Final

Foou Secuiity Piogiamme

2u1u-2u14

Bouseholu Asset Builuing





Ninistiy of Agiicultuie
anu Ruial Bevelopment
August 2uu9
Final

C0NTENTS
C0NTENTS.............................................................................................................................................................................iii
ACR0NYNS...........................................................................................................................................................................vii
1 Summaiy ...................................................................................................................................................................... 1
2 Backgiounu anu }ustification .............................................................................................................................. S
2.1 uoveinmentSectoi Policy most ielevant to the component ..................................................... S
2.1.1 Ruial finance.................................................................................................................................................... S
2.1.2 Coopeiative piomotion............................................................................................................................... 6
2.1.S Pastoial policy ................................................................................................................................................ 7
2.1.4 Women anu youth packages anu off-faim activity piomotion.................................................. 8
2.2 Featuies of the Sectoi .................................................................................................................................. 9
2.S Expecteu Clients ............................................................................................................................................. 9
2.4 Pioblems to be tackleu ............................................................................................................................. 1u
2.S 0thei ielevant inteiventions anu institutions involveu ............................................................ 11
2.S.1 The Extension System.......................................................................................................................... 11
2.S.2 Coopeiative uevelopment.................................................................................................................. 1S
2.S.S Financial seivice pioviueis ............................................................................................................... 1S
2.S.4 Agiicultuial uiowth Piogiamme (AuP) ...................................................................................... 14
2.6 Policy, Stiategy anu Piogiamme uaps ....................................................................................................... 14
2.7 Lessons leaineu fiom past piogiamming................................................................................................. 1S
S Inteiventions ........................................................................................................................................................... 17
S.1 uoal.................................................................................................................................................................... 17
S.2 0utcome anu Stiategy............................................................................................................................... 17
S.S 0utputs ............................................................................................................................................................ 2u
S.S.1 0utput 1: Access to viable on- anu off-faim income-geneiating oppoitunities
impioveu. .................................................................................................................................................................. 2u
S.S.2 0utput 2: Access to sustainable financial seivices enhanceu. ................................................ 22
S.S.S 0utput S: Sustainable input souicing, piouuction anu ueliveiy systems enhanceu. 2S
S.S.4 0utput 4: Access to effective piouuct anu laboui maikets incieaseu. ................................ 24
S.S.S 0utput S: Institutional capacity to manage anu implement the BABP ACBIEvEB. .. 2S
Final

S.S.6 0utput 6. Confiuence, knowleuge anu skills of foou insecuie householus in CFI
woieuas built. ............................................................................................................................................................... 26
S.4 Activities ........................................................................................................................................................ 27
S.4.1 0utput 1 Activities: Access to viable on- anu off-faim income-geneiating
oppoitunities impioveu...................................................................................................................................... 27
Activity 1: Iuentify viable investment anu income geneiating oppoitunities foi foou
insecuie householus............................................................................................................................................. 27
Activity 2: Pioviue auvice anu suppoit to foou insecuie householus in the uevelopment of
business plans......................................................................................................................................................... 29
Activity S: Suppoit the implementation of business plans thiough technical assistance on
vaiious technology options anu monitoiing of householu investments....................................... S1
S.4.2 0utput 2 Activities: Access to sustainable financial seivices enhanceu. ............................ S1
Activity 1: Builu the institutional capacity of financial seivice pioviueis (R0SACC0s anu
NFIs) foi sustaineu ueliveiy of multiple financial piouucts............................................................... S1
Activity 2: Pioviue a loan funu, community giant oi seeu capital to financial seivice
pioviueis. .................................................................................................................................................................. S4
Figuie S: Channelling moualities foi uoveinment contiibutions to BABP financial seivices
....................................................................................................................................................................................... SS
Activity S: Suppoit the implementation of an appiopiiate iegulatoiy anu supeivisoiy
fiamewoik foi giassioots financial institutions ...................................................................................... S7
S.4.S 0utput S Activities: Sustainable input souicing, piouuction anu ueliveiy systems
enhanceu......................................................................................................................................................................... S8
Activity 1: Builu linkages between supplieis anu useis of inputs anu technologies
necessaiy foi the implementation of business plans............................................................................. S8
Activity 2: Piomote multiplication oi uistiibution of inputspiouucts by volunteeis fiom
within client communities ................................................................................................................................. S9
S.4.4 0utput 4 Activities: Access to effective piouuct anu laboui maikets incieaseu............. 4u
Activity 1: Impiove stoiage, piocessing anu quality contiol foi incieaseu value auuition
accoiuing to business plans .............................................................................................................................. 4u
Activity 2: Impiove maiketing tiansactions anu access to highei-value maikets foi new
investments oi wage employment................................................................................................................. 41
S.4.S 0utput S Activities: Institutional capacity to manage anu implement the BABP
stiengtheneu. ................................................................................................................................................................ 42
Activity 1: Stiengthen management capacity of uoveinment implementeis ............................. 42
Activity 2: Stiengthen technical capacity of Extension Seivice, Coopeiative Piomotion
Buieaus, SNEA anu othei ielevant institutions to pioviue uemanu-uiiven extension anu
tiaining in maiket-oiienteu business planning anu technological innovation .......................... 4S
Final

Activity S: Stiengthen capacity of financial seivice pioviueis to pioviue appiopiiate
financial seivices to foou insecuie householus ........................................................................................ 4S
S.4.6 0utput 6 Activities: Confiuence, knowleuge anu skills of foou insecuie householus in CFI
woieuas built. ............................................................................................................................................................... 46
Activity 1: Builu skills, knowleuge anu confiuence in business planning anu management 46
Activity 2: Builu skills, knowleuge anu confiuence in financial management............................. 46
Activity S: Builu skills, knowleuge anu confiuence in input souicing anu piouuction,
paiticulaily foi new technologies................................................................................................................... 46
Activity 4: Builu skills, knowleuge anu confiuence in maiketing anu value auuition ............. 46
4 Assumptions ............................................................................................................................................................ 47
4.1 0utcome-to-uoal assumptions.............................................................................................................. 47
4.2 0utput-to-0utcome assumptions......................................................................................................... 47
S Implementation...................................................................................................................................................... 49
S.1 Physical anu non-physical means ........................................................................................................ 49
S.2 Institutional aiiangements..................................................................................................................... Su
S.2.1 Feueial Level ........................................................................................................................................... S6
S.2.2 Regional Level......................................................................................................................................... S8
S.2.S Woieua Level........................................................................................................................................... 61
S.2.4 Kebele anu Community.................................................................................................................. 64
S.S. Piogiamme Planning................................................................................................................................. 6S
S.S.1 Woieua Integiateu Planning ....................................................................................................... 6S
"#$#%# &'())*)+ ,-. /01&................................................................................................................................. 66
S.4 Cost Estimate anu Financing Plan................................................................................................................ 68
S.S. Special conuitions anu accompanying measuies to be taken by uoveinment ................ 69
6 Factois Ensuiing Sustainability....................................................................................................................... 71
6.1 Policy Suppoit anu Cooiuination......................................................................................................... 71
6.2 Economic anu Financial Issues ............................................................................................................. 71
6.S Institutional anu Nanagement Capacity........................................................................................... 71
6.4 Technical Issues, incluuing Regulatoiy anu 0peiational........................................................... 71
6.4.1 Technical uesign elements................................................................................................................. 71
6.4.2 Levels of technologies.......................................................................................................................... 72
Final

6.4.S uoveinment iegulatoiy iole in use anu uevelopment of technologies.......................... 72
6.S Enviionmental piotection....................................................................................................................... 72
6.6 Socio-cultuial anu genuei issues.......................................................................................................... 7S
6.6.1 Empoweiment anu confiuence builuing of CFI householus ............................................... 7S
6.6.2 uenuei equality ...................................................................................................................................... 7S
6.6.S BIvAIBS................................................................................................................................................... 7S
7 Piogiamme Peifoimance: Nonitoiing anu Evaluation anu Accountability................................. 74
7.1. Nonitoiing anu Evaluation............................................................................................................................. 74
7.2. Accountability foi peifoimance................................................................................................................... 77
Annex 1: Integiateu planning foi BAB anu othei FSP components........................................................... 79
Final

ACR0NYNS

ACSI Amhaia Cieuit anu Saving Institute
AEB Agiicultuial Extension Biiectoiate
AENFI Association of Ethiopian Niciofinance Institutions
AuP Agiicultuial uiowth Piogiamme
ATvET Agiicultuial Technical vocational Euucation anu Tiaining
BoARB Buieau of Agiicultuie anu Ruial Bevelopment
BoTI Buieau of Tiaue anu Inuustiy
CBE Commeicial Bank of Ethiopia
CCI Complementaiy Community Investment
CFI Chionically Foou Insecuie
CFSTF Community Foou Secuiity Task Foice
CIBA Canauian Inteinational Bevelopment Agency
BA Bevelopment Agent
BBE Bevelopment Bank of Ethiopia
BECSI Beuebit Cieuit anu Saving Institute
BRNFSS Bisastei Risk Nanagement anu Foou Secuiity Sectoi
ESE Ethiopian Seeu Enteipiise
ESNF Enviionmental anu Social Nanagement Fiamewoik
FREAC Faimei Reseaich-Extension Auvisoiy Council
FREu Faimei Reseaich-Extension uioup
FSP Foou Secuiity Piogiamme
FSCB Foou Secuiity Cooiuination Biiectoiate
FSS Foou Secuiity Stiategy
FTC Faimei Tiaining Centie
u0E uoveinment of Ethiopia
BABP Bouseholu Asset Builuing Piogiamme
BB Bouseholu
IuA Income ueneiating Activity
IPNS Impioving Piouuctivity anu Naiket Successes
}CC }oint Cooiuination Committee
}ICA }apan Inteinational Coopeiation Agency
KAC Kebele Appeals Committee
KBC Kebele Bevelopment Committee
KFSTF Kebele Foou Secuiity Task Foice
N&E Nonitoiing anu Evaluation
NFI Niciofinance Institution
NLvP Naiket-leu Livelihoous foi vulneiable Populations
NoARB Ninistiy of Agiicultuie anu Ruial Bevelopment
NoFEB Ninistiy of Finance anu Economic Bevelopment
N0I Ninistiy of Infoimation
NBE National Bank of Ethiopia
Nu0 Non-uoveinmental 0iganisation
0CSSC0 0iomiya Cieuit anu Saving Shaie Company
0FSP 0thei Foou Secuiity Piogiammes
PASBEP Plan foi Acceleiateu anu Sustaineu Bevelopment to Enu Poveity
PSNP Piouuctive Safety Net Piogiamme
QSAE Quality Stanuaius Authoiity of Ethiopia
RCBP Ruial Capacity Builuing Pioject
Final

RBPS Ruial Bevelopment Policy anu Stiategy
RFSC0 Regional Bisastei Pievention & Foou Secuiity Cooiuination 0ffice
RFSSC Regional Foou Secuiity Steeiing Committee
R0FIP Ruial Financial Inteimeuiation Piogiamme
R0SACC0 Ruial Savings anu Cieuit Coopeiative
SNS Subject Nattei Specialist
SNNPR Southein Nations, Nationalities anu Peoples Region
TC Technical Committee
0SAIB 0niteu States Agency foi Inteinational Bevelopment
vSLA village Savings anu Lenuing Association
WARB0 Woieua Agiicultuial anu Ruial Bevelopment 0ffice
WBC Woieua Bevelopment Committee
WFSTF Woieua Foou Secuiity Task Foice
WoFEB Woieua 0ffice of Finance anu Economic Bevelopment

1
1 S0NNARY

The Bouseholu Asset Builuing Piogiamme (BABP) is one of foui components of the uoveinment
of Ethiopia's Foou Secuiity Piogiamme. As such, it contiibutes to achievement of the FSP's
expecteu 0utcome of impioveu foou secuiity status of male anu female membeis of foou
insecuie householus in CFI woieuas, impioveu. The specific taigeteu 0utcome of the BABP:
Income souices uiveisifieu anu piouuctive assets incieaseu foi foou insecuie householus in CFI
woieuas.
Six 0utputs aie planneu in oiuei to achieve this 0utcome. Each 0utput incluues a set of activities
uesigneu to auuiess the lessons leaineu anu challenges encounteieu in the implementation of
the pievious phase. A biief synopsis is pioviueu below.
0utput 1: Access to viable on- anu off-faim income-geneiating oppoitunities impioveu. This
output uses a consultative appioach that seeks to involve householus in the iuentification of
investment oppoitunities as well as the uevelopment of tailoieu householu oi gioup business
plans. These business plans will incluue off-faim activities wheie appiopiiate anu will pioviue
the founuation foi piogiamme financial anu technical assistance unuei outputs 2-4.
0utput 2: Access to sustainable financial seivices enhanceu. This 0utput is uesigneu to ue-link
extension auvice fiom cieuit piovision anu to begin establishing a sustainable financial seivice
piovision system thioughout chionically foou insecuie woieuas. Key aspects of this 0utput
incluue financial liteiacysavings piomotion campaigns foi CFI householus, piomotion of
R0SACC0s, anu facilitation of NFI expansion into unuei-seiveu aieas. A vaiiety of funuing
mechanisms will be useu, incluuing a line of cieuit foi R0SACC0s. Subject to availability of
auuitional financing fiom Bevelopment Paitneis, alteinative financing aiiangements will be
exploieu - specifically paitial loan guaiantees anu matching seeu capital, anu a pilot on
insuiance.
0utput S: Sustainable input souicing, piouuction anu ueliveiy systems enhanceu. This 0utput is
uiiectly linkeu to the business plans uevelopeu unuei 0utput 1 anu seeks to oveicome the
huiules faceu in the pievious phase in the souicingpiocuiement of investment assets anu
inputs. It will entail linkages to piivate input supplieis anu the piomotion of seeu anu seeuling
multiplication anu input uistiibution as an income geneiating activity foi paiticipating
householus.
0utput 4: Access to effective piouuct anu laboui maikets incieaseu. This 0utput will enable
householus to maximize the piofitability of theii business plans by linking them to maikets.
Naiket oiientation will be a key chaiacteiistic of the technical assistance pioviueu fiom the veiy
beginning of the piogiamme.
0utput S: Institutional capacity to manage anu implement the BABP achieveu. The piogiamme
will be implementeu piimaiily thiough the public extension system anu financial seivice
institutions. Foi activities to be effective in achieving the intenueu 0utputs, it is necessaiy to
builu the capacity of implementing institutions to assess the neeus of chionically foou insecuie
householus, facilitate effective linkages, pioviue appiopiiate maiket-baseu technical auvice oi
appiopiiate financial piouucts, anu effectively manage a complex piogiamme involving a vaiiety
of stakeholueis. The capacity builuing 0utput focuses on achieving this.


2
0utput 6: Knowleuge, skills anu confiuence of foou insecuie people built. This 0utput is cioss-
cutting to 0utputs 1-4. It seeks to builu householus' confiuence foi taking iisks (paiticulaily in
obtaining cieuit) anu making investments in technological innovation, anu is iooteu in a piocess
that involves householu-level stakeholuei consultations anu uemanu-uiiven seivice ueliveiy.
The BABP will be implementeu thiough two piimaiy means: technical assistance (thiough the
Extension Seivice but in cooiuination with a vaiiety of actois, incluuing the Small anu Neuium
Enteipiise Bevelopment Agency, piogiammes foi women anu youth, 0ff-Faim technical officeis,
anu otheis) anu financial seivices (cieuit pioviueu by the piogiamme thiough NFIs anu
R0SACC0s).

S
2 BACKuR00NB ANB }0STIFICATI0N

The Foou Secuiity Piogiamme (2u1u-2u14) has foui majoi components: (i) the Piouuctive
Safety Net Piogiamme (PSNP), (ii) the Bouseholu Asset Builuing Piogiamme (BABP), (iii) the
Complementaiy Community Investment (CCI) component, anu (iv) the Resettlement component.
The FSP has its own piogiamme uocument, within which each component is nesteu anu to
which this component piogiamme uocument makes iegulai iefeience.
This uocument piesents a uetaileu uesciiption of the Bouseholu Asset Builuing Piogiamme. It
begins with an oveiview of goveinment policies anu stiategies ielevant to the component,
followeu by a uesciiption of objectives, outputs anu activities. Implementation moualities aie
uesciibeu, followeu by an analysis of factois affecting sustainability anu a biief uesciiption of the
monitoiing anu evaluation fiamewoik.
2. 1 u0vERNNENTSECT0R P0LICY N0ST RELEvANT T0 TBE C0NP0NENT
The uoveinment of Ethiopia has put in place policies anu stiategies that auuiess both chionic
anu tiansitoiy foou insecuiity. Chief amongst these aie the Ruial Bevelopment Policy anu
Stiategy (RBPS); the Foou Secuiity Stiategy (FSS); the Plan foi Acceleiateu anu Sustaineu
Bevelopment to Enu Poveity (PASBEP) anu the Pastoial Bevelopment Policy. Theie aie othei
piogiammes, anu policies which intenu to suppoit youth anu women.
These policies aie uesciibeu in uetail in the oveiall FSP uocument. Elements of uoE policies anu
stiategies that aie the most highly ielevant to the Bouseholu Asset Builuing Piogiamme aie:
Ruial finance policy
Coopeiative pioclamation
Pastoial policy
Women anu youth-ielateu policies
2.1.1 R0RAL FINANCE

The RBPS iecognises that appiopiiate anu timely iuial finance is the ciitical missing element in
iuial uevelopment. Pioviuing auequate, appiopiiate anu timely cieuit is consiueieu one of the
means to bieak the poveity cycle anu biing about sustainable uevelopment, as illustiateu in
Figuie 1 below.

4
FIGURE 1: THE POVERTY CYCLE RURAL FINANCE AS THE CRITICAL
MISSING ELEMENT
1
















Attempts have been maue to ensuie the availability of iuial cieuit thiough goveinment anu non-
goveinmental oiganisations. Regional goveinments have useu theii annual buuget subsiuies as
collateial to boiiow money fiom the Commeicial Bank of Ethiopia (CBE) anu on-lenu it to
faimeis foi the puichase of inputs thiough an in-kinu cieuit tiansaction. Although this
mechanism has playeu an impoitant iole given the absence of financial seivice pioviueis in
many iuial aieas, it has hau its own complex pioblems.
Fiist, Regional goveinments aie not financial institutions that can pioviue compiehensive
financial seivices, incluuing cieuit anu savings. In many cases they weie unable to collect the
loans anu enueu up iepaying fiom theii annual buugets on behalf of uefaulteis.
Seconu, the loan uisbuisement anu collection piocess imposeu consiueiable piessuie on
auministiatois anu extension woikeis. They became lenueis anu collectois of loans, which
affecteu theii ielationships with faimeis anu left little time foi iegulai extension activities.
Thiiu, faimeis often consiueieu the loan as a goveinment giant oi a iight, which leu to the
misuse of iesouices anu a tenuency not to iepay the loans.
Bence the RBPS policy uocument states that the use of goveinment agencies to pioviue loans is
not sustainable anu highlights the uigency of ueveloping piopei iuial finance mechanisms.
Touay, Regional goveinments aie incieasingly moving away fiom pioviuing in-kinu input cieuit

1
Baseu on uesciiption in the RBPS (N0I, 2uu2:186-189)
Limited finance
Credit Provision
Limited use of inputs
and technologies
Low productivity
Little or no
surplus for
markets

S
to all but the neeuiest faimeis, opting insteau to pioviue feitilizei anu seeu on a cash basis foi
the majoiity of faimeis. This has the potential to effectively ue-link uoveinment input supply
with uoveinment cieuit, theieby enabling the piivate sectoi to gain a footholu in input supply
assuming that financial seivice pioviueis aie piesent to enable faimeis to obtain the necessaiy
cieuit foi theii inputs.
Nu0s have playeu an impoitant iole in injecting finance into iuial communities thiough giants,
seeu money anu ievolving funus foi community gioups. Bowevei, loan uisbuisement anu
collection was ueclaieu to be incompatible with Nu0 uevelopment woik.
In oiuei to ensuie a cleai uiffeientiation between giants anu cieuit, the uoveinment intiouuceu
Pioclamation No 4u1996, "A Pioclamation to Pioviue foi the Licensing anu Supeivision of the
Business of Niciofinance Institutions", as the majoi law to establish anu iegulate NFIs. Since
then, 29 NFIs have been establisheu in all Regions of the countiy. Amongst these NFIs, a few aie
in the piocess of tiansfoiming themselves into iuial banks that pioviue compiehensive banking
seivices (not only loans) foi iuial householus.
Accoiuing to the Association of Ethiopian NFIs (AENFI), NFIs have mobiliseu ovei Biii 2 billion
fiom vaiious souices, of which Biii 82u million (41%) is in savings. They have issueu neaily Biii
S billion in loans to 2.4 million clients. Among the householu investments foi which loans weie
issueu, cattle fattening (16%) anu sheep anu goat ieaiing (11%) aie the top two. The size of
loans pei boiiowei iange fiom Biii 1Su to S,uuu (ACSI, BECSI); Biii 1,1uu to S,uuu (0CSSC0)
anu Biii Suu to S,uuu (0mo NFI).
The miciofinance inuustiy expects significant giowth in potential uemanu foi financial seivices,
most notably cieuit, ovei the next 1u yeais. In spite of the iapiu expansion of the NFIs uue to,
among othei things, stiong goveinment anu uonoi suppoit, anu stiong national netwoiks, theie
aie seveial challenges facing the inuustiy. Theie aie also oppoitunities that can be tappeu.
These aie summaiiseu in Table 1 below.
2(3'4 56 78(''4)+49 (): -;;-.<=)*<*49 ,-. .=.(' ,*)()>4 *) ?<8*-;*(
%

78(''4)+49 @;;-.<=)*<*49
A8-.<(+4 -, '-() >(;*<(' - inauequate
uonoi funuing, lack of equity capital, no
access to foieign capital.
&-'*>BC '4+(' (): .4+='(<-.B >-)9<.(*)<9 -
the involvement of goveinment agencies in
loan uisbuisement contiavening the NBE
iegulations. Although Nu0s uo not uiiectly
pioviue loans since 1998, they still pioviue
seeu money to gioups, with little oi no
contiact enfoicement mechanism theieby
leauing to non-iepayment. This uistoits the
miciofinance maiket.
D*E*<4: -=<.4(>8 paiticulaily with iespect
to women. Women account foi S8% of the
clients paitly uue to the supply uiiven
/=+4 =)E4< :4E(): - the NFIs meet 2u%
of the potential uemanu foi financial
seivices. Theie is high potential uemanu
which is an oppoitunity foi iuial financial
institutions to inciease outieach anu uelivei
uemanu uiiven financial seivices.
F4G4'-;E4)< -, *),.(9<.=><=.4 H.-(:9C
<4'4>-EE=)*>(<*-) (): ;-I4. 94.G*>49J -
ovei the past 1S yeais, the uoE has investeu
in the expansion anu impiovement of
infiastiuctuie. This is an oppoitunity foi
iuial financial pioviueis to inciease
outieach anu impiove theii management
infoimation system.
0G(*'(3*'*<B -, '-()9 ,.-E 7-EE4.>*('

2
Souice: Woluay Amha. A Becaue of Niciofinance Institutions Bevelopment in Ethiopia (0ccasional Papei
#21), }anuaiy 2uu8.

6
financial piouucts which aie not tailoieu to
women's neeus.
K*9L - among othei factois uiought,
seasonality of agiicultuial activities, anu
local maiket failuies affect the peifoimance
of iuial finance. Absence of agiicultuial
insuiance is a challenge. Bowevei, the
miciofinance inuustiy is piotecteu fiom
foieign competition which has eliminateu
iisk associateu with foieign exchange
fluctuations anu financial ciisis abioau.
?M>'=9*-) -, <84 ;--.49< -, <84 ;--. N
although the NFIs have maue significant
stiiues in seiving the iuial pooi, they still
excluue the pooiest of the pooi to ieuuce
iisk anu ensuie theii sustainability.
D*E*<4: >(;(>*<B - weak management
infoimation system has affecteu the
efficiency of NFIs - lack of stanuaiu
softwaie, skilleu manpowei, anu
infiastiuctuie to suppoit infoimation
netwoiks in iemote aieas.
1()L -, ?<8*-;*( H71?J - notwithstanuing
the point maue eailiei that iuial finance
institutions face shoitage of capital, iecently
the CBE has pioviueu loans that help NFIs to
inciease theii outieach. It is expecteu that
such facilities will also be available to
R0SACC0s.
O.-I*)+ *)<4.49< -, ;.*G(<4 *)G49<-.9
3-<8 :-E49<*> (): ,-.4*+) - if the financial
sectoi becomes open to foieign competition,
pieliminaiy assessment shows that a
numbei of investois have shown inteiest in
the miciofinance inuustiy. Similaily, the
piesent weak involvement of the uomestic
piivate sectoi (only one out of 29 NFIs is
piivate) is expecteu to change uue to
incieasing inteiest to invest in the sectoi.
&-9<(' 94.G*>4 - The postal seivice pioviues
money tiansfeis. Theie is an untappeu
potential of tiansfoiming the postal seivice
into postal micio-banks.

uoveinment policies stiongly asseit the neeu foi ueveloping a cultuie of savings anu loan
iepayment among iuial communities. As a mattei of fact, many iuial communities have
tiauitional ways of saving foi ceitain expenses, both in kinu (livestock anu giains) anu in cash
(thiough small, communal savingsfuneial gioups such as !"##$ anu %&&%'). Yet these savings
aie often small, anu iuial householus fiequently spenu ielatively laige amounts of iesouices on
ieligious, cultuial anu social events.
Ruial communities also have the tiauitional cultuie of honouiing loan iepayments to the extent
that they give piioiity to paying back money they owe someone "until they go hungiy" (RBPS).
Bowevei, some of the inappiopiiate ways of uisbuising loans uesciibeu above have eioueu this
cultuie. The BABP is theiefoie uesigneu to intiouuce best piactices in financial seivice piovision
to ensuie the sustainability of the seivices pioviueu.
2.1.2 C00PERATIvE PR0N0TI0N
Coopeiative piomotion in Ethiopia is goveineu by Pioclamation No. 14798, which uefines a
coopeiative as "a society establisheu by inuiviuuals on voluntaiy basis to collectively solve theii
economic anu social pioblems anu uemociatically manage same". This is majoi uepaituie fiom
the Beig times when iuial householus weie coeiceu to be membeis of coopeiatives.
Theie aie thiee levels of coopeiative foimation in Ethiopia: piimaiy, union anu feueiations.
Piimaiy coopeiatives aie foimeu by ten oi moie peisons living anu woiking in a given aiea.
0nions aie foimeu by two oi moie piimaiy coopeiatives. Similaily, feueiations aie foimeu by
two oi moie unions anu aie foimeu at Feueial level.
uoveinment policy, the RBPS in paiticulai, envisages that coopeiatives coulu seive as a link
between banks oi NFIs anu iuial householus. 0sing coopeiatives as an inteimeuiaiy to boiiow
money anu on-lenu it to iuial communities pioviues financial institutions with the economies of
scale they neeu in oiuei to keep auministiative costs low. Lenuing uiiectly to iuial householus is

7
auministiatively costly anu geneially unpiofitable, as low population uensities, iemoteness of
aieas, anu iisks associateu with lenuing foi agiicultuial piouuction inciease financial iisks,
theieby iequiiing highei inteiest iates that iuial householus aie not capable of paying.
In oiuei to play this inteimeuiaiy iole, howevei, it is necessaiy foi coopeiatives oi unions to
uevelop theii cieuitwoithiness by establishing stiong financial management systems (incluuing
financial uiscipline). BanksNFIs aie iesponsible foi caiiying out a thoiough financial anu
economic assessment befoie lenuing to coopeiatives oi unions.
S

Financial seivices pioviueu thiough agiicultuialmultipuipose coopeiatives aie geneially
limiteu to input cieuit anu occasionally maiketing cieuit. Foi othei financial seivices, savings
anu cieuit coopeiatives aie impoitant institutions in iuial communities. These have been
piomoteu by the Coopeiative Piomotion Buieaus as well as (along with theii less foimal village
Savings anu Loan Association counteipaits) by a vaiiety of Nu0s. In paiticulai, the Ruial
Financial Inteimeuiation Piogiamme (R0FIP) has playeu an impoitant iole in the cieation of
R0SACC0s in Ethiopia. The piogiamme estimates that ovei 1,Suu R0SACC0s aie now
opeiational in the countiy.
Pioclamation 14798 uoes not howevei auuiess the impoitant issue of financial coopeiatives. It
uoes not pioviue the necessaiy guiuance to iegulate financial coopeiatives as pait of the
financial sectoi. The goveinment is consiueiing the intiouuction of a new law foi financial
coopeiatives anu the establishment of appiopiiate systems foi iegulation anu supeivision.
2.1.S PAST0RAL P0LICY

Both the RBPS (pp 1S7-147) anu the FSS (page 18) inuicate that, as livestock is the piimaiy
souice of livelihoous in pastoial aieas, all pastoial uevelopment effoits shoulu be livestock-
centieu.
Key issues ievolve aiounu balances anu imbalances in iesouice availability, most notably watei,
pastuie anu livestock. Pastoialists move seasonally in oiuei to stiike a balance between these
iesouices. Natuial iesouice management is theiefoie ciitical to both livestock anu human
uevelopment in pastoial aieas. uoveinment policies anu stiategies call foi an unueistanuing of
inuigenous iesouice management techniques anu builuing on theii stiengths piioi to planning
inteiventions foi pastoial aieas. They also stiess the impoitance of animal health seivices
(vaccination anu tieatment), but state that these shoulu be compatible with the mobility of
pastoial communities.
The Livestock Bevelopment Nastei Plan calls foi impioveu livestock maiketing systems in
Ethiopia, incluuing enhanceu access to maiket infoimation anu maiket facilities wheie suiplus
livestock can be solu. The policy also encouiages investment in value auueu activities such as
meat piocessing.
Finally, goveinment policy encouiages investment in iiiigation schemes foi pastoialists anu
agio-pastoialists in oiuei to inciease foou piouuction anu maiketing in pastoial aieas.
The pastoial inteiventions highlighteu in these policies anu stiategies tenu to be laigei-scale
community investments iathei than householu-level investments. Inueeu, the iuentification anu

S
Lessons have been leaineu fiom the Beig times when banks weie instiucteu to lenu money to
coopeiatives without piopei assessment. The coopeiatives hau weak oi no financial system which leu to
embezzlement. Both the banks anu coopeiatives incuiieu consiueiable losses.

8
uevelopment of householu investments foi pastoialists is a challenging task, uue to the natuie of
the pastoialist livelihoou as one chaiacteiizeu moie by vulneiability than by chionic poveity.
This uilemma is auuiesseu moie fully in section 2.7 of the oveiall FSP uocument.

2.1.4 W0NEN ANB Y00TB PACKAuES ANB 0FF-FARN ACTIvITY PR0N0TI0N

The Small anu Neuium Enteipiise Agency (in the Ninistiy of Tiaue anu Inuustiy) has uevelopeu
a piogiamme facilitating the establishment of SNEs, focusing on uiban aieas as it is consiueieu
as a component of the uoveinment's uiban uevelopment piogiamme. The Ninistiy of Women
Affaiis anu the Ninistiy of Youth anu Spoit have uevelopeu "uevelopmental packages" foi both
uiban anu iuial youth anu women. These aie uesigneu to ensuie that women anu youth benefit
fiom uevelopment piogiammes. The focus is on mobilisation anu oiganisation of youth anu
women anu the involvement of othei agencies such as the Small anu Neuium Enteipiise Agency
in pioviuing the necessaiy tiaining on off-faim activities.
The key elements of the women anu youth package seek to ensuie that women anu youth
maximize theii ietuins fiom lanu anu laboui
4
. They aie also uesigneu to ensuie that agiicultuial
uevelopment piogiammes anu extension effoits, off-faim activity piomotion piogiammes, anu
maiket uevelopment piogiammes benefit women anu youth. Finally, they incluue piovisions to
encouiage women anu youth to foim coopeiatives of theii choice anu benefit fiom savings anu
cieuit schemes.
The Ninistiy of Women Affaiis anu the Ninistiy of Youth anu Spoit have also initiateu a piocess
of ueveloping pastoial suppoit measuies foi theii iespective clients. A backgiounu stuuy is
complete anu the uesign is expecteu to be completeu befoie the enu of Ethiopian financial yeai
(}une 2uu9).
The NoARB has the specific iesponsibility of ensuiing that women anu youth benefit fiom
uevelopment piogiammes. In paiticulai, the NoARB is expecteu to:
Integiate youth uevelopmental packages into iuial uevelopment policies anu stiategies
anu ensuie iuial youth benefit fiom inteiventions.
Ensuie that the youth have access to lanu (hilly lanu, iesettlement) anu aie able to
engage in off-faim activities.
Nobilise iesouices fiom local anuoi inteinational souices foi the implementation of
piogiammes that uiiectly benefit youth anu women.
Ensuie that youth anu women engageu in faim anu off-faim activities obtain appiopiiate
loans.
As noteu above the SNE uevelopment piogiammes uo not ieach iuial aieas. To auuiess this gap,
the Feueial Foou Secuiity Biiectoiate has now uesignateu a gioup of piofessionals that is
iesponsible foi piomoting off-faim activities in iuial aieas. uuiuelines fiom this team, issueu in
2uu9, pioviue specific objectives as follows:
ueneiation of employment foi iuial youth anu women, theieby ieuucing iuial-uiban
migiation

4
The RBPS iecognises that most Ethiopian youth uo not have lanu of theii own. Bowevei, it suggests that
they can use theii paients' lanu (oi pait of it) to unueitake investment in off-faim activities. They can also
inciease access to lanu by ienting fiom householus with no laboui to faim it.

