The role of microcredit institutions in poverty reduction

and on dependence on natural resources

A case study of COCOBA in Serengeti District

By

Emmanuel B. Sulle

Dr. Robert H. Nelson, Advisor

Frankfurt Zoological Society, Client

October, 2012

Submitted in fulfillment of the requirements of PUAF 790

School of Public Policy, University of Maryland College Park

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Contents Abbreviations .......................................................................................................................................... iv

Executive Summary ............................................................................................................................... v

1.0 Introduction ....................................................................................................................................... 1

2.0 Scope and Methodology ................................................................................................................ 3

2.1 Research Objectives ................................................................................................................... 3

2.2 Study Site ....................................................................................................................................... 3

2.3 Sampling ......................................................................................................................................... 4

2.4 Data Collection ............................................................................................................................. 4

2.4.1 Household Survey .............................................................................................................. 4

2.4.2 In-depth Interviews ........................................................................................................... 5

2.4.3 Group Discussions .............................................................................................................. 5

2.5 Methods of Data Analysis......................................................................................................... 6

3.0 Background ........................................................................................................................................ 7

3.1 Microfinance Institutions (MFIs) .......................................................................................... 7

3.3 Environmental Benefits of Microfinance institutions................................................ 16

3.4 The shortfalls of the MFIs ..................................................................................................... 17

3.6 Serengeti District Profile ....................................................................................................... 20

4. 0 Analysis and findings ................................................................................................................. 22

4.1 Overview of COCOBA groups .............................................................................................. 22

4.2 General performance of COCOBA groups in Serengeti District ............................. 25

4.2.1 Performance of selected COCOBA groups .............................................................. 26

4.3 Socio-economic activities ..................................................................................................... 29

4.4 Savings, credit facilities and household assets ............................................................. 30

4.4.1 Savings and types of collaterals ................................................................................. 31

4.4.3 Households’ assets holdings ....................................................................................... 32

4.4.4 Impact of COCOBA on ownership of livestock ..................................................... 33

4.4.5 The Impacts of COCOBA on households ................................................................. 33

4.4.4 Household’s source of cooking energy .................................................................... 36

4.6 Peoples’ attitudes, perceptions and views towards COCOBA ................................. 36

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4.6.1 Other environmental benefits of COCOBA. ............................................................ 38

4.7 Household expenditure patterns ....................................................................................... 39

4.7.1 Use of earned profit ........................................................................................................ 39

5. 0 Discussion ....................................................................................................................................... 42

5.1 Challenges ................................................................................................................................... 46

6.0 Recommendations ........................................................................................................................ 50

Acknowledgement ............................................................................................................................... 55

References .............................................................................................................................................. 56

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Abbreviations

CBNRM Community-based Natural Resource Management

COCOBA Community Conservation Bank

CREATE Conservation Research for East Africa’s Threatened Ecosystems

FZS Frankfurt Zoological Society

HH Household

Kms Kilometers

MDGs Millennium Development Goals

MFIs Microfinance Institutions

MIX Microfinance Information Exchange

NGO Non-governmental Organization

SACCOS Savings and Credit Cooperatives

SEDIT Social Economic Development Initiative of Tanzania

SENAPA Serengeti National Park

TANAPA Tanzania National Park Authority

TAWIRI Tanzania Wildlife Research Institute

TOT Trainers of Trainees

TZS Tanzania Shilling

URT United Republic of Tanzania

VICOBA Village Cooperative Banks

WCRP World Conference on Religion and Peace

WMA Wildlife Management Area

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Executive Summary

A Community Conservation Bank (COCOBA) provides an opportunity for rural

communities to participate in poverty reduction and conservation efforts. To-date

twenty-one COCOBA groups have been established in Serengeti District. Members

of these groups have access to both savings, and credit services from their COCOBA.

Loans at 5% and 10 % interest rates for three and six months respectively are used

to start up environmentally-friendly economic activities such as beekeeping, trading

of grains and crafts. This paper assesses the impacts of these institutions thus far.

As a new initiative established in 2009, little has been documented about the results

of COCOBA groups. Nonetheless, COCOBA groups that have been working on

various individual and group activities over the past two to three years can provide

some lessons. This paper explores experiences of the current COCOBAs. It further

provides recommendations to address challenges and lessons learned.

The paper employed three research methods: one, in-depth interviews were carried

out with eighteen key informants; two, a household survey was conducted of 73

households; and lastly, four group discussions were held. Based on the analysis, the

main findings include the increased variety of income generating activities,

improving livelihood, and increased conservation related initiatives (tree planting,

beekeeping projects, and water catchment protection).

However, despite these initial successes, COCOBAs face a number of challenges such

as a lack of entrepreneurial skills among its members, insufficient capital, poor

infrastructure, inadequate extension services and developing markets for local

produce.

To address these challenges and improve on lessons learned from the findings of

this study, the paper makes a number of recommendations aimed at development

and conservation stakeholders:

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1. Stakeholders’ strategic engagement. The COCOBA initiative needs to build

collaborative efforts among the development, and conservation stakeholders

working in the district, and within the Serengeti ecosystem. This will bring together

village officials necessary for COCOBA operations in the village, the district and

Serengeti National Park.

2. Link COCOBA to potential funding. Linking COCOBA to government loans

schemes, donors, private sponsors and micro-credit institutions will allow members

to improve credit availability and hence business opportunities. This will allow

members of the group to have access to additional credit offered by these

institutions.

3. Education and training. Focused education and training can strengthen

individuals’ and groups’ productivity and sustainability. It is necessary to continue

highlighting relevant conservation benefits of pursuing environmentally friendly

initiatives to COCOBA members, so that they do not undertake just income

generating activities such as tobacco farming.

4. Markets for local produce. The presence of reliable markets for local produce will

give local communities incentives to engage in diversified income generating

activities, thus improving their earnings and lives. It will also reduce dependence on

natural resources when people opt for non-agricultural activities that in some cases

pay back quickly.

5. Individual and community initiatives. Both personal and communal initiatives

are essential elements for poverty reduction and conservation efforts. Individual

members of the COCOBA groups need to undertake trainings to gain entrepreneurial

skills while learning about market dynamics and gaining information about prices of

the goods and services they offer.

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1.0 Introduction

Community Conservation Banks (COCOBAs) were first established in the Serengeti

by the Frankfurt Zoological Society (FZS) in 2009. The initiative aimed to provide

alternative income generating activities to bushmeat hunters around Serengeti

National Park (SENAPA). However, to-date, people with different backgrounds have

joined COCOBA groups. Currently, there are twenty-one COCOBA groups, jointly

established and monitored by FZS and SENAPA in Serengeti District.

COCOBA is one of the microfinance institutions with new sets of goals. While the

usual microcredit institutions such as VICOBA mainly deal with the provision of

financial services, COCOBA aims further by incorporating elements of best

environmental practices in business. Its core objective is to encourage members to

establish environmentally friendly income generating activities.

The benefits of COCOBA at the grassroots level range from environmental education

to environmental conservation, and from beekeeping to a variety of other small

business establishments. COCOBA is a new tool for poverty reduction efforts in

developing countries where threats to protected areas are increasing. This paper

highlights the impacts of these institutions on poverty reduction and dependence on

natural resources. It provides the results collected from field work carried out in

four selected COCOBA groups. Based upon the research findings, the paper provides

information on a series of lessons learned, and recommendations, for adoption by

stakeholders engaged in both development and conservation initiatives.

