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LRP What is it? Who is promoting LRP initiatives? LRP What is it? Who is promoting LRP initiatives?

LRP What is it? Who is promoting LRP initiatives? - PowerPoint Presentation

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LRP What is it? Who is promoting LRP initiatives? - PPT Presentation

Hows it being used What are the advantages Challenges Examples Do No Harm Food Aid Potential negative impact of food aid on local markets Food aid displaces commercial food sales ID: 754250

lrp food cash vouchers food lrp vouchers cash local analysis market study beneficiaries markets aid emergency program million voucher

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Presentation Transcript

Slide1

LRPSlide2

What is it?

Who is promoting LRP initiatives?

How’s it being used?

What are the advantages?

Challenges?

Examples?Slide3

Do No Harm – Food Aid

Potential negative impact of food

aid

on local markets

Food aid displaces commercial food sales

Food aid deliveries

increase supply faster than they increase demand, thus depressing the food prices received by producers and

traders

Low

prices translate into a disincentive for producers to invest in improved technologies or for marketing agents to bring in commercial supplies or invest in storage and transport

capacity

The

receipt of food aid may cause households to reduce their labor supply, discourage household investment in agricultural production and crowd out private transfers and community level safety nets. Slide4

Do No Harm – Cash/vouchers

Potential negative impact of cash/vouchers on local markets

If the increase in demand is not matched by increased supply, prices will increase, affecting both beneficiaries and non- beneficiaries

Reinforcing non-competitive market structuresSlide5

Main reasons for LRP

Reduce delivery costs, delays and market distortion.

Increase procurement flexibility while providing economic opportunities for small farmers/cooperatives.Slide6

Mechanisms for Implementation of Local Purchase

Tenders

Vouchers

Cash for Work

Vouchers for Work

Food for Work

Food Coupons

Others?Slide7

Cash transfers

– the provision of cash to food insecure beneficiaries who lack economic access to food stocks that are readily available in the local markets of the affected country. Key is functioning market system.

Food vouchers

- the provision of vouchers that are redeemable for food to food insecure beneficiaries who lack economic access to food stocks that are readily available in the local markets of the affected country. Slide8

History of Local/Region

Procurement

World Food Program

2008 Food Conservation and Energy Act or

Farm Bill

(Authorizing legislation for US food aid)

USDA LRP Pilot Program

GAO Study (2009)

USAID/EFSP ProgramSlide9

CRS Local/Regional

Purchases

2000-2008

20

Countries

Over

$9.8

million

Over

22,400 metric tons

Over

114

transactions

Donors:

CRS-HQ, USAID/PEPFAR, USAID/OFDA

USDA/FFE, Church of Jesus Christ of Latter Day Saints

Various CARITAS members, Government of UK (DFID)

Government of Ireland, Government of Germany

World Bank, MCC, Concern UniversalSlide10
Slide11

Recent US Funded LRP

for CRS

8 Projects

- Guatemala, Nicaragua, Benin, Burkina Faso, Niger (2), Mali, Afghanistan

Total value of approximately

$18 millionSlide12

Trends, Current Status of C&V

Food for Peace

Overall budget: $1.2 billion

LRP, C&V: $300 million (25%)

ECHO

2007: 2% food assistance budget on C&V, 12% projects

2010: 20% food assistance budget on C&V, 42% projects

WFP

2009: $54 million in cash and voucher programs

2010: $123 million in cash and voucher programs

USDA

LRP Pilot: $60 million over 4 years

LRP and vouchers,

no cashSlide13

USDA LRP Pilot

4 Phases - Study, Guidelines, Projects, Evaluation

$60 Million over 4 years

3 Goals - Emergency, Development, Do No Harm

USDA LRP Development InterventionsSlide14

GAO Study – May 2009

GAO = Government Accountability Office (US)

Why GAO did the study

What GAO found

GAO RecommendationsSlide15

USAID Emergency Food

Security Program (EFSP)

FY 10/11 Congressional Budget Justification

Request for Emergency Food Security funding

Included LRP – food vouchers/cash transfers

- April 2010 – APS

- April 2011 – APS that requested a response with Title II resources, LRP (vouchers/cash) or a combination of bothSlide16

Comparing Cash and Vouchers

Benefits of Vouchers

Gives beneficiaries varying levels of choice, while still having some control over how the transfer is used.

Vouchers can be targeted within the household, so it can potentially give more decision-making power to females (Sustainability?)

Ability to learn more about consumer/beneficiary preferences and demand. This information can be used in future programming.Slide17

Comparing Cash and Vouchers

Disadvantages of vouchers vis-à-vis cash

Higher administrative costs for vouchers than cash

More decisions on programmatic design,

e.g. number of vouchers/distribution, voucher denominations, criteria for and number of participating vendors

Vouchers can be exclusionary, particularly with respect to small vendors that are difficult to include in voucher schemes. Do no harm principles.