9
Engagement of lanuless anu unuei-employeu householu membeis to make them
piouuctive
value auuition thiough agiicultuial piocessing
Founuation builuing foi the expansion of iuial inuustiies
Stiengthening of iuial uevelopment centies thiough seivice ueliveiy
Bevelopment of commeicialisation anu intiouuction of mouein technologies into iuial
aieas
Income geneiation foi people living with BIvAIBS.
Thiough this gioup, the Foou Secuiity Piogiamme will cooiuinate with the SNE Agency anu
othei ielevant agencies to ensuie that off-faim activities aie piomoteu anu that the specific
neeus of women anu youth aie met thiough the piogiamme.
2. 2 FEAT0RES 0F TBE SECT0R
Agiicultuie is the uominant economic sectoi in Ethiopia in moie ways than one. Accoiuing to the
latest census (CSA, 2uu8), 84% of the population lives in the iuial aieas anu makes a living fiom
agiicultuie anu ielateu activities. Agiicultuie also geneiates 4u% of the gioss uomestic piouuct
anu 8u% of the foieign exchange eainings. Bowevei, uespite these contiibutions to the
Ethiopian economy, agiicultuie iemains iain-feu with a limiteu use of impioveu faim
technologies anu inputs. Piouuctivity is low anu much of the iepoiteu piouuction inciease
comes fiom aiea expansion iathei than incieases in yielus pei hectaie.
Pastoial anu agio-pastoial aieas iepiesent ovei 4u% of the lanu anu 12% of the population of
Ethiopia. Although the economic value of pastoialism has nevei been piopeily assesseu, it is
wiuely iecognizeu by pastoialism anu livestock expeits as being significant.
Ruial communitieswhethei aie they agiicultuial, pastoial oi agio-pastoialaie vulneiable to
a numbei of natuial hazaius such as uiought, floouing, pests anu ciop anu livestock uiseases.
Bue to low level of iesilience, these hazaius often leau to uisasteis anu iuial householus
expeiience foou shoitages. The uoveinment of Ethiopia has an emeigency piepaieuness plan
that iesponus to uisasteis. In the past, the iesponse was tiiggeieu by an annual appeal foi foou
assistance to which uonois iesponueu. Bowevei, the iesponse has often been late paitly uue to
the time it takes to assess the emeigency situation anu come to an agieement on the numbei of
clients anu the amount of foou iequiieu. Bouseholus iesoit to coping mechanisms that involve
the consumption oi sale of piouuctive assets to feeu the family.
In 2uuS the goveinment calleu upon uonois to commit to a multi-yeai financing piogiamme, as
opposeu to annual appeals. The Foou Secuiity Piogiamme was then launcheu, with the PSNP
uesigneu to meet the neeus of the chionically foou insecuie anu with complementaiy
piogiammes (notably, the "package" piogiamme unuei the 0thei Foou Secuiity Piogiamme)
uesigneu to place them on the path to foou secuiity.
2. S EXPECTEB CLIENTS
The clients of the Bouseholu Asset Builuing component aie ,--: *)94>=.4 8-=948-':9 *)
>8.-)*>(''B ,--: *)94>=.4 I-.4:(9. As in the pievious phase of the foou secuiity piogiamme,
householus' paiticipation in asset builuing inteiventions is expecteu to speeu up giauuation
fiom PSNP anu at a latei stage, fiom the FSP. Bowevei, in this phase piioiity will be given to
expanuing the coveiage of the BABP component as iapiuly as possible (though paying uue
attention to sustainability), in oiuei to ensuie giauuation at scale. PSNP clients anu giauuates

1u
will be piioiitiseu foi suppoit unuei BABP. Shoulu auuitional financing become available, all
foou insecuie householus in piogiamme woieuas will be eligible foi cieuit piovision.
Although E('4 (): ,4E('4P84(:4: chionically foou insecuie householus will have equal
oppoitunities to paiticipate in this component, the specific neeus of women anu female-heaueu
householus will be taken into special account. Women will be key paiticipants in the stakeholuei
consultations fiom the inception of the piogiamme. Piogiamme inteiventions such as business
plan uevelopment anu householu confiuence builuing activities will specifically auuiess
women's neeus in teims of business skills anu financial liteiacy tiaining. The iuial B-=<8 face
paiticulai constiaints as they seek to eain a livelihoou uue to theii lack of access to lanu, which
has often limiteu theii access to cieuit. 0ff-faim oppoitunities piomoteu by the piogiamme aie
likely to be paiticulaily ielevant foi this gioup.
F*.4>< 9=;;-.< >'*4)<9 will not be excluueu fiom paiticipation in the BABP. Theii paiticipation
will be encouiageu anu facilitateu thiough a vaiiety of stiategies, incluuing: tailoiing business
plans to each householu's capacity, anu incieasing the piogiamme's focus on off-faim activities
such as petty tiauing anu seivice piovision. In this way, even laboui-pooi householus will have
oppoitunities to giauually builu theii householu assets anu move towaiu foou secuiity.
Although the iates of PSNP giauuation foi uiiect suppoit clients aie expecteu to be lowei than
those foi public woiks paiticipants, the BABP is uesigneu to enable them to paiticipate as fully
as possible in the piogiamme. Bowevei, the piogiamme will ensuie that no uiiect suppoit client
is compelleu to paiticipate in the BABP if they uo not believe that they have the capacity to uo
so.
&(9<-.(' (): (+.-P;(9<-.(' ;-;='(<*-)9 will also be taigeteu by the BABP, as the piogiamme
implementation aieas will incluue the pastoial aieas of Afai, Somali, 0iomiya anu SNNPR.
Inueeu, builuing (oi in many cases iebuiluing) assets is ciitical in these aieas, as they have
suffeieu fiequent uiought anu othei shocks that contiibuteu to the uepletion of theii key
assetlivestock. In these aieas, householus that have uioppeu out of pastoialism can benefit
fiom householu asset builuing as they aie usually veiy pooi anu neeu options foi uiveisifying
theii livelihoous. Pastoialist householus will paiticipate as well, although the natuie of theii
livelihoous anu the impoitance of iisk management may iequiie a slightly uiffeient appioach (as
is outlineu in section 2.7 of the FSP uocument). A full iecommenuation on pioposeu appioaches
anu inteiventions foi the BABP in pastoial aieas is expecteu fiom the Pastoialist Task Foice
piioi to the stait of the piogiamme.
2. 4 PR0BLENS T0 BE TACKLEB
Bioauly speaking, the oveiall pioblem which the BABP auuiesses is the issue of enhancing
income anu assets anu theieby enhancing livelihoou status of chionically foou insecuie
householus in agiicultuial, pastoial anu agio-pastoial aieas, once livelihoou status has been
secuieu thiough the safety net pioviueu by the PSNP. Noie specifically, the piogiamme is
uesigneu to tackle a vaiiety of factois ielateu to giowth out of foou insecuiity in a way that is
moie effective than its pieuecessoi 0thei Foou Secuiity Piogiamme (0FSP). These factois
incluue:
a) &--. ,*)()>*(' ;.(><*>49 combineu with a lack of appiopiiate financial seivices in iuial
communities. Paiticulai pioblems incluue low iates of savings anu low loan iepayment
iates by iuial householus. The piogiamme will tackle these pioblems by iaising
awaieness on the impoitance of saving, piomoting financial seivice piovision by
appiopiiate institutions anu piomoting a cultuie of contiact enfoicement.

11
b) 284 *)(3*'*<B -, '->(' (:E*)*9<.(<-.9 (): 4M<4)9*-) I-.L4.9 <- ;4.,-.E <84*.
4M<4)9*-) <(9L9, as a iesult of theii loan uisbuisement anu collection uuties (both unuei
the pievious 0FSP anu as pait of the annual cieuit-baseu input supply piocess). The
piomotion of appiopiiate financial seivices will ielieve them of some of these uuties anu
give them moie time to focus on theii iegulai woiks.
c) Q4(L '*)L(+49 between the piomotion of householu investment anu the piovision of
complementaiy seivices such as technical follow-up, inputs anu animal health seivices.
This was a paiticulai constiaint uuiing the pievious phase of the piogiamme. The next
phase will have a paiticulai emphasis on capacity builuing which ensuies that the
necessaiy linkages between piogiammes anu institutions aie maue. The Extension
Biiectoiate will be encouiageu, anu iesouiceu whenevei appiopiiate, to uesign
investment activities that aie linkeu to the Small anu Nicio Enteipiise Agency, Ruial
Technology Bevelopment Centies, Regional ieseaich institutions, etc.
u) 284 ;--. (>>499 -, .=.(' >-EE=)*<*49 <- E(.L4<9# The majoiity of foou insecuie
communities lack physical access to effectively-functioning maikets as well as maiket
infoimation. The BAB component will cooiuinate with the PSNP to take auvantage of
new feeuei ioaus constiucteu thiough public woiks, maximizing the impact of the
physical infiastiuctuie by pioviuing tiaining in maiket oiientation anu facilitating
maiket linkages.
Pastoial anu agio-pastoial aieas suffei fiom similai pioblems as those outlineu above. They,
too, iequiie householu asset builuing oppoitunities thiough access to financial seivices anu
maikets. Bowevei the appioaches to auuiessing these pioblems must take into account the
specific chaiacteiistics of these communitiessuch as theii cohesive natuie anu paiticulai
livelihoou stiuctuies anu may not be the same as foi the highlanus. The BAB component will
builu on best piactices fiom Nu0s anu othei uevelopment paitneis who have implementeu
maiket-ielateu inteiventions anu piloteu vaiious investment moualities (inuiviuual, householu,
gioup, community oi clan-baseu) in pastoial aieas. These lessons will be geneiateu by the
Pastoialist Task Foice.
2. S 0TBER RELEvANT INTERvENTI0NS ANB INSTIT0TI0NS INv0LvEB
2.S.1 TBE EXTENSI0N SYSTEN
The agiicultuie extension system will be iesponsible foi uemanu-uiiven extension seivices
ielateu to the implementation of the Bouseholu Asset Builuing component. In paiticulai,
Bevelopment Agentscential to the Ethiopian extension systemwill be cential to BABP
implementation. At piesent the uoveinment has ieacheu its taiget of thiee Bevelopment Agents
pei kebele in the majoiity of woieuas, making a total of 69,uuu BAs in the Ethiopian extension
system. These BAs aie tiaineu at one of the 2S Agiicultuial anu vocational Euucation anu
Tiaining (ATvET) Colleges thioughout the countiy. They aie also suppoiteu by woieua-level
expeits (subject mattei specialists) who pioviue auvice on technical issues. BAs aie specializeu,
with each kebele having one ciop science BA, one animal husbanuiy BA anu one natuial
iesouices management BA. These BAs uisseminate "technology packages" uevelopeu by expeits
in the extension system, pioviuing technical auvice on faim as well as in Faimei Tiaining
Centies (FTCs) in each kebele. Bowevei, the quality of FTC facilities anu the uegiee of theii
utilisation vaiies fiom one kebele to anothei.
Theie have been consiueiable impiovements fiom the uays when only thiee agio ecologies
weie consiueieu by the extension system: &!(), *+%,)-&!() anu .+/). Touay the NoARB

12
iecognizes appioximately 18 agio-ecological zones within thiee uistinct enviionments
moistuie suiplus, moistuie ueficit anu pastoial. Noieovei, within the BRNFSS the Livelihoous
Integiation 0nit (LI0) is in the piocess of completing a moie uetaileu piofiling of the whole
countiy in Livelihoou Zones, baseu on the Bouseholu Economy Appioach. This has potential foi
uevelopment piogiamming, which will be fuithei exploieu.
Yet the agiicultuialpastoial extension system faces consiueiable challenges in CFI aieas. A
ieview conuucteu as pait of the foimulation piocess founu that extension seivices hau little
effect in helping householus achieve foou secuiity. It also iuentifieu the following weaknesses in
the system:
Inauequate tiaining, auvice anu technical suppoit foi CFI householus
Limiteu awaieness of upgiauing oppoitunities anu complementaiy seivices (auuitional
cieuit, input, maikets, anu off-faim activities)
Ineffective opeiation of FTCs
Involvement of extension staffpaiticulaily BAsin cieuit uisbuisement anu collection
Absence of genuei consiueiations
Lack of effective N&E
In auuition to the geneial pioblems listeu above, the Extension Seivice is wiuely iecognizeu to
be much weakei in pastoial aieas than in the highlanus.
284 K=.(' 7(;(>*<B 1=*':*)+ &.-R4>< HK71&J has been a key initiative woiking to stiengthen
the Ethiopian extension system. Staiteu in 2uu7, this five-yeai pioject is being implementeu in
127 woieuas acioss the countiy, of which 28 aie safety net woieuas. The pioject suppoits
ATvETs as well as agiicultuial extension anu ieseaich.
Suppoit to agiicultuial extension (incluuing livestock-ielateu extension) consists of capacity
builuing foi subject mattei specialists, suppoit to FTCs, a faimei innovation funu anu extension-
ieseaich-faimei linkage. At the iequest of faimeis, the pioject is piepaiing to tuin the cuiiently
specialiseu BAs into geneialists. It is also tiansfoiming some of the ATvETs into business-
oiienteu institutions, wheieby they tiain BAs on cost shaiing anu also uo othei shoit teim
tiaining foi othei clients.
The pioject aims to tiansfoim FTCs into well equippeu anu fuinisheu centies of leaining anu
infoimation shaiing foi community membeis. 0ut of 2,Suu FTCs selecteu fiom the 127 woieuas,
only about Su% aie fully equippeu anu fuinisheua numbei which is expecteu to ieach 1uu%
by the enu of 2uu9. These FTCs will then be useu as focal points foi extension piovision. The
pioject's suppoit to faimei innovation is veiy much in line with the BABP piinciple of uemanu
uiiven extension. Twenty woieuas (anu 1uu FTCs) have been selecteu to seive as mouel
woieuas. Faimeis aiounu the FTCs aie tiaineu to tuin theii iueas into pioposals which aie then
funueu by the pioject. Thus the pioject cieates uemanu foi innovative technologies fiom the
faimeis' siue anu mobilises ieseaich centies, piivate tiaueis, univeisities, coopeiatives anu
unions anu associations (youth anu women) to iesponu to the uemanu.
Nany of these appioaches will be ieplicateu in non-RCBP woieuas unuei the BABP, with an
auuitional focus on maiketing anu maiket linkages (not incluueu in the RCBP).
@<84. 4M<4)9*-) ;.-G*:4.9# Although goveinment policy cleaily uefines a iole foi the piivate
sectoi in the piovision of agiicultuial extension seivices, theie has been little piivate sectoi

1S
involvement to uate. Nu0s, howevei, have hau significant involvement both in stiengthening the
uoveinment extension system anu in intiouucing innovative faimei tiaining methouologies.
Recent anu cuiient examples incluue the Paiticipatoiy Foiest Nanagement appioach
implementeu by Faim Afiica, the Integiateu Pest NanagementFaimeis Fielu School
methouology employeu by Save the Chiluien 0K anu a vaiiety of livestock ielateu activities in
pastoial aieas conuucteu by Save the Chiluien 0SA.
2.S.2 C00PERATIvE BEvEL0PNENT

The Feueial Coopeiative Agency, with its buieaus anu offices at iegional anu woieua levels
pioviues suppoit in the piomotion, cieation anu management of agiicultuial maiketing
coopeiatives, multipuipose coopeiatives, anu savings anu cieuit coopeiatives. These buieaus
anu offices will theiefoie be impoitant counteipaits of the Foou Secuiity buieaus anu offices in
the implementation of the BAB piogiamme, paiticulaily with iegaius to suppoit foi R0SACC0s
anu agiicultuial coopeiatives. Betails aie pioviueu in Chaptei S of this uocument.
2.S.S FINANCIAL SERvICE PR0vIBERS

The significant iole of financial institutions is one of the impoitant featuies of the new BAB
component. Yet an inventoiy of available NFIs anu R0SACC0s in the 29u safety net woieuas
ievealeu wiue iegional uispaiities in coveiage. Tigiay has the wiuest coveiage, with at least one
NFI bianch piesent in all woieuas in Tigiay anu a total of S18 R0SACC0s that covei all but one
woieua. Amhaia has the next best coveiage, with at least one NFI bianch opeiating in 64
woieuas anu 24 woieuas aie coveieu by 99 R0SACC0s. 0iomiya, SNNPR anu the pastoial
iegions of Afai anu Somali have the least coveiage.
TABLE 2: AVAILABILITY OF FINANCIAL SERVICE PROVIDERS
5

K4+*-) S-# -, I-.4:(9 I*<8
-)4 -. E-.4 TUV9
S-# -, I-.4:(9 I*<8 -)4
-. E-.4 A077@9
2-<(' A077@9 *) <84
.4+*-)
Amhaia 64 24 99
0iomiya S4 1u 27
Tigiay S1 Su S18
SNNPR 76 19 228
Afai u 2 S
Baiaii u 1 18
Biie Bawa u 1 96
Somali u u u
2-<(' %%" WX XY5


S
Souice: Backgiounu papei piepaieu foi the foimulation of the FSP by Bi. Woluay Amha, 2uu9

14
The cieation of new R0SACC0s anu the expansion of NFI coveiage into chionically foou
insecuie communities will theiefoie be an impoitant BABP inteivention.
2.S.4 AuRIC0LT0RAL uR0WTB PR0uRANNE (AuP)

As pait of uonoi suppoit to the Ruial Economic BevelopmentFoou Secuiity agenua of the
PASBEP, in Apiil 2uu8 a gioup of uonois expiesseu inteiest in financing a giowth agenua with a
pooleu oi cooiuinateu funuing in oiuei to haimonise effoits to piomote agiicultuial giowth in
Ethiopia. As a iesult, an Agiicultuial uiowth Piogiamme is cuiiently unuei piepaiation. The
specific objectives aie expecteu to incluue the following:
Suppoiting faimeis to intensify theii piouuction in oiuei to inciease piouuctivity
Stiengthening local (woieua level) goveinment capacity to pioviue public seivices foi
incieaseu agiicultuial piouuctivity
Beveloping both infoimal anu laigei piivate sectoi opeiations in the maiketing anu
value auuition of agiicultuial piouucts anu linking them with smallholueis.
The piogiamme focuses on geogiaphic aieas that will most likely leau to high ietuins (as a
iesult of agio-ecological potential as well as auministiation commitment) anu on selecteu
commouities whose piouuction intensification anu availability of maikets is likely to be highly
piofitable. This tenus to excluue the safety net woieuas. Bowevei, the BABP is uesigneu to
uemonstiate the giowth potential of chionically foou insecuie aieas by tiansfoiming
subsistence into small-scale commeicialiseu faiming in those aieas. Linkages to maikets
facilitateu by the BABP will likely be uone in cooiuination with "giowth agenua" aieas.
Noieovei, lessons fiom the piogiamme will be impoitant foi householus that giauuate fiom
PSNP anu then into foou secuiity, as they will uevelop the capacity to paiticipate in giowth
inteiventions such as this.
The institutional aiiangements foi the oveiall FSP aie uesigneu to facilitate close links between
the FSP anu the REBFS agenua as a whole, incluuing the AuP (see section S.1 of the FSP
uocument).
2. 6 P0LICY, STRATEuY ANB PR0uRANNE uAPS
This biief oveiview of the policy, stiategy anu piogiamme enviionment highlights some
stiength as well as ciitical gaps that might impeue the implementation of the new FSP in geneial
anu the BAB component in paiticulai. Aieas that neeu paiticulai attention anu stiengthening
aie as follows:
1. The uevelopment of a flexible iegulatoiy enviionment that enables R0SACC0s anu NFIs to
opeiate effectively in CFI aieas is a ciitical step as the new FSP embaiks on ueveloping a
sustainable financial seivice piovision system foi CFI householus.
2. The foou secuiity stiategy has been uesigneu to piomote off-faim income geneiating
activities since its inception. Bowevei, cleai guiuance is lacking on how the vaiious agencies
iesponsiblethe Small anu Neuium Enteipiise Agency within the Ninistiy of Tiaue anu
Inuustiy anu the Ninistiies of Women anu Youthcan woik togethei to piomote off-faim
activities in iuial aieas. This is an aiea that BABP will have to auuiess in oiuei to ensuie
that these activitieswhich aie paiticulaily impoitant foi lanuless youth (both men anu
women)aie auequately piomoteu.

1S
S. The extension of the BAB to pastoial aieas is ciitical, as these aieas have suffeieu
consiueiable asset uepletion ovei the past uecaues uue to iecuiient uiought. Piioi to the
ioll-out, howevei, a stiategy will neeu to be uevelopeu to tailoi the component's activities to
the specific ciicumstances of pastoial populations. In paiticulai, this stiategy uevelopment
will neeu to take into account the following: (i) the impoitance of the communityas
opposeu to the householuamong pastoialists; (ii) the impoitance of iisk management anu
auuitional asset piotection schemes in suppoit of the pastoial livelihoou; anu (iii) potential
pathways foi giauuation that may oi may not be baseu on asset levels as they aie in the
highlanus.
2. 7 LESS0NS LEARNEB FR0N PAST PR0uRANNINu
Foi much of the 199us anu eaily 2uuus, the Extension Seivice was mobilizeu to implement a
stiategy baseu on supply-siue constiaints to agiicultuial giowth, incluuing the uistiibution of
inputs anu collection of cieuit at the enu of the season. The stiategy was implementeu by a
centializeu piomotion of technological packages mainly combining feitilizei, seeu anu technical
auvice.
Whilst theie was a mouest giowth in foou supply, it was incieasingly iecognizeu theie was a
neeu foi geneiating moie uiveisifieu, efficient anu sustainable baskets of faim investment anu
income geneiating oppoitunities, as well as a stiongei focus on the uemanu siue thiough iuial
maikets. uoveinment is now placing emphasis on suppoiting piouuceis to be successful
uecision-makeis, to impiove incentives to maiket piouuce anu to make piouuction investments
anu to ieuuce unmanageu iisks anu shocks such as uiought. This change in couise has been
aiticulateu in the seconu Poveity Reuuction Stiategy (PASBEP).
The Bouseholu Asset Builuing Component will builu on the implementation expeiience of the
Woilu Bank-funueu RCB, the CIBA-funueu IPNS anu the 0SAIB suppoiteu PSNP Plus piojects
anu the lessons leaint fiom the implementation of the 0thei Foou Secuiity Piogiamme. This
expeiience cleaily uemonstiates the success of auopting a uemanu uiiven appioach to extension
that empoweis anu builus iuial householus' confiuence to embaik on investments anu income
geneiating enteipiises appiopiiate to theii neeus anu capacity. This expeiience has also cleaily
uemonstiateu the necessity of linking piouuction to maikets, incieasing value auuition anu
accessing a uiveisifieu iange of inputs souices anu uistiibutois.
Bowevei, past expeiience has also iuentifieu significant gaps in the capacity of the key
stakeholueis that must be auuiesseu if this iauical change in uiiection is to be achieveu. Whilst
theie has been a uiamatic inciease in the numbei of BAs anu functioning FTCs, theie iemains a
neeu foi a compiehensive capacity builuing piogiamme to auuiess woieua expeits' anu BAs'
gaps in technical skills, facilitation skills anu management capacity. Ruial financial seivice
piovision is also an aiea which iequiies significant investment.
Theie is now an incieasing iealization that investments on on-faim income geneiating anu asset
builuing only will be insufficient foi many pooi iuial families to achieve foou secuiity. The
expansion of oppoitunities in both agiicultuial anu non-agiicultuial off-faim investment anu
income geneiating oppoitunities is an essential element of the BABP. This iequiies
implementeis anu cooiuinatois of the piogiamme to establish linkages with ongoing SNE
uevelopment piogiammes that hitheito have laigely focuseu on uiban householus.
In pastoial aieas, past piogiamming has uemonstiateu the ciitical neeu foi income
uiveisification suppoit to ex-pastoialists anu agio-pastoialists anu foi iisk management
activities foi pastoial communities. The FSP will suppoit these activities, with the BABP focusing

16
in paiticulai on income uiveisification anu asset builuing among the pooiei segments of the
population.

17
S INTERvENTI0NS
S. 1 u0AL
The oveiaiching goal to which the Foou Secuiity Piogiamme as a whole contiibutes is to achieve
foou secuiity foi chionic anu tiansitoiy foou insecuie householus in iuial Ethiopia. In tuin, the
O-(' of the Bouseholu Asset Builuing Piogiamme, as a component of the FSP, is the 0utcome (oi
specific objective) of the FSP:
U--: 94>=.*<B 9<(<=9 ,-. E('4 (): ,4E('4 E4E34.9 -, ,--: *)94>=.4 8-=948-':9 *) 7UV
I-.4:(9 *E;.-G4:#
The objectively veiifiable inuicatois foi this uoal outline the expectations of what will be
achieveu anu aie as follows:
1. Su% of male anu female membeis of chionically foou insecuie householus paiticipating in
PSNP public woiks access sufficient foou at all times foi an active anu healthy life in the
absence of PSNP tiansfeis by 2u14 |foou secuiityj.

2. Su% of male anu female membeis of chionically foou insecuie householus paiticipating in
PSNP public woiks yet to achieve foou secuiity have sufficient foou foi 12 months anu can
iesist moueiate shocks in the absence of PSNP tiansfeis by 2u14 |foou sufficiencyj.

S. 9u% of male anu female membeis of chionically foou insecuie householus paiticipating in
PSNP Biiect Suppoit have sufficient foou fiom sustainable souices foi 12 months anu can
iesist moueiate shocks by 2u14 |foou sufficiencyj.

4. 9u% of male anu female membeis of (non-chionic) foou insecuie householus involveu in the
FSP have sufficient foou foi an active anu healthy life in the absence of PSNP tiansfeis by
2u14 |foou secuiityj.

Foou secuiity is uefineu as: "access by all people at all times to sufficient foou foi an active anu
healthy life" (New Coalition foi Foou Secuiity).
Foou sufficiency is an inteimeuiate step towaiu foou secuiity anu is uiiectly ielateu to the ability
to giauuate fiom the PSNP: "A householu has giauuateu when, in the absence of ieceiving PSNP
tiansfeis, it can meet its foou neeus foi all 12 months anu is able to withstanu mouest shocks."
This state is uesciibeu as being 'foou sufficient' (PSNP uiauuation uuiuance Note).
S. 2 00TC0NE ANB STRATEuY
The expecteu 0utcome of the Bouseholu Asset Builuing Piogiamme - the specific objective that
the BABP is expecteu to achieve - is:
V)>-E4 9-=.>49 :*G4.9*,*4: (): ;.-:=><*G4 (994<9 *)>.4(94: ,-. ,--: *)94>=.4
8-=948-':9 *) 7UV I-.4:(9#
The objectively veiifiable inuicatois foi this 0utcome aie:
1. 9u% of foou insecuie householus iepoit that the aveiage ieal value of theii piouuctive
assets has incieaseu by at least Su%.
2. 9u% of foou insecuie householus iepoit sustainable new souices of income
S. 7S% of householus iepoiting a new souice of income fiom non-faim activities.

18
The ieview of the pievious foou secuiity piogiamme highlighteu the neeu foi a moie consistent
anu timely appioach to householu investment anu income geneiating inteiventions anu a moie
uiveisifieu appioach to piovision of financial piouucts foi asset accumulation anu piotection
(incluuing tiansfeis, savings, multiple aiiangements foi cieuit). The householu asset builuing
component iesponus to these uemanus.
The ieview also inuicateu that theie is neeu to take cognizance of vaiiations in householus'
capacity to unueitake investments, assume iisks, auopt innovative piactices, anu to take on anu
iepay cieuit. The appioach on which inteiventions unuei this component aie baseu iecognizes
these uiffeiences. 0ne must beai in minu that all foou insecuie householus' capacity to take
cieuit, innovate anu assume iisk is limiteu, although the capacity of some is bettei than otheis.
Bowevei, both inteinational anu Ethiopian expeiience shows that householu level investments
incoipoiating all these elements aie impoitant if householus aie to achieve foou secuiity.
6
The
intention is to place householus that aie cuiiently chionically foou insecuie on a pathway
wheieby theii capacity impioves ovei time anu they aie able to geneiate sufficient anu
sustaineu incomes that covei basic foou neeus anu iesist shocks.
In bioau teims, foou insecuie householus can be categoiizeu into thiee bioau gioups:
Chionically foou insecuie householus, with few piouuctive assets, low anu insecuie
income souices; have little ability oi self confiuence to take on the iesponsibilities of
loan conuitionalities anu, in all likelihoou have no cieuit histoiy so that commeicial
cieuit pioviueis aie unwilling to lenu to them; anu, who uepenu on tiansfeis foi a
significant piopoition of theii foou neeus.
Chionically foou insecuie householus, with a bettei asset base anu confiuence to take on
a loan, but iely on tiansfeis to meet the householu's foou neeus anu who may not have a
cieuit histoiy oi sufficient savings to geneiate confiuence among commeicial cieuit
pioviueis.
Foou insecuie householus who have some piouuctive assets, moie substantial anu
secuie income souices anu have the capacity anu self-confiuence to take on investment
loans, but neveitheless have fiagile livelihoous anu aie theiefoie not veiy attiactive
customeis foi commeicial cieuit pioviueis.
Foi such householus to move towaius foou secuiity iequiies the tiansfoimation of fiagile
piouuction systems involving both asset accumulation anu innovation. Although pooi, foou
insecuie householus have knowleuge, skills anu potential to tiansfoim theii livelihoous, they
neeu confiuence builuing suppoit. Cleaily, householus in all thiee categoiies iequiie suppoit to
unueistanu ietuins to investments, to uevelop viable anu appiopiiate business plans anu to
ieceive auvice on new technologies, impioveu piactices anu managing cieuit. In this way they
will be able to iuentify investment anu income geneiating oppoitunities that will place them on
a pathway to foou secuiity. The content of the suppoit will uiffei accoiuing to the type of
householu. This is illustiateu in Figuie 2 below
7
, which also ieflects the complementaiy suppoit
pioviueu thiough the othei components of the Foou Secuiity Piogiamme.