This paper has five sections. The next section provides the research methodology,

followed by the background information about the microfinance institutions and the

genesis of COCOBAs. The fourth section provides the research analysis and findings

which include the household’s main economic activities, expenditure patterns and

environmental benefits of these initiatives. This is followed by discussions of each.

2

Finally, the paper provides detailed recommendations for improving the COCOBA

initiative

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2.0 Scope and Methodology

2.1 Research Objectives

The purpose of this study is to assess the impact of microcredit institutions (in this

case Community Conservation Banks) on poverty reduction and dependence on

natural resources. It does so through a detailed case study of four COCOBA groups in

Serengeti District. The study examines, through community feedback, the

performance of COCOBA in their areas. Specifically, this research provides insights

into the following issues:

The role of COCOBA on poverty reduction and use of natural resources

among the rural communities;

The effect of changing from natural resource-dependent to conservation-

friendly livelihood strategies within the household;

Assessment of the effects of increased wealth on natural resource use among

the members of COCOBA groups and changes in lifestyle;

Recommendations for improving the COCOBA initiative, and effective

participation of conservation and development stakeholders in the Serengeti

District, and perhaps in other parts of the country with similar

characteristics.

2.2 Study Site This study was conducted in four villages of Bisarara, Nyichoka, Park Nyigoti and

Rwamchanga. All these villages are located in Serengeti District, Mara Region. The

four villages have had established COCOBAs since 2009; only one group among

those surveyed in 2010 was selected from each village. In villages like Rwamchanga

and Bisarara, where there were two groups surveyed in 2010, one group was picked

randomly. The rest were the only groups in their respectively villages.

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2.3 Sampling This study used the same households previously surveyed in 2010 in order to have

data consistency on the same households over time. The Author, in collaboration

with the facilitators of the COCOBA groups, selected a sample of households

according to the availability of the members and their membership status, because a

few members of different groups had either moved outside the village or the district.

Also, some had already left COCOBA groups.

2.4 Data Collection This study employed a variety of techniques to collect data. Those include in-depth

interviews, household surveys and group discussions conducted from January 5th to

February 1st, 2012. Secondary data was collected whenever it was possible to gather

relevant documents, but most of the online materials such as peer reviewed

journals, national and international reports were found via university databases.

2.4.1 Household Survey To ensure the quality of data and its collection processes, the researcher in

collaboration with FZS-Tanzania office in Fort Ikoma trained nine local enumerators

for two days. After training, the researcher and FZS staff took enumerators to

conduct a pilot study. At the end of the pilot exercise, seven enumerators qualified

to participate in data collection. The researcher guided the selected enumerators to

administer a socio-economic survey in Bisarara, Nyichoka, Park Nyigoti, and

Rwamchanga villages in Serengeti District.

In total, the survey was carried out in 73 households. Of the respondents in each

household, 47 (64.38%) were women and 26 (35.62%) men. This equals 82% of the

89 households previously surveyed in 2010. This happened for a number of reasons.

First, a few members dropped out of their COCOBA groups, and others were absent

during the survey either by being in business or community work. The survey

questionnaire was designed to collect information on aspects related to:

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Socio-economic characteristics of the study population - age, sex, education,

ethnicity, and migration patterns;

The status of the living conditions that include livelihood assets, land uses and

production patterns, and trades;

Household’s sources of income and expenditure patterns;

Assess people’s perceptions of the present microcredit schemes;

Assess present environmentally friendly investments and their relationship to

COCOBA

2.4.2 In-depth Interviews The researcher conducted in-depth interviews (IDIs) with key informants in each

village within the study areas. Other interviews involved district officials and

Serengeti National Park officials. In total, 18 people were interviewed from the

district offices to the village government.

At the village level, interviewed leaders include village government leaders,

(chairpersons and village executive officers). For planning, environmental,

community development and management issues, district officials dealing with

natural resources, cooperatives and economic planning were interviewed. Gathered

information includes:

The contribution of COCOBA towards poverty reduction and dependence on

natural resources;

Availability of district experts to help local communities develop entrepreneurial

skills, and implement environmentally friendly activities;

Opinions on the performance of COCOBA and ideas for improvement.

2.4.3 Group Discussions Group discussions provided an avenue for people to share and express their

opinions on the subject in question. The Author held one group discussions in each

study village (four group discussion; a total of 63 people) to gather information on

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the status of COCOBA, its contribution to poverty reduction and dependence on

natural resources. Information collected from these discussions helped to

understand:

People’s understanding, views, attitudes and perceptions of COCOBA;

Whether COCOBAs have improved their living conditions or not.

Types of dominant economic activities in the villages;

Individual and group participation in COCOBAs’ initiatives such as

beekeeping projects and protection of water catchment areas.

2.5 Methods of Data Analysis Data collected from field visits were coded and analyzed using both qualitative and

quantitative techniques. Quantitative data obtained for this research was analyzed

using excel, tables, and graphs. Also, content analysis was done for qualitative data

to meet the objectives of the paper.

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3.0 Background

3.1 Microfinance Institutions (MFIs) The term “Microfinance” or “Microcredit” has been used interchangeably in this

paper. In many cases these terms have also been given varying definitions to mean

different things in different places. To avoid further confusion, this paper uses Gert

van Maanen definition which states that “microcredit or microfinance, is banking the

unbankables, bringing credit, and savings and other essential financial services within

the reach of millions of people who are too poor to be served by regular banks, in most

cases because they are unable to offer sufficient collateral” (Oikocredit 2004). To put

an emphasis on the variety of microcredit institutions available in different

societies, this paper highlights some broad classification of microcredit as stipulated

by the respected Author on poverty and microfinance -- Mohammad Yunus who

classified microcredit1 as follows:

1) Traditional informal microcredit (such as, moneylender's credit, pawn shops, loans from friends and relatives, consumer credit in informal market, etc.)

2) Microcredit based on traditional informal groups (such as, tontin, Rotating Savings and Credit Association (ROSCA), etc.)

3) Activity-based microcredit through conventional or specialized banks (such as, agricultural credit, livestock credit, fisheries credit, handloom credit, etc.)

4) Rural credit through specialized banks.

5) Cooperative microcredit (cooperative credit, credit union, savings and loan associations, savings banks, etc.)

6) Consumer microcredit.

7) Bank-NGO partnership based microcredit.

8) Grameen type microcredit or Grameen credit.

9) Other types of NGO microcredit.

1 The details about the Mohammad Yunus definition and classification of microcredit can be found at : http://www.grameen-info.org/index.php?option=com_content&task=view&id=28&Itemid=108; accessed on 09/10/2012

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As discussed above though these classifications of microcredit somehow exclude

COCOBA as its core goals are differs from most of these institutions. Yet, while

microcredit institutions (MFIs) have been in place for decades in Southern Asian

countries, they have been less popular in some parts of the world such as sub-

Saharan Africa (IAMFI 2012). It until 2005, when microcredit institutions got a new

degree of recognition after the United Nations dedicated 2005 “a Year of

Microcredit.” The UN launched the International Year of Microcredit 2005 to build

an inclusive financial sector to help achieve the Millennium Development Goals

(MDGs). It further aimed to strengthen the powerful, but often untapped,

entrepreneurial spirit present in communities around the Globe.2 2005 was

followed by the Nobel Peace Prize Award to Muhammad Yunus, the founder of

Grameen Bank-a highly recognized institution by NGOs and Multinational

organizations in 2006 (Herrod-Menzies 2008).

