were achieved. The project achieved goals of promoting agriculture, increased production, and institutionalisation of Associations and the Union. In addition, farmers moved from subsistence to commercial farming thanks to provision of irrigation system and farming of cash crops. When applying the lens of the micro-credit triangle model the project also appears to have achieved some success - the project shows some success in depth and breadth of outreach and some gains in improved wellbeing through poverty reduction. However, it was difficulty to separate from the analysis the changes observed by individuals and households. This could be considered as an important limitation of the research. Farmers also benefited from social networks. In spite of these positive outcomes, income generation was not high, asset accumulation remained low, farmers are in debt, level of trust was not extensive, and the project has collapsed. In practice the project worked as a safety net for the farmers rather a sustainable economic initiative.
In terms of the economic paradigms described in Chapter 2 it is clear that the project did not equip the Marrambajane farmers to succeed in a free market economy. Indeed there are indications that the farmers expect state support and require donor support for their agricultural activities to succeed. The expectation of state support is captured eloquently in the quote that brings Chapter 5 to a close. The reliance on donor support is evident from the collapse of the project soon after donor funding ceased. While it is important for Mozambique to reduce her reliance on donor funding, the experience of the Marrambajane farmers suggests stronger interventions are needed before the state and donors can withdraw their support. Analysis of findings from this research indicate that interventions are necessary at different levels.
Poor project design, poor business planning, market and institutional failures, and lack of corrective action when problems were identified during implementation can be identified. At the project design level there was too strong a focus on perishable crops.
The solution here would be to develop skills in growing a more robust crop, such as
rice, along with the more lucrative, but more volatile, tomatoes crop. In the case of Marrambajane, the Union management and other stakeholders did not implement any direct or indirect method to ensure consistent repayments and to reduce risk of debt.
The introduction of direct or indirect methods would go some way toward improving the business model. An economic model that encourages partnership between the community, the state and donors should be adopted. This could ensure that problems resulting from poor infrastructure are addressed, for example the installation of a furrow irrigation system through to Marrambajane. The study also revealed that human capital is low (a significant proportion of the farmers are illiterate) in Marrambajane. If development projects are to succeed human capital must grow.
Thus, education should be prioritised in the area. Better educated farmers would be able to develop stronger relationships with donors, project technicians and representatives from the state. If farmers are to gain leverage in order to achieve, for example sustainable irrigation infrastructure, they need to be sufficiently educated to lobby the state and donors.
6.2 Policy recommendations
Based on Chapters 4 and 5 and the conclusions drawn above, the Marrambajne project, and similar projects which aim to have an impact on poverty reduction, achieve financial sustainability and poverty outreach and develop social capital, must adopt the following policies:
1. Design agricultural micro-credit interventions targeting a particular segment of small scale farmers and not heterogeneous households. For example an intervention can target only poor households (below a poverty line, or poor according to wellbeing ranking) leaving out the non-poor households.
Alternatively, an intervention can be designed to target specifically non-poor households (above poverty line or middle and rich households in wellbeing ranking). By doing so, it would ensure more benefits reach the intended segment of small-scale farmers.
2. Micro-credit projects must be designed with both poverty reduction and financial sustainability in mind. The project must recover administrative and operational costs and subsidisation should be avoided; where subsidies are necessary participants must be informed well in advance of their withdrawal. Those
development organisations whose mission is not provision of financial services must seek to implement agricultural micro-credit programmes in collaboration with specialised micro-credit organisations. The latter should have a strong sense of how to achieve financial sustainability while the former may not meet the prerequisites demanded for saving schemes and they have no adequate skills in loan supervision and intensive loan collection, which are an important elements for financial sustainability (Zeller, 2003 :20).
3. Mistakes identified during implementation of agricultural micro-credit projects must be resolved timeously, so that the sustainability of the interventions is not compromised.
4. Since factors such as strong investment and management skills and alcoholism are important determinants of household asset growth, agricultural micro-credit projects must adopt policies which enhance investment and management skills of the beneficiaries, while taking measures to reduce problems such as alcoholism.
5. The Ministry of Agriculture and all stakeholders involved in promotion of farmer's AssociationslUnions in Mozambique must not concentrate only In
institutionalisation of farmers AssociationslUnions. Monitoring and evaluation of the performance of AssociationslUnion must be one of the major priorities. More attention must be given in systematic evaluation of the dynamics of trust, prevention of violence, and divulging of the statutes in order to empower the members to exercise their rights.
6.3. Recommendations and directions for future research
This research was constrained by difficulties faced by farmers to recall the amount and value of inputs used and outputs generated. The researcher overcame this problem using the project archive. The project provided some documentation but there are significant gaps. I strongly recommend the implementers of agricultural micro-credit projects carry out an effective documentation of amount of inputs employed, outputs generated, and other relevant indicators.
I argued that one of the causes of low returns was poor business planning. I therefore, recommend development of a good business planning, based on market research and wise research of enterprises (crops) taking into consideration all the weakness and risks discussed in Chapter 5.
Identification of sustainable systems of irrigation for poor small scale farmers was beyond the scope of this research. However, extension of furrow irrigation from Muianga village to Marrambajane must be investigated further. A rural engineering study to assess the practicality of the vision should be carried out.
In conclusion, this research has shown that poverty reduction (measured by gains in income, assets and social capital) can occur in Marrambajane through the use of in- kind credit. However, stronger project design and attention to credit recovery are required for longer term success.