6
Impoitant but not sufficient; neeus to be complementeu by PSNP anu CCI.
7
This is the same figuie as the "vision foi giauuation" uiagiam in the FSP uocument

19
U*+=.4 %# &(<8I(B <- O.(:=(<*-) ,.-E &AS& (): -G4.('' UA&
Food
Secure
(including
Graduates
of FSP)

A
s
s
e
t

a
c
c
u
m
u
l
a
t
i
o
n

Food
Insecure
(including
graduates
from PSNP)

Chronically
Food
Insecure
A
s
s
e
t

s
t
a
b
i
l
i
s
a
t
i
o
n

Ultra Poor




Foi the fiist gioup of householus ('ultia-pooi' in the uiagiam), safety net tiansfeis, savings anu
micio-cieuit with intensive suppoit anu tailoieu piouucts aie seen as pieiequisites to enable
them to gain a footholu on the pathway to foou secuiity. Such householus will neeu to focus on
iebuiluing theii piouuctive systems anu aie unlikely to assume laige iisks, auopt new
technologies oi uiveisify into unfamiliai activities. As they iebuilu theii asset base, they will
stait geneiating a suiplus that will allow them to take on moie innovative investments at a latei
stage. Small appiopiiate anu well-planneu anu suppoiteu loans as well as the uiscipline of
saving will allow them to builu a cieuit histoiy foi moie foimal engagement in cieuit maikets.
The seconu gioup of householus ('Chionically Foou Insecuie') woulu continue to iequiie safety
net tiansfeis, but they woulu be likely to have laigei anu moie innovativesophisticateu
business plans. The thiiu gioup of householus (foou insecuie, incluuing giauuates fiom PSNP)
woulu notno longei iequiie safety net tiansfeis anu woulu be in a position to take cieuit on
commeicial teims but woulu be looking foi suppoit in maiket uevelopment anu investment
oppoitunities.
Anothei impoitant element in helping foou insecuie householus embaik on a pathway wheieby
they giauually uevelop a capacity to geneiate sufficient anu sustaineu incomes that covei basic
foou neeus anu iesist shocks, is the uevelopment of maiket linkages both foi input supply anu
sale of outputs anuoi ueliveiy of seivices. The lattei is especially impoitant foi the ielatively
bettei off householus anu those uiveisifying into non-faim activities.
Figuie 2 above illustiates the sequential natuie of these inteiventions.
Graduation
from FSP
Graduation
from PSNP
Community
assets (CCI
& PSNP
PW)

Repeat
access to
FSP credit
Extension services, including
business planning, input linkages
and market advice

Village savings & credit and
financial literacy
PSNP
Transfers
Intensive support and
tailored products
Mainstream credit
and service
provision

2u
S. S 00TP0TS
In oiuei to auuiess the neeus of the vaiious types of householus in foou insecuie communities
along the continuum uesciibeu in Figuie 2 anu thus to achieve the intenueu 0utcome foi this
component, the following 9*M @=<;=<9 will be ueliveieu:
0utput 1: Access to viable on- anu off-faim income-geneiating oppoitunities impioveu.
0utput 2: Access to sustainable financial seivices enhanceu.
0utput S: Sustainable input souicing, piouuction anu ueliveiy systems enhanceu.
0utput 4: Access to effective piouuct anu laboui maikets incieaseu.
0utput S: Institutional capacity to manage anu implement the BABP achieveu.
0utput 6: Knowleuge, skills anu confiuence of foou insecuie people built.
S.S.1 00TP0T 1: ACCESS T0 vIABLE 0N- ANB 0FF-FARN INC0NE-uENERATINu
0PP0RT0NITIES INPR0vEB.
1(>L+.-=):: Noving along a pathway out of foou insecuiity iequiies that householus invest in
impioving existing piouuction systems anuoi ueveloping new income geneiating enteipiises,
oi that they gain bettei eainings fiom wage employment. Yet foou insecuie householus face
limiteu oppoitunities in this iegaiu, because they opeiate in iisky enviionments, theii iesouice
base is low anu theiefoie theii investment capability is weak, anu also because theii access to
seivices (paiticulaily cieuit) anu maikets tenu to be veiy limiteu. While the specific neeus of
inuiviuual householus uiffei, they all iequiie suppoit in iuentifying viable investments
(incluuing seeking wage employment) anu unueistanuing ietuins anu iisks foi uiffeient types of
investments. They then neeu suppoit in ueveloping viable anu appiopiiate business plans to
implement the investments, as well as auvice on new technologies, impioveu piouuction
piactices anu cieuit management (if loans aie useu to finance the investments).
The public extension system anu the micio anu small enteipiise uevelopment piogiammes
pioviue some suppoit to iuial householus in the aieas outlineu above. Inueeu, they will continue
to pioviue the bulk of the suppoit in this aiea. Bowevei, significant investment is neeueu to
stiengthen on going iefoims anu ieoiient these inteiventions to ensuie that they aie able to
bettei iesponu to the neeus of foou insecuie householus anu theieby help impiove foou
insecuie householus' access to investmentIuA oppoitunities. The BABP is uesigneu to builu the
capacity of the extension system to achieve this, anu this is uiscusseu fuithei unuei BABP
0utput S.
Stiengthening existing iefoims anu ieoiientation of these piogiammes will be baseu on the
following piinciples:
7-)9='<(<*-)to iuentify investment anu IuA oppoitunities appiopiiate foi foou
insecuie householus by builuing on local knowleuge anu expeiience as well as ieseaich
anu uevelopment.
D*G4'*8--: Z-)4 (;;.-(>8although consultations will be at woieua anu community
levels, in oiuei to be ielevant the iuentification of oppoitunities must be baseu on
livelihoou zones.

21
A*E;'*>*<B -, 3=9*)499 ;'()9these shoulu be easily unueistanuable, uemanu uiiven
anu baseu on householus' technical capacity, maiket oppoitunities anu appiopiiate
choice of technologies.

FB)(E*9Eoppoitunities iuentifieu anu technological innovation must iemain
uynamic anu iesponsive to maiket changes anu geneiation of new knowleuge.
A=EE(.B: To achieve ieoiientation of these piogiammes along the above piinciples, the BABP
will focus on the following inteiventions:
Facilitate a stakeholuei consultation piocess in all piogiamme woieuas to iuentify
investment oppoitunities
Pioviue technical input foi the iuentification of investmentIuA oppoitunities (maiket
anu technical analyses)
Builu technical anu facilitation skills (incluuing TA, tiaining anu uevelopment of ielevant
cuiiicula anu tiaining moualities) within ielevant institutions at the woieua level anu
among BAs at the kebele level to ensuie that auvice to business plans is appiopiiate in
teims of (i) financial viability, (ii) agio-ecological suitability, (iii) acceptance by the
community anu inuiviuual householus, (iv) input supply, anu (v) maiketability of
piouuctsseivices at woieua anu kebele levels; anu, that theie is effective technology
uissemination foi householus inteiesteu in innovation.
0nueitake a tiansfoimation piocess at all levels (Feueial, Regional anu Woieua) to
ieoiient the extension seivice in foou insecuie aieas towaius a moie uemanu uiiven
appioach. This will bioauly entail analysis anu agieement on why change is neeueu;
what neeus to change; a plan foi how changes will be achieveu, anu a plan of ioles anu
iesponsibilities.
Supeivise the business planning piocess.
Bevelop tiaining cuiiicula anu pioviue tiaining-of-tiaineis on new technologies anu
piactices.
Piomote auaptive ieseaich activities anu linkages with new souices of technology.
Suppoit the capacity of both woieua staff anu BAs to follow up anu monitoi client
householus' investments, thiough the piovision of necessaiy equipment, tianspoit, etc.
as appiopiiate
The BABP will thus implement thiee sets of Activities unuei 0utput 1. The fiist set of Activities
will be a consultative piocess uesigneu to iuentify, assess anu summaiise technical auvice on on-
anu off-faim householu investments anu income geneiating enteipiises appiopiiate foi CFI
householus. 0nuei Activity 2, the piogiamme will then suppoit technical assistance to
householus in the uevelopment of business plans foi the investments anu activities selecteu
(incluuing suppoit foi the auoption of impioveu piactices anu the uevelopment of innovative
technologies), anu iefei these householus to financial institutions foi the financing of theii plans.
Finally, unuei Activity S the piogiamme will suppoit continueu monitoiing of investment
activities by paiticipating householus.


22
S. S. 2 00TP0T 2: ACCESS T0 S0STAINABLE FINANCIAL SERvICES ENBANCEB.
1(>L+.-=):6 In conjunction with the iuentification of oppoitunities, uevelopment of business
plans, technology tiansfei anu input supply, financial seivices aie iequiieu to stiengthen the
livelihoous of foou insecuie householus. Pieviously, cieuit was pioviueu thiough the Extension
Seivice, but this leu to confusion about the teims unuei which the funus weie given, low
iepayment iates, anu fiiction between communities anu BAs who weie iesponsible foi loan
collection. It also often involveu the Extension Seivice in the uiiect supply of assets to CFI
householus, theieby foifeiting an oppoitunity to link these householus moie uiiectly to maikets.
Niciofinance institutions aie piesent in most of the piogiamme woieuaswith the notable
exception of pastoial aieas but theii outieach to chionically foou insecuie householus is often
pooi. This is uue to two piimaiy factois: the lack of available loan capital anu the incieaseu iisk
of lenuing to CFI householus. The piogiamme is theiefoie uesigneu to mitigate these factois anu
pioviue incentives to NFIs to lenu to piogiamme paiticipants.
R0SACC0s aie the othei type of financial institution available in the piogiamme woieuas. They
aie membei-owneu anu as such they aie moie likely to ieach CFI householusbut theii numbei
anu scope is limiteu, anu theii capacity is geneially weak.
The piogiamme will suppoit the piovision of financial seivices to foou insecuie householus in
accoiuance with the following basic piinciples:
0;;.-;.*(<4 *)9<*<=<*-)9: Financial seivices shoulu be ueliveieu thiough sustainable
anu appiopiiate financial pioviueis. R0SACC0s aie well placeu to piomote savings anu
manage cieuit that is ievolveu within a community. NFIs aie bettei placeu to mobilize
exteinal funus anu pioviue cieuit on a laigei scale. They can also pioviue money tiansfei
seivices foi migiant laboui.
0;;.-;.*(<4 ;.-:=><9: The financial iequiiements of CFI householus will uiffei.
Theiefoie multiple piouucts will be uevelopeu anu appiopiiate seivice pioviueis will be
useu foi the uiffeient piouucts.
A=9<(*)(3'4 *)<4.49< .(<4: The level of inteiest shoulu not uistoit the financial maiket.
Seivice pioviueis will set inteiest iates that aie sustainable. Neveitheless, since the
pooiest householus aie often unable to take on loans, special measuies will be
consiueieu.
74)<.('*<B -, 9(G*)+96 While multiple financial piouucts aie iequiieu, savings must foim
the basis of the financial system. Savings mobilization will theiefoie pieceue cieuit
piovision as this piouuces financial uiscipline anu expeiience in managing cash.
D4(.)*)+ (): L)-I'4:+4 E()(+4E4)<# Exposuie visits, iegulai monitoiing anu
evaluation, anu peiiou woikshops will all be ciitical to inciease leaining by financial
sectoi stakeholueis of best piactices in the piovision of seivices to vulneiable
householus.
A=EE(.B: In oiuei to establish a system of sustainable financial seivice piovision to CFI
householus, the piogiamme will pioviue a iange of incentives anu funuing stieams thiough a
vaiiety of financial institutions, with NFIs anu R0SACC0s as the piimaiy pioviueis to
householus. The piogiamme will implement thiee majoi activities uesigneu to make sustainable
financial seivices available to CFI anu othei householus accoiuing to theii capacities anu neeus.
The planneu activities aie the following: (1) builuing the institutional capacity of financial
seivice pioviueis, (2) pioviuing a line of cieuit to financial seivice pioviueis anu, penuing

2S
auuitional financing, a cieuit guaiantee to encouiage continueu piovision of loans to clients who
aie in tiansition to giauuation oi have iecently giauuateu, anu (S) suppoiting the
implementation of an appiopiiate iegulatoiy anu supeivisoiy fiamewoik foi giassioots
financial institutions.
In this 0utput, the focus will not only be on pioviuing cieuit to chionically foou insecuie
householus but in the establishment of sustainable financial seivices that can manage capital
anu continue to pioviue financial seivices long into the futuie. These seivices will be ueliveieu
thiough sustainable finance pioviueis, which will pioviue moie uiveisifieu anu flexible seivices
to foou insecuie householus even aftei completion of the piogiamme.
S. S. S 00TP0T S: S0STAINABLE INP0T S00RCINu, PR0B0CTI0N ANB
BELIvERY SYSTENS ENBANCEB.
1(>L+.-=):6 Assisting the implementation of householus' business plans will iequiie suppoit
to the entiie value chain foi the selecteu asset oi enteipiise, fiom input supply to piouuction to
value auuition to vaiious phases of maiketing. This 0utput is conceineu with ensuiing that the
fiist stepinput supplyis auequately suppoiteu, as access to high-quality, appiopiiate inputs
is ciitical to piomoting innovation anu theieby tiansfoiming the livelihoous of foou insecuie
householus. The uoveinment has tiauitionally been veiy involveu in input supply in Ethiopia,
but the lack of coveiage unueiscoies the neeu foi incieaseu involvement of the piivate sectoi in
both the piouuction anu the uistiibution of inputs. Although input uistiibution is officially
libeializeu, the piivate sectoi has tiauitionally been ciowueu out as a iesult of the in-kinu cieuit
system establisheu by Regional goveinments. This system was uevelopeu to ensuie that iuial
householus woulu gain access to the necessaiy seeu anu feitilizei foi each piouuction season.
Inputs weie pioviueu on cieuit thiough agiicultuial coopeiatives at the beginning of the season,
anu paiu back in cash aftei the haivest. Recently, howevei, low iepayment iates have leu
Regional goveinments to begin iequiiing that faimeis pay cash foi seeu anu feitilisei, ieseiving
the cieuit piovision foi only the neeuiest householus. This uevelopment is effectively ue-linking
input supply with cieuit piovision, theieby opening up space foi the piivate sectoi to entei the
input maikets. It also has the potential to inciease uemanu foi input cieuit fiom financial
institutions such as NFIs.
The lack of basic seeu is a ciitical constiaint to piouuctivity in Ethiopia. The Ethiopian Seeu
Enteipiise (ESE) has tiauitionally been the piimaiy basic seeu piouucei in the countiy (togethei
with ieseaich institutions), but it uoes not have the capacity to meet the neeus of Ethiopian
piouuceis. Cuiiently a hanuful of piivate companies aie also involveu in seeu multiplication anu
Regional Seeu Enteipiises aie being establisheu foi basic seeu anu seeu multiplication.
Becoming an official seeu multiplication company iequiies iegistiation with the Animal anu
Plant Bealth Biiectoiate of N0ARB anu ceitification fiom the Quality Stanuaius Authoiity of
Ethiopia (QSAE), but moie infoimal paiticipation is now becoming possible. The ESE, foi
instance, giows seeu on subcontiact with faimeis. Similaily, iegional goveinments aie
beginning to pioviue technical anu oiganizational suppoit to faimeis to multiply basic seeu.
Seeu anu feitilisei aie not the only inputs iequiieu by pooi iuial householus. In oiuei foi them
to uiveisify theii incomes anu inciease theii asset bases, they iequiie access to laigei, moie
expensive inputs such as iiiigation equipment, piocessing technology oi livestock. Piocuiing
these inputs is often uifficult in iemote woieuas wheie piivate supplieis aie few anu fai
between. To auuiess this pioblem, goveinment anu Nu0s have typically unueitaken the task of
piocuiing, tianspoiting anu uistiibuting piouuctive assets to foou insecuie householus. The
auvantage of this piocess is that it tenus to be iapiu, but it entails seveial significant iisks. The
items piocuieu may not be appiopiiate to clients' neeusfoi instance, the wiong bieeu of
livestock, oi a too sophisticateu watei pump. Noie funuamentally, no contact is establisheu

24
between buyei anu sellei, theieby limiting any oppoitunity foi iepeat puichases, technical
auvice oi maintenance fiom the suppliei, oi othei tiansactions. Such a system ultimately limits
the piofitability anu sustainability of the asset oi input.
A=EE(.B# To achieve output S, the piogiamme will take auvantage of the cuiient tienus to
suppoit householus' access to the inputs iequiieu to implement theii business plans. Foi inputs
that aie not ieauily available within the woieuas themselves, the piogiamme will:
Reoiient the iole of uoveinment as a facilitatoi, iathei than a pioviuei, of inputs
incluuing laigei inputs such as piouuctive assets. The Extension Seivice will theiefoie
act as a souice of the basic piouuct (founuation seeu foi multiplication, aitificial
insemination, etc), an iuentifiei of new technology souices, anu a quality contiollei.
Suppoit piivate businesses in the ueliveiy of inputs
Wheie appiopiiate, piomote input multiplication anu uistiibution by anu within the
taigeteu communities.
It is expecteu that the main thiust of facilitating anu piovision of input souicing will continue as
pei the cuiient system, wheiein Regional goveinments anu coopeiatives aie main souice of
inputs foi many householus.
The piogiamme will thus unueitake two main activities in selecteu woieuas. The fiist activity
will entail the facilitation of linkages between supplieis anu useis of inputs, paiticulaily as
ielateu to the implementation of householus' business plans. Capacity builuingpaiticulaily in
the aiea of facilitationwill be a majoi focus of this activity. The seconu activity will entail
suppoit to client communities in the piouuction anu uistiibution of inputs such as impioveu
seeu, seeulings anu agiicultuial equipment.
S. S. 4 00TP0T 4: ACCESS T0 EFFECTIvE PR0B0CT ANB LAB00R NARKETS
INCREASEB.
1(>L+.-=):6 Access to maikets is ciitical foi householus to inciease theii incomes anu builu
theii assets. Past piojects such as NLvP have uemonstiateu the impoitance of a maiket-uiiven
appioach to livelihoous stiengthening, even when woiking with foou insecuie householus.
Bowevei, the capacity of the Extension Seivice to pioviue maiket-oiienteu auvice to householus
iemains weak, as the piimaiy tiaining of BAs is in piouuction techniques. This has too often leu
to householus being suppoiteu in piouuctionthiough uistiibution of assets anu inputs anu
thiough technical assistanceanu then being unable to finu a piofitable maiket foi theii
piouuct. Such an expeiience leaves householus moie iisk aveise anu hesitant to auopt
innovative technologies.
A piogiamme of capacity builuing is theiefoie iequiieu to builu the skills of the Extension
Seivice, the Agiicultuial Naiketing Bepaitment anu the Coopeiative Piomotion Buieaus at the
Regional anu woieua levels in pioviuing sounu maiket-oiienteu auvice. This capacity builuing
will stait with the maiketvalue chain analyses as uesciibeu in 0utput 1, but will continue
thioughout the piogiamme to enable woieua expeits anu BAs to supply householus with up-to-
uate infoimation on iecent maiket tienus, local anu moie uistant maiket oppoitunities,
competition, anu evolving suppoiting maiket seivices.
A=EE(.B6 In 0utput 4, the piogiamme will inciease clients' access to piouuct anu laboui
maikets. Foi piouuct maikets, this will entail incieasing value auuition thiough quality,
piocessing anu stoiage; anu impioving maiket tiansactions thiough bulk sales, contiacts anu
incieaseu maiket knowleuge. Foi laboui maikets, this will entail builuing householus'

2S
unueistanuing of oppoitunities anu iequiiements thiough awaieness iaising anu potential
employei-employee linkages.
S. S. S 00TP0T S: INSTIT0TI0NAL CAPACITY T0 NANAuE ANB INPLENENT
TBE BABP ACBIEvEB.
1(>L+.-=):6 The stiengthening the ongoing shift in appioach to uemanu-uiiven extension anu
to stiengtheneu maiket linkages anu input supply systems will iequiie a substantial piogiamme
of capacity builuing anu technical suppoit. Capacity builuing will be iequiieu in the technical,
financial anu livelihoou aspects of the potential investments anu income geneiating enteipiises
foi the BAs at the kebele level anu theii technical suppoit subject mattei specialists at the
woieua level. New aieas of expeitise iequiieu foi Extension, Coopeiatives anu Input anu
Naiketing specialists anu BAs will incluue facilitation techniques, maiket analysis, anu business
uevelopment skills. SNE anu Laboui agencies' peisonnel may also iequiie capacity builuing as
well as familiaiisation with the piogiamme. In auuition, stiengtheneu management capacity anu
systems aie iequiieu foi this multifaceteu piogiamme which is biinging in a new set of
institutions: financial seivice pioviueis.
The successful implementation of outputs 1-4 outlineu above will theiefoie iequiie a substantial
investment in capacity builuing along the following piinciples:
/*+8P[=('*<B <.(*)*)+ E4<8-:-'-+*49# It will be impoitant that all piogiamme tiaineis
anu pioviueis of technical assistance be specialists not only in theii iespective fielus
e.g. ciop piouuction, animal piouuction, animal health, coopeiative uevelopment, input
souicing, piouuction anu uistiibution, maiket uevelopment anu value chain analysis
but also that they be tiaineu in new anu effective extension techniques consistent with
the pioposeu tiansfoimation of appioach.
F4E():P:.*G4) (;;.-(>8# 0nueistanuing the chaiacteiistics anu iequiiements of
chionically foou insecuie householus is a challenging task, but one which is necessaiy foi
effective technical assistance. The shift to uemanu-uiiven extension is alieauy unueiway
in the Extension Seivice, but the capacity to implement it is laigely lacking, as it will
iequiie changing the woiking mouality not only of BAs anu woieua Subject Nattei
Specialists, but of the entiie extension seivice. The piogiamme will theiefoie unueitake
sensitization anu tiaining activities at all levels (Feueial, Regional anu Woieua) to
ieoiient the way in which extension seivices aie uevelopeu anu pioviueu. This piocess,
anu the bioauei vision foi how extension seivices will woik in the futuie anu how this
will be achieveu, will be outlineu in uetail in the BABP Technical Implementation
Nanual.
D-)+P<4.E G*9*-)# Builuing the capacity of the Extension Seivice anu othei uepaitments
to implement the BABP in a way that effectively enables householus to builu theii assets
anu uiveisify theii incomes will not happen oveinight. Such a piogiamme of capacity
builuing will stait with aujustments to the cuiiicula of the Agiicultuial Technical anu
vocational Tiaining (ATvET) centies anu be incoipoiateu into the long-teim tiaining
piogiamme foi all specialists involveu in the Asset Builuing Piogiamme.
A=EE(.B6 Builuing the capacity of the piogiamme implementeis (uoveinment buieaux, offices
anu inuiviuuals as well as financial institutions) will be the fiist oiuei of business unuei BABP,
as the success of the vaiious inteiventions iests on the uegiee to which they possess thiee
specific skill sets:
Piogiamme management capacity

26
Technical capacity (this incluues facilitation skills)
Financial seivice piovision capacity (foi financial institutions)
Foi each of these thiee aieas, the piogiamme will theiefoie stait by unueitaking a
compiehensive ieview anu assessment of capacity builuing anu tiaining anu skill neeus. This
will be followeu by tiaining cuiiiculum uevelopment, aftei which the capacity builuing of the
piogiamme's key on-the-giounu implementeis (paiticulaily BAs) will be uone.
Pastoial aieas will ieceive special attention in all capacity builuing activities, as they have less
expeiience with FSP implementation anu iequiie significant suppoit.
S. S. 6 00TP0T 6. C0NFIBENCE, KN0WLEBuE ANB SKILLS 0F F00B
INSEC0RE B00SEB0LBS IN CFI W0REBAS B0ILT.
1(>L+.-=):6 Chionically foou insecuie householus have justifiably high levels of iisk aveision
anu low confiuence in theii ability to builu theii assets anu achieve foou secuiity. Yet the BABP
iecognises that builuing householu confiuence to make investments, auopt innovative
technologies anu tiy new income geneiating activities is ciucial to the piogiamme's success. The
BABP appioach theiefoie incoipoiates householu-level involvement fiom the veiy beginning, in
an effoit to giauually builu knowleuge anu skills anu ultimately confiuence.
Thioughout the implementation of outputs 1-4 above, the piogiamme will complement
institutional capacity builuing inteiventions with householu-level confiuence builuing activities.
The activities uesciibeu unuei this 0utput aie theiefoie pait anu paicel of the implementation
of outputs 1-4, but aie highlighteu heie foi extia emphasis. Specific piinciples of implementation
incluue:
K49;-)9*G4)499 <- <84 9;4>*,*> )44:9 -, I-E4)C B-=<8 (): <84 ='<.(P;--.# The
piogiamme will take special caie to ensuie that householu-level consultations uon't
become ue facto male heau-of-householu consultations. The specific neeus of youth anu
the ultia-pooi, often lanuless anuoi with limiteu laboui capacity, will be taken into
account fiom the consultation stage to the piovision of technical assistance anu financial
seivices. Consulting women, youth anu the ultia-pooi will be consiueieu by the
piogiamme as the fiist step towaiu builuing theii confiuence anu skills.
7-)9='<(<*G4C :4E():P:.*G4) (;;.-(>8# Consultation infoimeu by analysis will ensuie
that householus aie not at the ieceiving enu of auvice, but iathei that they aie pait of the
knowleuge piocess. A uemanu uiiven appioach will then be auopteu with iespect to
ueveloping householu investments anu income geneiating activities that will pioviue
pooi householus with access to inteiventions that aie tailoieu to theii neeus. 0n-faim
investment anu income geneiating activities piomoteu foi veiy pooi anu pooi
householus will neeu to be appiopiiate in teims of theii technical anu laboui capacity, be
of ielatively low iisk, be capable of builuing up assets in a ielatively shoit peiiou of time,
be financially viable anu pioviue ietuins sufficient to covei loan iepayments within the
specifieu time.
A=EE(.B6 This output highlights the householu skills, knowleuge anu confiuence builuing
elements of outputs 1-4 outlineu above. Confiuence-builuing activities will be baseu on
assessments of householu capacity uone uuiing the Stakeholuei Consultation as uesciibeu unuei
0utput 1.

27
S. 4 ACTIvITIES
S.4.1 00TP0T 1 ACTIvITIES: ACCESS T0 vIABLE 0N- ANB 0FF-FARN INC0NE-
uENERATINu 0PP0RT0NITIES INPR0vEB.
ACTIvITY 1: IBENTIFY vIABLE INvESTNENT ANB INC0NE uENERATINu
0PP0RT0NITIES F0R F00B INSEC0RE B00SEB0LBS
The iuentification of householu investment anu income geneiating oppoitunities will be uone
thiough a foui-step iteiative piocess.
A<4; 56 7-):=>< E(.L4<\G('=4 >8(*) ()('B949 I*<8*) <84 <(.+4< (.4(
Naiket oppoitunities tenu to be less well ieseaicheu than agiicultuial oi livestock piouuction
oppoitunities, anu theie aie few skills within suppoit institutions to conuuct maiket
assessments oi value chain analyses. Yet in oiuei foi foou insecuie householus' businesses to be
piofitable, auvice on these business plans must be embeuueu in an unueistanuing of maiket
tienus anu oppoitunities. It is theiefoie impeiative that maiket assessments be unueitakenat
the woieua level foi livelihoou zonesanu be upuateu iegulaily. These maiket assessments
shoulu covei but not be limiteu to maiket shaie, iecent maiket tienus, local anu moie uistant
maiket oppoitunities, competition, suppoiting maiket seivices, value chains (e.g. piocessing,
local input piouuction), maiket enabling enviionment (wet anu uiy season ioau access, financial
infiastiuctuie anu stanuaiuiseu weights anu measuies). The assessment will incluue the
capacity of local maikets to absoib auuitional maiketable suiplus.
Nuch of this knowleuge is ieauily available fiom local tiaueis anu some knowleugeable faimeis,
but neeus to be to iecoiueu anu unueistoou by Regional anu woieua expeits anu BAs. The
piogiamme will theiefoie builu Regional anu woieua level capacity in maiket anu value chain
analysis. uioups of woieuas in one livelihoou zoneas uefineu by uata fiom the Livelihoous
Integiation 0nit (LI0)will collaboiate in this activity in oiuei to ieuuce inuiviuual woieua
woik loaus anu expanu theii knowleuge base beyonu the woieua. This will also help to ensuie
that the activities iuentifieu aie tailoieu to livelihoou typesnot only pastoialagiicultuial, but
uistinctions baseu on cash ciops, foou ciops, livestock anu milk sales, laboui, etc. Regional anu
woieua expeits will in tuin pioviue iegulai tiaining of BAs to help them unueistanu maiket
oppoitunities. Cuiiicula anu tiaining moualities will be uevelopeu by ATvETs, iegional
univeisities oi local consulting fiims as pait of the piogiamme.
Whilst theie is expeiience within the Extension Seivice in the iuentification anu uevelopment of
on-faim investment anu IuA oppoitunities, this is not the case foi off-faim income
oppoitunities. Wheie these uo not yet exist, the Regional anu woieua Foou Secuiity Buieaux will
establish 0ff-Faim Case Teams following the Feueial mouel. These teams will cooiuinate with
the Small anu Neuium Enteipiise 0ffices of the Buieaus of Tiaue anu Inuustiy anu the Youth
anu Women Bevelopment piogiammes of the Ninistiy of Youth, Spoits anu Cultuie, anu
stiengthen collaboiation between these institutions anu the extension seivice, to conuuct
assessments of viable off-faim activities anu the absoiptive capacity of local maikets foi non-
agiicultuial seivices oi piouucts.
A<4; %6 7-):=>< <4>8)*>(' ()('B949
The piogiamme will also builu woieua level capacity to institutionalise iegulai technical
analyses coveiing both on- anu off-faim enteipiises. These analyses will be compiiseu of the
following elements:

28
Assessing the piouuction potential ielateu to the specific agio-ecological zone,
tiauitional skills of the population, etc. This will entail a piocess of iesouice mapping.
0nueitaking feasibility stuuies foi vaiious types of enteipiise.
Beveloping technological options foi piouuction anu piocessing.
The piogiamme will make use of existing technical anu value chain analyses wheie possible,
upuating them when necessaiy.
Income fiom migiatoiy anu non faim employment compiises a substantial anu ciitical element
in householus' livelihoous anu has consiueiable potential to contiibute to giauuation to foou
secuiity. The expanuing commeicial agiicultuial sectoi anu the incieasing use of laboui-
intensive methous of maintenance of public infiastiuctuie (e.g. meuiumlaige scale iiiigation,
main anu seconuaiy ioaus) as well as local piocessing anu tiauing activities pioviue potential
income geneiating oppoitunities. The piogiamme's analysis of income geneiating activities will
theiefoie incluue an assessment of these potential employment oppoitunities.
Capacity builuing to institutionalize maiket anu technical analyses as uesciibeu above will be
mostly in the foim of tiaining manageu thiough a seivice contiact with appiopiiate institutions
at the Regional level.
A<4; $6 ?)+(+4 *) ( >-)9='<(<*G4 ;.->499 (< <84 >-EE=)*<BC I-.4:( (): K4+*-)(' '4G4'9
The analyses uiscusseu unuei steps 1 anu 2 will feeu into an Investment 0ppoitunity
Stakeholuei Consultation. At the community level, the stakeholuei consultation will be a ciitical
step in householu awaieness cieation anu knowleuge acquisition with iespect to potential
investment anu income geneiating oppoitunities foi foou insecuie householus. 0sing PRA
techniques, BAs togethei with the kebele auministiation anu with suppoit fiom the woieua
offices of agiicultuie anu the small anu meuium enteipiise agencies will iuentify stakeholueis
anu biing them togethei into investment assessment sessions unueitaken at FTCs. The
stakeholuei consultation will pay paiticulai attention to iuentifying suitable investment
oppoitunities foi specific chionically foou insecuie householus such as female heaueu
householus, lanuless youths anu extiemely asset pooi householus. This will ensuie that the
iuentification of oppoitunities is infoimeu by local expeiience. Woieua anu Regional-level
expeits will paiticipate in this consultation piocess as well as in the maiket anu technical
analyses outlineu in steps 1 anu 2 above.
Such a consultation piocess is not pait of the mainstieam extension oi miciosmall enteipiise
uevelopment suppoit piogiammes, anu will theiefoie iequiie significant facilitation thiough the
FSP unuei the BABP. The piogiamme will establish a Bouseholu Asset Builuing Piogiamme
}oint Technical Committee (BABP TC) at Feueial, Regional anu woieua levels. Leu by the
Extension Seivice anu closely involving othei agencies such as the SNE Agency anu Women's
Affaiis as membeis, this committee will cooiuinate the stakeholuei consultation piocess. The
object of the piocess will be to iuentify, assess anu uevelop the knowleuge base of householus
iegaiuing investment anu income geneiating enteipiises. The on-going CIBA funueu Impioving
Piouuctivity anu Naiketing Successes (IPNS) anu the Ruial Capacity Builuing (RCBP) piojects
have uevelopeu consiueiable expeiience in piomoting this appioach anu can seive as useful
mouels.
The Stakeholuei Consultation will also incluue giassioots financial seivice pioviueis, although a
much moie thoiough capacity assessment will be conuucteu unuei 0utput 2, as uesciibeu
below.