MFIs provide a range of options for the poor communities such as access to credit

and development of self-reliance. They do this at both individual and household

levels. Access to financial services leads to the increased income of the household

and subsequent increase in consumption, savings, investment and asset

accumulation (Zeller 1999; Banerjee 2010).

Proponents of microcredit institutions stress that they can play a key development

role compatible with “neo-liberal ideologies that champion individual initiative, self-

reliance, and ‘pulling yourself up by your bootstraps’” (Herrod-Menzies 2008).

Microfinance is also viewed as a win-win undertaking where lenders profit from the

interest they earn, while poor borrowers engage in “self-help” by using their

entrepreneurial skills and hard work to improve their lives (Herrod-Menzies 2008).

However, as explained earlier in this section, this system is yet inapplicable to MFIs

such as COCOBA which do not have lenders who are likely to expect profits returns

from earned interests.

2 http://www.un.org/events/microcredit/

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The Status of MFIs in Tanzania

While there are many MFIs in Asian countries, in Tanzania there are still very few,

and their penetration to rural poor communities is extremely low. In 2007, Tanzania

had only 16 MFIs and 249,000 borrowers. Most of these MFIs include small

enterprises such as Small Enterprise Development Agency (SEDA), Mbinga

Commercial Bank, and The Foundation for International Community Assistance

(FINCA).3 Some of these MFIs are further non-profit, tax-exempt charitable

organizations such as FINCA. Penetration of the MFIs to borrowers was respectively

1% and 2% of the general population and the poor. Tanzania has a population of 40

million people among whom the poor are about 14.4 m (Gonzalez 2008). In the

same year, Kenya had 28 MFIs with 975,000 borrowers while Uganda had 21 MFIs

with 121,000 borrowers.

A 2010 report by the Microfinance Information Exchange (MIX) shows that

Tanzania had only 13 reporting MFIs with a total loan portfolio of $63.7 million,

while in the same year Kenya had 27 MFIs and Uganda 25 MFIs, representing a total

loan portfolio of $1.2 billion and $256 million, respectively (Latortue & Linthorst

2010; KIVA 2012).

Compared with 2007, in Tanzania there were 3 MFIs that dropped out of reporting

to MIX. But the number of active borrowers and depositors also slightly declined. It

is unclear though if depositors declined were mainly due to the drop out of the 3

MFIs out or there are other factors. In 2010, there were 222,000 borrowers and

239,000 depositors, saving about $53 million (Latortue & Linthorst 2010). With the

national population growth, this number is low compared to Kenya where there are

over million active borrowers and over seven million depositors with total savings

of $1.5 billion a year. While these are important facts, they exclude small MFIs

3 For further details on the MFIs that report to MIX in Tanzania visit : http://www.mixmarket.org/mfi/country/Tanzania?gclid=COPUlpTEhbMCFYwc6wodF1QAhQ

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especially with different characteristics such as COCOBA which basically do not

report to MIX.

The Central Bank of Tanzania (BOT) is the official institution that oversees and

regulates the financial sector including licensing all financial operations. It also sets

the required minimum capital for commercial and savings banks. With a lack of

financial resources, the microfinance sector in Tanzania is mostly run by non-

deposit taking institutions, mainly Non-governmental Organizations (NGOs) and

Savings and Credit Cooperatives (SACCOS), and very recently Village Cooperative

Banks (VICOBA) and Village Savings and Loans Associations (VSLA) have been

widely established in the country. These institutions are governed by the National

Microfinance Policy launched in February 2001. The policy document emphasized

‘the need to support poor people excluded from the formal financial services’ (UN

Habitat 2005). Moreover, the policy provides broad freedom to microfinance

institutions to develop microfinance services according to their internal objectives

(ibid). Presently, common objectives of the majority of community-based

microcredit finances include poverty reduction, environmental protections, profits

and empowerment of special groups such as women and youth.

Village Savings and Loans Associations (VSLAs)

In Tanzania VSLAs were first introduced by Care International through its program

called “Ongeza Akiba” meaning “Add Savings”. This is a special program that targets

poor people with different characteristics to the usual MFIs which have lenders such

as commercial banks. VSLAs depend on members’ contributions or shares. In rare

cases, these organizations get some top up loans from donor organizations,

particularly during the initial stages to facilitate their take off. According to Care

International’s Website (accessed on August 10, 2012), it planned to implement this

program in two phases where phase 1 is planned to be implemented from 2008 to

2011. Within this period, “the program aimed to reach 221,760 rural poor

throughout 8 regions of mainland Tanzania and Zanzibar”. It further planned to

implement phase II from 2011 to 2014, “meeting an additional 500,000

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beneficiaries from the rest of the 17 regions of mainland Tanzania.”4 Care

International adopted VSLAs almost two decades ago and the first trials for this

model were done in Maradi, Niger in 1991, (Hugh 2006). The model was found to be

successful due to its very low costs of establishing clients and running the VSLAs is

ten times cheaper than MFI. Presently, however, in Tanzania, VICOBA is the widely

publicized organization among the rural communities.

Development of VICOBA in Tanzania

VICOBA is the acronym for Village Community Bank. It was initiated in 2002 by then

advisor to Social Economic Development Initiative of Tanzania (SEDIT), Mr. George

and the partner client WCRP. According to George the idea was borrowed from the

model developed by the Care International in Niger, West Africa in 1991. Originally,

the model was known as Mata ‘Masu Dubara’ (MMD) –the Nigean vernacular

meaning ‘women in a course to emancipate themselves from poverty’ (URT 2009).

According to the report by the government of Tanzania three organizations, namely

SEDIT, Care International and WCRP played a great role in the formulation and

growth of VICOBA in the country (URT 2009). The report further acknowledged the

contribution made by other organization that have implemented the similar models

of VICOBA such WWF, FZS, ORGUT FLORESTA and others (ibid). As of March 2011,

SEDIT program had established more than 2000 VICOBA groups in the country – a

bit higher than the target of establishing 2000 VICOBA groups. During its operation,

SEDIT was able to raise up to TZS 9 billion. The project has been implemented in 20

districts covering six regions where 2004 groups have been formed. This is

equivalent to 100.2% of the earlier target (SEDIT & Orgut 2010; Begasha 2012).

Following the successful establishment of VICOBA by donor organization, and the

end of the SEDIT program, the government recognizes VICOBA from grassroots to

national level. In 2011/2012 Financial year, the Minister for Finance and Economic

4 For details on add savings and Care International please visit: http://www.care.org/careswork/projects/TZA060.asp

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Affairs assured the National Assembly that “the government will continue to

implement the National Economic Empowerment Policy by disseminating it to the

majority of citizens to enable them understand it and participate effectively in its

implementation; provide training to entrepreneurs; sensitization on saving and

investment, sensitization on formation of SACCOS and VICOBA; and conduct studies

aiming at developing entrepreneurship skills, as well as initiating and improving

economic activities” (URT 2011).

Introduction of COCOBA by Frankfurt Zoological Society (FZS)

The provision of credit facilities to local communities that depend on natural

resources for their living, although new, has been used in different parts of the

country as part of initiatives to conserve the environment and water catchments.