Tradeoff between increased consumer benefit/vendor inclusion and administrative costs,Slide18

Delivery Mechanisms

Cash/paper voucher distributions

Microfinance Institutions/Banks

Barcodes

Smart cards

Mobile phonesSlide19

Opportunities of new methodologies

Provide more choice and dignity to the beneficiaries that we serve

Respond quicker and more efficiently

Support local market actors and local production

Integration of emergency food security responses with longer-term food security programming, e.g. increasing agricultural productivity, linking farmer groups to markets, improving food quality standards, support to small traders and businessesSlide20

Advantages of LRP

Timeliness

Cost

Management

Adaptability to local tastes and conditions

Empowerment of Beneficiaries

Priming Markets for Smallholder Farmers

Link from Producers to MarketsSlide21

Challenges with LRP

Better Understanding local/regional markets, Market analysis

Food Quality and Safety Issues (Do No Harm)

High Level of Monitoring required

Timeliness in following agency procedures

Unfamiliarity of sellers with agency buying procedures

Timeliness of delivery

Market distortion concerns

Local government regulations/taxes

Price fluctuations/budgeting

Limited supply base (food insecure areas)

Co-ordination with other agencies in the marketSlide22

Food Quality and Safety Testing

Testing of

Mycotoxins

- Lab or field test? Cost?

Conform to laws and standards in each country at minimum

Only 14 African countries have standards for

aflatoxins

Moisture meters/REVEAL tests for outlying areas

Capacity of National Laboratories

WFP’s Blue Box (P4P)Slide23

Group Exercise – Case Studies

Context – Why do we need a response?

Target beneficiary group(s)

Size of grant/procurement (MT)

Mechanism used for response

(cash, voucher, FFW, etc.)

Results/Sustainability

Other important elements to note?Slide24

Case Study 1 – CRS Guatemala

Response to drought and tropical storm Agatha

3,000 HH / 18,000 Individuals (EFSP)

Corn, Black Beans,

Incaparina

Semi-competitive bids accepted from farmer- based and commercial organizations

Agreement signed 9/20/2010

First distribution to beneficiaries in Santa Rosa on 10/25/2010Slide25

Case Study 2 – Burkina Faso

Response to food insecurity among school aged children in target zone (Development)

Students, Producers (Coops and CFGs), PTAs

One year pilot for $985,965 (USDA)

Vouchers, Tender

Cost and Time efficient, increased capacity of local producers, boost in local economy

VideoSlide26

Case Study 3 – CRS Niger

1

st

voucher program in Niger

(USAID EFSP)

Followed up by USDA LRP Emergency program

Total of 300,000 beneficiaries and $8 million

25% Female Head of Household

Vouchers for 6 commodities (added

gari

and sugar in second project) for approved vendors

Wholesalers and Retailers

Consumers not covered under voucher program may have paid more due to delays?Slide27

Cost Comparison – CRS MALI

Commodity

PRICE/Kg - $

MT

Cost

Locally

Procured

Millet

$0.41

35.14

$14,522

Rice

$0.82

2.5

$2,060

Cowpeas

$0.74

7.53

$5,593

TOTAL

$22,175

Imported from

US

Corn Meal

$1.88

35.14

$66,063

Rice

$2.26

2.50

$5,650

Split Peas

$2.67

7.53

$20,105

TOTAL

$91,818

Cost

Savings

$69,643

Percent Savings

76%Slide28

Cornell Component

Benefit of partnership between development organizations and universities

Lead role in developing

tools for data collection

and analysis

Increased evidence base

Better data to analyze impact/raise awareness of issues

Improved advocacy efforts for LRPSlide29

Focus of Cornell Analysis

Pilot tools for monitoring and collection of market price data that enable uniform data processing and analysis that will ensure high quality results reporting, review and analysis of overall results for all programs.

Price

Impact

Timeliness

Cost-Effectiveness

Recipient SatisfactionSlide30

Tools to Design Interventions

MIFIRA

– Market Information and Food Insecurity Response Analysis (Cornell)

EMMA

– Emergency Market Mapping Analysis

EFSA

– Emergency Food Security Assessments

LEGS

– Livestock Emergency Guidelines and Standards

SSSA

– Seed System Security AnalysisSlide31

LRP Leaning AllianceSlide32

LA Goal

To coordinate monitoring of price data to ensure that LRP programs do not negatively affect local and regional markets, and to coordinate data analysis among the various programs.Slide33

LRP LA Main Activities

Trainings (online and regional)

Database development

Database management

Data analysis

ReportingSlide34

LRP LA Meeting Nairobi

Closer Look at Global Indicator Framework

(monitoring, pre/post procurement, post distribution indicators)

Future activities

Advocacy Day in DC for partners/donors

Presentations to influence next Farm BillSlide35

LRP – Way Forward

What could be next steps for advancing this topic?

Examples:

LRP Programs have positive food security impacts for the duration of the program. But how can we improve the sustainability of these impacts?

S

trengthening the evidence base

New donor policy

Task force/Working GroupsSlide36

Recommended LRP Reading

GAO Study (May 2009)

CARE White Paper (2006)

WFP’s “Revolution: From Food Aid to Food Assistance”

2006 OECD Study “The Development Effectiveness of Food Aid: Does Tying Matter?”

Michigan State University – “Local and Regional Food Aid Procurement”