29
A<4; ]6 &.4;(.4 .4>-EE4):(<*-)9 ,-. *)G49<E4)< (): VO0 -;<*-)9#
Steps 1 thiough S uesciibeu above will feeu infoimation into the uevelopment of
iecommenuations foi potential investment anu IuA options foi each livelihoou zone. These
iecommenuations, compileu by woieua expeits, will piesent viable onoff-faim investment anu
income geneiating enteipiises in teims of financial viability, agio-ecological suitability,
appiopiiateness to livelihoou systems, input supply anu maiketability of piouuctsseivices. Foi
each potential investment anu income geneiating enteipiise iuentifieu, uetaileu householu
(anuoi gioup) investment iequiiements in teims of finance, technology, skills, laboui, uiaught
powei, haivesting, stoiage, piocessing anu maiketing will be auuiesseu.
An illustiative list of these iecommenuations will be uetaileu in the BABP Technical
Implementation Nanual. Bowevei, in oiuei to avoiu ieveiting to a package-baseu "menu" of pie-
set options, these iecommenuations will not be consiueieu as an exhaustive list of the
oppoitunities to be funueu unuei the BABP. If householus can uemonstiate the viability of
business plans foi activities othei than those iuentifieu thiough the analyses anu stakeholuei
consultation, they will be incluueu alongsiue the "iecommenueu" activities anu foi tiaining anu
cieuit piovision.
Recommenuations will be uynamic as they will be infoimeu by a constant feeuback loop thiough
annual upuating of steps 1-S anu monitoiing of investments.
ACTIvITY 2: PR0vIBE ABvICE ANB S0PP0RT T0 F00B INSEC0RE B00SEB0LBS IN
TBE BEvEL0PNENT 0F B0SINESS PLANS
Following the iuentification of viable investment oppoitunities, the BABP will suppoit the
tiansfei of this knowleugevia the extension seiviceto client householus to help them
uevelop business plans appiopiiate to theii paiticulai technical, laboui anu financial capacity.
This will be accomplisheu thiough a thiee-step piocess:
A<4; 56 7-):=>< (I(.4)499P.(*9*)+ -, :*,,4.4)< -;<*-)9#

This step will pioviue infoimation to householus on the viability of uiffeient options, with a
focus on uiveisifying livelihoous anu mitigating iisks thiough combinations of uiffeient
investments anu activities. The piogiamme will pioviue sounu technical auvice to householus
on how to choose the most appiopiiate option foi theii ciicumstances. This will entail a
piesentation of the vaiious elements iuentifieu in Activity 1 above.

A<4; %6 &.-G*:4 <4>8)*>(' (99*9<()>4 *) <84 ;.4;(.(<*-) -, 3=9*)499 ;'()9

This will entail gioup uiscussions aiounu potential investment options incluuing:
Initial anu ongoing investment neeus as well as iecuiient costs (such as animal feeu,
uiugs anu veteiinaiy seivices in the case of a livestock investment, maintenance of
equipment anu watei souices in the case of iiiigation, woiking capital foi inventoiy anu
tianspoit costs foi maiketing activities, etc.)
Laboui, lanu anu othei input neeus
Potential iisks (foi instance, bee colony absconuing oi animal moitality)
Potential ietuins on investment

Technical assistance will be pioviueu by BAs with suppoit fiom ielevant woieua offices
(mobiliseu as noteu above, thiough the }oint TC anu the integiation of the BAB planning piocess
with the woieua planning piocess) to gioups of faimeisentiepieneuis at FTCs. In aieas such as
Tigiay that have specialiseu BAs in iiiigation, beekeeping, etc., in auuition to the minimum S pei

Su
kebele, these will be heavily involveu in piogiamme implementation. Foi moie sophisticateu on-
faim investments, anu foi most off-faim investments (e.g., small scale piocessing, tiaue, wage
employment), woieua expeits may be substituteu foi BAs anu pioviue tiaining uiiectly. The
involvement of expeits fiom the SNE Agency in pioviuing tiaining will be paiticulaily ciitical, as
BAs geneially have no backgiounu in off-faim activities. Cooiuination of the vaiious agencies
anu theii contiibution to BABP tiaining will be uone by the BABP Technical Committee at the
woieua level. Though these tiainings will be gioup-baseu, the majoiity of householus will
uevelop inuiviuual business plans, as illustiateu in Figuie S below.

U*+=.4 $# F4G4'-;*)+ 3=9*)499 ;'()9C +.-=; <.(*)*)+ (): E(<>8*)+ ,*)()>*(' ;.-:=><9 <-
8-=948-':9 ,-. *)G49<E4)<9 (): *)>-E4 +4)4.(<*)+ 4)<4.;.*949



It is expecteu that the majoiity of householus will select this inuiviuual mouel. Bowevei, in cases
wheie seveial householus aie inteiesteu in a collective investment, piogiamme suppoit will be
pioviueu foi the uevelopment anu implementation of joint business plans. The financing of these
business plans will uepenu on the cieation of an appiopiiate financial piouuct foi gioups
(cuiiently, NFIs pioviue financing to legally iegisteieu coopeiatives but not to infoimal gioups).
The piogiamme's suppoit foi the uevelopment of such a piouuct is outlineu in 0utput 2.


S1
A<4; $6 K4,4. 8-=948-':9 <- ,*)()>*(' *)9<*<=<*-)9 ,-. ,*)()>*)+ -, <84*. 3=9*)499 ;'()9#
Following the piepaiation of a viable business plan, householus will be iefeiieu to potential
financial seivice pioviueis to enable the vaiious investments to be matcheu with specific
financial piouucts. Specific technical assistance pioviueu by the piogiamme to enable the
piovision of these seivices is uesciibeu in uetail unuei 0utput 2: Access to sustainable financial
seivices (cieuit, savings anu money tiansfeis) enhanceu.
ACTIvITY S: S0PP0RT TBE INPLENENTATI0N 0F B0SINESS PLANS TBR00uB
TECBNICAL ASSISTANCE 0N vARI00S TECBN0L0uY 0PTI0NS ANB N0NIT0RINu 0F
B00SEB0LB INvESTNENTS
A<4; 56 A=;;-.< <.(*)*)+ -) )4I <4>8)-'-+*49 (): *E;.-G4: (+.*>='<=.(' ;.(><*>49#
0nce householus have uevelopeu theii business plans, they will be pioviueu with tiaining anu
uemonstiation (as pei theii selecteu investments in newly constituteu gioups) on ielevant
technologies. Wheie piopeily analyseu anu founu to be appiopiiate some business plans will
neeu to incluue new technology, innovation, anuoi impioveu agiicultuial piactices (e.g., stall
feeuing insteau of fiee giazing, iow planting, conseivation tillage, small scale iiiigation). Wheie
this is the case the piogiamme will ensuie that the new appioach to uemanu-uiiven appiopiiate
anu enabling extension is effectively applieu anu uoes not uiift into a 'business as usual' moue of
encouiaging inappiopiiate technological appioaches when simplei technologies woulu uo.
Wheie business plans iequiie technologies that aie not available locally, the piogiamme will
help woieua level institutions iuentify new souices of technologies, suppoit the uevelopment of
tiaining cuiiicula anu pioviue tiaining-of-tiaineis on new technologiespiactices. It will also
piomote on-faim auaptive ieseaich thiough the establishment of Faimei-Reseaich-Extension
uioups (FREus). The RCBP anu }ICA have uevelopeu some expeiience in piomoting FREus anu
will seive as mouels foi implementation unuei the FSP. Also, since the auoption of impioveu
technologies implies the availability of associateu inputs, the FSP will also suppoit activities to
uevelop new souices, piouuceis anu uistiibutois of inputs iequiieu foi householus' on- anu off-
faim investments anu income geneiating activities. This is uiscusseu fuithei unuei 0utput S.

Step 2: Provide monitoring and follow-up support on household investments

The piogiamme will suppoit the monitoiing of householu investments to ensuie that they aie
piofitable anu successful in iaising householu income anu to auuiess constiaints as they aiise.
This will iequiie close collaboiation with specialists in the Animal Bealth, Coopeiative
Piomotion anu Agiicultuial Naiketing uepaitments of the BoARB, the Small anu Nicio
Enteipiise 0ffice within the Buieaus of Tiaue anu Inuustiy, anu with othei ielevant
stakeholueis such as financial seivice pioviueis anu maiket actois. Again, it will be one of the
ioles of the BABP }oint TC to make suie that joint monitoiing occuis.
S. 4. 2 00TP0T 2 ACTIvITIES: ACCESS T0 S0STAINABLE FINANCIAL
SERvICES ENBANCEB.
ACTIvITY 1: B0ILB TBE INSTIT0TI0NAL CAPACITY 0F FINANCIAL SERvICE
PR0vIBERS (R0SACC0S ANB NFIS) F0R S0STAINEB BELIvERY 0F N0LTIPLE
FINANCIAL PR0B0CTS
A<4; 56 ^):4.<(L4 ( :4<(*'4: HI-.4:(P (): L434'4P'4G4'J E(;;*)+ (): >(;(>*<B
(99499E4)< -, 4M*9<*)+ ,*)()>*(' 94.G*>4 ;.-G*:4.9#

S2
The piogiamme will hiie consultants to conuuct consultative uiscussions with financial
institutions to assess theii capacity anu exploie the feasibility of matching financial
iequiiements foi BABP investments with specific financial piouucts. A paiticulai emphasis will
be placeu on assessing financial seivice iequiiements foi piogiamme clients in pastoial aieas.
This assessment will concluue with iecommenuations on the most appiopiiate financial seivice
pioviueis foi each taiget aiea anu each segment of the client population, keeping in minu that
R0SACC0s tenu to be bettei suiteu to the neeus of vulneiable householus (although theii
capacity is often weak), while NFIs tenu to be the moie appiopiiate institutions foi uisbuising
laigei loans. Bowevei, the fiist piioiity will be coveiagein eveiy woieua that has no NFI
bianch, the piogiamme will woik with neaiby NFIs to extenu theii coveiage.
A<4; %6 7(;(>*<B 3=*':*)+ -, TUV9C K^A077@9 (): ,(>*'*<(<-.9
Tiaining financial seivice pioviueis to pioviue the appiopiiate seivices anu piouucts is a ciitical
element of the cieuit activity. This will be facilitateu by inteinational oi local tiaining expeits, as
appiopiiate, who will be hiieu to uevelop tiaining mouules anu pioviue tiaining to uoveinment
anu NFIs.
K^A077@9# Foi R0SACC0s, tiaining mouules have been alieauy uevelopeu by the Feueial
Coopeiative Agency thiough the suppoit of R0FIP. The BABP will theiefoie pioviue financial
tiaining accoiuing to the existing mouules, incluuing: (a) sensitization woikshop befoie
commencement of opeiation; (b) tiaining of committee membeis in theii iespective functions,
goou goveinance, leaueiship anu management issues, bookkeeping anu iefieshei tiaining eveiy
yeai; (c) tiaining on the iights anu iesponsibilities of R0SACC0s anu theii membeis; anu (u)
tiaining on financial management so that they uevelop anu impiove theii capacity to collect
loans anu pioviue loans fiom theii own funus oi othei (exteinal) funus as well. Limiteu suppoit
to builu the capacity of R0SACC0 unions anu to suppoit the planneu establishment of a
feueiation of SACC0s will also be pioviueu.
The piogiamme will woik thiough the Coopeiative Piomotion Agency to pioviue technical
assistance to R0SACC0s. This will iequiie significant capacity builuing of coopeiative piomotion
staff at the woieua as well as the Regional anu Feueial levels. This is uesciibeu in fuithei uetail
in 0utput S.
TUV9# Thiough the piogiamme's line of cieuit anu paitial cieuit guaiantee, NFIs will be given
the incentive to inciease theii coveiage to taiget cieuit seivices to foou insecuie aieas. Bowevei,
NFIs will also iequiie tiaining to ensuie that theii staff at the woieua (sub-bianch) level have
the capacity to uelivei the types of financial seivices iequiieu by CFI householus.
The piogiamme will suppoit the uevelopment of a compiehensive tiaining plan anu tiaining
packages to builu staff capacity to ieview the business plans anu assess the cieuitwoithiness of
CFI householus anu to pioviue the appiopiiate financial piouucts. Tiaining will focus on the
ueliveiy of appiopiiate cieuit anu othei financial seivices as well as iisk management
techniques. With suppoit fiom the piogiamme, AENFI will cooiuinate the implementation of the
tiaining in collaboiation with the paiticipating NFIs.
A<4; $6 &.-E-<4 <84 4M;()9*-) -, TUV >-G4.(+4 (): <84 >.4(<*-) -, )4I _*''(+4 A(G*)+9
(): D4):*)+ 099->*(<*-)9 H_AD09J (): K^A077@9 I84.4 <8494 :- )-< 4M*9<#
The absence of R0SACC0s in many taiget kebeles anu the lack of NFI coveiage in much of
0iomiya anu SNNPR unueiscoies the neeu foi the cieation of new financial seivice pioviueis oi
bianches in the taiget aieas. u0E policy calls foi one SACC0 pei kebele, but with thousanus of
kebeles paiticipating in the piogiamme this goal appeais unattainable within a five-yeai

SS
timefiame.
8
uiven this ieality, the piogiamme will simultaneously implement a vaiiety of
inteiventions uesigneu to inciease financial seivice coveiage in the taiget aieas. These will
incluue expanuing NFI coveiage anu cieating new giassioots financial seivice pioviueis, such as
vSLAs anu R0SACC0s.
In oiuei to piepaie communities to ieceive anu manage cieuit, the piogiamme will suppoit a
financial liteiacy campaign. This campaign will euucate clients on the impoitance of savings,
how to manage finance (savings anu loans) anu cash flows, etc. AENFI in collaboiation with the
Feueial Coopeiative Agency will implement the financial liteiacy activities with the paiticipation
of othei stakeholueis incluuing iegulatois (National Bank of Ethiopia), finance pioviueis, the
meuia, euucatois anu extension agents.
_AD09 (): K^A077@9# The piogiamme will conuuct community mobilization among PSNP
clients to geneiate awaieness anu inteiest in R0SACC0s, pioviue technical assistance to help
establish R0SACC0s incluuing ueveloping by-laws, anu give systematic capacity builuing to
membeis, office beaieis anu bookkeepeis of piimaiy R0SACC0s anu theii unions. It will also
pioviue minimal establishment suppoit foi R0SACC0s, incluuing office fuinituie, filing cabinets
anu leugeisbooks of accounts.
The piogiamme will also pioviue suppoit to Nu0s ueveloping innovative lenuing methouologies
thiough giassioots institutions. Exposuie visits to successful piogiammes suppoiting iuial
savings anu cieuit within Ethiopia will be conuucteu.
TUV9# The piogiamme will facilitate the establishment of new sub-bianches in safety net
woieuas. NFIs such as BECSI anu ACSI have sub-bianch offices in all the safety net woieuas in
Tigiay anu Amhaia iegions iespectively. It is only in 26 safety net woieuas (2S in 0iomiya anu S
in SNNPR) that NFIs have not yet openeu a sub-bianchas well as the S2 safety net woieuas in
Afai iegion. Subject to the availability of financing fiom uevelopment paitneis, the Piogiamme
will pioviue financial suppoit foi the opening of new bianch offices in each of the safety net
woieuas that cuiiently have no coveiage as well as pastoial woieuas wheievei possible. This
financing will covei office anu tianspoit costs as well as tiaining of new staff.
A<4; ]6 Q-.L I*<8 ,*)()>*(' 94.G*>4 ;.-G*:4.9 <- :4G4'-; (;;.-;.*(<4 ,*)()>*(' ;.-:=><9
A iange of financial seivices will be maue available to piogiamme clients, incluuing savings
seivices anu uiffeientiateu cieuit piouucts that meet the neeus of householus at vaiious levels of
foou insecuiity anu with uiffeient types of business plans, as well as money tiansfei seivices
wheie possible. The financial seivices will be pioviueu by the seivice pioviuei best positioneu
(in teims of coveiage anu piouuct offeiing) to uelivei the iequiieu piouuct. The BABP will hiie a
technical pioviuei who will woik with financial institutions to uevelop these vaiious piouucts,
as appiopiiate to each iegional context.
A(G*)+9# Piogiamme clients will have access to savings thiough vSLAs, R0SACC0s, anu NFIs.
R0SACC0s will likely iequiie membeis to save befoie taking loans, as specifieu in theii by-laws.
NFIs will pioviue savings by iequiiing that a small peicentage of the loan amount be placeu in a
savings account, as is cuiiently piacticeu.
7.4:*<# The piogiamme will woik with both R0SACC0s anu NFIs to uevelop appiopiiate cieuit
piouucts foi foou insecuie householus accoiuing to theii business plans, ensuiing that loan

8
As a point of compaiison, R0FIP cieateu appioximately 1,Suu functional R0SACC0s ovei a seven-yeai
peiiou. R0FIP expeiience inuicates that while establishing R0SACC0s is ielatively easy, ueveloping theii
management capacity is time-consuming anu challenging.

S4
sizes, eligibility ciiteiia, teims anu iepayment scheuules aie appiopiiate to householus' capacity
anu selecteu assetenteipiise. This will incluue gioup guaiantee mechanisms foi CFI householus
without collateial, as is cuiiently piacticeu by most NFIs, anu possibly inuiviuual mechanisms if
appiopiiate alteinative guaiantees can be uevelopeu. The piogiamme will also ensuie that
financial piouucts aie appiopiiate to each cultuial context. This will incluue loan piouucts
without inteiest but with appiopiiate mechanisms of seivice chaige foi Nuslim communities
anu, as ueteimineu by the mappingcapacity assessment exeicise, appiopiiate financial
piouucts foi pastoial communities.
The majoiity of householus will likely stait with ielatively small loans, builuing up to laigei
loans as they inciease theii business capacity anu impiove theii cieuitwoithiness. The
piogiamme will woik with financial institutionspaiticulaily NFIsto ensuie that 2
nu
anu S
iu

cycle loans aie available to householus in oiuei to enable effective asset builuing.
As noteu in 0utput 1, some householus will likely be inteiesteu in gioup loansnot inuiviuual
loans with gioup guaiantees, but iathei gioup loans foi the financing of joint business plans.
Cuiiently, no mechanism exists foi such gioups to obtain collective financing unless they
iegistei as a coopeiative. To suppoit these gioups in obtaining financing foi the plans, the
piogiamme will woik with financial seivice pioviueis to uevelop appiopiiate cieuit piouucts
that match the neeus of gioups while being financially sustainable anu contiactually sounu.
Wheie appiopiiate, it will also suppoit the cieation of coopeiatives.
V)9=.()>4# The BABP will woik with financial seivice pioviueis to exploie the viability of an
insuiance scheme foi householu investments, suppoiting the uevelopment of a iegulatoiy
fiamewoik foi NFIs to pioviue asset insuiance piouucts, woiking with insuiance companies to
expanu coveiage to CFI aieas, anu suppoiting piouuct uevelopment. This will uiaw on
inteinational expeiience, anu will likely be uone thiough a pilot at fiist, with potential foi scaling
up if the pilot pioves successful.
T-)4B <.()9,4.9# Finally, the piogiamme will suppoit the uevelopment of money tiansfei
seivices thiough NFIs oi othei appiopiiate institutions, wheie possible. These seivices will
suppoit laboui employment by facilitating the tiansfei of funus by migiant woikeis back to
theii families.
ACTIvITY 2: PR0vIBE A L0AN F0NB, C0NN0NITY uRANT 0R SEEB CAPITAL T0
FINANCIAL SERvICE PR0vIBERS.
A<4; 56 ?9<(3'*98 /01& ,*)()>*(' 94.G*>49 ,=):9
BABP will establish tiansfeis with the following uistinct featuies:
a) loan funu
b) seeu capital funu
c) community giant
D-() ,=):# This funu will flow following the financial management pioceuuie of the
goveinment i.e. N0FEB, B0FEB, W0FEB then to R0SACC0s anu NFIs to be channelleu to the
clients.
7-EE=)*<B ,=):# BABP will pioviue giants to communities thiough the Kebele Bevelopment
Committee. This Committee will channel these iesouices to clients of the Piogiamme thiough

SS
R0SACC0s. The R0SACC0s will manage these funus on behalf of the community to ensuie sounu
financial piinciples aie followeu.
A44: >(;*<(' ,=):# The seeu capital foi R0SACC0s will be channelleu thiough uoveinment
institutions all the way uown to the woieua level. The N0FEB will channel funus to the Regional
B0FEB, which will then allocate them to W0FEBs. W0FEBs will then tiansfei the funus to
R0SACC0s on a matching basis to theii savings. These funuswhich will be useu in theii
entiiety as loan capitalaie uesigneu to complement the limiteu capacity of R0SACC0s in
mobilizing funus foi lenuing anu will be pieceueu by the institutions' own capitalization thiough
fees anu savings.
&(.<*(' '-() +=(.()<44# BABP will consiuei pioviuing paitial loan guaiantees. These will be
placeu within commeicial banks in oiuei to ieuuce theii iisk in lenuing to NFIs. Cieuit lines
thiough the Bevelopment Bank of Ethiopia may also be exploieu. The inclusion of this
component is uepenuent upon auuitional financing fiom uevelopment paitneis.
FIu0RE S: CBANNELLINu N0BALITIES F0R u0vERNNENT C0NTRIB0TI0NS T0 BABP
FINANCIAL SERvICES

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S6
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K^A077@9# In oiuei to access the BABP line of cieuit, community funu oi seeu capital, a
R0SACC0 will be iequiieu to meet a specific set of ciiteiia ielateu to financial management,
peifoimance anu accountability. Specific benchmaiks will be uevelopeu piioi to the stait of the
piogiamme anu outlineu in the BABP Piogiamme Implementation Nanual, but will incluue at a
minimum:
(a) The Woieua Agiicultuie anu Ruial Bevelopment 0ffice pioviues wiitten assuiance that
the R0SACC0 is opeiationally viable.
(b) The R0SACC0 uemonstiates that it will attain financial sustainability in thiee to foui
yeais.
(c) The Woieua pioviues wiitten assuiance that the management of a R0SACC0 is
satisfactoiy.
(u) The R0SACC0 has been fully opeiational anu staiteu mobilizing savings anu pioviuing
loans fiom its own souice foi at least 12 months.
(e) The R0SACC0 chaiges a lenuing inteiest iate that is estimateu on the basis of coveiing
its opeiational expenses, anu is consistent with wiuei BABP appioaches to inteiest iates.
(f) The R0SACC0 has at least Su membeis anu is actively woiking to inciease its
membeiship within anu outsiue the kebele to attain opeiational anu financial
sustainability.
The lenuing conuitions foi R0SACC0s will be as follows:
The membeis of the R0SACC0s may incluue both clients anu non-clients of the
piogiamme. Bowevei, funus fiom the line of cieuit will be ieseiveu foi BABP clients.
In auuition to managing community giants, some R0SACC0s will be eligible foi seeu capital anu
a line of cieuit. The seeu capital is uesigneu to encouiage R0SACC0s to save (since the funus will
be pioviueu on a matching basis) anu to inciease theii own capital, theieby ueveloping a sense
of owneiship iathei than a sense of only channelling piogiamme funus. To ensuie that this
sense of owneiship is instilleu, the piogiamme will not iequiie that all of the funus be
channelleu to BABP clients. Bowevei, in oiuei to be eligible to ieceive seeu capital, the R0SACC0
must have a minimum numbei (to be ueteimineu) of PSNP clients. They must also agiee that the
seeu capital will be useu in its entiiety as loan capital to be ievolveu among its membeis anu
must assume iesponsibility foi all aspects of loan management following basic financial
piinciples.
TUV9# Piioi to accessing the line of cieuit, NFIs who aie inteiesteu in paiticipating in the
piogiamme will be iequiieu to:
a) 0btain a lettei of commitment fiom theii boaiu inuicating that the NFI is willing to
pioviue financial seivices to the clients of the piogiamme in specific woieuas.
b) Sign a cleai contiact agieement with the piogiamme inuicating the commitment of theii
management anu boaiu to pioviuing loans anu othei financial seivices foi a specific
numbei of clients in a specific woieua.
c) Woik with the piogiamme to uevelop financial piouucts that match the neeus of
chionically foou insecuie householus.

S7
u) Agiee to pioviue special mentoiing anu tiaining on financial management to the clients
of the piogiamme.
e) Submit a business plan which shows the uetaileu implementation aiiangement.
f) Pioviue an auuiteu annual financial iepoit.
g) Bave a iepayment iate of at least 9u% in the pievious yeai.
h) Pioviue savings piouucts that inciease the savings of clients anu uevelop theii saving
cultuie.
i) Chaige a lenuing inteiest iate which is estimateu on the basis of coveiing the opeiational
expenses of the NFIs.
The lenuing conuitions foi NFIs will be as follows:
The lenuing inteiest iate will covei the full cost of the loans as incuiieu by the NFI. This
will ensuie sustainability anu viability of theii seivice piovision to CFI householus.
NFIs will pioviue loans anu othei financial seivices to clients who aie in the piocess of
giauuation oi who have giauuateu fiom the PSNP
A<4; $6 F*93=.94 ,=):9
Following the establishment of the financial seivices funus, the finalization of opeiating iules
anu pioceuuies foi NFIs anu R0SACC0s, anu the uevelopment of appiopiiate financial piouucts,
the piogiamme will uisbuise funus thiough the channels uesciibeu in Step 1 above.
Funus will be allocateu on an annual basis pei the piogiamme buuget. Foi R0SACC0s, the
piovision of matching funus will be uone giauually, peihaps on an incieasing basis ovei the
yeais, as they uevelop theii capacity to effectively manage funus thiough savings mobilization.
A<4; ]6 T-)*<-. '-() ,=):9C >-EE=)*<B +.()<9 (): >.4:*< +=(.()<44
The actual peifoimance in the implementation of the agieements between the stakeholueis in
Figuie S above will be monitoieu thiough the BABP N&E system (uiscusseu in section 7.1
below). Appiopiiate inuicatois will be uevelopeu to monitoi flows of funus anu use of funus in
ways that aie in line with the iegulatoiy anu institutional fiamewoik foi the financial sectoi anu,
wheie appiopiiate, the coopeiative sectois. The line of cieuit will be monitoieu to ensuie that
taigeteu clients aie ieceiving the loans given thiough the piogiamme accoiuing to the
guiuelines outlineu above anu in the PIN. The use of seeu capital will be assesseu to ensuie that
it is being useu as loan capital anu is being ievolveu among the R0SACC0's membeis.
In auuition to the institutions iesponsible foi monitoiing the piogiess of the financial seivices
component pei the agieements, an impoitant monitoiing iole foi R0SACC0s anu NFIs will be
playeu by coopeiative piomoteis anu AENFI, iespectively.
ACTIvITY S: S0PP0RT TBE INPLENENTATI0N 0F AN APPR0PRIATE REu0LAT0RY
ANB S0PERvIS0RY FRANEW0RK F0R uRASSR00TS FINANCIAL INSTIT0TI0NS
A<4; 56 F4G4'-; .4+='(<-.B ,.(E4I-.L ,-. K^A077@9
The piogiamme will woik with uoveinment stakeholueis to suppoit the uevelopment
cuiiently at the planning stageof a iegulatoiy fiamewoik in oiuei to enable R0SACC0s to
opeiate effectively anu sustainably. R0SACC0s will opeiate within the legal fiamewoik anu be

S8
supeiviseu by the Feueial Coopeiative Agency anu its counteipaits at the Regional anu woieua
levels, as well as othei oveisight institutionspossibly the National Bank of Ethiopia. As
coopeiatives they will follow coopeiative piinciples anu woik foi the benefit of theii
membeisbut as financial institutions they must also closely follow financial iegulations. The
piogiamme will builu capacity within the new suppoit stiuctuie anu the coopeiative movement
to effectively auuit anu supeivise R0SACC0 activities as pei the legal fiamewoik goveining
them.
A<4; %6 1=*': 9<.(<4+*> ;(.<)4.98*;9
The piogiamme will builu stiategic paitneiships with the inteinational netwoik of financial
coopeiatives foi stiategic auvice on feueiation anu iegulatoiy fiamewoiks.
S. 4. S 00TP0T S ACTIvITIES: S0STAINABLE INP0T S00RCINu, PR0B0CTI0N
ANB BELIvERY SYSTENS ENBANCEB
ACTIvITY 1: B0ILB LINKAuES BETWEEN S0PPLIERS ANB 0SERS 0F INP0TS ANB
TECBN0L0uIES NECESSARY F0R TBE INPLENENTATI0N 0F B0SINESS PLANS
A<4; 56 V:4)<*,B ;-<4)<*(' ;.-:=>4.9 (): :*9<.*3=<-.9 -, .4[=*.4: *);=<9 (): (99499 <84*.
>(;(>*<B .4[=*.4E4)<9
Business plans uevelopeu unuei 0utput 1 will uetail the input iequiiements foi selecteu on- anu
off-faim investment anu income geneiating enteipiises. These may incluue:
Impioveu seeus oi seeulings
Livestock
Animal feeu
Watei pumps anu othei iiiigation equipment
Feitilisei
Beehives
Non-agiicultuial inputs such as constiuction mateiials, tianspoitation equipment
(uonkey caits, etc.)
Beie the iole of the extension anu inputs & maiketing
9
seivices will piimaiily be to contiol
quality, ensuie that technology is appiopiiate anu iuentify gaps in the piovision of inputs. Wheie
possible, the piogiamme will piioiitize local supplieis in oiuei to ensuie that the inputs (oi the
spaie paits, iepaii seivices, etc.) aie easily accessible to the buyeis on a sustainable basis. This
will help to inciease the sustainability of the inputfoi instance, watei pumps that can be
iepaiieu easily, open-pollinateu seeus that can be souiceu locally, etc.
Analytical woik uone at the woieua anu iegional levelspaiticulaily the value chain analyses
conuucteu unuei 0utput 1will pioviue a soliu founuation foi input linkage activities. These

9
At feueial level theie is an Agiicultuie Naiketing Biiectoiate unuei which theie is an Input unit. At
iegional level aiiangements vaiy, but usually incluue sepaiate functions foi maiketing anu inputs. At
woieua level this most often is not the case anu inputs anu maiketing aie often one anu the same sub-unit
of the ARB office.

S9
analyses will iuentify constiaints anu oppoitunities at eveiy stage of the value chain, staiting
fiom input supply.
A<4; %6 ?9<(3'*98 >-)<(><9 34<I44) 9=;;'*4.9 (): ;.-+.(EE4 ;(.<*>*;()<9#
In oiuei to stiengthen the value chains taigeteu by householu business plans, extension anu
inputs anu maiketing seivices will suppoit the input linkages necessaiy foi householus to
implement theii plans. Woieua expeits within the Inputs Seivice of the Agiicultuial Naiketing
Bepaitment anu SNE 0ffice, wheie piesent, will woik with BAs to pioviue householus with
maiket infoimation on the availability of inputs in aujacent woieuas. It may entail calling on a
local multi-puipose coopeiative to supply the iequiieu input. Alteinatively, in some instances,
facilitating linkages may entail pioviuing inuiiect incentivessuppoit foi piivate supplieis
uepenuing on the local conuition. 0i it may entail oiganizing householus into gioups accoiuing
to theii planneu investmentsfoi example, gioups of 1u-2u householus whose business plans
incluue the same equipment oi livestock typeto aiiange tianspoit foi the puichase of theii
assets fiom a moie uistant location. The key uiffeience between this piogiamme anu the way
input supply foi householu packages has been implementeu in the past is that the Extension
Seivice will not be involveu in puichasing, tianspoiting oi uistiibuting assets.
Facilitatingiathei than pioviuinglinkages to input supplieis will help to ensuie that
householus have a way to access auuitional assets anu inputs on a continual basis, theieby
stiengthening linkages within the value chain. The piogiamme will have a significant capacity
builuing component to ensuie that BAs anu othei W0ARB officials aie able to effectively
facilitate timely access to high-quality, appiopiiate inputs.
1u
The piogiamme will monitoi the
quality anu appiopiiateness of the input as well as the seivice(s) pioviueu.
ACTIvITY 2: PR0N0TE N0LTIPLICATI0N 0R BISTRIB0TI0N 0F INP0TSPR0B0CTS
BY v0L0NTEERS FR0N WITBIN CLIENT C0NN0NITIES
When input gaps aie iuentifieu, the Extension Seivice will both facilitate linkages as uesciibeu
above anu stimulate local piouuction of inputs. The lattei piocess is uesciibeu below.
A<4; 56 F4E-)9<.(<4 )4I <4>8)-'-+*49
Foi new technologies that aie unfamiliai to faimeis, the piogiamme may suppoit
iepiesentative volunteeis to establish its piouuctivity oi effectiveness. Bemonstiations will be
caiiieu out in FTCs wheie available. Foi agiicultuial technologies such as impioveu seeu anu
seeulings, this will entail obtaining ceitifieu founuation seeu fiom ieseaich centies anu
pioviuing it to iepiesentative volunteeis foi use on a uemonstiation plot. The same coulu apply
foi a new type of iiiigation equipment obtaineu fiom a piivate suppliei. The piogiamme will
pioviue tiaining anu supeivision, wheie possible suppoiteu uiiectly by the suppliei (whethei
public oi piivate) of the input.
This piocess will be unueitaken in ways consistent with the continueu tiansfoimation in
extension appioach uesciibeu in 0utputs 1 anu S, in which appiopiiateness of new iueas in the
context of livelihoou iisk, anu iecognition of uiffeiences in clients' inteiests anu capabilities aie
paiamount.
A<4; %6 &.-E-<4 *);=< ;.-:=><*-) (): :*9<.*3=<*-) (9 ( G*(3'4 *)G49<E4)<\*)>-E4
+4)4.(<*)+ -;;-.<=)*<B

1u
The BABP's focus on builuing capacity in facilitation iecognizes that piojects that have hau success in
linking piouuceis to impioveu input supply (e.g. IPNS) aie those that have hau highly skilleu facilitatois.