Leading examples of COCOBAs can be found around the Great Ruaha River in the

southern highlands of Tanzania, and in Mafia and Zanzibar. COCOBAs were

introduced in these regions by the World Wide Fund for Nature (WWF) to enable

local communities’ access loans to start up conservation-friendly business activities,

and participate in environmental protection including water resources (Field 2006).

But, as discussed earlier in this section, FZS is also part of the organizations that

implement program similar to VICOBA named COCOBA.

COCOBAs were initiated by the Serengeti Luangwa Ecosystem Management Project

(SLEMP) to provide alternative income generating activities to bushmeat hunters

around Serengeti National Park (SENAPA) and North Luangwa National Park.5 At

the moment, COCOBA acts as a sustainable microcredit facility for reducing poverty

and improving livelihoods while establishing a process of environmentally friendly

livelihood diversification.

The bank was established to address the ever-growing illegal bushmeat hunting in

Western part of Serengeti Ecosystem. The target group for this initiative was

5 Frankfurt Zoological Society website: http://www.zgf.de/?projectId=122&id=65&language=en

13

initially the bushmeat hunters in the area. To-date COCOBAs have been established

in nine villages in western Serengeti where there are higher poaching rates. The

COCOBA initiative in Serengeti is unusual in its formulation and managerial set-up

compared to other MFI initiatives in many ways. First, COCOBA members do not

start by getting financial assistance from any other sources other than some rare

top-up loans from NGOs. The overall goal of COCOBA groups is to strengthen

conservation through sustainable poverty reduction efforts. People who join

COCOBA obtain their membership through an individual subscription whereby by

one is required to purchase shares valued at TZS 1000 ($0.6) each.

COCOBA is a unique initiative in both conservation and development circles. While

in other MFIs there are lenders and borrowers of different characteristics, COCOBA

is formed by a group lenders and borrowers with almost similar characteristics.

From the beginning, COCOBA groups were formed by targeting a specific group

(bushmeat hunters and sellers). Among the established groups, four of them are

entirely formed by the former illegal bushmeat hunters. According to FZS report, the

former hunters have stopped hunting and they are now looking for alternative

options of income generation. After forming the group, trainers of trainees (TOT)

receive some instruction in entrepreneurial skills by business experts. The TOTs

will later train their group members about what they have learned. The business

training package to COCOBA members has conservation values incorporated into

business concepts. To-date, the maximum number in each group is thirty people.

The main group is divided into sub-groups of five people maximum. During the

weekly meetings members purchase shares while contributing to a number of

welfare funds.

Presently, COCOBA members also contribute to social fund which include health and

education, environmental and gifts fund during their weekly meetings. The whole

group decides to give loans to an individual member who must also be in a small

group of up to five people. Loans provided in COCOBA have to be returned after

either three months or six months. At the end of the year the groups break their

14

cycle and share the dividends earned from the 5 to 10% interest rate earnings from

repaid loans. To-date, each group member contributes about 3 shares minimum in

weekly meetings. This is an increment of two more shares from one share

requirement in the past year. The increment was meant to reduce the growing

insufficiency in credits. Already, two groups are pondering the possibility of

increasing the weekly contribution to five shares a week. The five shares would

have a value of TZS 5000 ($3.1) (FZS COCOBA documents 2011).

At the end of each business cycle, members of each group audit their financial,

attendance and progress reports. They also do election for new leaders. Everyone

including the previous leaders can be elected in any post according to the group’s

constitution. The main advantage of this banking system is the almost zero

administrative costs since most leaders perform their responsibilities on the

voluntary basis.

Given their interest in conservation, FZS and SENAPA provide some technical

assistance and guidance to these groups. The two organizations also support

COCOBA groups to attend business exhibitions and send some groups’

representatives to learning trips. However, as COCOBA groups expands financial

and seek for financial from advanced financial institutions such as commercial

banks, they would need to have competent finance and accounting experts to meet

requirements of big financial institutions.

VICOBA versus COCOBA

Similarities: In many cases, VICOBA groups particularly those established by Sedit

are given start up facilities such as credit kit, stamp and calculators. The same is

done to COCOBA where FZS and SENAPA provide them with documentation

materials as well as credit box. The other major similarity between COCOBA and

VICOBA is the lending and borrowing scheme of which both organizations operate

on the rotational basis to ensure everyone in the group is reached. Also, the loans

awarded in VICOBA as it is in COCOBA are due after three to six months. The loans

15

are charged the interest rates of 5 and 10 percent respectively. Both organizations

offer loans to members to start income generating activities. They also offer interest

free loans to members with health problems and other emergencies. The interest

free loans are offered for a period of one-two months.

Differences: The first and foremost deference between COCOBA and VICOBA starts

from the initial process of establishing VICOBA. At the first point, Sedit trained

advisors call a village meeting and introduce the idea of VICOBA, how it function and

how to join it. Then villagers are given time to ask questions on what they

understand and what they need further clarification (Sedit and Ogut 2010; Begasha

2012). From this meeting, the second meeting is also set up and they participate

again. This is the time where those who are interested to join, then in fact register to

form a VICOBA group. After the formation of groups, rigorous training is provided,

covering issues from entrepreneurial skills to business management and from loan

disbursement to loan repayment (ibid). On the other hand, COCOBA was initially

designed to targeted group of illegal bushmeat hunters. In COCOBA, TOTs are

trained for the purposes for being the facilitators of their fellow group members. In

addition, on top of the welfare fund, members contribute to environmental fund and

gifts.

The difference between the formal and informal microcredit institutions

While in formal microcredit institutions the interest rate earned from loans flows

back to lenders to cover operational costs, in semi-informal ones, the interest rate is

re-invested in the group (Begasha 2012). In Tanzania, organizations such as

COCOBA and VICOBA operate following the structure of semi-informal microcredit

institutions, as such communities that form these groups are not essentially

reporting to BOT rather operates according to their own rules at the grassroots

level. Indeed there are many other differences such as the lack of formal

employment in informal microcredit institution as opposed to formal microcredit

institutions were a number of professionals handle finances, data and registrations.

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3.3 Environmental Benefits of Microfinance institutions For many years, many poor communities in developing countries have been entirely

dependent on the use of natural resources to sustain their daily lives. The main

resources used include bushmeat, firewood and charcoal, timber and other building

materials, honey, fruits and roots for various medicinal and food purposes.

Unsustainable and uncontrolled use of natural resources causes substantial

environmental degradation in many places in Tanzania including the national parks.

The buffer areas northwest of the Serengeti ecosystem have been designated in

various conservation categories. Some of these buffer areas overlap with village

lands. The buffer areas include the Ikorongo, Grumeti and Kijereshi Game Reserves

as well as the Ikona Wildlife Management Area (WMA). Whilst national parks and

game reserves are not inhabited by people, the areas outsides these reserves fall

under village lands inhabited by agropastoralist communities and minority hunter-

gatherers, as is common with much of a larger region (Roe and Jack, 2001). With

increasing population around the buffer areas, there have been significant changes

in the land use patterns, and degradation of natural resources (Roe & Jack, 2001).

Kideghesho et al. (2006) found that increased human activity resulted in

fragmentation, deforestation and habitat degradation. This process results in an

overall decline of wildlife habitat and loss of biodiversity throughout the ecosystem.

Earlier reports have indicated the loss of wildlife habitat in Serengeti ecosystem at

60% (Newmark & Hough, 2000 in Kideghesho et al. (2006). A more recent study

carried out in large areas inhabited (mainly) by herbivores indicated a 50% decline

in the number of herbivores, with the Serengeti alone registering a decline of 42.9%

of its herbivores (Stoner et al., 2006).

