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ENHANCING RESILIENCE AND PROMOTING DEVELOPMENT IN THE HORN OF AFRICA -

AN EXPLORATION INTO ALTERNATIVE INVESTMENT OPTIONS

Derek Headey, Alemayehu Seyoum Taffesse, Liang YouInternational Food Policy Research Institute (IFPRI)

The Horn of Africa has witnessed recurring and devastating droughts, seemingly with more frequency

But vulnerability to drought is only part of the problem – there is an interplay between shocks and underlying stresses (population growth, climate change, shrinking grazing lands)

But not well understood which factors matter most

1. Background

This context has produced some very polemical views: sedentarization vs. preservation of pastoralism

Can either view draw on a strong evidence base? IFPRI was asked by USAID revisit that evidence base in

the context of some tough questions:

1. Can pastoralism be sustained in the face of these stresses and shocks?

2. What role should other sectors play in promoting a more resilient development path?

In addition to “What to do?” there is “How to do?”

1. Background

2. Pastoralism: characteristics, constraints, potential

• ASAL population not necessarily poor in relative terms, but very vulnerable

• Wealth stems from livestock, but where does vulnerability come from?

2. Pastoralism

• Superficially, livestock mortality is the main cause of vulnerability in ASAL regions, and drought is the main cause of livestock mortality

• But why don’t pastoralists destock prior to drought and restock afterwards?

• Lack of early warning? Poor access to markets? Cultural attachment to livestock?

• Dominant theory is missing markets for destocking, restocking, insurance & credit

• So pastoralists hold on to animals more than they would if markets worked

2. Pastoralism

Figure 4. Herd size threshold effects that push households out of pastoralism

Source: Lybert et al. (2004).

• So the superficial answer is that drought renders pastoralists vulnerable, and has pushed many out

• But looking deeper, is it shocks that cause this or the interaction of shocks with various stresses?

1. Climate change? Not much evidence so far

2. Rapid population growth? 2-3% per year

3. Mobility restrictions? Yes, but could also be related to population growth as well as policies

• So while pastoralists may be rationale and efficient, indefinite population growth is not sustainable

2. Pastoralism

• What do these facts imply about pastoralism & resilience?

1. Pastoralism is too big to fail – in the medium term it is impossible to create enough viable livelihoods in other sectors (and livestock has strong potential)

2. Diversification is also essential – resilience of pastoralism can be improved by both better land & water management, but also by diversification

3. Critical to understand commercialization: opportunities, constraints, engagement with the poor

4. Improve drought management: destocking, restocking & interactions with commercialization; impacts on diversification?

2. Pastoralism

• The share of pastoralism in ASAL incomes is thought to have been declining for some time

• Recent snapshots also tell us that there is variation across space, and significant populations are engaged in sedentary farming (irrigated and non-irrigated) and firewood/charcoal production, smaller shares in trade, various types of labor, shopkeeping, etc.

3. Non-pastoralist livelihoods

Activity types Birr/month

% HHs engageda

Most & least lucrative activities

Birr/month

Most lucrative activitiesTrading 615 3.8% 1. Contraband trader 1,607Rents 502 <2% 2. Construction worker 1,307Labor 447 2.4% 3. Carpentry/metal-worker 873Services 300 10% 4. Khat trader 868Food /drink proc. 244 8% 5. Selling meat 853

Livestock 216 69.9% Least lucrative activitiesCrop farming 210 50-55% 60. Charcoal seller 100Small industry 182 6.3% 61. Firewood collector 88Begging 123 <2% 62. Basket/mat maker 88Natural products 117 25-30% 63. Selling eggs 79

64. Beekeeper 77

Table 4. Average income by livelihood category, and by highest and lowest returns: Somali region 2005

• Similar picture in Borena region and north-eastern Kenya• Upshot is the following ranking of livelihoods:

1. Urban livelihoods pay best

2. Irrigated livelihoods second best

3. Pastoralism third

4. Agro-pastoralism (rainfed farming) distant fourth

5. Firewood/charcoal pa a very distant fifth• So seems a good idea to promote urbanization and irrigation – but in both cases there are capacity constraints over the medium term

3. Non-pastoralist livelihoods

• For irrigation, it’s important to look back and look forward• Behnke et al. (2010) look at mature irrigation schemes in

Afar, since these are the most mature in the region• Several irrigation schemes performed poorly, but sugar

generates major income for govt (pastoralism doesn’t)• Looking forward, we use a recent GIS model to estimate

profitable irrigation potential for ASALs• Then use these area estimate to calculate some crude back-

of-the-envelope estimates of potential job creation

3. Non-pastoralist livelihoods

Figure 6. A map of profitable irrigable areas by lowland and highlands of eastern Africa

Source: Authors construction from data and methods described in Liang et al. (forthcoming).Notes: Lowlands (highlands) are defined as areas below (above) 1500 meters in altitude. This is a standard definition in Ethiopia, but may perhaps be too high in Kenya. IRR refers to internal rate of return.

Cost scenariosc

Countries Profitable increase in irrigated ASAL areas (Ha)b

Rural ASAL population in 2020 (millions)d

Percentage of 6-person rural HHs that could work 1 irrigated hectaree

Low Ethiopia 217,060 22.7 5.7%cost Kenya 291,486 19.7 8.9%

Djibouti 7 0.2 0.0%

Somalia 14,297 7.3 1.2%

Total 522,850 49.9 6.3%

Medium Ethiopia 159,568 23 4.2%cost Kenya 152,869 20 4.7%

Djibouti 7 0 0.0%

Somalia 8,245 7 0.7%

Total 320,689 50 3.9%High Ethiopia 156,030 23 4.1%cost Kenya 108,762 20 3.3%

Djibouti 0 0 0.0%

Somalia 1,293 7 0.1%

Total 266,085 50 3.2%

Table 6. Profitably irrigable area in the ASALs of eastern African countriesa

Source: Authors’ estimates based on the data and methods described in Liang et al. (forthcoming).

• What about urbanization and migration?• Both ASAL data and surveys from other developing

regions tend to show that education is a requirement for successful migration

• Education also important for improved governance, reducing fertility rates and female empowerment

• The question is how best to deliver these services: boarding schools, mobile schools, distance learning, etc

3. Non-pastoralist livelihoods

Figure 7. A map of literacy status in Ethiopia by pastoralist and non-pastoralist woredas

• Other interventions could benefit both pastoralist and non-pastoralist livelihoods

• Infrastructure important, but in low population density environments investments need to be very strategic.

• On the positive side, roads have been transformative in Borena, Garissa, and other parts of the region

• But roads in lowland areas have sometimes been criticized for low rate of usage (low benefit-cost ratios)

• Also, there is an argument for more strategic use of space in general. Where should infrastructures be clustered? Where are there dangers of over-clustering?

3. Non-pastoralist livelihoods

• An economic interpretation of the evidence suggests that a balance development strategy is needed.

• Pastoralism has significant advantages, but major risks – Can commercialization enhance resilience? Can it be pro-poor? What does that package entail?

• Resilience of pastoralists & ASAL population as a whole will also require some pastoralists to exit, ideally into urban livelihoods and irrigation

• Education and infrastructure most likely the big ticket cross-cutting investments, but innovative service delivery will be key

4. Summing up