4u
The uemonstiations uesciibeu in Step 1 above aie uesigneu to encouiage householus to
consiuei input supply as a viable oppoitunity foi investment oi income geneiation, both as
inuiviuual householus anu as gioups, even coopeiatives. This will not be limiteu to agiicultuial
oi on-faim inputs. Possible activities incluue seeu anu seeuling multiplication, but also
uistiibutionietailing of equipment (paiticulaily foi youth oi lanuless householus), piovision of
animal uiugs, etc. Wheie appiopiiate, the piogiamme will suppoit inteiesteu householus in
incoipoiating these investments oi income geneiating activities in theii business plans as
uesciibeu unuei 0utput 1. It will also suppoit gioups in maiketing theii inputs thiough the
piocesses uesciibeu unuei 0utput 4 below. Buiing the piepaiation phase of the piogiamme, an
assessment will be conuucteu to iuentify possible constiaints to these activities, notably
iegulatoiy constiaints that may affect activities such as seeu multiplication, anu these will be
auuiesseu thiough the ielevant channels.
S. 4. 4 00TP0T 4 ACTIvITIES: ACCESS T0 EFFECTIvE PR0B0CT ANB LAB00R
NARKETS INCREASEB
ACTIvITY 1: INPR0vE ST0RAuE, PR0CESSINu ANB Q0ALITY C0NTR0L F0R
INCREASEB vAL0E ABBITI0N ACC0RBINu T0 B0SINESS PLANS
This activity will suppoit householus anu gioups in making piouuct-level impiovements in
oiuei to inciease the piices obtaineu.
A<4; 56 V)>-.;-.(<4 <.(*)*)+ (): <4>8)*>(' (99*9<()>4 -) G('=4 (::*<*-) *)<- 4M<4)9*-)
9=;;-.< ;.-G*:4: <- 7UV 8-=948-':9#
The tiaining cuiiiculum will be uevelopeu by ATvET colleges, Regional univeisities oi piivate
sectoi agiicultuial cuiiiculum uevelopeis. It will emphasize skills-baseu leaining iathei than
theoiy, theieby complementing the theoietical tiaining that is the backgiounu of most BAs. The
tiaining will be uesigneu to enable woieua expeits anu BAs to iuentify anu analyse capacity
iequiiements to stiengthen ciitical paits of value-auueu chains. These iequiiements will be
baseu on maiket uemanus in teims of piouucts, quality anu timing of ueliveiy, anu maiket
segments (localiegional, uibaniuial, bulkniche, etc.). Tiaineis will impait this cuiiiculum to
woieua expeits, who will supeivise BAs in pioviuing technical assistance to gioups of
piogiamme paiticipants in cost-effective value auuition techniques. Specific tiaining topics will
incluue, but not be limiteu to:
Piopei stoiage techniques to minimize pest infestation, moulu, etc. anu to inciease
baigaining powei by enabling piouuceis to sell when piices aie highei.
Post-haivest quality contiol, incluuing soiting anu giauing.
Piocessing, paiticulaily small-scale piocessing such as uiying, honey piocessing, small-
scale uaiiy activities, etc. to piolong shelf life oi ieach new maiket segments.
0nuei RCBP these tiaining cuiiicula foi ATvETs have laigely been uevelopeu. The Piogiamme
will auopt these foi tiaining of BAs fiom CFI woieuas.
A<4; %6 Q84.4 (;;.-;.*(<4C (99*9< *) <84 ;.4;(.(<*-) -, 3=9*)499 ;'()9 (): '*)L <- 9-=.>49
-, >.4:*< ,-. +.-=; *)G49<E4)<9#
A significant numbei of householus may be inteiesteu in collective investments, eithei to
suppoit theii existing householu business plan (to auu value to theii piouuct) oi to auu anothei
ievenue stieam fiom seivice piovision. The piogiamme will pioviue technical assistance to
gioups in the piepaiation of joint business plans so that they can access financing fiom NFIs,

41
with complementaiy suppoit to NFIs foi the uevelopment of piouucts tailoieu foi such gioups
as uesciibeu unuei 0utput 2 above. These plans may incluue investment in piocessing
technologies oi constiuction of stoiage facilities. Alteinatively, inuiviuual householus may select
small-scale piocessing investments foi theii householu business plan.
ACTIvITY 2: INPR0vE NARKETINu TRANSACTI0NS ANB ACCESS T0 BIuBER-vAL0E
NARKETS F0R NEW INvESTNENTS 0R WAuE ENPL0YNENT
This activity will suppoit householus anu gioups in maiketing tiansaction level impiovements.
The aim will be to ieuuce maiket tiansfei costs in oiuei to inciease ietuins foi piouuceis as
well as small-scale tiaueis. This activity will iequiie the Extension Seivice anu coopeiative
piomoteis to have knowleuge of maiket uynamics anu key maiket playeis such as biokeis,
miuulemen, wholesaleis anu ietaileis, as well as laboui oppoitunities such as those offeieu by
commeicial faims oi laige constiuction anu maintenance piogiammes. It will also iequiie skills
in infoimation uissemination anu maiket linkage facilitation. Builuing these skills will be a coie
pait of the maiket facilitation tiaining cuiiiculum given to extension staff, coopeiative
piomoteis, anu woieua-level SNEA expeits.
A<4; 56 A=;;-.< <84 >.4(<*-) -, +.-=;9 ,-. 3='L E(.L4<*)+
Foi householus that have chosen similai investments, the piogiamme will pioviue suppoit foi
the cieation of maiketing gioups oi coopeiatives wheie appiopiiate. This will be uone thiough
the Extension Seivice as well as the Coopeiative Piomotion Buieaus, whose agents will pioviue
technical assistance in coopeiative piinciples such as membei owneiship as well as impoitant
business management anu accounting skills. Linkages between the two uepaitmentsExtension
anu Coopeiative Piomotionwill be stiengtheneu thiough iegulai BABP Technical Committee
meetings.
A<4; %6 V)>-.;-.(<4 E(.L4< -.*4)<(<*-) (): 3=9*)499 9L*''9 *)<- <84 4M<4)9*-) ;(>L(+4
;.-G*:4: <- 7UV 8-=948-':9# The piogiamme will iuentify gaps in woieua expeits' anu BAs'
unueistanuing of maikets anu business skills anu will suppoit the uevelopment of a cuiiiculum
to auuiess these gaps thiough ATvETs anu othei institutions. This tiaining will then be
institutionaliseu anu pioviueu to woieua expeits anu BAs on a iegulai basis thiough a iefieshei
piogiamme.
The piogiamme will then pioviue tiaining to maiketing gioups in oiuei to help them
unueistanu the maikets foi theii piouucts in teims of quality iequiiements, timing, piices, etc.
Wheie appiopiiate, impioveu maiketing technologies (such as the use of scales foi weight-
baseu maiketing) will be piomoteu.
Foi all maiketing tiaining anu suppoit, linkages between the extension seivice anu othei
uepaitmentspaiticulaily the Agiicultuial Naiketing Bepaitment anu the Coopeiative
Piomotion 0fficeswill be ciitical. Foi instance, BAs may be linkeu to coopeiative piomotion
officeis foi auuitional suppoit, as these often have a stiongei unueistanuing of maiketing.



A<4; $6 D*)L 9=;;'*4.9 H-, ;.-:=><9 (9 I4'' (9 94.G*>49J <- E(.L4<9

42
The piogiamme will help link gioupscoopeiatives to maikets by facilitating contacts with
potential buyeis. Wheie appiopiiate, sales contiacts anuoi outgiowei schemes will be
exploieu.
This activity will place paiticulai emphasis in suppoiting non-faim enteipiises anu laboui
oppoitunities thiough facilitation of the flow of infoimation between laboui suiplus anu ueficit
aieas. This will piomote both goveinment-ielateu employmentsuch as goveinment-financeu
constiuction anu maintenance schemesanu piivate sectoi employmentsuch as piivately
funueu constiuction, commeicial faims, oi inuustiialagio-inuustiial piocessing. Linkages with
the Roaus Authoiity anu the Nicio anu Small Scale Enteipiise Bevelopment Agency will be
ciitical. In auuition, the woieua laboui & social affaiis office will be stiengtheneu to peifoim
laboui office functions of linking job seekeis with the iight job oppoitunity anu ensuiing
stieamlineu technical suppoit to householus, in collaboiation with Tiaue & Inuustiy office
wheie appiopiiate. Impioveu financial seivice piovision (as uesciibeu unuei 0utput 2), anu
paiticulaily money tiansfei seivices, may help suppoit laboui migiation wheie appiopiiate.
Similaily to the gioup business plan suppoit foi investments in value auuition uesciibeu above,
the piogiamme will suppoit the uevelopment of gioup business plans foi laboui-baseu
activities. Foi instance, a youth gioup foimeu with the puipose of pioviuing small-scale
constiuctionmaintenance activities may iequiie suppoit in obtaining an initial loan foi the
puichase of equipment, etc. The BABP will link with existing youth piogiammes to suppoit such
initiatives anu the uevelopment of fuithei off-faim oppoitunities foi youth anu othei lanuless
householus. Special caie will be taken to iuentify oppoitunities foi female youth, as they aie
often neglecteu by the women uevelopment piogiammes (which taiget oluei women, female-
heaueu householus, etc.) anu youth uevelopment piogiammes (which geneially taiget male
youth).
S. 4. S 00TP0T S ACTIvITIES: INSTIT0TI0NAL CAPACITY T0 NANAuE ANB
INPLENENT TBE BABP STRENuTBENEB.
ACTIvITY 1: STRENuTBEN NANAuENENT CAPACITY 0F u0vERNNENT
INPLENENTERS
A<4; 56 099499 E()(+4E4)< (): T`? >(;(>*<B
This assessment will look at the systems in place foi managing the 0FSP anu ueteimine theii
skills anu weaknesses in oiuei to uesign a moie effective system foi managing the BABP.
Nanagement aspects consiueieu will incluue:
Piogiamme planning anu staffing
Auequacy of policy anu stiategy
Financial management anu iepoiting
Nonitoiing anu evaluation of activities
Activity iepoiting
A<4; %6 1=*': ,*)()>*(' E()(+4E4)< 9B9<4E9
This step will ensuie that uoveinment uepaitments anu offices uown to the woieua level have
the necessaiy financial management systems in place to tiack BABP-ielateu expenuituies.
0veiall, the piogiamme is expecteu to ease the buiuen of financial management at the local
level, as the Extension Seivice will no longei be involveu in loan uisbuisement anu collection.

4S
A<4; $6 A<.4)+<84) T`? (): .4;-.<*)+ 9B9<4E9
In oiuei to ensuie that the piogiamme's taigeteu 0utputs, 0utcome anu uoal aie met, a iigoious
system of monitoiing, evaluation anu iepoiting will be iequiieu. The piogiamme's N&E system
will be baseu on the logfiame but will also incluue a step-by-step plan foi piogiamme planning
anu tiacking of activities. An oveiview of the BABP monitoiing anu evaluation system anu how it
is integiateu in the N&E fiamewoik foi the bioauei Foou Secuiity Piogiamme is pioviueu in
Chaptei 7. As foi the FSP as a whole, fuithei woik will be unueitaken uuiing the final stage of
piepaiation foi the piogiamme (seconu half of 2uu9), in oiuei to uevelop a moie uetaileu
system. This will then be ieflecteu in the uevelopment of the BAB Piogiamme Implementation
Nanual. Following the uesign, tiaining will be given to builu the capacity of ielevant BABP
stakeholueis to effectively implement the system by monitoiing not only the accomplishment of
piogiamme activities but also theii effectiveness, by following up on householu investments anu
iuentifying iemaining neeus.
ACTIvITY 2: STRENuTBEN TECBNICAL CAPACITY 0F EXTENSI0N SERvICE,
C00PERATIvE PR0N0TI0N B0REA0S, SNEA ANB 0TBER RELEvANT
INSTIT0TI0NS T0 PR0vIBE BENANB-BRIvEN EXTENSI0N ANB TRAININu IN
NARKET-0RIENTEB B0SINESS PLANNINu ANB TECBN0L0uICAL INN0vATI0N
A<4; 56 099499 <4>8)*>(' >(;(>*<B
This assessment will be highly consultative anu paiticipatoiy anu will stuuy the capacity at
uiffeient levels of uoveinment in teims of:
Business skills
Naiket knowleuge anu unueistanuing
Analytical skills
Facilitation anu mentoiing skills, anu
The auequacy of existing vision, stiategy anu plans foi tiansfoimation of extension
appioach
The pioposeu shift towaiu uemanu-uiiven extension is a majoi unueitaking anu will iequiie
significant changes in attituues, behaviois anu piactices. Like all piocesses of change, this will
not happen oveinight anu theiefoie neeus to be manageu auequately. Buiing the lifetime of the
piogiamme, continuous effoits will be maue to builu a common unueistanuing acioss the
extension seivice as a whole (fiom Feueial level to BAs at the kebele level) of what 'uemanu-
uiiven' extension means. In effect, the piogiamme envisages extension as a key means of
empoweiing householus to make well-infoimeu uecisions. This puts a high piemium on
facilitation anu mentoiing skills, which will featuie as a piioiity in teims of capacity
uevelopment.
Also, theie will be a paiticulai focus in the capacity assessments on assessing the knowleuge anu
capacity of the kebele anu woieua agents (i.e. woieua SNSs anu BAs), as they aie closest to the
foou insecuie householus who aie the taiget gioup of the piogiamme. This will help to infoim
the uevelopment of an appiopiiate suppoit stiuctuie foi BAsfiom othei membeis of the
Extension Seivice as well as othei uepaitments such as Agiicultuial Naiketing anu Coopeiative
Piomotionto pioviue technical guiuance anu suppoit in theii BABP activities.

44
In auuition the piogiamme will, in its pie-implementation phase, conuuct a ieview of BAs'
woikloau anu woiking moualities in oiuei to iuentify the implications of the BABP appioach at
that level. BABP activities must be integiateu in the BAs' job uesciiptions. The puipose of the BA
woikloau assessment will be to outline piactical moualities which will make this possible,
consiueiing the wiue iange of aieas in which BAs will be expecteu to oiient householus. 0ptions
will be consiueieu such as the ueployment of specialiseu BAs foi gioups of kebeles in which a
numbei of householus wish to engage in a specific activity (such as BAs specialiseu in iiiigation
ueployeu in Tigiay) as well as the moie uiiect involvement of woieua expeits in actual
extension piovision. uuiuance will be pioviueu to BAs in teims of woik piogiamming, team
oiganisation etc.
Foi pastoial aieas wheie theie aie often few BAs, the piogiamme will exploie innovative
mechanisms of biinging togethei all ielevant stakeholueisgoveinmental (fiom vaiious
agencies anu uepaitments) anu non-goveinmentalto pioviue the necessaiy suppoit to
paiticipating householus.
Step 2: Prepare HABP Technical Implementation Manual

Following the assessment outlineu above, a Technical Implementation Nanual foi the BAB
component will be piepaieu. This manual will be the BABP's counteipait to the Community-
Baseu Paiticipatoiy Wateisheu Nanagement guiuelines foi the PSNP. It will outline the technical
ioles anu iesponsibilities of all key actois, incluuing BAs anu woieua expeits fiom vaiious
uepaitments; technical aspects of piogiamme implementationpaiticulaily as ielateu to the
skills sets outlineu in Step S belowanu aiiangements foi skills uevelopmenttiaining.

A<4; $6 F4G4'-; <.(*)*)+ >=..*>='( (): ( <4>8)*>(' 9=;;-.< )4<I-.L ,-. F09
The Technical Implementation Nanual will set the agenua foi the uevelopment of BABP tiaining
cuiiicula. In each of the following cuiiicula, a high level of emphasis will be placeu on
consultation skills anu facilitation techniques, in oiuei to ensuie that the extension auvice
pioviueu is uemanu uiiven anu appiopiiate to foou insecuie householus.
1=9*)499 9L*''9# The piogiamme will stiengthen the business skills of BAs who will be
suppoiting householus in the piepaiation of business plans, anu of Coopeiative Piomotion office
staff who will be pioviuing tiaining to maiketing gioups. The piogiamme will link with woieua-
level offices of othei agencies, such as the Nicio anu Small Enteipiise Agency anu the woieua
Laboui anu Social Affaiis office, to extenu theii outieach anu builu theii capacity to woik with
iuial, foou insecuie populations. These agencies will be ciitical to suppoiting off-faim activities
anu linking job seekeis with skills tiaining.
@,,P,(.E *)G49<E4)<9# Paiticulai attention will be given to the piomotion of off-faim
investments, as these aie cuiiently a weak point foi extension seivices. The Nicio anu Small
Enteipiise Agency is iesponsible foi piomoting these investments, but it cuiiently uoes not
ieach iuial aieas. The Regional anu woieua Foou Secuiity Buieaus will establish 0ff-Faim Case
Teams, following the Feueial mouel. These will uevelop linkages anu cooiuinate the piomotion
of off-faim investment anu income geneiating oppoitunities, woiking with existing piogiammes
such as Small anu Neuium Enteipiise uevelopment suppoiteu by Buieaus of Tiaue anu
Inuustiy, anu with the Youth anu Women Bevelopment piogiammes of the Ninistiy of Youth,
Spoits anu Cultuie. The iole of the BABP }oint TC will be ciitical in opeiationalising these
linkages anu oiganising collaboiation between the vaiious agencies.
V);=< 9=;;'B ,(>*'*<(<*-)# The piogiamme will pioviue tiaining to faimeis in seeu anu seeuling
multiplication in oiuei to inciease the uiveisity of input supplieis. Reseaich station expeits will
play a key iole in this activity. The piogiamme will also help input supplieis unueistanu theii

4S
maiket (piouuceis) by linking them with piogiamme paiticipants thiough input faiis. Finally,
the piogiamme will pioviue tiaining to Input Teams, Extension Seivice, anu coopeiative
piomotion officeis to builu theii capacity to uelivei impioveu input souicing anu ueliveiy
systems. This tiaining will focus on iuentifying appiopiiate inputs, monitoiing quality, anu
builuing analytical anu facilitation skills.
T(.L4<*)+ ,(>*'*<(<*-)# The piogiamme will uevelop capacity within the Woieua W0ARB (foi
agiicultuial piouucts) anu Woieua 0ffices of Tiaue anu Inuustiy oi Small anu Neuium
Enteipiise Bevelopment Besks (foi non faim piouucts anu seivices) foi peiiouic analysis of
maiket oppoitunities ielateu to potential investments by foou insecuie householus anu pioviue
initial technical assistance to unueitake such analysis. Cuiiicula anu paiticipatoiy tiaining
moualities will be uevelopeu as pait of the piogiamme by ATvETs, univeisities anu piivate
sectoi pioviueis funueu by the piogiamme. A seiies of tiainings will then be oiganizeu foi BAs
anu woieua specialists to impiove theii unueistanuing of maiket oppoitunities, to enhance theii
analyticalconsultationfacilitation skills anu ueepen theii technical know-how.

A<4; ]6 &.-G*:4 '-+*9<*>(' 9=;;-.<

U279# As faimei tiaining centies will seive as the focal point foi extension activities conuucteu
unuei the BABP, it is impoitant that these centies be equippeu with the necessaiy mateiials to
facilitate leaining, consultation anu uemonstiation. The piogiamme will theiefoie pioviue
logistical suppoit to FTCs in the 216 CFI woieuas not coveieu by the RCB pioject. This suppoit
will incluue the cost of selecteu fuinituie, equipment, tiaining anu iefeience mateiials anu
means of tianspoit (bicycles, mules) to enable the effective opeiation of the FTC.

Q-.4:( 9<(,, (): F09# BAs will benefit fiom logistical suppoit to the FTCs, as these centies aie
wheie they will pioviue much of theii tiaining. The piogiamme will also suppoit the capacity of
both woieua staff anu BAs to follow up anu monitoi client householus' investments, thiough the
piovision of necessaiy equipment, vehicles, motoicycles, bicycles, etc. as appiopiiate.
ACTIvITY S: STRENuTBEN CAPACITY 0F FINANCIAL SERvICE PR0vIBERS T0 PR0vIBE
APPR0PRIATE FINANCIAL SERvICES T0 F00B INSEC0RE B00SEB0LBS
A<4; 56 099499 ,*)()>*(' E()(+4E4)< (): 94.G*>4 ;.-G*9*-) >(;(>*<B
This assessment will be uone with two types of financial seivice pioviueis: NFIs anu R0SACC0s.
NFIs will be assesseu in teims of theii cieuit management skills, theii unueistanuing of the
neeus of chionically foou insecuie householus anu gioups, anu theii ability to tailoi financial
piouucts anu packages to them. R0SACC0s will be assesseu in teims of theii ability to mobilize
savings, theii cieuit management skills, anu theii oveiall management anu accountability
systems. An assessment will also be conuucteu of the tiaining pioviueu to R0SACC0s by
Coopeiative Piomotion staff in oiuei to ueteimine any gaps oi weaknesses.
A<4; %6 0::.499 >(;(>*<B +(;9 <8.-=+8 <.(*)*)+
Accoiuing to the iesults of the assessments uone unuei Step 1, the piogiamme will pioviue
tiaining anu capacity builuing to NFIs, R0SACC0s anu Coopeiative Piomotion staff. This tiaining
may be pioviueu by piivate consultants oi, foi R0SACC0s, by NFIs. Foi all financial institutions,
the tiaining will focus on builuing theii capacity to sustainably pioviue financial seivices anu
piouucts that meet the neeus anu capacities of foou insecuie householus.
In auuition, to ensuie that R0SACC0 staff can opeiate effectively, the piogiamme will pioviue
office equipment anu logistical suppoit.

46
S. 4. 6 00TP0T 6 ACTIvITIES: C0NFIBENCE, KN0WLEBuE ANB SKILLS 0F
F00B INSEC0RE B00SEB0LBS IN CFI W0REBAS B0ILT.
ACTIvITY 1: B0ILB SKILLS, KN0WLEBuE ANB C0NFIBENCE IN B0SINESS PLANNINu
ANB NANAuENENT
The Investment 0ppoitunity Stakeholuei Consultation piocess outlineu unuei 0utput 1 will the
fiist step in householu awaieness cieation anu knowleuge acquisition with iespect to potential
investment anu income geneiating enteipiises foi foou insecuie householus. uioup anu
inuiviuual householu consultations conuucteu at FTCs will enable householus to assess the
appiopiiateness of a specific investment foi a paiticulai householu's technical, laboui, financial
capacity. Involvement in savings activities pioviues an oppoitunity foi ueveloping financial
awaieness. Significant investment in consultations, awaieness iaising anu business plan tiaining
will move the piogiamme away fiom a "package" appioach anu empowei householus to make
uecisions foi themselves.
ACTIvITY 2: B0ILB SKILLS, KN0WLEBuE ANB C0NFIBENCE IN FINANCIAL
NANAuENENT
The BABP's new appioach to self selection of householu investments anu suppoiting cieuit
iequiies an initial awaieness anu knowleuge of the technical anu financial aspects involveu in
unueitaking the investment anu the suppoiting cieuit. The piogiamme will theiefoie uevote
significant time to builuing householus' financial liteiacy, pioviuing tiaining to inciease
householus' confiuence in financial management (savings anu cieuit) anu managing cash flows.
Female-heaueu householus anu women gioups will ieceive special attention foi these activities.
The piogiamme staff will also woik to encouiage a savings cultuie, paiticulaily thiough suppoit
to R0SACC0s anu vSLAs.
ACTIvITY S: B0ILB SKILLS, KN0WLEBuE ANB C0NFIBENCE IN INP0T S00RCINu ANB
PR0B0CTI0N, PARTIC0LARLY F0R NEW TECBN0L0uIES
The piogiamme will uevelop faimeis' knowleuge anu skills in piouucing anu selling inputs (as
uesciibeu unuei 0utput S) anu will use paiticipatoiy uemonstiation techniques to inciease theii
unueistanuing of new technologies. These activities will be ciitical to enabling householus to
invest in the appiopiiate inputs to inciease theii piouuction anu asset base.
ACTIvITY 4: B0ILB SKILLS, KN0WLEBuE ANB C0NFIBENCE IN NARKETINu ANB
vAL0E ABBITI0N
Bouseholus' skills anu confiuence in unueitaking value auuition activities will be built thiough
the uemonstiation of innovative technologies (as uesciibeu unuei 0utput 1) anu tiaining
pioviueu unuei 0utput 4. Similaily, householus' unueistanuing of maikets will be incieaseu
thiough a vaiiety of activities, paiticulaily those unuei 0utput 1 (paiticulaily the stakeholuei
consultation piocess, the piesentation of viable investment anu IuA options, anu the
paiticipatoiy uevelopment of householu business plans) anu 0utput 4 (tiaining in maiket
oiientation anu linkages to highei-value maikets). This is ielevant both foi piouuct anu laboui
maikets. Paiticipation in maiketing gioups anu coopeiatives will also be ciitical to ueveloping
maiketing skills anu confiuence.

47
4 ASS0NPTI0NS

4. 1 00TC0NE-T0-u0AL ASS0NPTI0NS
The uoal of the Foou Secuiity Piogiamme is to achieve foou secuiity foi chionic anu tiansitoiy
foou insecuie householus in iuial Ethiopia. The 0utcome of the BAB component is to see income
souices uiveisifieu anu piouuctive assets incieaseu foi foou insecuie householus in CFI woieuas. Seveial
key 0utcome-to-uoal assumptions unueilie the ability of the BABP 0utcome to enable the
achievement of the FSP uoal:
1. T(.L4<9 *) -. )4(. 7UV I-.4:(9 ;.-G*:4 9=,,*>*4)< '*G4'*8--: -;;-.<=)*<*49 ,-. ,--:
*)94>=.4 8-=948-':9# Naiket piomotion inteiventions such as the uiowth Agenua will be
ciitical foi this.
2. A=9<(*)(3'4 9=;;-.< 94.G*>49 4M*9< *) 7UV I-.4:(9 <- 4)(3'4 (994<9 <- >-)<*)=4 <- 34
;.-:=><*G4# Complementaiy institutions anu piogiammes pioviuing animal health seivices,
technical auvice anu maintenancespaie paits wheie necessaiy will be impoitant actois in
ensuiing the sustainability of asset builuing piogiess maue by householus.
S. &.-<4><*-) ,.-E <.()9*<-.B 98->L9 <8.-=+8 <84 &AS& *9 9=,,*>*4)< <- ;.4G4)< 9*+)*,*>()<
(994< :4;'4<*-)# The PSNP is a ciitical founuation to the householu asset builuing activities
pioposeu unuei the BAB component.
4. 284 4)(3'*)+ 4)G*.-)E4)<a*)>'=:*)+ *),.(9<.=><=.4 (): O-G4.)E4)< ;-'*>Ba(''-I9
(994<9 <- 34 ;.-:=><*G4 (): +4)4.(<4 9=,,*>*4)< .4<=.)9 ,-. 8-=948-':9 <- E(L4
(::*<*-)(' *)G49<E4)<9# Foi instance, the CCI component will be ciitical to the success of
the BABP in woieuas that have a moistuie ueficit.
S. UA& 3=:+4< (): -.+()*9(<*-) -, *E;'4E4)<(<*-) (''-I9 -;4.(<*-) (< 9=,,*>*4)< 9>('4C
[=('*<B (): >-G4.(+4# The success of the BABP in helping significant numbeis of
householus achieve foou secuiity anu foou sufficiency uepenus on the oveiall FSP buuget,
cooiuination between the foui components, anu quality of oveiall piogiamme
implementation anu management.
4. 2 00TP0T-T0-00TC0NE ASS0NPTI0NS
In oiuei foi the BABP to achieve its 0utcome, six 0utputs aie pioposeu, as uesciibeu in uetail in
this uocument. But this will only happen if 0utput-to-0utcome Assumptions holu tiue, anu so
these neeu to be caiefully monitoieu anu manageu wheie necessaiy uuiing piogiamme life. Key
0utput-to-0utcome Assumptions aie outlineu below:
1. U*)()>*(' *)9<*<=<*-)9 .49;-): <- UA& *)>4)<*G49# The BABP is built upon the assumption
that given the iight incentives, NFIs will be willing to expanu theii geogiaphic coveiage anu
clientele to lenu to chionically foou insecuie householus anuoi R0SACC0s. The piogiamme
has been uesigneu to auuiess financial institutions' legitimate conceins in teims of
piofitability anu the cieuitwoithiness of chionically foou insecuie householus. In iesponse
to these conceins, a iange of incentives, incluuing capacity builuing, logistical suppoit anu a
line of cieuit, will be pioviueu thiough the capacity builuing anu othei components financeu
by uevelopment paitneis. These will be coupleu with tiaining to householus in financial
liteiacy anu business management in oiuei to inciease theii cieuitwoithiness.

48
%# 284 >-G4.(+4 -, K^A077@9 (): TUV9 ->>=.9 (< <84 )4>499(.B ;(>4# This will iequiie
substantial involvement fiom the Coopeiative Piomotion Buieaus0ffices, as they have the
manuate to suppoit the cieation anu capacity builuing of all types of coopeiatives, incluuing
savings anu cieuit coopeiatives. Nany woieuas of SNNPR, 0iomiya anu Afai in paiticulai
lack such local-level savings anu lenuing institutions (be they R0SACC0s oi theii small-scale,
moie infoimal vSLA counteipaits), which will be ciitical in linking chionically foou insecuie
householus with souices of cieuit (incluuing NFI lines of cieuit) foi householu investments.
The success of the piogiamme theiefoie iests in pait on how quickly such institutions can
be cieateu, suppoiteu anu scaleu up.

S. A=,,*>*4)< (<<.(><*G4 *)G49<E4)<9 >() 34 *:4)<*,*4:C (): <8494 ;.-G4 <- 34 ;.-,*<(3'4#
This is a necessaiy conuition foi the BABP to achieve its stateu outcome of incieasing
householu assets. Although viable investment oppoitunities aie moie uifficult to iuentify in
iuial, chionically foou insecuie aieas, they uo exist, both foi on- anu foi off-faim activities. A
compiehensive consultative piocess of assessment of these will be unueitaken to iuentify
viable investments as well as theii potential iisks anu ietuins. Bouseholus will ieceive
technical anu financial tiaining appiopiiate to the technology they aie auopting as well as
othei technical seivices (e.g. animal health, ciop piotection) as may be iequiieu.
Complementaiy suppoit to input anu output maiketing will also ensuie piofitability of
householu investments.
4. @<84. ,(><-.9 :- )-< >(=94 '-99 -, *)G49<E4)< ;.-,*<9# Piovision of technical tiaining anu
linkages with complementaiy seivices will ieuuce the iisk of loss of investment piofits
iesulting fiom natuial events such as plant anu animal uisease. The feasibility of ciop anu
livestock insuiance foi foou insecuie householus will be ieseaicheu.
S. 284 4M<4)9*-) 94.G*>4 8(9 <84 >(;(>*<B <- :4'*G4. :4E():P:.*G4) 9=;;-.< 94.G*>49 -)
9>('4 .4[=*.4:# Nuch of the iesponsibility foi implementing the BABP will iest with the
extension seivice, paiticulaily BAs anu woieua expeits. The piogiamme's focus on uemanu-
uiiven seivice ueliveiy anu maiket iesponsiveness will iequiie a ieoiientation of the way
most extension seivices aie cuiiently pioviueu. In oiuei foi this to happen, the piogiamme
has incoipoiateu a compiehensive capacity builuing element, which is specifically uesigneu
to ensuie that the Extension Seivice will have the capacity to uelivei infoimation, knowleuge
anu skills at the scale iequiieu. The FTCs will pioviue the focal point foi ueliveiy of uemanu-
uiiven suppoit to its clients anu the piogiamme will suppoit the builuing of theii mateiial
capacity.
6. ?,,4><*G4 '*)L(+49 34<I44) G(.*-=9 ;.-+.(EE49 (): :4;(.<E4)<9 <.()9'(<4 <-
4,,4><*G4C R-*)4: =;C >--.:*)(<4: 9=;;-.<# This will be paiticulaily ciitical foi the success
of off-faim investments, as these will iequiie cooiuinateu suppoit fiom the Small anu Nicio
Enteipiise offices, the Women anu Youth Bevelopment piogiammes, anu the extension
seivice.
7. 284 .*9L (G4.9*-) -, >8.-)*>(''B ,--: *)94>=.4 ;4-;'4 *9 (3'4 <- 34 -G4.>-E4# To
encouiage this, the piogiamme will uevelop a flexible iange of financial piouucts
appiopiiate to iesouice pooi anu iisk-aveise householus. An intiouuction to financial
knowleuge will be inculcateu thiough the encouiagement of a savings cultuie suppoiteu by
financial anu business awaieness anu knowleuge iaising piogiammes.