Bushmeat hunting is regarded as a key threat to the extinction of wildlife in most

African countries (Holmen, 2007). A number of research studies indicate that

bushmeat hunting, particularly illegal hunting, is unsustainable, and poses a severe

threat to both conservation and sustainable livelihoods (Mfunda and Røskaft, 2010;

Loibooki, et al, 2002). Mfunda et al. (2002) found that illegal hunting by residents

17

causes significant management and wildlife protection problems for Serengeti

National Park Managers.

A number of research findings have suggested that income diversification is an

effective way to address poverty and the total dependence of poor local

communities on natural resources. Experience also shows that community-based

natural resource management (CBNRM) is an important part of this effort (Ellis and

Allison, 2004; Nelson et al 2007; Elliot and Sumba, 2011). CBNRM gives

communities a direct role in making decisions over conserving their natural

resources - assuming that they are also allowed to benefit substantially from their

conservation efforts (Elliot and Sumba, 2011). Diversification in this paper refers to

an increase in the household’s income in both variety of sources and scale (Ellis and

Allison, 2004).

Elsewhere recent research findings indicate that initiative community savings and

loans have changed people’s lives as they provide options for income generating

activities. In particular, communities with high poverty levels have experienced

positive impacts (Anyango et al, 2006, 2007; Wild et al. 2008). The COCOBA project

introduced in Mwaluma Village, Ruaha in Iringa Region has been a key factor in

transforming the community’s livelihoods that had depended on the unsustainable

firewood business, now relying on sustainable and profitable agricultural

enterprises (Wild et al. 2008).

3.4 The shortfalls of the MFIs While COCOBA is not a typical MFI, and as such it does not fall under the shortfalls

explained here, it has an opportunity to learn from the current bottlenecks facing

MFIs around the world. MFIs boom has been spreading around the world since

2005. However, in recent years there have been concerns about the future of MFIs.

The doubts began to rise after the reports of suicides of members of MFIs in

Southern India. In 2010, there was a substantial increase in failing MFIs in India

18

followed by reports that every thirty minutes one Indian farmer commits suicide for

either failing to return a loan or due to the hardship of life (Center for Human Rights

and Global Justice 2011). However, current findings indicate that the failures of

MFIs particularly in India were the result of the dependency of the Indian banks on

the foreign sources of credit. Therefore, after the global financial crisis of

2008/2009 the funding of Indian banks declined (Viada & Gaul 2012). Similarly, Di

Bella found that MFI performance is correlated not only to domestic economic

conditions, but also to changes in international capital markets (DI Bella 2011).

Also, in other parts of the world, MFI growth started to slow. Research conducted in

Morocco, Nicaragua, Bosnia and Pakistan in 2010 concluded that major

vulnerabilities of the MFIs were, first, concentrated around market competition and

multiple borrowing; second, overstretched MFI systems; and third poor controls

and the erosion of MFI lending discipline (Viada & Gaul 2012).

Viada and Gaul further found a significant relationship between higher numbers of

lenders and increased systematic risk. They also note that countries that had more

lenders providing debt financing to MFIs in 2007 saw increased risk over the next

four years (Viada & Gaul 2012). The authors came to the conclusion that MFIs are

fragile. They also observed that the poor have limited capacity to absorb debt and

can easily overextend themselves by taking on debt obligations in excess of what

they can reasonably hope to repay (Viada & Gaul 2012). While these challenges have

been observed in formal microfinance institutions, the informal ones are unlikely to

face them because they have limited credit and borrowers and lenders originated

from the same group.

Scholars like Buckley 1997; Brett, 2006 and Horrod-Menzies 2008) note that high

repayment rates have indicated little about the success of institutions, contrary to a

widely held view of many microcredit institutions. Horrod-Menzies (2008) note that

the group responsibility for loans imposes numerous burdens and, the peer

pressure may mean that borrowers struggling to repay loans have to borrow money

19

from other sources to repay the loan (Horrod-Menzies 2008). Buckley (1997 in

Horrod-Menzies 2008) is concerned that funds that might be better channeled to

other forms of development projects are being diverted into microcredit programs.

However, Park (1999) does not consider credit a constraint to economic

development in rural areas, rather investment in education and health programs

could bring better results in some cases.

More recent criticism of the importance of microcredit institutions came from a

researcher at the Overseas Development Institute, Batman who argues that

microenterprise failures can strip poor people of all their remaining assets. She

further observes that the overall lack of access to credit for small and medium

enterprises prevents microenterprises growing into anything more substantive

(Batman 2011).

Other factors that have led to the slower growth of microcredit institutions include

higher financial returns made to managers of these institutes (Batman 2011) and

poor management of credits and revenues. Although the efforts to reduce poverty

through the use of microcredit institutions have faced enormous challenges, the

contribution of these institutions to environmental conservation is making a

difference in Tanzania. The following section provides the background to the

establishment of community conservation banks in Tanzania.

Conservation challenges facing microcredit institutions

While a number of studies (Anyango et al 2006, 2007; Wild et al 2008) indicate that

it is possible the current environmental problems could be reduced through

initiatives such as COCOBA, there are still ongoing environmentally destructive

activities such as unsustainable woodcutting in a number of villages where

microfinance initiatives are in place. However, from these studies it is unclear who

does the woodcutting, of which non-COCOBA members may be the source of the

problem. Wild et al. further observed that microfinance is unlikely to bring about

tangible benefits in the absence of supportive interventions such as institutional

20

capacity building, environmental education, common property resource

management, enterprise development, judicious resource protection, development

and conservation education, and cost and benefit sharing (Wild et al. 2008).

While elsewhere initiatives like COCOBA have been studied, some in qualitative

terms and others with some quantitative analysis, or both, little is known about the

COCOBA initiative in western Serengeti. Although the project started a few years

ago, there is a need to have up-to-date information about this initiative and feedback

from the community. This study is therefore, aimed at contributing to a broader

understanding of the community conservation bank initiatives in Tanzania. This

study is the first to closely study the status of COCOBAs in Serengeti District and

seeks to set the stage for further research by graduate students in the next five

years.

3.6 Serengeti District Profile Serengeti District is one of the six districts of Mara Region. The District borders the

Republic of Kenya on the Northeast; Ngorongoro on the East and Mwanza region on

the South. The District has a total area of 10,373 km2, of which 7,000 km2 is

occupied by the Serengeti National Park, 189. 68km2 Ikorongo Game Reserve,

68.37km2 Gurumeti Game Reserve and 2,456km2 are open area. The only remaining

area of 659km2 is used for agriculture, livestock keeping and residence. As of

November, 2011, the district had 37,356 households and 235,531 people of whom

113,135 were men and 122,396 were women. The district’s growth rate is 2.8% per

year (District Profile 2011).

Serengeti National Park (SENAPA) occupies the largest portion of land in the

district. It is one of the most ecologically significant national parks in Tanzania. Its

establishment dates to 1929 when the Serengeti Game Reserve was declared

(228,600 ha) to preserve lions previously seen as vermin. In 1940, it was upgraded

and declared a Protected area, and in 1951, Serengeti National Park was officially

21

created, at the time including Ngorongoro Crater but the boundaries were modified

in 1959 (URT 2010). The whole process was done by then British Administrators of

Tanganyika. Its establishment was spearheaded by the German conservationist and

then President of the Frankfurt Zoological Society (Nelson 2010).