49
S INPLENENTATI0N

S. 1 PBYSICAL ANB N0N-PBYSICAL NEANS
The inputs ielateu to @=<;=< 5 (iuentification of investment oppoitunities anu business plan
uevelopment) incluue (i) skilleu manpowei to unueitake maiket anu technical analysis (ii)
skilleu community facilitatois (iii) skilleu woikshop facilitatois at woieua anu Regional levels
anu (iv) funus to finance the consultative piocess. Buman anu financial iesouices aie iequiieu
to unueitake uetaileu feasibility stuuies to ensuie the functionality anu cost effectiveness of the
householu investments. Special emphasis will be given to off-faim investment oppoitunities, as
less woik has been uone in this aiea to uate.
Limiteu financial inputs will also be iequiieu to unueitake an enviionmental iisk assessment foi
some of the enteipiises to ensuie that potential negative enviionmental impacts aie mitigateu.
In this iegaiu, special emphasis will be given to livestock ielateu enteipiises because of
implications foi caiiying capacity, pastuie anu watei availability.
The majoi inputs ielateu to @=<;=< % (piovision of financial seivices) concein the capitalisation
anu capacity builuing of financial seivice pioviueis. Supeivisoiy anu iegulatoiy agencies may
also neeu capacity builuing suppoit. This will incluue technical suppoit to impiove seivice
ueliveiy anu uiveisify the piouucts pioviueu, as well as mateiial suppoit to enable them to fulfil
theii iesponsibilities.
Investments in @=<;=< $ (impioveu input ueliveiy system) will laigely involve expenses ielateu
to supeivision anu suppoit.

@=<;=< ] (suppoit to maiket linkages) will laigely involve the uevelopment of technical skills
with iegaiu to maiket iuentification anu the uevelopment of value chains anu investment in
functioning systems.
@=<;=< " (institutional capacity builuing) iequiies substantial suppoit to the extension
uepaitment as well as the uevelopment of new extension appioaches (suppoiteu thiough
technical assistance). Rolling out the communication stiategy will iequiie the uesign, wiiting
anu piinting of posteis anu newsletteis as well as the piepaiation of bioaucast mateiials foi
both iauio anu television. A communication specialist has alieauy been seconueu to the FSPB to
suppoit this piocess.
The BABP iequiies iegulai supeivision anu follow up on how householu investments aie uoing.
0utput S will theiefoie have thiee main aieas of investment: investment in human iesouices
(both incieaseu staffing anu the tiaining of existing anu new staff), systems (incluuing the
uevelopment anu ievision of manuals) anu physical capacity (computeis, vehicles etc.)
A majoi input foi @=<;=< b will be a planneu anu systematic sensitisation piogiamme (not
campaign appioach). Skilleu tiaineis anu sensitizeis will be iequiieu. Posteis, pocket sizeu
sensitisation mateiials will be uevelopeu anu uisseminateu. Funus will be iequiieu to finance
expeiience shaiing exchange piogiamme foi selecteu householus oi theii iepiesentatives
locally anu if possible abioau wheie similai piogiammes have succeeueu.
These measuies anu the associateu inputs will iaise the confiuence of the householus on the
piogiamme anu the feasibility of the investment options they have chosen.

Su
S. 2 INSTIT0TI0NAL ARRANuENENTS
The Bouseholu Asset Builuing Piogiamme is a component of the uoveinment of Ethiopia's
laigei Foou Secuiity Piogiamme. As explaineu in the FSP uocument (in section S.1), the Ninistei
foi N0ARB anu Beaus of Regional B0ARB anu woieua 0ARB aie the piogiamme manageis foi
the FSP. A numbei of intei-sectoial cooiuination bouies chaiieu at senioi level (N0ARB
Ninistei, Regional Piesiuent anu woieua Auministiatoi) ensuie cooiuination inteinally in the
sectoi as well as with non-ARB agencies involveu in the FSP implementation (Feueial FSP Intei-
Ninisteiial Nanagement Committee, Regionalwoieua FSP Steeiing Committee
11
). At Feueial
level theie is also an FSP }oint Stiategic 0veisight Committee foi uoveinment-Bevelopment
Paitneis uialogue anu joint oveisight of the FSP implementation. At Regional anu woieua levels,
unuei the stiategic guiuance of the RegionalWoieua Steeiing Committee the Regionalwoieua
FS Task Foice, chaiieu by the Beau of B0ARBWoieua ARB0 iespectively, ensuies opeiational
cooiuination among anu within the FSP components.
Thus with iegaiu to BABP these bouies have impoitant ioles in ensuiing its integiation with
othei FSP piogiammes. Foi instance at Feueial level, the State Ninistei foi Agiicultuie,
oveiseeing the Extension Biiectoiate, will iepoit on piogiess with the BABP at the iegulai
N0ARB management meetings. This will be an oppoitunity to assess plans anu piogiess with
BABP in ielation to plans anu piogiess of othei FSP components, e.g. the uevelopment of
enabling infiastiuctuie thiough PSNP PW anu CCI, anu to assess how well BABP manages to
covei the PSNP taiget population. The State Ninistei will also attenu the FSP Intei-Ninisteiial
Nanagement Committee, as well as the State Ninistei in chaige of SNE Bevelopment in the
Ninistiy of Tiaue anu Inuustiy, so that this Committee will be in a position to ensuie joint anu
cooiuinateu guiuance with iegaiu to the piomotion of off-faim activities unuei the BABP, to all
agencies conceineu. Similaily, the Beau of B0TI anu of the woieua Tiaue anu Inuustiy 0ffice
will be membeis of the Regionalwoieua FSP Steeiing Committee anu will be iepiesenteu at the
appiopiiate level (Beaus of SNE Agencies) on the RegionalWoieua FSTFs.
The Feueial FSP }oint Stiategic 0veisight Committee anu Regional anu woieua FSP Steeiing
Committee anu FS Task Foice will be suppoiteu by a numbei of }oint Technical Committees, one
of which will be the /01& c-*)< 24>8)*>(' 7-EE*<<44# At all levels the BABP }oint TC will be
chaiieu by the Extension Seivice Beau (e.g. the Extension Biiectoi at N0ARB), who will be the
'managei' of the BABP. The BABP }oint TC will be accountable to the State Ninistei foi
Agiicultuie, Regional Buieau of Agiicultuie anu Ruial Bevelopment anu woieua office of
Agiicultuie anu Ruial Bevelopment thiough FSP oveiall cooiuination bouies. At all levels the
Foou Secuiity bouies will have a key iole of facilitating the management anu cooiuination of the
FSP anu of each of its components. With iegaiu to the BABP, Foou Secuiity bouies will membeis
of the BABP }oint TC Committee chaiieu by the Extension agencies.
This is iepiesenteu in the uiagiams below.



11
The Regionalwoieua FSP Steeiing Committees function like sub-committees of the Regionalwoieua
Cabinet.

S1
U*+=.4 $6 U4:4.('P'4G4' O-G4.)E4)< UA& T()(+4E4)< 7-EE*<<449 (): O-? F4G4'-;E4)<P
&(.<)4. 7--.:*)(<*-) 0..()+4E4)<9



FSP INTER-MINISTERIAL MANAGEMENT
COMMITTEE
State Minister DRMFSS
CHAIR
MOARD
State Ministers
Agricultural Development
NRM
M & I
Federal Cooperative
Agency
MOFE
D State Minister
MoW
R State
Minister
Roads
Authority State
Minister
Trade &
Industry State Minister
for SM
E
FSCD
MOARD MANAGEMENT
ARRANGEMENTS (FSP to be a standing item on agenda of management
team)
Minister of Agriculture & Rural
Development


Chai
r
DRMFSS
State Minister
Agricultural
Development
State Minister
NRM
State Minister
Market & Input
State Minister

"#
FSP COORDINATION MECHANISM (JOINT GOE-
DONORS)
FSP Joint Strategic Oversight
Committee
Chair: MoARD DRMFSS State
Minister
JOINT TC
2
HABP

Chair
:
Directo
r
Extensio
n
Cas
h
Workin
g
Grou
p
Foo
d
Workin
g
Grou
p
Fin
Services
Workin
g
Grou
p

FSCD
Minister
MOARD

Overall RED-
F
S
Committee
s
JOINT TC
3
PW/CC
I

Co-
Chairs:
Director
Natural
Resource (ARD)
&
MoWR
Director
JOINT TC
1
Early Warning
&
Response/Transfer
s

Co-Chairs: EWR
& FSC
Directors
Extensio
n
Working
Group

SS
!"#$%& () *+,- ."/0"1 2&#"3145 5&6&5 !7- 833%9"14/"31 419 :414#&:&1/ 4%%41#&:&1/;



!"#$%& <) *+,- ."/0"1 .3%&94 5&6&5 !7- 833%9"14/"31 419 :414#&:&1/ 4%%41#&:&1/;



S4
In teims of uay-to-uay management anu cooiuination, the Extension bouies will take the leau foi
the BAB piogiamme, with the suppoit of the BABP }oint Technical Committee that they chaii. In
oiuei to ensuie cooiuination between anu mobilisation of the ielevant expeitise fiom all
conceineu agencies, the BABP }oint TC will compiise the following agencies (in auuition to
Extension as Chaii anu Secietaiiat, anu Foou Secuiity as membeispecifically, the Bouseholu
Asset Builuing case team in the Foou Secuiity bouies):
S. Inputs anu Naiketing (involveu in paiticulai in 0utput 1 anu S, key iole in ielation to
facilitating links with maikets)
6. Coopeiative Piomotion (involveu in 0utputs 1, 2 as oveiseeing R0SACC0s, anu S anu 4 as
suppoiting coopeiatives in facilitating linkages with input anu output maikets)
7. Small anu Nicio-Enteipiise Bevelopment (involveu in 0utputs 1, S anu 4 with iegaiu to off-
faim activities anu ensuiing links with SNE uevelopment package piogiammes)
8. NFI iepiesentative(s) (leau iole in 0utput 2)
9. Women Affaiis of N0ARB (cioss-cutting, anu ensuiing links with Women package
piogiammes)
1u. Youth, Spoit anu Cultuie (cioss-cutting, anu ensuiing links with Youth package
piogiammes)
11. Laboui anu Social Affaiis (facilitating links with laboui maikets foi both on- anu off-faim
activities in 0utput 4 anu integiation of such oppoitunities in 0utput 1)
12. Bonois, Nu0s anu othei ielevant non-goveinment stakeholueis.
This is illustiateu in the uiagiam below.














SS

!"#$%& =) *+,- >3"1/ ?&801"845 @3::"//&& A!&9&%45B 2&#"3145 419 .3%&94 5&6&5C


The BABP }oint Technical Committees will iepoit to the Beaus of Agiicultuie anu Ruial
Bevelopment (ARB) anu the bioauei FSP cooiuination bouies that these Beaus chaii. The BABP
}oint TCs at Feueial, Regional anu woieua level will have similai compositions, as shown above.
At Feueial level the BABP }oint TC will incluue iepiesentatives of uonoi agencies who have a
paiticulai expeitise anuoi inteiest in the BABP fielu of activity anu who will iepiesent the
uonoi gioup on the TC. Regions anu woieuas will ensuie that all ielevant stakeholueis aie
iepiesenteu on the BABP }oint TC. Consiueiing the impoitance of engaging with the piivate
sectoi (input supplieis, investois in value chains anu agiicultuial piocessing etc.) anu with the
coopeiative sectoi at laige, the Regional anu woieua }oint TCs coulu, foi instance, incluue
iepiesentatives fiom Regional Chambeis of Commeice oi piivate sectoi associations oi
umbiella oiganisations wheie these exist, as well as iepiesentatives fiom coopeiative unions.
At Regional anu woieua level in paiticulai, the BABP }oint TC will have a ciitical iole in ensuiing
that the planning foi BABP activities is integiateu with the planning of othei FSP activities in the
woieua anu Region anu with othei activities in the oveiall woieua anu Regional plans. This is
fuithei elaboiateu in section S.S below. This is ciitical as the woieua plan, incluuing BABP
activities, will then be the basis foi each agency involveu in the BABP implementation to caiiy
out its activities accoiuingly.

S6
Financial seivice pioviueis will be iepiesenteu on the BABP Technical Committees at each level,
as appiopiiate. In auuition, theie will be a set of specific aiiangements ensuiing the
management anu cooiuination of the uiffeient types of activities suppoiteu by the Piogiamme in
ielation to piovision of financial seivices, as showeu in the uiagiam above.
The aiiangements uesciibeu in this section will be cementeu in a Nemoianuum of
0nueistanuing (N00) between uoveinment anu uevelopment paitneis, as well as N00s
between ARB agencies anu othei agencies involveu in the FSP implementation at the same level.
Within the context of these aiiangements the ioles anu iesponsibilities of implementing
paitneis aie summaiizeu below. They will be uesciibeu in uetail in the BABP PIN.
S.2.1 FEBERAL LEvEL

The D"1";/%E 3F +#%"8$5/$%& 419 2$%45 G&6&53H:&1/ AD3+2GC is iesponsible foi the
oveisight anu cooiuination of the Foou Secuiity Piogiamme in geneial, incluuing the BAB
component. It sets the policy uiiection to which the BABP contiibutes. It ensuies that the FSP
components aie closely cooiuinateu thiough a numbei of cooiuination bouies (incluuing the FSP
}oint Stiategic 0veisight Committee) anu thiough the iegulai management meetings of the
Ninistiy. It appioves the piogiamme buuget anu iesouice allocation to the vaiious piogiamme
implementeis, baseu on the consoliuateu iesouice allocation pioposal piepaieu by the FSCB,
anu it iesolves implementation issues iequiiing senioi engagement, especially ielating to
cooiuination issues. The G";4;/&% 2";I D414#&:&1/ 419 !339 7&8$%"/E 7&8/3% AG2D!77C anu
its Foou Secuiity Cooiuination Biiectoiate pioviue technical suppoit foi the BAB component
planning anu implementation. The State Ninistiy foi BRNFSS also leaus an FSP Intei-Ninisteiial
Nanagement Committee which mobilises the suppoit of othei sectois that must be involveu in
the FSP implementation.
The +#%"8$5/$%45 JK/&1;"31 G"%&8/3%4/& A+JGC is the managei of the BAB piogiamme. As such,
the Biiectoiate takes the technical leau in managing, cooiuinating anu oveiseeing the
implementation of the BABP activities to ensuie that the BABP meets its objectives, suppoiteu
by the BABP }oint Technical Committee (chaiieu by the Biiectoi AEB). The Biiectoi iepoits to
the State Ninistei foi Agiicultuie who infoims the Ninistei anu the FSP Intei-Ninisteiial
Nanagement Committee about piogiess with BAB anu iaises any issue that woulu uemanu
highei level, cooiuinateu guiuance oi uecision making. In this cooiuination leauing iole the
Biiectoiate is iesponsible foi i) pioviuing guiuance to implementing paitneis; ii) ensuiing
appiopiiate linkages of the BABP with the othei components of the Foou Secuiity Piogiamme
anu othei uevelopment inteiventions; anu iii) ensuiing effective cooiuination acioss
uepaitments anu ministiies foi the successful implementation of the piogiamme.
0ne key iesponsibility of the AEB is to implement the ieoiientation of the Extension Seivice
towaiu a uemanu-uiiven appioach making the seivice moie iesponsive to CFI householus'
neeus anu inteiests. The Biiectoiate will (i) ie-oiient its system anu staff towaius a uemanu-
uiiven extension appioach; (ii) chaii the special multi-agency technical committee (BABP }oint
TC) that will pioviue technical back up to the vaiious implementing agencies conceineu; (iii)
issue explicit guiuelines that its staff at all levels anu paiticulaily woieua extension staff anu
Bevelopment Agents will not be involveu in loan uisbuisement anu collection.
The !339 7&8$%"/E @33%9"14/"31 G"%&8/3%4/& A!7@GC has uay-to-uay iesponsibility foi
facilitating the management anu cooiuination of the BABP along with othei components of the
FSP. Its key iesponsibilities ielateu to the BABP incluue: i) pioviuing technical suppoit to
Regional foou secuiity offices; ii) monitoiing oveiall capacity to implement the BAB; iii)
assisting the AEB in the management anu cooiuination of the BABP, incluuing in leauing the

S7
tiansition fiom supply-uiiven to uemanu-uiiven extension; iv) togethei with the AEB,
monitoiing anu evaluating the efficiency, effectiveness anu impact of the BAB anu uocumenting
anu uisseminating lessons; anu v) baseu on annual woik plans anu buuget pioposals of
piogiamme implementeis, piepaiing consoliuateu iesouice allocation pioposals foi appioval by
N0ARB Ninistei.
The D"1";/%E 3F !"1418& 419 J8313:"8 G&6&53H:&1/ ADL!JGC is iesponsible foi uisbuising
BABP iesouices to Regions in line with iequests submitteu by FSCB, baseu on N0ARB-appioveu
piogiamme woik plan anu buuget. N0FEB is accountable foi the oveiall financial management
of the piogiamme, incluuing management of the special anu pooleu Biii accounts anu iepoiting
on the BABP.
The !&9&%45 @33H&%4/"6& +#&18E will play a laigei iole in the FSP than pieviously. The Agency
will collaboiate with the FSCB, AEB anu othei ielevant institutions to stiengthen existing iuial
saving anu cieuit coopeiatives (R0SACC0s) anu establish new R0SACC0s wheie they uo not
exist. The Agency will woik with ielevant institutions to make the iegulatoiy enviionment
conuucive foi R0SACC0s to opeiate anu flouiish in CFI aieas. The Feueial Coopeiative Agency
will also be iesponsible foi pioviuing guiuance to Regional anu woieua Coopeiative Piomotion
buieaus anu offices in the implementation of the BAB moie geneially, notably in the
establishment anu stiengthening of piouuction, maiketing anu othei coopeiatives that will
stiengthen the integiation of householus with the maiket.
The +#%"8$5/$%45 D4%I&/"1# G"%&8/3%4/& (unuei the State Ninistei foi Inputs & Naiketing) will
have an impoitant iole too as it will leau the aujustment in the iole of goveinment agencies at all
levels with iegaiu to agiicultuial maikets. The BABP envisages that goveinment agencies will
have a iole piimaiily of facilitation of the establishment of maiket linkages (incluuing thiough
collection, analysis anu timely uissemination of maiket analysis), quality contiol, anu piomotion
of investment by the piivate sectoi. This will iequiie stiong leaueiship fiom the Feueial level to
steei Inputs anu Naiketing entities at all levels to unueitake this aujustment. The Agiicultuial
Naiketing Biiectoiate will also be iesponsible foi iuentifying the type of incentives that the
piogiamme coulu suppoit in oiuei to facilitate piivate sectoi investment in the moie iemote CFI
aieas (examples may be capacity builuing, exposuie, intiouuction to technology innovations,
cieating maiket shaie etc.).
The +;;38"4/"31 3F J/0"3H"41 D"8%3F"1418& M1;/"/$/"31; A+JD!MC will auvise on matteis
ielateu to the channelling of financial seivices thiough NFIs anu R0SACC0s. It will paiticipate in
the capacity builuing of financial institutions at woieua anu kebele levels.
The 2$%45 !"1418& M1/&%:&9"4/"31 -%3#%4::& (R0FIP) will auvise on technical issues ielateu
to the cieation anu iapiu scale up of laige numbeis of R0SACC0s.
With iegaiu to BABP, the !7- >3"1/ 7/%4/&#"8 L6&%;"#0/ @3::"//&& is iesponsible to: (i) assess
piogiamme peifoimance anu piogiess towaiu oveiall objectives; (ii) baseu on the analysis of
the BABP }oint Technical Committee, make iecommenuations to the Ninistei of N0ARB on the
appiopiiate iesponses to issues emeiging uuiing the implementation of the piogiamme; (iii)
make iecommenuations to the Ninistei on stiategic uecisions conceining piogiamme
implementation, linkages with emeigency inteiventions, othei foou secuiity inteiventions anu
agiicultuial giowth piogiamme, anu ielateu policies; anu (iv) engage in policy anu stiategy
uialogue on issues that aie of uiiect ielevance to the BABP.
The !&9&%45 *+,- >3"1/ ?&801"845 @3::"//&& will guiue the implementation of the BABP anu
iepoit iegulaily to the FSP }oint Stiategic 0veisight Committee. It will be iesponsible to: (i)
assess peifoimance anu piogiess at opeiational level, towaiu achievement of agieeu

S8
benchmaiks; (ii) iecommenu to the FSP }oint Stiategic 0veisight Committee appiopiiate
iesponses to issues emeiging uuiing the implementation of the piogiamme; (iii) piomote
linkages with othei foou secuiity piogiammes (notably, ieviewing iegional FSP plans to check
BABP coveiage in ielation to the PSNP clients anu the syneigy between BABP plans anu plans
foi the uevelopment of enabling infiastiuctuies thiough PW anu CCI, anu iecommenuing any
action necessaiy to stiengthen this to the FSP }oint Stiategic 0veisight Committee), agiicultuial
giowth initiatives anu emeigency inteiventions, anu (iv) iuentify, manage anu oveisee au hoc
measuies to suppoit of Regional oi Feueial authoiities to implement specific aspects of the
piogiamme. The Committee will in paiticulai be iesponsible foi acceleiating the tiansition to
uemanu uiiven seivice ueliveiy that pioviues linkages with input anu output maikets as well as
piofessional financial seivices.
S.2.2 REuI0NAL LEvEL

Theie may be some vaiiation in the stiuctuie at Regional level uepenuing on the outcome of the
business piocess ie-engineeiing (BPR) piocess anu othei Regional specificities. Buiing the
uevelopment of the PIN, complete stiuctuies anu uesciiptions will be pioviueu. Foi the puipose
of this uocument, the most common stiuctuies aie uesciibeu below.
The ,$%&4$ 3F +#%"8$5/$%& 419 2$%45 G&6&53H:&1/ A,3+2GC (in pieuominantly pastoial
iegions it is the ,$%&4$ 3F -4;/3%45 419 2$%45 G&6&53H:&1/), as managei of the FSP in the
Region, oveisees the implementation of the BABP at the Regional level. With the suppoit of the
Regional BABP }oint TC anu the oveiall Regional FSP Steeiing Committee anu FS Task Foice, the
BoARB oveisees the integiation of householu asset builuing activities into the Foou Secuiity
Piogiamme anu the Regional Ruial Bevelopment Stiategy. It (i) pioviues oveiall guiuance to the
Extension Coie Piocess, the Regional Foou Secuiity Coie Piocess anu othei BuieauxPiocesses
to ensuie cooiuination on planning anu implementation of the Regional BABP; (ii) ensuies
efficient piocuiement wheie applicable; (iii) ieviews anu pioviues feeuback on iepoits
submitteu by the Regional BABP }oint Technical Committee (leu by Extension Coie Piocess) on
implementation of piogiamme inteiventions; (iv) cooiuinates the links with the feueial level foi
the FSP as a whole (incluuing iepoiting lines), incluuing foi the BABP baseu on the iepoits anu
suggestions fiom the Regional Extension Biiectoiate anu the Regional BABP }oint TC.
The 2&#"3145 @4N"1&/ is iesponsible foi the ieview anu appioval of BABP annual plans anu
buugets submitteu by woieuas thiough the Regional Buieau of Agiicultuie anu Ruial
Bevelopment (B0ARB) anu the annual anu biannual piogiess iepoits on implementation of the
iegional BABP anu buuget utilization. The Regional Cabinet ensuies that the Regional Council is
iegulaily infoimeu on the implementation of the FSP as a whole, incluuing the BABP, anu that
the Regional Council's uecisions with iegaiu to bioauei iegional uevelopment aie ieflecteu in
the FSP iegional plans anu those foi the BABP component.
The 2&#"3145 !7- 7/&&%"1# @3::"//&& A2!77@C anu the 2&#"3145 !7 ?4;I !3%8&
OP
suppoit the
Regional Cabinet anu pioviue guiuance at the stiategic level anu cooiuination at the opeiational

12
As outlineu in the main FSP uocument, the Regional FSP Steeiing Committee chaiieu by the Regional
Piesiuent involves the Beaus of B0ARB, B0FEB anu BuieausAgencies in chaige of Roaus,
WateiIiiigation, SNE (Tiaue & Inuustiy), Coopeiative Piomotion, Laboui & Social Affaiis, Women
Affaiis, anu Youth anu Spoits. The FS Task Foice, chaiieu by B0ARB Beau uelegateu by the Regional
Piesiuent, compiises of the ielevant Biiectois of ARB anu othei Buieaus Agencies involveu in the
implementation of the piogiamme, miiioiing the composition of the FSP Steeiing Committee.


S9
level, to ensuie the piopei implementation of the Foou Secuiity Piogiamme in the Region. These
cooiuination bouies suppoit B0ARB in ensuiing the effective integiation of the BABP with the
othei FSP components so as to achieve giauuation at scale.
Regional institutions biiefly uesciibeu below have uiiect beaiing on the implementation of the
BAB component. Betaileu ioles anu iesponsibilities will be outlineu in the BABP PIN.
The 2&#"3145 +#%"8$5/$%45 JK/&1;"31 G"%&8/3%4/& is the BABP managei, accountable to
B0ARB Beau, anu leauing the cooiuination of othei agencies thiough the BABP }oint TC. In this
cooiuination leauing iole, it is iesponsible foi: i) ueveloping anu consoliuating annual
implementation plans anu buugets foi BABP in the Region in line with pioposals fiom woieuas
anu line Buieaus; ii) ensuiing close collaboiation with anu cooiuination between implementing
agencies both within anu outsiue the ARB sectoi; iii) ensuiing that Nu0 plans with householu
asset builuing activities contiibute to the oveiall objectives of the FSP; (iv) ensuiing appiopiiate
integiation of the BABP plans anu activities with plans anu activities of othei FSP piogiammes
in the Region (incluuing, notably, ensuiing syneigy between the BABP householu-level activity
anu the uevelopment of enabling community infiastiuctuie thiough the PSNP PW anu CCI), anu
with othei uevelopment inteiventions).
Noieovei, the Regional AEB is uiiectly iesponsible foi implementing the envisageu uemanu-
uiiven extension seivice to CFI householus in each Region. In bioau teims, it will ie-oiient its
system anu staff towaius a uemanu-uiiven extension appioach; leau the special multi-agency
technical committee (the BABP }oint TC) that will pioviue technical back up to implementeis on
the giounu; anu issue explicit guiuelines that its staff, paiticulaily woieua extension staff anu
BAs, will not be involveu in loan uisbuisement anu collection. Its iesponsibilities incluue: (i)
piepaiing anu ieviewing the consultative stakeholuei piocess anu pioviuing technical inputs
into the maiket analysis; (ii) consoliuating plans anu buugets foi BABP technical seivices
uevelopeu in the woieuas; (iii) oveiseeing integiation of maiket analysis anu othei BABP-
ielateu plans into woieua plans; (iv) oveiseeing woieua supeivision of the BABP technical
seivices, anu pioviuing technical backstopping; (v) ensuiing effective tiaining ielateu to BABP
technical seivices, maiket analysis, anu maiketing; (vi) cieating linkages foi the uissemination
of technological innovations; (vii) suppoiting the implementation of the FSP N&E system
especially on the BABP; anu (viii) facilitating knowleuge management incluuing iuentifying anu
uisseminating best piactices.
The 2&#"3145 G";4;/&% -%&6&1/"31 419 !339 7&8$%"/E @33%9"14/"31 LFF"8& A2!7@LC iepoits
to the Regional BoARB while it is technically accountable to the Feueial FSPB. Its
iesponsibilities incluue: i) suppoiting the AEB in managing anu cooiuinating the BABP in the
Region anu in linking up with the Feueial level thiough the Beau of B0ARB; ii) iuentifying anu
monitoiing capacity to implement BAB activities at Regional, woieua anu kebele levels; (iii)
facilitating the Regional BABP }oint TC meetings anu any othei meetings with goveinment anu
non-goveinmental agencies involveu in the implementation of the BAB; iv) mobilizing technical
assistance as neeueu; v) cooiuinating monitoiing anu evaluation activities anu piepaiing
piogiess iepoits; anu vi) assisting the Regional Agiicultuial Extension Seivice in its tiansition to
uemanu-uiiven extension. The RFSC0 acts as secietaiy of the Regional FSP Steeiing Committee,
the Regional FS Task Foice anu the }oint TCs incluuing the BABP }oint TC.
This new phase of the FSP gives paiticulai attention to off-faim activities. It is expecteu that all
Regions will establish an LFFQ!4%: @4;& ?&4: within the Foou Secuiity 0ffice at Regional

6u
level
1S
anu within the W0ARB at woieua level. These Case Teams will (i) suppoit assessments of
the local maiket foi non-agiicultuial seivices oi piouucts anu (ii) uevelop linkages anu
cooiuinate the piomotion of off-faim investment anu income geneiating oppoitunities, woiking
with existing piogiammes in othei sectois such as the Small anu Neuium Enteipiise
uevelopment piogiamme suppoiteu by Buieaus of Tiaue anu Inuustiy, anu with the Youth anu
Women Bevelopment piogiammes of the Buieaus of Women Affaiis, anu Youth, Spoits anu
Cultuie.
The 2&#"3145 ,$%&4$ 3F @33H&%4/"6& -%3:3/"31 will have an enhanceu iole in the new FSP, in
ielation to the incieaseu iole given to R0SACC0s in pioviuing financial seivices to CFI householu
anu the gieatei attention paiu to coopeiatives in linking householus to input anu output
maikets. The Buieau (Commission in 0iomiya) will collaboiate with the Regional Foou Secuiity
Cooiuination 0ffice, Regional Agiicultuial Extension Bepaitment anu othei ielevant institutions
to stiengthen existing R0SACC0s anu establish new R0SACC0s wheie they uo not exist. The
BuieauCommission will pioviue guiuance to the woieua Coopeiative Piomotion 0ffices in the
suppoit that they shoulu give to coopeiatives in linking householus to the maiket anu assist
them foi instance in facilitating the establishment of coopeiative unions.
Inputs anu Naiketing agencies
14
will be iesponsible foi guiuance anu suppoit to the woieua
ARB0s to facilitate the uevelopment of a stiong woieua level maiket facilitation function (in
ielation to 0utputs S anu 4 of the BABP)ueveloping existing Inputs & Naiketing woieua
agencies (see below). The Regional level will facilitate links among woieuas anu between
woieuas anu Regional goveinment anu non-goveinment agencies with iegaiu to maiket
facilitation (such as Regional Chambeis of Commeice, piofessional associations etc.). It will
contiibute to technical analyses anu value chain analyses foi oppoitunities that may be of
inteiest foi gioups of woieuas. It will assist woieua agencies in iuentifying anu quality
contiolling input pioviueis, iuentifying maiket outlets, linking up with ieseaich institutions etc.
The SNE Bevelopment Agency in the Buieau of Tiaue anu Inuustiy, anu the Women Affaiis
Buieau anu Buieau of Youth, Spoits anu Cultuie, will suppoit the BAB thiough: i) fully
paiticipating in the Stakeholuei Consultation Piocess anu ii) iuentifying piactical ways in which
the expeitise in theii sectoi anu the piogiammes that they manage can contiibute to the BABP
activities.
D"8%3F"1418& M1;/"/$/"31; will play multiple ioles: i) suppoit the FSP's effoits to builu financial
management capacity of existing R0SACC0s; ii) in some cases, pioviue cieuit uiiectly to
piogiamme clients oi infoimal gioups such as vSLAs.
The 2&#"3145 *+,- >3"1/ ?&801"845 @3::"//&&B composeu of key expeits fiom the institutions
iepiesenteu in the Regional FSP Steeiing Committee anu FS Task Foice anu most uiiectly
involveu in the BABP component of the FSP (see figuie 6 above) will be chaiieu by the Regional
Agiicultuial Extension Biiectoiate anu assist it in its cooiuination iole. It will pioviue technical
backup to giassioots implementeis of the BAB component, ensuiing that guiuance emanating
fiom the uiffeient Regional sectois involveu in implementing the BABP is cooiuinateu anu
consistent (e.g. guiuance on involvement of SNE agencies at woieua level etc.). The Committee
will assist the Regional Extension Biiectoiate in checking the syneigy between BABP plans anu
activities anu the plans anu activities of othei FSP components anu of othei uevelopment

1S
Amhaia Region has alieauy establisheu 0ff-Faim Case Team within the Bisastei Pievention & Foou
Secuiity Cooiuination 0ffice.
14
Regions have uiffeient aiiangements foi these two functions. The ioles anu iesponsibilities foi the
BABP will be auapteu by the Regions to theii own set-up.