The main economic activities undertaken in the district include both food and cash

crops farming where about 90% of the population is engaged. Other activities are

animal husbandry, retail and whole sales businesses as well as crafts and art works.

The District has an estimated Gross Domestic Product (GDP) of TZS 31,045,573,944

($19,939,354), and the Per Capita income of TZS 345,000 ($222) much higher than

the National Per Capita Income of TZS 170,733 ($110) (Serengeti District Profile

2011). While the district has a substantial workforce, strategies and strong

partnership with the private sector, it has only seasonal roads, hence poor

communications and accessibility to rural areas during the rainy seasons. The

District further lacks working tools including vehicles, personnel and funding to

implement field work programs.

22

4. 0 Analysis and findings

This section provides the description of the selected groups, their locations and

basic background information such as ethnicity and economic activities. It also gives

an analysis of the collected information that includes the main economic activities,

household expenditure patterns and environmental benefits of COCOBA.

4.1 Overview of COCOBA groups The four COCOBA groups selected are located in four different villages. These

villages are geographically disconnected and about 5 to 10 kms apart. The average

distance from the District Headquarters (and/or Mugumu town center) is between

7-20 kms. While these villages have some cultural, social and political similarities

they also have some significant differences. Similar characteristics include economic

activities where the majority of the villagers are engaged in both farming and

livestock keeping. All villages are connected to the Serengeti National Park and have

had a large number of illegal poachers as well as bushmeat businesses. A number of

dissimilarities include tribal differences, levels of economic progress and the nature

of other economic activities.

Bisarara village is dominated by the people of Kurya tribe, while Nyichoka, Park

Nyigoti and Rwamchanga are mainly dominated by the Ikoma tribe. In each village,

however, there are a few people from other tribes such as Kerewe and Isenye. Both

Park Nyigoti and Nyichoka villages are largely inhabited by traditional pastoralists.

The two villages are located at a close proximity to the Serengeti National Park,

Ikorongo and Grumeti Game Reserves. This makes it difficult for the people in these

villages to grow a variety of food and cash crops. Wildlife such as elephants and

zebras eat crops such as maize, sorghum and beans, which are the main staple food

of many Tanzanian communities. Livestock keeping relatively less risky in areas

adjacent to protected areas than crop cultivation. The latter is prone to wildlife

destruction. Tanzanian laws governing national parks and game reserves do not

allow for human activities such as farming, and gazing in the protected areas. At

23

present, both Park Nyigoti and Nyichoka villages are members of the Ikona WMA.

This is one of the opportunities the two villages have to engage in conservation and

economic activities and hence generate additional revenues. In most cases, rural

households practice both farming and animal husbandry, therefore, making it

difficult to identify the household’s main economic activity among the two and

others.

Gender and COCOBA

From the beginning COCOBA aimed to target men--the bushmeat hunters in villages

adjacent to Serengeti National Park (SENAPA). Women were given an open

membership. The results of the field survey show that 64% of the respondents

surveyed were women. This alludes to the possibility that, on the basis of open

membership, the number of women might be even higher than the current percent,

because the majority of women in developing countries remain poorer than men.

Studies in other parts of the world indicate higher participation of women in MFIs

activities. A study carried out by the Microcredit Summit Council of Practitioners in

1998 surveyed 925 member institutions, and that about 76% of clients were women

(Microcredit Summit 1999; Holvoet 2005). Regarding this figures, it is however,

important to note that most of the institution covered by the Microcredit Summit

were mostly restricted to women.

A number of women join MFIs to earn income to support their families and

particularly children. A study by the UN Millennium Task (2005) finds that in rural

Africa, women often play a key role in the household such as supply of food and

cloth to children and production, and particularly in agriculture. It further indicates

that in sub-Saharan Africa women contribute about 60% to 80% of labor for food

production both for household consumption and sales. Also, according to existing

studies, the issue of gender determines the levels of loan repayments among the

members of the MFIs. This has been well documented by (Hulme & Mosley 1996;

Sharma & Zeller 1997; Holvoet 2005).

24

While still early, COCOBA members can tell the difference from other microcredit

groups in the village and the district at large. To-date, COCOBA members can

differentiate between the environmentally friendly business and nonfriendly ones6

to some extent. At the discussion group in Rwamchanga Village, members of the

Juhudi group stated that they were instructed to invest in business activities that

were conservation-friendly. Also, in Nyichoka Village, three members of the Zinduka

groups who are also in VICOBA group gave an example indicating that members of

VICOBA have no restrictions to start up the income generating activities. They

explained that in VICOBA a member can start up even a charcoal business because

the institution (VICOBA) has no mention of environmental conservation, a core

feature behind the establishment of COCOBA. One participant who doubles as a

member of both COCOBA and VICOBA groups finds that loans from VICOBA have

higher interest rate compared to those she gets from COCOBA. She further observed

that VICOBA is short of funds, inadequate personnel and entrepreneurial trainings,

as opposed to COCOBA. At present, VICOBA groups in Nyichoka Village are

supported by the Foundation for International Community Assistance (FINCA)

Tanzania.

COCOBA is different from VICOBA--the initiative funded by the Swedish

Development Agency (SIDA) to provide loans to poor communities countrywide.

VICOBA focus on poverty alleviation strategies, and it has no specific target groups.

On the other hand COCOBA was specifically formed to target the former bushmeat

hunters. It was meant to create enabling environment for bushmeat hunters to get

credit to startup alternative income generating activities. Members of the VICOBA

groups have no environmental conservation requirement but allow participants to

engage in any business or productive economic activity. As of December 2011,

Serengeti District had eighty (80) registered VICOBA groups. This equals 80%

achievement of the district’s goal of having hundred (100) VICOBA groups by 2011.

In total, these groups had savings of up to 653,316,700 ($419,600) (Serengeti

6 COCOBA group discussions in Bisarara, Rwamchanga and Nyichoka villages January 26 & 28, 2012

25

District annual report 2011). Whilst VICOBA groups are making some progress,

district community development officers are concerned with the inadequate human

and financial resources to provide the required technical assistance to these groups

at the village level.

While VICOBA is one of the tools publicized by both politicians and government

officials as a means for poverty alleviation, COCOBA has not enjoyed the same

publicity despite having poverty reduction in its core goals. COCOBA has been

advocated and supported by non-governmental, conservation-based organizations.

In recent years SENAPA has joined FZS to support COCOBA groups. In addition,

COCOBA members are themselves the source of the credit extended as loan(s) to

each other under their own leadership.

4.2 General performance of COCOBA groups in Serengeti District As of February 2012, the 19 COCOBA groups had total savings of TZS 95,000,0007

($59,271.3) ready for disbursement as loans and TZS 56,000,000 ($34,938.9) was in

the circulation. In 2011, four more COCOBA groups were formed through the joint

efforts between the FZS and SENAPA.

To-date, five COCOBA groups, two of which are in the case study, have set aside

about 700 acres of protected areas (Tumaini Njema, 2011) and have reportedly

planted a considerable number of trees.8 The groups have also started beekeeping

projects. By January, 2012, there were 107 modern beehives installed in 4 groups, in

four villages, of which two were in the case studies (Nyichoka and Bisarara villages).

Beekeeping is carried out as an individual business in the two villages, but projects

are located in communal lands.

7 1$ = TZS 1,557 as of April 9, 2012 8 Interview with SENAPA community outreach program officer, January 29, 2012

26

4.2.1 Performance of selected COCOBA groups By the time of this survey, all four groups had total shares of TZS 13,601,300

($8,736) and TZS 20,059,500 ($12,883) was already disbursed as loans. This

amount is double the amount of shares collected and disbursed as loans in the first

year 2010 where total shares were TZS 5,502,300 ($3,534) of which 5,035,000

($3,233) was disbursed as loans (see table 1). It is also important to note that the

total loans are higher because groups used accumulated shares from previous years

plus the top up credit given by the FZS.

Presently, in terms of total shares, each group’s total collection varies slightly. This

can be explained by the number of active members in the group and their income

status. Overall, the Juhudis in Rwamchanga Village performed better than the rest of

the villages in terms of total collection of shares. Park Nyigoti Village ranked fourth

in all the categories with Mkombozi in Rwamchanga Village and Zinduka in

Nyichoka Village being in the second and third positions respectively. As of now,

Zinduka group has loaned more to its members than any other group.

Table 1: Financial report of the four COCOBA groups

Group Shares in year 1 (TZS)

Loans in year 1 (TZS)

Shares in year 2 (TZS)

Loans in year 2 (TZS)

Juhudi 6,143,650 2,245,050 12,287,300 4,490,100

Mkombozi 4,643,750 2,282,000 9,281,500 4,564,000

Zinduka 3,540,300 2,697,500 7,080,600 5,540,300

Thorani 1,429,850 554,000 2,859,700 1,108,000

Total 5,502,300 5,035,000 13,601,300 20,059,500 Source: Tumaini Njema financial report 2012; Author’s calculation 2012; $1= TZS 1557

While there are many factors that may explain why Rwamchanga Village had such

success, the enthusiasm of COCOBA TOTs may be a powerful factor as they play a

leading role in encouraging members’ participation in COCOBA activities. It was also

observed that two COCOBA teachers in Rwamchanga have done especially well

economically, but their success is likely due mostly to their experience, knowledge

and creativity. The other factor is the COCOBA leaders (Chairperson, Secretary and

27

Treasurer). These are the people who lead the meetings and also participate in

different workshops and field trips. In general, an individual member creativity and

readiness to learn is fundamental to success. While the FZS and TANAPA try to

rotate participants in learning and exposure trips, the leaders are still the one with

the most exposure, creative and visionary leaders have effectively designed,

mobilized and engaged members in conservation and other income generating

activities such as beekeeping and poultry.

In addition, the village government plays a significant role in providing an enabling

environment for COCOBAs to flourish. A number of COCOBA activities are somehow

tied to village resources. For instance, in implementing beekeeping projects in

public land (s) COCOBA groups need to secure approval from both the Village

Council and Village Assembly. As of January, 2012, in Nyichoka and Bisarara villages

COCOBA groups have been allocated pieces of land for beekeeping and conservation

initiatives. By January, 2012, Zinduka group in Nyichoka Village had 22 beehives in

an area also protected as the water catchment area by the same group. Also,

Mkombozi group in Bisarara Village had 23 beehives installed in an area where the

group has also been planting trees for the past three years.

In these two villages, (Bisarara and Nyichoka) village governments’ view COCOBA as

one of the keys to conservation and development initiatives. During in-depth

interviews, village leaders explained that they give opportunities to teachers,

leaders and other members of COCOBA groups to mobilize their fellow villagers to

form new or join existing COCOBA groups in village meetings. This was also

observed during the group discussions with COCOBA members.

From the field observation, group discussions and interviews with key informants,

each village in the district has a set of leadership strengths and weaknesses. A

number of villages also have different attitudes on development issues. These

include poorly designed personal initiatives to start individual business or group

works. For example, in Zinduka group, Nyichoka Village, Respondent 2 (the TOT for

28

Zinduka group) and her family have built a small hostel and curio shop in their

household compound. Presently, the hostel is used by tourists and visiting

international students. Although she started to work on her idea before the

establishment of COCOBA, the implementation of the project was the result of

training and loans she received from COCOBA. Respondent 2’s hostel is currently

registered as the Ikoma craft business center where all COCOBA and non- COCOBA

members in Nyichoka Village take their crafts which are later sold to the curio shops

in Serengeti National Park. Non-COCOBA members are charged extra service fees.9

Moreover, a total of 22 members of Zinduka COCOBA group have formed a dancing

group that performs regularly at the Grumeti Reserve Lodge for profit. The group

also performs traditional dance at various local functions such as wedding and

religious ceremonies in the village and Mugumu town.10

Therefore, COCOBA groups in different villages show different levels of

achievement. From this preliminary study, Park Nyigoti Village provides evidence of

how villagers can have low self-motivation to start up initiatives compared to the

other villages (see table 1 above). As of February, 2012, the Park Nyigoti Village has

had the lowest savings and loan rates than any other villages and has no group

projects compared to groups in Nyichoka and Bisarara villages which have

beekeeping and conservation projects. Also, as detailed above Zinduka group in

Nyichoka village have the most diversified economic activities. The Park Nyigoti

Village’s geographical location enables it to access markets for agricultural produce,

and customers for restaurants and shops. However, few or none of these initiatives

have been established in Park Nyigoti.

9 Personal communication with Zinduka TOT, June 1, 2012 10 Ibid

29

4.3 Socio-economic activities The leading income generating activity11 practiced by the majority of COCOBA

members is agriculture (89%), followed by small business at about 10%. Agriculture

is usually practiced even by those who engage in other activities such as a business.

This can also be explained by the national statistics whereby in 2011, agriculture

remained the main economic activity for as much as 77.5 percent of the population

and it accounts for 95 percent of the food consumed in the country. In 2010

agriculture sector grew by 4.2 percent compared to 3.2 percent registered in 2009

(URT 2011). While at least every household has some livestock, only 7% of the

respondents mentioned it as a main part of their income generating activity.

Other income generating activities performed by the members of the COCOBA

groups vary from one individual to another and from one village to another. An

individual’s activity and production are influenced by the accessibility to loans,

individual skills and proximity to market places. A number of livelihood strategies

such as farming, livestock keeping and some small businesses have been in place

even before the introduction of COCOBAs. While this study identified these

traditional activities, it sought to know the types of income generating activities that

members of COCOBA groups were taking loans for in order to assess their progress.

The results show that COCOBA members are engaged in ten economic activities.

These include business such as restaurants, kiosks, buying and selling food crops,

salons, sewing and weaving, carpentry and selling livestock and crafts.

Apart from food crops cultivation, a number of COCOBA members participate in the

production of cash crops such as cotton and tobacco. Field observation revealed that

a number of COCOBA members participate in the tobacco business too. While some

may not understand some significant environmental problems associated with

tobacco farming, this is a serious threat to the sustainability of trees in the district.

11 The Danish Refugee Council defines income generating activity as 'small-scale projects that create an income source to individual beneficiaries or beneficiary groups whilst promoting a) the principal right to self-determination and b) the objectives of integration, repatriation and (re-)integration.’

30

District agricultural officials, while concerned with the growing trend of tobacco

farming, have blamed politics because the crop was rejected to be planted in the

district for years due to its potential environmental impacts.12 The following studies

on COCOBA therefore should investigate whether the investments in tobacco

production and businesses among the members of the COCOBA continue in the

future. It is also important to note that this study has shown increase in a number of

economic activities carried out by the members of COCOBA groups. But, it has not

studied whether there were changes in economic activities such as production of

food crops and or cash crops between 2010 and 2012.