61
inteiventions in the Region, so as to iaise any issue at the Regional FS Task FoiceRegional FSP
Steeiing Committee as iequiieu.
2&5&641/ R3145 LFF"8&; aie expecteu to play a significant iole in suppoiting the implementation
of the FSP in geneial anu BAB in paiticulai. Amhaia, 0iomiya anu SNNPR in paiticulai have a
laige numbei of FSP woieuas anu aie geogiaphically laige making it impossible foi the Regions
alone to pioviue auequate technical backstopping to woieuas. Zones aie auministiatively pait of
the Regional stiuctuie anu as such Zonal uepaitments will have the same iesponsibilities as the
Regional buieaus outlineu above.
S.2.S W0REBA LEvEL

The Woieua is the level of goveinment that ueteimines neeus, unueitakes integiateu planning
(see section S.S below) anu implements the BAB component of the FSP. As the highest uecision-
making bouies at woieua level, the S3%&94 @3$18"5 419 @4N"1&/ aie iesponsible foi the
allocation of BABP iesouices to kebeles baseu on the iecommenuations of the Woieua Foou
Secuiity Task Foice. These bouies, among othei things i) appiove woieua PSNPBAB clients
baseu on the iecommenuations of the WFSTF; anu ii) ensuie that BAB activities aie in line with
the woieua uevelopment agenua anu the woieua integiateu plan.
The S3%&94 G&6&53H:&1/ @3::"//&& ASG@C is a sub-committee of the Cabinet, establisheu in
all woieuas to oveisee the planning anu implementation of uevelopment piogiammes. As one of
the majoi uevelopment activities in the woieua, the FSP will also be supeiviseu by the WBC with
paiticulai emphasis on integiation anu haimonisation of uevelopment effoits so as to maximise
effectiveness in the use of all iesouices available to the woieua. It is chaiieu by the Woieua
Auministiatoi anu incluues heaus of all sectoi offices (Agiicultuie, Euucation, Bealth, Capacity
Builuing, Women, Youth, anu otheis). It may be meigeu with the .3%&94 !7- 7/&&%"1#
@3::"//&& showeu in the uiagiam above, oi the lattei will function as anothei specialiseu sub-
committee of the woieua Cabinet, as the woieua sees fit best.
The S3%&94 !339 7&8$%"/E ?4;I !3%8& AS!7?!), chaiieu by the Agiicultuie anu Ruial
Bevelopment 0ffice is the bouy iesponsible foi oveiseeing the uay-to-uay implementation of the
BAB component as well as of the othei FSP components
15
. The WFSTF oveisees the taigeting
anu sensitisation of clients as well as the planning anu implementation of BAB activities,
uelegating the uay-to-uay management anu cooiuination of the BABP to the Extension 0nit
suppoiteu by the woieua BABP }oint Technical Committee. In this phase of the FSP, the WFSTF
anu, in paiticulai, the BABP }oint TC on behalf of the WFSTF, will be iesponsible foi the
successful conuuct of the Investment 0ppoitunity Stakeholuei Consultation at the woieua level,
incluuing the facilitation of linkages with impoitant stakeholueis such as local anu Regional
investois anu othei piivate sectoi agents.

1S
In the past in some iegions oi woieuas, WARB0 chaiieu the WFSTF; in othei iegions, it was chaiieu by
the Woieua Auministiatoi. In this phase it is pioposeu that the Woieua Auministiatoi chaii a Woieua FSP
Steeiing Committee that makes moie stiategic uecisions anu has authoiity to uiiect all woieua agencies to
implement the FSP activities which they aie iesponsible foi, whilst the WFSTF chaiieu by the Beau of
ARB0 then makes uecisions at a moie opeiational level anu guiues uay-to-uay implementation by all
agencies, incluuing those outsiue of the ARB sectoi, as manuateu by the woieua FSP Steeiing Committee.
The woieua FS Task Foice membeiship compiises the Foou Secuiity Besk (which acts as secietaiy),
Finance anu Economic Bevelopment, Natuial Resouice Besk, Capacity Builuing, Extension, Inputs anu
Naiketing, Women's Affaiis, Youth, Spoit anu Cultuie, the Small anu Neuium Enteipiise Agency, the
Coopeiative Piomotion 0ffice, Nu0s anu NFIs, anu Watei & Roau offices at woieua level.

62
0pon analysis anu iecommenuations by the BABP }oint TC the WFSTF also
(i) ieviews anu iecommenus kebele annual BABP plans foi appioval;
(ii) ensuies cooiuination between the technical extension anu financial seivice piovision
uimensions of the woieua BABP plan;
(iii) ensuies the integiation of BABP plans anu activities with plans anu activities of othei
FSP components (in paiticulai, looking at issues of BABP coveiage of the PSNP clients
anu ensuiing syneigy between the BABP planneu activities in teims of householu
business plans anu the uevelopment of enabling infiastiuctuie thiough PSNP PW anu
CCI) anu moie geneially the integiation of the BABP plans anu activities with othei
uevelopment activities in the woieua (see section S.S on integiateu woieua planning);
(iv) consoliuates annual woieua BABP plans anu buuget anu piepaies pioposals foi iesouice
allocation to be submitteu to Woieua Cabinet anu then Council;
(v) ensuies iegulai infoimation to anu close collaboiation with the Woieua Council;
(vi) paiticipates in monitoiing anu evaluation of BAB activities;
(vii) pioviues assistance to kebeles in establishing anu tiaining KFSTFs;
(viii) holus quaiteily piogiess ieview meetings on BAB activities; anu
(ix) ieviews monthly piogiess iepoits on BAB activities, also iepoiting on the same to the
iegional level.
The following inuiviuual offices will play a leauing iole in the implementation of the BAB.
The S3%&94 +#%"8$5/$%& 419 2$%45 G&6&53H:&1/ LFF"8& (W0ARB) chaiis the Woieua FSTF
anu with its suppoit anu that of the BABP }oint TC oveisees the integiation of BAB activities
with the othei components of the FSP anu othei uevelopment piogiammes. It will have
paiticulai iesponsibility foi ensuiing that the shift fiom supply-uiiven to uemanu-uiiven seivice
ueliveiy is institutionaliseu. It will ensuie that woieua extension officeis anu BAs aie not
involveu, unuei any ciicumstance, in uisbuising anu collecting loans unuei the BAB.
Within the W0ARB, the JK/&1;"31 T1"/ is the managei of the BABP in the woieua, with the
suppoit of the BABP }oint TC. As such, it plays the leauing anu cooiuinating iole in all activities
entiusteu to the WFSTF (listeu above) in ielation to the BABP. The Extension 0nit manages the
BAs anu as such it is the piime entity iesponsible foi making them auopt the new uemanu-
uiiven appioach unueipinning the BABP. It is also iesponsible foi establishing close links with
othei ARB expeit units anu expeit teams in othei sectois (such as SNE, Youth anu Women) in
oiuei to cooiuinate the suppoit that must be extenueu to BAs in the uevelopment, suppoit to
anu monitoiing of householus' business plans integiating a potentially wiue iange of both on-
anu off-faim activities. The BABP }oint TC, suppoiting the Extension 0nit, will consiuei piactical
moualities to ensuie that BAs get appiopiiate suppoit, foi instance thiough allocating woieua
expeits to specific kebeles, establishing multi-sectoial extension teams foi specific kebeles, etc.
The S3%&94 !339 7&8$%"/E G&;I A!7GC facilitates all BABP activities (it iepoits to the Beau of
W0ARB anu is technically accountable to the RFSC0s). Its functions incluue: i) mobilizing
technical assistance as neeueu; ii) unueitaking monitoiing anu evaluation in cooiuination with
woieua sectoial offices; iii) facilitating the holuing of WFSTF anu BABP }oint TC meetings anu of
quaiteily technical ieview meetings with all implementing agencies; iv) suppoiting the
Extension 0nit in piepaiing anu submitting piogiess iepoits to the Woieua Ruial Bevelopment

6S
0ffice; v) maintaining accuiate iecoius of kebele BAB activities anu list of clients; anu vi)
pioviuing infoimation on taiget aieas anu clients to sectoial offices anu othei agencies involveu
in planning anu implementing FSP.
The S3%&94 LFF"8& 3F !"1418& 419 J8313:"8 G&6&53H:&1/ ASL!JGC (i) ensuies that the
buugets foi the BABP aie ieceiveu in a timely mannei at the woieua level to guaiantee smooth
implementation of appioveu plans anu activities; anu (ii) exeicises necessaiy fiuuciaiy contiols
anu iepoits on funu utilization to Regional B0FEBs.
The S3%&94 @33H&%4/"6& -%3:3/"31 LFF"8& will suppoit the piogiamme's ambition of
impioving financial seivice ueliveiy in CFI aieas thiough a shift fiom woieua iuial uevelopment
office to R0SACC0s foi ueliveiing financial seivices to CFI householus. It will assist in
capacitating existing R0SACC0s anu establishing new ones. It will implement any uiiective
issueu fiom the Feueial anu Regional Coopeiative Piomotion Agency to impiove the iegulatoiy
enviionment within which R0SACC0s function. The 0ffice will also assist the foimation of
householu gioups anu coopeiatives anu assist existing ones in theii activities, as a way of
stiengthening the linkage between householus anu the maiket foi both input supply anu
maiketing of theii piouucts as well as foi value auuition activities.
The M1H$/; 419 D4%I&/"1# $1"/ will play a ciitical iole in the BABP. It will uevelop a stiong
maiket facilitation function anu help ensuie the integiation of householu business plans into
value chains thiough linkages with input supplieis, maiket outlets, anu value auuition activities
wheie appiopiiate. In paiticulai, the Inputs anu Naiketing unit will be iesponsible (anu its
capacity will be built accoiuingly) foi: i) facilitating the Stakeholuei Consultation piocess anu
the uevelopment of business plans foi householus anu gioups thiough auequate infoimation on
maikets; ii) facilitating the establishment of business platfoims to stiengthen linkages between
gioups of actois (faimeis, tiaueis, input supplieis, investois etc.) aiounu paiticulai value
chains; iii) iuentifying input pioviueis anu maiket outlets in ielation to the householus' anu
gioups' activities; iv) linking up with iegional agiicultuial maiketing piomotion agencies,
Chambeis of Commeice, anu coopeiatives; v) linking with ieseaich institutions; vi) iuentifying
tiaining neeus ielateu to stiengthening BAs' anu householus' unueistanuing of maiket
functioning, anu vii) facilitating the piovision of such tiaining.
+55 .3%&94 7&8/3% LFF"8&; have a common iesponsibility foi (i) consoliuating pioposals of the
kebele Foou Secuiity Task Foice foi incoipoiation in the woieua Bouseholu Asset Builuing
plans; (ii) incoipoiating BABP activities in theii yeaily piogiammesaction plans, baseu on the
integiateu woieua plan (see section S.S below); (iii) accoiuingly, piepaiing activity plans anu
iequesting buugets foi implementation; (iv) implementing householu asset builuing activities in
theii fielu, at kebele anu community levels; (v) pioviuing technical assistance anu tiaining to
technical peisonnel anu kebele staff; (vi) paiticipating in monitoiing anu evaluation of the BAB
activities anu of theii effectiveness (incluuing following up householus' piogiess in
implementing theii business plans); anu (vii) piepaiing quaiteily piogiess anu financial iepoits.
UVL;B with theii expeitise in implementing householu asset builuing activities, have an
impoitant iole to play in BAB component of the FSP. As membeis of the Woieua anu Regional
Foou Secuiity Task Foices, they will contiibute theii capacity anu expeitise to the piogiamme
anu also ensuie integiation of theii foou secuiity activities to the oveiall FSP. Selecteu Nu0s will
become membeis of the Technical Committee specially set up foi BAB.



64
S.2.4 KEBELE ANB C0NN0NITY

The W&N&5& @3$18"5 419 @4N"1&/ aie the highest uecision making bouies at kebele level,
appioving the allocation of all iesouices available to the kebele. These bouies i) appiove the
kebele PSNPBAB clients baseu on the iecommenuations of the Kebele Foou Secuiity Task Foice
anu ii) ensuie that FSP activities aie in line with the kebele uevelopment agenua - integiateu in
the oveiall woieua uevelopment plan (see section S.S below).
The W&N&5& G&6&53H:&1/ @3::"//&& AWG@C, wheie it exists, oveisees the planning anu
implementation of uevelopment piogiammes in the Kebele incluuing the FSP. Since the KBC has
an oveiview of uevelopment activities, it is well positioneu to ensuie integiation anu
haimonisation of uevelopment effoits so as to maximise the effectiveness of the use of all
iesouices available to the kebele. It is chaiieu by the Kebele Chaiipeison anu incluues kebele
focal peisons foi Agiicultuie (BA), Euucation (School Biiectoi), Bealth (Bealth Post Beau), anu
otheis.
The W&N&5& !339 7&8$%"/E ?4;I !3%8& AW!7?!CB which was establisheu in all kebeles incluueu
in the PSNP in the pievious phase
16
, will have an extenueu manuate in this phase. It will oveisee
the uay-to-uay planning anu implementation of the FSP as a whole, incluuing the BAB in the
kebele! In ielation to the BABP, the KFSTF's functions incluue: i) facilitating the Investment
0ppoitunity Stakeholuei Consultation at the kebele level; ii) mobilizing communities to iuentify
anu piioiitize theii neeus; iii) suppoiting BAs in the householus' business planning piocess; v)
piepaiing the kebele BABP Plan in consultation with W0ARB anu othei woieua agencies
involveu in the BABP, NFIs anu R0SACC0s; vi) maintaining minutes of KFSTF meetings on BAB
issues, lists of paiticipants anu piogiess iepoits; vii) establishing anu tiaining Community Foou
Secuiity Task Foices; anu viii) paiticipating in monitoiing anu evaluation of BAB activities.
W&N&5& +HH&45; @3::"//&&; AW+@;C have also been establisheu in all kebeles incluueu in the
PSNP in the pievious phase. In this phase, they will be fuithei stiengtheneu (as inuicateu in the
FSP uocument) anu theii manuate will extenu to auuiessing giievances anu appeals ielateu to
all FSP activities. With iegaiu to the BABP they will auuiess appeals in ielation to the taigeting
foi the cost shaiing component of the BABP. Among othei iesponsibilities the KACs will (i)
submit a complete listing of appeals cases, appeals iesolutions, anu uniesolveu appeals to the
Kebele Council, which will ieview them anu foiwaiu them to the Woieua Council anu the
W0ARB eveiy quaitei; (ii) meet within one month of the establishment of a new annual listing
of clients to heai appeals submitteu in theii juiisuiction anu to iesolve a minimum of 9S% of
these cases within the month; anu (iii) pioviue the listing of the appeals anu the associateu
iesolutions to the Kebele Council no latei than 2 months aftei the announcement of the clients
listing.
In ielation to the BABP the @3::$1"/E !339 7&8$%"/E ?4;I !3%8& A@!7?!C
OX
is iesponsible
foi: i) facilitating the Investment 0ppoitunity Stakeholuei Consultation at the community level;
ii) mobilizing householus so that they engage fully in the BABP; iii) suppoiting the BAs in the
oiganisation of gioup tiaining; iv) iuentifying those householus that will benefit fiom the cost

16
The minimum composition of the KFSTF incluues: a Chaiipeison of the Kebele council, a membei fiom
the Kebele Council, Bevelopment Agents (BAs); thiee electeu iepiesentatives of women's gioups; anu two
electeu iepiesentatives fiom elueis anu youth (one fiom each gioup).
17
It is composeu of iepiesentatives fiom the Kebele FSTF; a Bevelopment Agent, two to thiee each of
women's anu men's iepiesentatives (electeu); a youth iepiesentative (electeu); anu an elueis'
iepiesentative (electeu).

6S
shaiing component of the householu asset builuing, in line with the agieeu taigeting ciiteiia;
anu iv) monitoiing the link between BAB anu othei components of the FSP in the community.
2$%45 746"1#; 419 @%&9"/ @33H&%4/"6&; aie the piimaiy choice foi ueliveiy of financial seivices
to CFI householus, piimaiily to impiove financial seivice ueliveiy but also to ielieve extension
staff fiom uisbuising anu collecting loans. This is expecteu to impiove ielations between
extension woikeis anu faimeis anu significantly contiibute to effectiveness of the extension
seivice.
The uetails of how R0SACC0s will pioviue financial seivices to the CFI householus will be
pioviueu in an agieement to be signeu. Bioauly speaking, R0SACC0s will mobilise savings;
ensuie that financial seivices ieach the iight taiget CFI householus; monitoi anu follow up loan
uisbuisement anu timely iepayment; anu ensuie funus ievolve among the taiget community.
The G&6&53H:&1/ +#&1/; (BAs), employees of the Extension Bepaitment in the 0ffice of
Agiicultuie anu Ruial Bevelopment but iesiuent in the kebeles, play a key facilitation iole in
BAB implementation. They i) aie membeis of both the KFSTF anu CFSTF; ii) suppoit the CFSTF
in piioiitising community neeus anu piepaiing annual BAB plans; iii) assist householus in the
piepaiation anu implementation of business plans, ensuiing that the business plans aie the
outcome of householu uecisions not a supply (package) uiiven appioach of the past.
@5"&1/; 419 131Q85"&1/ 03$;&0359; paiticipate in public meetings on BABP that taiget clients
anu ueteimine multi-yeai annual plans. Community membeis paiticipate in the consultative
meetings to iuentify viable householu-level investment oppoitunities. They uevise business
plans, seek suppoit fiom local financial seivice pioviueis anu implement theii business plans
ovei time. Client anu non-clients alike also play a key iole in holuing implementeis to account
thiough the KAC anu public foia.
S. S. PR0uRANNE PLANNINu
S.S.1 W0REBA INTEuRATEB PLANNINu
As alieauy noteu, the BABP is ciitical foi achieving giauuation at scale anu foi this theie must be
syneigy between it anu the othei components of the FSP. The institutional aiiangements
outlineu above shoulu facilitate this syneigy, but the ciitical mechanism thiough which it will be
opeiationaliseu is the kebele anu woieua planning piocess. At this level, theie neeu to be
systems anu pioceuuies in place so that, foi instance, wheie iiiigateu hoiticultuie is iuentifieu
as a suitable oppoitunity foi CFI householus in a paiticulai community (with potential foi
iiiigation anu ieasonable access to maiket), all the iequiieu activities to make this a ieality aie
planneu anu implementeu in a cooiuinateu mannei. This incluues implementing the PW oi CCI
to constiuct the necessaiy infiastiuctuie, pioviuing auvice anu tiaining on hoiticultuial
piouuction, facilitating links with input pioviueis (seeus, seeulings, tieaule pumps, iiiigation
systems etc.), iuentifying maiket outlets, possibly facilitating the foimation of gioups to
unueitake value-auuing piocessing activities etc. Noieovei, all of these activities neeu to be
closely cooiuinateu with FSP activities aimeu at ueveloping othei oppoitunities, anu with the
othei uevelopment initiatives taking place in the aiea. The woieua plan is wheie plans foi the
BAB, foi the othei FSP components anu foi othei uevelopment piogiammes must "come
togethei".
As noteu in the FSP uocument, integiateu planning foi the FSP activities, anu within this foi the
BABP activities, iequiies in the fiist instance stiengthening the oveiall kebele-woieua planning
piocess. This has been iecogniseu anu N0FEB is in the piocess of ieviewing woieua planning

66
guiuelines. The FSP stakeholueis aie engageu in this piocess with a view to ensuiing that the
outcome of this piocess is iesponsive to the neeus of the FSP planning. In ielation to BABP
planning it is paiticulaily impoitant to stiengthen the syneigy between householu asset builuing
inteiventions anu community asset uevelopment thiough the PSNP PW anu CCI. This iequiies,
among otheis, guiuelines foi the woieua to be able to ieconcile wateisheu uevelopment
planning which is the coineistone of the PSNP PW anu CCI planning at kebele then woieua level,
anu planning foi livelihoou options which uiaws on othei concepts such as maiket absoiption
capacity anu uevelopment, anu othei techniques incluuing technical analyses of investments,
value chain analyses etc.
What neeus to happen, at a conceptual level, is illustiateu in the uiagiam below.
M1/&#%4/&9 *+, 419 36&%455 .3%&94 H5411"1#



FSP stakeholueis will ensuie that the N0FEB team woiking on woieua planning guiuelines
unueistanus well the BAB piogiamme anu the piocesses that neeu to be planneu to implement
it, so that these aie incluueu in the guiuelines. In tuin, the ieviseu woieua planning guiuelines
will be ieflecteu (anu expanueu if neeu be) in the BAB Piogiamme Implementation Nanual.
<YZYPY -[+UUMUV !L2 *+,-
This section piesents a snapshot (in the foim of the table below) of the BABP activities that neeu
to be planneu (anu implementeu accoiuingly) accoiuing to paiticulai timefiamesonce,
iegulaily oi annually. Annual activities aie those that woieuas shoulu plan as pait of the woieua
planning piocess (as outlineu in the pievious section), in line with the annual planning anu
buugeting cycle. They must be planneu anu buugeteu foi following the Ethiopian Fiscal Yeai
cycle. This conceins in paiticulai the conuuct of the Stakeholuei Consultation. Activities
implementeu by BAs aie not listeualthough they aie ciitical to piogiamme implementation
as theii technical assistance anu auvice to CFI householus aie incoipoiateu in theii iegulai
uuties anu will be ongoing thioughout the life of the pioject. As 0utputs S anu 6 aie cioss-
cutting to the othei foui, they aie not listeu sepaiately in the time scheuule outlineu below.
0utputs 1, S anu 4 aie listeu sepaiately.



67
Activity Main Implementer Timeframe
Initial Repeat Annual
Output 1
Conduct market/VC analyses Private consultants with woreda
experts, Region when relevant
\ \
Conduct technical analyses Private consultants with woreda
experts, research centres, Region
when relevant
\ \
Conduct stakeholder consultation HABP Joint Technical Committee
\ \
Prepare recommendations on investment
opportunities
Private consultants with woreda
experts
\ \
Identify infrastructure requirements for
consideration for integration in PSNP
PWs/CCI
DAs and woreda experts
\ \
Assess business/market orientation skills
of extension service staff (CFI woredas)

\ \
Prepare training curriculum in business
skills and market orientation
ATVETs, regional universities,
private consultants
\ \
Provide training to woreda experts and
DAs
ATVETs, regional universities,
private consultants
\ \
Assess knowledge of DAs and woreda
experts on off-farm activities
SMEA with Federal and Regional
Off-Farm Case Team
\ \
Create Off-Farm Case Teams at regional
and woreda levels
Federal Off-Farm Case Team
with Regions
\
Prepare training curriculum on off-farm
investment promotion
SMEA with Regional Off-Farm
Case Teams
\ \
Provide training in off-farm activities SMEA with Regional Off-Farm
Case Teams
\ \
Output 2

Assess MFI and RUSACCO coverage
and capacity
Financial services consultant with
AEMFI
\ \
Develop appropriate incentives and sign
MOUs with MFIs
HABP TC (Regions)
\ \
Develop financial products with MFIs and
RUSACCOs
Financial services consultant with
AEMFI and HABP TC (regional)
\ \
Prepare plan for creation of RUSACCOs Cooperative Promotion Bureaus
\ \
Assess households confidence, skills
and knowledge in business investments
and financial literacy
Private consultant with MFIs and
AEMFI
\ \
Prepare financial literacy training
curriculum
Private consultant with MFIs and
AEMFI
\ \

68
Provide training to DAs MFIs and other service providers
\ \
Output 3

Assess input facilitation skills and
capacity gaps of DAs and woreda
experts
Private consultant with ATVETs
\ \
Prepare training curriculum in input
facilitation skills and demand-driven
service delivery
ATVETs, Regional Research
Institutes, Regional Rural
Technology Development
Institutes,
\ \
Provide training to woreda experts and
DAs in input facilitation skills
ATVETs

\ \
Provide training to woreda experts and
DAs in seed and seedling multiplication
Research centres
\ \
Output 4

Assess marketing facilitation skills of DAs
and woreda experts

\ \
Prepare training curriculum in marketing
facilitation skills
ATVETs
\ \
Provide training ATVETs
\ \

S. 4 C0ST ESTINATE ANB FINANCINu PLAN
The basic paiameteis useu in the calculation of the costings: numbei of Regions, woieuas,
kebeles, FTCs anu R0SACC0s aie shown below. Tables S anu 4 below aie incluueu foi
infoimational puiposes only anu aie inuicative to infoim final buuget calculations. They shoulu
not be consiueieu final anu Table 4 in paiticulai shoulu not be consiueieu binuing.
?4N5& ZY ,4;"8 G4/4) U$:N&%; 3F 2&#"31;B -7U- S3%&94;]I&N&5&;B 2@, -%3^&8/
S3%&94;]I&N&5&; 419 1$:N&%; 13/ 836&%&9 NE 2@, -%3^&8/_ H5$; 1$:N&% 3F &K";/"1# 419
%&`$"%&9 2T7+@@L;B 4;;$:"1# O 2T7+@@L H&% I&N&5&Y



69
?4N5& (Y *+,- @3;/ J;/":4/&;

S. S. SPECIAL C0NBITI0NS ANB ACC0NPANYINu NEAS0RES T0 BE TAKEN
BY u0vERNNENT
The Bouseholu Asset Builuing Component will be laigely staffeu by coie uoveinment of Ethiopia
staff, paiticulaily within the Ninistiy of Agiicultuie anu Ruial Bevelopment. 0f paiticulai note
has been the effoits maue by goveinment to put in post thiee BAs in each kebele (incluuing
kebeles wheie the BAB Component will be opeiational). This has uiamatically incieaseu the
human iesouices available to this anu othei piogiammes. The uoveinment will continue to
pioviue the majoiity of the staffing iequiieu foi BAB Component implementation thiough
mainstieam goveinment buugets.
Fuithei woik will take place ovei coming months to iefine the ioles anu iesponsibilities foi the
BAB Component of the vaiious goveinment uepaitments anu to finalise the management
stiuctuie (incluuing any necessaiy technical committees). This piocess will be finisheu piioi to
Septembei 2uu9. The final agieeu ioles anu iesponsibilities will be uocumenteu in a
Nemoianuum of 0nueistanuing which will be signeu by all ielevant paities.
It is anticipateu that BAB Component planning will be one component of the oveiall woieua anu
iegional planning piocesses. This planning piocess is cuiiently being ievieweu by NoFEB anu it is
ciitical that the BRNFSS feeu into the ievision piocess to ensuie that the ieviseu planning piocess
incluues a Community Baseu Paiticipatoiy Wateisheu Planning appioach anu ieflects the neeus of
BAB Component planning.
Two key pilots aie cuiiently ongoing in the CFI woieuas:
The -4;/3%45 +%&4; -"53/ is testing vaiious implementation moualities foi a planneu
expansion of the PSNP to pastoial iegions. This pilot, togethei with othei pastoial
livelihoous piogiammes such as the Woilu Bank-funueu Pastoial Community
Bevelopment Piogiamme (PCBP) anu vaiious 0SAIB-funueu piogiammes, aie ciitical foi
geneiating the lessons leaineu foi the scale-up of the BABP to pastoial aieas. The Pastoial
Task Foice is iesponsible foi analysing the lessons leaineu anu pioviuing
iecommenuations to the Foou Secuiity Piogiamme.

7u
The a4%"4N5& [&6&5; 3F 7$HH3%/ AZQ=QbC H"53/ is on a much smallei scale anu is ieviewing
the possibility of pioviuing householus with uiffeient numbeis of months of tiansfeis (S, 6
oi 9) on the basis of theii annual foou gap. In auuition to allowing the piogiamme to be
moie iesponsive to actual neeus, this appioach may allow a phaseu appioach to
giauuation which might bettei enable householus to withuiaw fiom piogiamme suppoit.
If scaleu up, this tieieu appioach can help with taigeting of clients foi the seivices
pioviueu in 0utput 2.
The uoveinment will continue to suppoit these pilots anu ensuie auequate lesson leaining to
enable iesults to be auopteu in mainstieam piogiamming.

71
6 FACT0RS ENS0RINu S0STAINABILITY

6. 1 P0LICY S0PP0RT ANB C00RBINATI0N
The policy enviionment is suppoitive of the pioposeu BABP. Inueeu, it is envisageu that the
new pioposals in the BAB component will acceleiate the implementation of seveial policy iueas
that
have been put foiwaiu in the vaiious policy anu stiategy uocuments, such as: (i) the sepaiation
of extension fiom financial seivices; (ii) the establishment of sustainable iuial finance thiough
the use of NFI anu financial coopeiatives; (iii) an unpieceuenteu focus on maiketing linkages,
anu (iv) the uevelopment of off-faimnon-faim income geneiating activities as instiuments foi
achieving the fastest path to giauuation.
The new BABP iequiies a gieatei uegiee of cooiuination than pieviously as a numbei of new
playeis aie enteiing the foou secuiity piogiamme. Foi instance, in view of the iecognition of off-
faimnon-faim activities as key to ensuiing foou secuiity, the Foou Secuiity Biiectoiate neeus to
cooiuinate pioactively with institutions such as the NinistiyBuieau of Women's Affaiis anu
Youth anu Spoit, anu the Small anu Neuium Enteipiise Bevelopment Agency.
6. 2 EC0N0NIC ANB FINANCIAL ISS0ES
The Ethiopian economy has been giowing by ovei 1u% foi the last five yeais, laigely as a iesult
of agiicultuial sectoi giowth. If this iate of giowth is sustaineu, it will cieate an enabling
enviionment foi the BABP. Economic giowth will cieate new oppoitunities foi householus to
invest in on- anu off-faim activities, theieby suppoiting the piogiamme's objectives.
Availability of finance foi CFI householus is key to the success of BABP. It is also equally
impoitant that the teims anu conuitions be flexible anu affoiuable to these householus. The
piogiamme will theiefoie invest significant iesouices in the achievement of 0utput 2.
6. S INSTIT0TI0NAL ANB NANAuENENT CAPACITY
The BABP has paiu uue attention to institutional anu management capacity because capacity is
key to sustainability of the pioposeu systems (e.g. piovision of sustainable iuial finance). A
sepaiate output (0utput S) is ueuicateu to these activities in oiuei to make it possible foi the
piogiamme to monitoi anu evaluate to what extent capacity has been auuiesseu at all levels.
6. 4 TECBNICAL ISS0ES, INCL0BINu REu0LAT0RY ANB 0PERATI0NAL
6.4.1 TECBNICAL BESIuN ELENENTS

A key piinciple guiuing the uesign of the Bouseholu Asset Builuing Component has been the
neeu to cieate a moie efficient, iesponsive anu uemanu uiiven appioach to the Extension
System. The technical uesign of the Component has focuseu on the following key elements:
M1/&#%4/&9 &K/&1;"31B "1H$/ ;$HH5E 419 :4%I&/ 5"1I4#&;. 0ne of the key pillais of
PASBEP is a maiket leu appioach to agiicultuial uevelopment. Bitheito the extension
appioach has focuseu almost entiiely on commouity piouuction. The BABP has been
uesigneu to incluue a wiuei iange of input supplieis anu uistiibutois anu an attention given
to value chains (stoiage, piocessing, anu quality contiol) anu stiongei linkages with maiket
playeis.

72
G&:419 9%"6&1 4HH%3480 /3 &K/&1;"31. This uepenus on iuial householus gaining
knowleuge, skills anu self-confiuence to embaik on a moie uiveisifieu iange of asset builuing
anu income geneiating investments. The BABP uesign iecognizes the neeu to expanu the
iange of potential investments to incluue both agiicultuial anu non-agiicultuial off-faim
activities.
7&H4%4/"31 3F &K/&1;"31 419 F"1418"45 ;&%6"8&;. The inappiopiiateness of the combination
of extension anu financial seivice piovision was a key lesson leaineu fiom the pievious
phase of the piogiamme. The piogiamme uesign theiefoie incluues a heavy emphasis on
builuing the capacity of financial seivice pioviueis to ieach CFI householus.
!38$; 31 "1;/"/$/"3145 84H48"/E N$"59"1# 419 03$;&0359 831F"9&18& N$"59"1#. The
technical uesign iecognizes the impoitance of these two unueilying factois in the success of
the oveiall piogiamme anu has theiefoie ueuicateu two 0utputs to builuing institutional
capacity (in teims of management, facilitation skills, anu technical issues) anu householu
confiuence.
6.4.2 LEvELS 0F TECBN0L0uIES

The BABP suppoits technological innovation thiough linkages to input anu equipment supplieis.
The piogiamme will link faimeis to souices of ieseaich-testeu technologies uevelopeu by
ieseaich stations anu piivate companies, with a focus on appiopiiate technology to ensuie theii
appiopiiateness to local agio-ecological anu faim management conuitions. 0ff-faim non-
agiicultuial technologies will emanate fiom the Ruial Technology Bevelopment Institutes, who
will be membeis of the RegionalZonal level Faimei-Reseaich-Extension Auvisoiy Councils, anu
fiom expeiience gaineu in the implementation of the miciosmall scale enteipiise uevelopment
piogiamme of the Buieau of Tiaue anu Inuustiy.
The BABP uesign also suppoits the uevelopment by faimeis themselves of innovative solutions
to piouuction, stoiage anu piocessing pioblems that may aiise uuiing implementation of
agiicultuial baseu investments.
6.4.S u0vERNNENT REu0LAT0RY R0LE IN 0SE ANB BEvEL0PNENT 0F
TECBN0L0uIES
The piogiamme suppoits a wiuening of the iange of input piouuceis anu uistiibutois. The
uoveinment's iole is in the ceitification of basic seeu, quality contiol, anu oiganizational anu
technical assistance to small-scale piouuceis in seeu multiplication.
6. S ENvIR0NNENTAL PR0TECTI0N
The BABP will contiibute to positive enviionmental outcomes by suppoiting sustainable
agiicultuial piactices foi ciop, livestock anu tiee piouuction. The Component will auopt the
Enviionmental anu Social Nanagement Fiamewoik (ESNF) of the PSNP. The ESNF incoipoiates
a Stiategic Enviionmental Assessment (SEA), which iuentifies ceitain cumulative impacts that
might ieasonably be expecteu to occui. Because it is not possible to pieuict what activities might
be unueitaken, anu wheie, anu because of the potentially veiy laige numbei of BABP activities
that might be unueitaken, a fiamewoik appioach is auopteu. Thus, a pioceuuie will be in place
to (i) avoiu oi mitigate such impacts befoie they occui, anu (ii) monitoi the implementation of
the mitigating measuies. The ioles anu iesponsibilities at uiffeient level aie as follows:

7S
At woieua level, the Natuial Resouices Expeit within W0ARB is iesponsible foi implementing
the ESNF pioceuuies (notably the BABP SEA), in conjunction with the Enviionmental Specialist
in the woieua Enviionmental Piotection 0ffice (EP0).
The Feueial PW Cooiuination 0nit (PWC0) is iesponsible foi cooiuination, oveisight anu
technical suppoit; while the iegional Public Woiks Focal 0nits (PWF0s) ensuies that the ESNF
is implementeu in theii iespective iegion, anu manages the piocess.
6. 6 S0CI0-C0LT0RAL ANB uENBER ISS0ES
6.6.1 ENP0WERNENT ANB C0NFIBENCE B0ILBINu 0F CFI B00SEB0LBS

The Investment Stakeholuei Consultation piocess that foims a key element of 0utput 1 is
uesigneu to uevelop foou insecuie householus' knowleuge, skills anu financial awaieness to
pioviue them with self-confiuence to unueitake asset builuing anu income geneiating
investments of theii own choice. In this way, paiticipation will be incieaseu anu householus will
be empoweieu to iuentify theii own pioblems, uevelop solutions themselves anu so impiove
theii own livelihoous.
6.6.2 uENBER EQ0ALITY

Fiom the inception of the piogiammeanu paiticulaily thiough the stakeholuei consultation
piocess uesciibeu in 0utput 1, women will be key paiticipants in the planning piocess of the
piogiamme. Piogiamme inteiventions such as tailoieu householu business plan uevelopment
anu householu confiuence builuing activities will take into account the specific neeus anu
capacities of women in both male- anu female-heaueu householus. This coulu incluue attention
to low levels of asset holuings (in paiticulai lanu), in paiticulai householu laboui availability
anu availability of uiaught powei. The piogiamme will pay special attention to women's neeus
in teims of business skills anu financial liteiacy tiaining.
The piogiamme will also ensuie auequate iepiesentation of women on the FREus anu FREACs
anu pioviue tiaining to enable them to actively paiticipate at all levels of piogiamme
implementation.
6.6.S BIvAIBS

None of the activities envisageu unuei this Component aie expecteu to inciease iisk of BIv
tiansmission among taiget populations. The specific neeus of householus affecteu by BIvAIBS
will be consiueieu in the uevelopment of tailoieu householu business plans anu the piomotion
of off-faim activities foi laboui-pooi householus.



74
7 PR0uRANNE PERF0RNANCE: N0NIT0RINu ANB
EvAL0ATI0N ANB ACC00NTABILITY
7. 1. N0NIT0RINu ANB EvAL0ATI0N
The Bouseholu Asset Builuing Piogiamme has an integiateu logical fiamewoik uesigneu to
achieve its 0utcome anu ultimately the uoal of the Foou Secuiity Piogiamme. The fiamewoik
fits within the oveiall FSP logfiame anu outlines objectively veiifiable inuicatois anu means of
veiification at 0utput, 0utcome anu uoal levels. This is one impoitant founuation foi the BABP
monitoiing anu evaluation system. The BABP N&E system is also conceiveu as a pait of that foi
the bioauei FSP.
As noteu in the FSP uocument, in this phase the focus will be on ensuiing that the Foou Secuiity
Piogiamme N&E system is uiiectly useful foi all FSP stakeholueis; that is, implementeis,
planneis, uecision-makeis, oveisight bouies, financieis anu clients. The N&E system will captuie
the infoimation necessaiy to ensuie that feeuback on piogiamme peifoimance enables the
aujustment of piogiamme implementation oi even uesign if iequiieu. These piinciples apply to
the uesign of the BAB N&E fiamewoik as well. Noieovei, the N&E system will enable
accountability at all levels:
! Among uoveinment agencies anu between uoveinment anu Bevelopment Paitneis, along the
lines of the institutional aiiangements foi the BABP outlineu in section S.2 above
! Fiom the piogiamme implementing agencies to the piogiamme clients; that is, the
householus eligible to benefit fiom BABP activities.
Fuithei woik will take place in the peiiou pieceuing the stait of implementation of the seconu
phase of the FSP to uevelop the FSP N&E fiamewoik anu that foi each of its components,
incluuing the BABP. This will be a consultative piocess involving all cuiient anu potential useis
of N&E uata anu infoimation. In-uepth uiscussion will be helu with the institutions having key
iesponsibilities foi unueitaking iegulai monitoiing anu peiiouic assessments anu evaluations.
The woik will incluue the final ueteimination of inuicatois foi the FSP as a whole anu foi the
BAB piogiamme, as well as the iuentification of infoimation souices, collection appioaches anu
institutions iesponsible foi collection anu analysis.
0f ielevance foi the BAB, the FSP N&E fiamewoik will auuiess challenges left outstanuing in the
pievious phases. Notably, paiticipatoiy monitoiing will be opeiationaliseu anu theie will be
gieatei attention to following up of piogiamme achievements in ielation to special categoiies of
piogiamme clients such as women, youth, anu the 'ultia-pooi' householus benefiting fiom the
cost-shaiing element in the BAB piogiamme.
The N&E fiamewoik foi the BABP will covei the monitoiing of financial seivice piovision to
piogiamme clients by the NFIs anu R0SACC0s. This will incluue iegulai assessments of
stakeholueis' compliance with the agieements signeu to opeiationalise the channelling of
financial suppoit fiom the piogiamme (see Figuie S above). Inuicatois anu tools will also be
uevelopeu to monitoi the actual level of piovision of seivices to piogiamme clients, in a way
which is compatible with the financial anu coopeiative sectoi iegulatoiy fiamewoik.
Subject to valiuation in the couise of the woik outlineu above, the following bioau categoiies of
achievements of the BABP will be measuieu anu monitoieu:


7S
+8/"6"/EQ5&6&5 "19"84/3%;) The extent to which the taigeteu clients anuoi theii
institutional stiuctuies utilise the vaiious foims of suppoit pioviueu (iesouice
management anu utilisation inuicatois focuseu at the activity level). Bay-to-uay
supeivision anu iecoius of piogiamme anu paitnei staff, along with the quaiteily
ieviews will pioviue the main oppoitunities to assess inuicatois at this level. These may
incluue the following:
o Numbei of householu anu gioup business plans uevelopeu thiough piogiamme
suppoit
o volume anu value of loans given thiough the piogiamme's line of cieuit
o Numbei of R0SACC0s cieateu anu new NFI bianches openeu in CFI woieuas as a
iesult of piogiamme tiaining anu incentives
o Numbei of woieua expeits anu BAs tiaineu in business skills, maiket
oiientation, anu facilitation techniques
o Numbei of householus paiticipating in stakeholuei consultations anu ieceiving
financial liteiacy tiaining
L$/H$/ "19"84/3%;) The success of the piogiamme in iealising the iesults of action plans
oi inputs anu ueliveiing 0utputs, incluuing the valiuity of Activity-to-0utput
Assumptions in the BABP logfiame. The annual woieua level ieviews will pioviue the
main oppoitunity to assess inuicatois at this level, anu to ensuie that the piogiamme is
on tiack to achieving its expecteu 0utcome anu iuentify any aujustments neeueu. The
iesults of the vaiious suiveys will also infoim aujustments in piogiamme activities.
Possible inuicatois incluue:
o Savings anu loan iepayment iates of paiticipating financial institutions in CFI
woieuas
o Rate of auoption of new technologies by client householus
o Numbei of paiticipating householus making new investments in input supply oi
uistiibution
o Numbei of paiticipating householus making new investments in off-faim
activities
o Numbei of householus accessing new laboui oppoitunities thiough piogiamme
linkages
o Numbei of BAs in CFI woieuas with impioveu facilitation skills
o Timeliness anu quality of piogiamme iepoiting
o Numbei of paiticipating householus iepoiting incieaseu knowleuge anu
confiuence in investing in new technologies oi IuAs, paiticipating in maikets, anu
accessing cieuit
o Numbei of paiticipating householus taking loans foi the fiist time


76
M:H48/ "19"84/3%; AL$/83:&Q 419 V345Q5&6&5C) The changes that aie biought about foi
the uiiect anu inuiiect clients anuoi theii institutional stiuctuies as a iesult of the
activities initiateu by the piogiamme (impact inuicatois) will laigely be the
iesponsibility of inuepenuent assessments incluuing the biannual householu suivey anu
the PSNP anu CCI impact assessments. Theie will be a neeu to monitoi the valiuity of
0utput-to-0utcome Assumptions in the BABP logfiame to ensuie that the inteivention
logic will holu anu that the planneu 0utcome is likely to be achieveu. Systems foi such
monitoiing will be uevelopeu piioi to Piogiamme stait-up. Possible 0utcome anu uoal-
level inuicatois incluue:
o Inciease in value of assets of paiticipating householus
o Inciease in uiveisity of income souices of paiticipating householus
o Reuuction in numbei of foou gap months foi paiticipating householus
o Peicentage of paiticipating householus achieving foou sufficiency
o Peicentage of paiticipating householus achieving foou secuiity
0ne impoitant aspect of the uevelopment of the FSP N&E fiamewoik will be to assess the tools
anu iepoits alieauy existing in oiuei to expanu, ievise, stieamline anu complement them as
iequiieu to catei foi the expansion of the scope of the piogiamme anu ensuie that inuicatois,
tools anu iepoits aie integiateu acioss FSP component piogiammes wheievei possible, anu to
bettei inuicate what theii use will be (by whom anu foi what). Existing monitoiing anu
evaluation tools will be ieviseu anu bioaueneu following the ievision of the Nonitoiing anu
Evaluation Fiamewoik.
Among existing tools anu iepoits that will be ieviseu in this way, the following tools aie
applicable to the BABP:

DcJ ?335]2&H3%/ M1F3%:4/"31 "/ ."55 H%36"9&
D31"/3%"1#
%&H3%/;
Regulai collection of infoimation at output anu activity level.
Bata collecteu will incluue infoimation on clients, uptake of
financial seivices anu extension suppoit. Theie is also a neeu to
ensuie that uata is collecteu in iesettlement sites.
M1F3%:4/"31
@&1/%& %&H3%/"1#
This cuiiently focuses on PSNP-specific uata, will be expanueu
to potentially incluue a key set of inuicatois on the Bouseholu
Asset Builuing component of the piogiammesee logfiame anu
potential inuicatois listeu above.
d$4%/&%5E M!2;
The quaiteily (anu annual) financial iepoits pioviue
infoimation on buuget expenueu accoiuing to agieeu line items.
+11$45 H5411"1#
%&6"&.
This ieview assesses the auequacy of integiateu woieua plans.
The ieview will assess the planning piocess anu the quality of
the iesulting plans.
2&6"&. 3F
03$;&0359 4;;&/
N$"59"1# H%3#%&;;
Nany woieuas aie now conuucting annual ieviews of householu
assets to assess piogiess to achieving asset benchmaiks. This
expeiience will be scaleu up anu may be maue moie fiequent.
Theie is also a neeu to ensuie that uata is collecteu in
iesettlement sites.
2&6"&. 3F This tool will pioviue an inuepenuent assessment of piogiess

77
DcJ ?335]2&H3%/ M1F3%:4/"31 "/ ."55 H%36"9&
H%3#%&;; /3.4%9;
#%49$4/"31
towaius giauuation to complement the above ieview of
householu asset builuing piogiess.
+$9"/;

Auuits will fulfil thiee functions: auuit of accounts; systems
auuit; anu ieview of tiansactions to clients to ensuie that funus
uisbuiseu aie useu foi puiposes intenueu. Existing ioving anu
annual auuits will be amalgamateu into one stieamlineu auuit
piocess with quaiteily as well as annual iepoiting.
236"1# +HH&45;
+$9"/
This inuepenuent auuit looks at whethei piopei pioceuuies aie
followeu anu iecoius kept in the appeal system.
-%38$%&:&1/
+$9"/
Will ieview pioceuuies followeu, auheience to guiuelines anu
make iecommenuations on how piocuiement coulu be
impioveu in futuie.
-41&5 7$%6&E

Eight woieua suivey, which incluues iepeat visits to householus
as the appioach to assess piogiess towaius outcomes anu
impacts. Smallei sample size allows iapiu calculation of iesults.
,"411$45
*3$;&0359 7$%6&E
The householu suivey assesses outcomes anu impacts of all
components of the FSP in chionically foou insecuie woieuas.
Theie is also a neeu to ensuie that uata is collecteu in
iesettlement sites.
7. 2. ACC00NTABILITY F0R PERF0RNANCE
As explaineu in the FSP uocument, in this phase of the FSP theie will be gieatei focus on
stiengthening bottom-up accountability, as a way of piessing foi piogiamme peifoimance. A
vaiiety of means will be useu to auuiess this challenge, notably: stiengthening the
implementation of the FSP-wiue communication stiategy, intiouucing a system of FSP client
caius, fuithei stiengthening the appeals system, anu the intiouuction of peifoimance incentives.
All of these measuies have a beaiing on the BABP.
Stiengthening 83::$1"84/"31 will pioviue piogiamme clients with the infoimation that they
must have in oiuei to holu implementeis to account. The way in which the communication
stiategy will be stiengtheneu anu iolleu out is uesciibeu in the FSP uocument. With iegaiu to
the BABP, communication activities planneu anu implementeu as pait of the stiategy will
iepiesent an impoitant vehicle foi the key messages unueipinning the piogiamme. Piioiity will
be given to ueveloping anu uisseminating messages that explain the majoi shifts unueitaken in
the BABPtowaiu uemanu-uiiven extension, the piovision of financial seivices by specialiseu
seivice pioviueis, anu the move away fiom subsiuies that uistoit the financial maiket.
Anothei measuie aimeu at impioving tianspaiency in piogiamme implementation anu
stiengthening accountability to piogiamme paiticipants will be the intiouuction of !7- 85"&1/;e
84%9;Y The piimaiy objective of the system is to pioviue piogiamme clients with an incieaseu
sense of ceitainty ovei theii entitlements anu a pioof of the seivices that they actually ieceive
fiom the piogiamme. While in the fiist instance the system will likely focus on the PSNP, the
intention is to incluue infoimation on the implementation of the BAB piogiamme too (e.g. access
to cieuit seivices, to tiaining piogiammes etc.), once the system has uemonstiateu its usefulness
in a simple veision.

78
In this phase of the piogiamme, H&%F3%:418& "18&1/"6&; linkeu to success in piogiamme
ueliveiy will be intiouuceu. This is fuithei outlineu in the FSP uocument. The intention is to
uevelop the system ovei time so that eventually it coveis all components of the Foou Secuiity
Piogiamme. Again, while it shoulu be ielatively easy to put a system in place foi the PSNP, theie
is an oppoitunity to stait implementing the peifoimance incentive system foi the BABP at the
same time as piogiamme implementation begins. Fuithei woik will theiefoie take place uuiing
the final stages of piepaiation of the BABP to iuentify how this coulu be uone (i.e. what kinu of
peifoimance inuicatoi anu taigets coulu be useu anu foi which 'level', inuiviuual oi
oiganisational, to stait with). Paiticulai attention will be paiu to iuentifying inuicatois anu
taigets that pioviue incentives foi implementing agencies anu actois to auheie to the uemanu-
uiiven appioach unueipinning the BABP.



79
ANNEX 1: INTEuRATEB PLANNINu F0R BAB ANB 0TBER
FSP C0NP0NENTS












1
ANNEX 2: B00SEB0LB ASSET B0ILBINu PR0uRANNE 2u1u - 2u14 L0uICAL FRANEW0RK

Hierarchy of Objectives Objectively Verifiable Indicators Means of
Verification
Assumptions
!"#$% '()*

Foou secuiity
1
foi chionic anu tiansitoiy foou insecuie
householus in iuial Ethiopia achieveu

!"#$%#&''( *$+,(-,.
1. By 2u1S, 8u% of all householus in
iuial Ethiopia access sufficient
foou at all times foi an active anu
healthy life in the absence of PSNP
tiansfeis |foou secuiityj
2. By 2u1S malnutiition among
chiluien unuei 2 yeais of age
uecieases by 1.S% pei yeai on
aveiage

National nutiition
suiveys


FSP panel suivey
0thei national
foou secuiity
suiveys

'()*

Foou secuiity status foi male anu female membeis of
foou insecuie householus in chionically foou insecuie
(CFI) woieuas impioveu
!"#$%#&''( *$+,#/01,(2 ,$ ,3/2.
1. Su% of male anu female membeis
of chionically foou insecuie
householus paiticipating in PSNP
public woiks access sufficient
foou at all times foi an active anu
healthy life in the absence of FSP
suppoit by 2u14 |foou secuiityj
2. 8u% of male anu female membeis
of chionically foou insecuie
householus paiticipating in PSNP
public woiks yet to achieve foou

FSP panel suivey,
assessment of
giauuateu
householus anu
inuepenuent
assessments



!4$&5 ,$ 617(# 4$&5.
1. Sufficient livelihoou oppoitunities anu
sustainable suppoit exist to allow foou
insecuie people in CFI woieuas to
ieach foou secuiity.



2. Sufficient enabling suppoit is available
to enable foou insecuie people in non-
CFI woieuas to become foou secuie.

1
According to the New Coalition for Food Security food security is defined as: access by all people at all times to sufficient food for an active and healthy life.
2
It is anticipated that this will be met through the launch of a social protection policy framework and associated programmes.
2
secuiity have sufficient foou foi
12 months anu can iesist
moueiate shocks in the absence of
PSNP tiansfei by 2u14 |foou
sufficiencyj
S. 9u% of male anu female membeis
of chionically foou insecuie
householus paiticipating in PSNP
Biiect Suppoit have sufficient
foou fiom sustainable souices foi
12 months anu can iesist
moueiate shocks by 2u14 |foou
sufficiencyj
2
.
4. 9u% of male anu female membeis
of (non-chionic) foou insecuie
householus involveu in the FSP
have sufficient foou foi an active
anu healthy life in the absence of
PSNP tiansfeis by 2u14 |foou
secuiityj.





S. Piotection fiom tiansitoiy shocks in
CFI woieuas is sufficient to pievent
foou secuie anu foou sufficient people
fiom losing assets.


4. Piotection fiom tiansitoiy shocks is
sufficient to allow anu maintain
piogiess to foou secuiity in non-CFI
woieuas foi those not yet foou secuie.
Outcome

Income souices uiveisifieu anu piouuctive assets
incieaseu foi foou insecuie householus in CFI woieuas

!"#$%#&''(82 $9+ :'7&*,.

1. 9u% of foou insecuie householus
have incieaseu numbei of souices
of income, by sex of householu
heau, by Becembei 2u14
2. 9u% of householus with incieaseu
ieal value of piouuctive assets, by
sex of householu heau, by
Becembei 2u14.



FSP bi-annual
householu suivey

!;1,*$'( ,$ 4$&5.

1. Naikets in oi neai CFI woieuas
pioviue sufficient livelihoou
oppoitunities foi foou insecuie
householus.

2. Sustainable suppoit seivices exist in
CFI woieuas to enable assets to
continue to be piouuctive.
S. Piotection fiom tiansitoiy shocks
thiough the PSNP is sufficient to
pievent significant asset uepletion.
3

4. The enabling enviionmentincluuing
infiastiuctuie anu uoveinment
policyallows assets to be piouuctive
anu geneiate sufficient ietuins foi
householus to make auuitional
investments.

S. FSP buuget anu oiganisation of
implementation allows opeiation at
sufficient scale, quality anu coveiage.
+",#",-

1. Access to viable on- anu off-faim income geneiating
oppoitunities impioveu.












2. Access to sustainable financial seivices enhanceu.






!"#$%#&''( <(5/=(#&05(2.

1.1 7S% of BAB clients iepoit that
they have uevelopeu a on- oi off-
faim income geneiating
oppoitunity attiibutable to BABP,
by sex of householu heau, by
Becembei 2u14
1.2 9u% of BAB clients iepoit they aie
satisfieu that theii business plans
ieflect theii piioiities, neeus anu
capabilities, by sex of householu
heau, by Becembei 2u14

2.1 9u% of BABP clients have access to
financial seivices attiibutable to
BABP by Becembei 2u12
2.2 9u% of cieuit to foou insecuie
householus ueliveieu thiough
NFIs, RuSACC0s anu vSLAs by


Foi all:
FSP bi-annual
householu suivey
Financial seivice
pioviuei iecoius
anu iepoits
Cieuit sectoi
analyses
Naiket suiveys
Input quality
maiket suivey
NoARB staffing
anu management
iepoits
BAB implementei
suivey

!;1,71, ,$ ;1,*$'(.

1. Financial institutions iesponu to BABP
incentives.

2. The coveiage of R0SACC0s anu NFIs
occuis at the necessaiy pace.

S. Sufficient attiactive investments can
be iuentifieu, anu these piove to be
piofitable.

4. 0thei factois uo not cause loss of
investment piofits.

S. Effective linkages between vaiious
piogiammes anu uepaitments
tianslate to effective, joineu up,
cooiuinateu suppoit.

6. The iisk aveision of chionically foou
insecuie people is able to be oveicome.

4






3. Sustainable input souicing, piouuction anu
ueliveiy systems enhanceu.







4. Access to effective piouuct anu laboui maikets
incieaseu







5. Institutional capacity to effectively manage anu
implement the BABP achieveu.





6. Knowleuge, skills anu confiuence of foou insecuie
people built.

Becembei 2u12
2.S Aveiage iepayment iates foi
BABP-ielateu cieuit at 9S%, as
scheuuleu, by Becembei 2u1S

S.1 7S% of BABP clients puichasing
inputs uo so fiom sustainable
souices by 2u12
S.2 Less than 1u% BABP clients
iepoiting unavailability of uesiieu
inputs by 2u12

4.1 7S% of BABP clients iepoit
impioveu access to maikets foi
theii piouucts by Becembei 2u12
4.S 7S% of BABP clients iepoit
impioveu access to employment
oppoitunities by Becembei 2u12

S.1 9S% of staff positions iequiieu foi
BABP filleu by Becembei 2u11
S.2 9u% of client householus satisfieu
with auvisoiy seivices anu financial
seivices by Becembei 2u12

6.1 7S% householus with new skills
iepoit that the new skills have
helpeu inciease householu incomes


5
by Becembei 2u12
6.2 9u% of male anu female BABP
clients iepoit incieaseu confiuence
in managing existing anu new
enteipiises by Becembei 2u11
6.S 9u% of male anu female BABP
clients iepoit satisfaction with
business uecisions they have taken
by Becembei 2u11
./,010,0$-

./,010,0$- 2(% +",#", 34 .//$-- ,( (56)57 (2262)%8
05/(8$ 9$5$%),059 (##(%,"50,0$- 08#%(1$7
1.1 Iuentify viable investment oppoitunities anu IuAs
thiough maiketvalue chain analyses anu technical
analyses of on- anu off-faim enteipiises
1.2 Caiiy-out consultations at the community, woieua
anu Regional levels to iefine analysis anu iuentify those
investment anu IuAs suitable foi foou insecuie
householus
1.S Recommenu viable investments anu IuAs foi foou
insecuie householus, incluuing investment
iequiiements
1.4 Iuentify householus eligible to paiticipate in BABP
1.S Pioviue auvice anu suppoit to taigeteu householus
to iuentify an appiopiiate investment oi IuA anu
piepaie the associateu business plan
1.6 Refei householus to a sustainable financial seivice
pioviue to access cieuit foi business plans
!:+71,2.

uoveinment staff at Feueial,
Regional anu woieua-level
Staff of NFIs anu membeis of
RuSACC0s
Bonoi staff time
Cash iesouices foi cieuit
Equipment
Technical Assistance
Nateiials


!>$2,2.

8S million 0SB
foi capacity
builuing
0p to Suu,uuu
0SB foi cieuit

!?*,/=/,@ ,$ ;1,71,.


1.1 Analyses anu consultative piocess aie
of a sufficient quality to iuentify viable
investment anu IuA oppoitunities foi
foou insecuie householus
1.2 The extension seivice has the capacity
to uelivei uemanu-uiiven suppoit
seivices on scale iequiieu.
1.S The extension seivice effectively links
with the SNE offices anu othei
stakeholueis to iuentify non-faim
activities
1.4 Iuentifieu investment oppoitunities
anu IuAs aie appiopiiate foi uiffeient
types of foou insecuie householus.
1.S The iisks anu oppoitunities of the
iuentifieu investments anu IuAs aie
communicateu effectively to foou
6
1.1.1 1.7 Pioviue technical assistance to suppoit the
implementation of householu business plans
1.1.2 1.8 Nonitoi householu business plans anu
maiket conuitions
1.1.S 1.9 Revise analyses anu iecommenueu
investment anu IuAs, as iequiieu.

./,010,0$- 2(% +",#", :4 .//$-- ,( -"-,)05);*$
205)5/0)* -$%10/$- $5<)5/$74
2.1 0nueitake a uetaileu mapping anu capacity
assessment of existing financial seivice pioviueis
2.2 Bevelop a iange of financial piouucts foi foou
insecuie householus
2.S Launch a financial liteiacy campaign amount CFI
woieuas
2.4 Piomote the expansion of NFIs anu establishment
of new vSLAs anu RuSACC0s
2.S Builu the institutional capacity of new anu existing
financial seivice pioviueis (RuSACC0s anu NFIs) foi
sustaineu ueliveiy of multiple financial piouucts to foou
insecuie householus
2.6 Pioviue a loan funu, community giant oi seeu
capital to financial seivice pioviueis
2.7 Bisbuise loans to eligible householus with viable
business plans
2.8 Suppoit the implementation of an appiopiiate
iegulatoiy anu supeivisoiy fiamewoik foi giassioots
financial institutions
insecuie householus
1.6 Foou insecuie householus voluntaiily
take-up the oppoitunities iuentifieu.
1.7 Sufficient cieuit is available to finance
householu business plans



2.1 NFIs anu RuSACC0s take-up the
financial piouucts uesigneu foi foou
insecuie householus.
2.2 The iange of financial piouucts
uesigneu auequately iesponus to the
capacities anu inteiests of foou insecuie
householus
2.S The coveiage of R0SACC0s anu NFIs
occuis at the necessaiy pace.
2.4 The capacity of NFIs, RuSACC0s anu
vLAs is sufficient to follow goou financial
seivice piactices
2.S The financial liteiacy campaign
pioviues foou insecuie householus with
the knowleuge anu skills to make goou
financial uecisions
2.6 Loans aie uisbuiseu to eligible
householus following sounu financial
pioceuuies

7
2.9 Nonitoi loan uisbuisements anu financial seivice
pioviueis systems anu capacity

./,010,0$- 2(% +",#", =4 !"-,)05);*$ 05#", -("%/059>
#%(7"/,0(5 )57 7$*01$%? -?-,$8- $5<)5/$74
S.1 Conuuct analysis to iuentify oppoitunities anu
constiaints to input supply (linkeu to 1.1), existing
piouuceis anu uistiibuteis anu inputs foi local
piouuction
S.2 Facilitate linkages between supplieis anu
householus iequiiing inputs foi theii business plans
S.S Suppoit iepiesentative volunteeis establish the
piouuctivity oi effectiveness of new input technologies
S.4 Suppoit the integiation of successful input
technologies into householu business plans
S.S Pioviue quality contiol anu ensuie appiopiiateness
of inputs
S.6 Nonitoi input maikets anu expeiience of
householus with inputs

./,010,0$- 2(% +",#", @4 .//$-- ,( $22$/,01$ #%(7"/,
)57 *);("% 8)%A$,- 05/%$)-$74
4.1 Iuentify anu analyse capacity iequiiements to
stiengthen ciitical paits of value-auueu chains.
4.2 Pioviue technical assistance to gioups of
piogiamme paiticipants on cost-effective value auuition
techniques
4.S Suppoit the piepaiation of gioup business plans foi



S.1 Quality of analysis is sufficient to
iuentify constiaints anu oppoitunities to
input supply.
S.2 Input pioviueis aie auequate in
numbei anu pioviue appiopiiate inputs
S.S. Linkages between supplieis anu useis
of inputs aie effectively cieateu
S.4 Naikets foi inputs exist anu, wheie not,
piivate supplieis can be cultivateu ovei
time
S.S Quality contiol is auequate




4.1. Ciitical paits of the value-auueu chain
iuentifieu can be auuiesseu with
piogiamme anu community iesouices
4.2 Piouuct anu laboui maikets exist




8
'value-auuition' activities
4.4 Suppoit the cieation of gioups foi bulk maiketing
4.S Pioviue maiking tiaining anu suppoit to these
gioups
4.6 Facilitate access to highei-value maikets foi new
investments oi wage employment

./,010,0$- 2(% +",#", B4 C5-,0,",0(5)* /)#)/0,? ,(
8)5)9$ )57 08#*$8$5, ,<$ D.EF -,%$59,<$5$7
S.1 Assessment of management, technical anu
implementation capacity
S.2. Nake available auequate buugets foi capacity
builuing anu othei change management piocesses
S.S Bevelop anu ievise manuals anu guiuelines as
necessaiy.
S.4 Auuiess staffing gaps thiough both mainstieam
goveinment channels anu contiact staff oi technical
assistance
S.S Suppoit the uevelopment of physical capacity
thiough piovision of equipment anu seivices.
S.6 Suppoit management implement iefoims iequiieu
to systems anu piocesses
S.7 Piomote a technical suppoit netwoik foi fiont-line
implementeis
S.8 0nueitake iolling tiaining piogiamme
S.9 Nonitoi anu evaluate capacity builuing effoits,
incluuing tiainings.






S.1 Commitment to continuing iefoims in
the Extension System exists at all
levels
S.2 Nanagement systems aie effective
S.S Impiovements to institutional capacity
iesult in implementation
impiovements in piactice
S.4 Staff tuinovei uoes not compiomise
capacity gains
S.S Cooiuination mechanisms iesult in
linkages between implementing
institutions in piactice








9

./,010,0$- 2(% +",#", G4 H5(I*$79$> -A0**- )57
/(5207$5/$ (2 2((7 05-$/"%$ #$(#*$ ;"0*,4
6.1 Caiiy-out consultations, awaieness iaising anu
business plan tiaining foi householus
6.2 0nueitake financial liteiacy tiaining anu pioviue
tailoieu suppoit to householus on financial
management
6.S Bevelop householus' knowleuge anu skills in
piouucing anu selling inputs anu use paiticipatoiy
uemonstiation techniques to inciease theii
unueistanuing of new technologies.
6.S Caiiy-out activities that builu skills, knowleuge anu
confiuence in maiketing anu value auuition

6.1 Appioach to tiansfeiiing infoimation
builus knowleuge, skills anu confiuence in
piactice.
6.2 Foou insecuie householus have
oppoitunities to use knowleuge anu skills
theieby builuing confiuence



F%$/(570,0(5-
1. uoveinment anu uonoi agieements in
place foi BABP
2. Commitment of uoveinment anu
uonois to BABP in place
S. Initial iesouices aie available
4. Secuiity situation conuucive to BABP
activities