Presently, a tobacco Company called Tanzania Alliance has opened an office and

storage facility in Mugumu Township. While it is not the purpose of this report to

venture into the cultivation of tobacco in the district, it is noteworthy that

stakeholders concerned with conservation and development initiatives took the

matter seriously.

In recent years, charging mobile phones using solar power is one of the emerging

businesses among the members of the COCOBA groups. This is because most

villages that form COCOBA groups are not connected to the national grid. Other

common activities across the groups are selling food crops (grains such as maize,

beans, and sorghum), buying and selling livestock when prices are low and high

respectively. In recent years, there has also been increasing opening of kiosks and

restaurant businesses in the visited villages. These emerged as some of the reasons

people were taking loans from these groups.

4.4 Savings, credit facilities and household assets In an attempt to understand the availability of savings and loans, households’

representatives were asked whether they have savings, loans and sources of those

savings and loans. The results are indicated below.

12 Interview with the district agricultural officer, January 28, 2012

31

4.4.1 Savings and types of collaterals In the survey, 82% of respondents had savings in COCOBA while 17% had no

savings, and for 1% the information was missing. To be a member of COCOBA group

one must have share (s) in it, therefore, the percentage of members with savings

could have been at least 99%. However, it is possible that this result might have

been due to lack of understanding among the respondents about their savings or the

way the question was presented. About 86% of the respondents reported having

secured loans from COCOBA between 2010 and 2011. The percentage is not 100%

because some members have returned the first loan, and they are yet or in the

process of taking the second loan. A majority of 74% have used their own shares to

access these loans. About 12% of the COCOBA members used livestock as collateral

to get their loans. The use of livestock is part of the agreement among the members

of JUHUDI group in Rwamchanga Village. It is only one person (1%) who used a

milling machine to secure COCOBA funds. In COCOBA, members form a small group

of five people with similar background (friends or acquaintances). Members of these

groups guarantee each other the loan taken from the larger group of thirty people.

Almost all those who used livestock as their collateral were from the Juhudi

COCOBA group in Rwamchanga Village. There was only one percent of savings in

commercial banks. This is partly explained by the lack of commercial banks in the

rural areas in Tanzania as in other parts of the country. Serengeti has had only one

commercial bank. It is only in the past year that the CRDB Bank Plc mobile bank was

introduced in the district; thus far only two commercial banks are operating in the

district.

Since the four COCOBA groups visited during this study were formed in 2010, they

only had one to two business cycles. Given this, most members only had one loan

from the COCOBA and few twice and very few thrice. According to the field results

those who took the first loans were about 86% of the whole members, while and the

second loans were 34% and less than 5% had taken the third loan.

32

4.4.3 Households’ assets holdings At the time of this research, among the surveyed 73 COCOBA members 57 people

(78%) reported owning mobile phones. This equates to an increase of 4% between

2010 and 2012. Out of 73 members, 92% had one to four mosquito nets. This fell

short by 1% as compared to the 93% of those surveyed in 2010. While the statistical

significance of these increments are doubtful, the present ownership of mosquito

nets among the COCOBA members is slightly higher than the goal set by the

Population Service International (PSI) Tanzania; 80% of pregnant women and

children to be sleeping under insecticide treated nets by 2013, and for 90% of

households own at least one treated net (PSI 2012). The health benefits associated

with the use of mosquito nets include the increase in individual productivity and

saving of resources otherwise used to treat malaria.

When asked a follow up question on which assets members bought as the result of

the COCOBA business, their responses frequently showed purchase of solar for both

lighting and charging of mobile phones. For instance, in 2010, among the 89

households surveyed, only 2 households had solar, but in 2012, the number rose to

25 households. This increase can also be explained by the increase in the number of

people owning mobile phones (for more see table 2). Information about the

household assets is helpful in determining the wealth of the household and

investment and consumption patterns. At this point, however, it is worth

mentioning that these changes may not only be the result of COCOBA because there

is no data from non-COCOBA group (control group) this study has explored.

33

Table 2: Changes in the households’ assets 2010-2012

Changes in the household's owned assets

Asset's name HH = 89 (2010) HH =73 (2012) Changes

% % %

Mobile phones 64 78 14

Mosquito nets 93 92 -1

Bicycles 63 71 8

Motorcycles 6 7 1

Maksai/Plough 61 66 5

Chicken coop 29 25 -4

Solar 2 25 23

Radio 63 58 -5

4.4.4 Impact of COCOBA on ownership of livestock In the survey, about 7% reported that livestock keeping was one of their main

economic activities. In the same survey it was also established that in 2011 alone

about 473 livestock were purchased by the members of the COCOBA groups. This is

about 4 livestock per household (this includes chickens). By 2012, on average,

members of the groups seem to have increased the average number of livestock

owned by a household by 3 livestock from 2010.

Table 3: Livestock owned by household from 2010 - 2012

Number of livestock owned by household in 2010 and 2012

2010 (88 HH) 2011 (73 HH) 2012 (73 HH)

Livestock Ave. per HH Purchased

Ave. per HH Livestock

Ave. per HH

Ave. changes in 2010 and 2012

3409 9 473 4 2752 12 3

Note: HH = Household; Ave = Average

4.4.5 The Impacts of COCOBA on households According to the results of the group discussions, COCOBA has been an excellent

means for members to get loans, business ideas, invest savings and make tangible

investments. During the group discussion in Bisarara Village, members of Mkombozi

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COCOBA groups expressed their feelings in different ways. One member of the

group noted that “if it was not for COCOBA, I could not have started my business of

selling goats’ soups in Nyamburi Village. I did not have business ideas, and the only

way I could earn any income was through selling bushmeat”. According to a number

of COCOBA members, COCOBA has not only brought about access credits and

trainings, but also created a forum in which members can discuss emerging issues

from social events to politics, development and conservation.

Today, all the four COCOBA groups have established social, environmental and grant

funds. These funds cater to educational and health issues, and environmental

protection. Grant funds are set for special donations and gifts. Although COCOBA is

in the early stage, members of the groups have expressed their confidence in these

initiatives. To-date these funds have helped a number of families with financial

difficulties to pay tuition fees for their children at the Secondary School.

Education: FZS in collaboration with SENAPA has taken a number of the COCOBA

members to a number of business exhibitions in Arusha and Mwanza cities. Having

these exposures, today members of the COCOBA groups have greater business skills

and experience than before joining the groups. This was observed during group

meetings where people expressed how they could not keep earnings they generate

from their businesses before joining COCOBA. But, after COCOBA’s trainings and

exposure trips, they do cost-benefit analysis and budget their earnings better on a

priority basis.

Entrepreneurial Skills: From the survey, 56% of the total respondents mentioned

that one of the benefits of COCOBA was the development of entrepreneurial skills. In

the discussion groups a majority similarly expressed that they benefited from the

training offered by COCOBA TOTs. A number of participants mentioned that

training did help them to prepare and write business plans. At the same time, the

members expressed the need to have more guidance to further improve their

business skills, financial management and search for markets.

35

Social changes: Through exposure to public forums, women in COCOBA groups

gain public speaking and decision making skills. During the group meeting in

Nyichoka Village, one participant expressed that COCOBA has strengthened

women’s participation in decision making processes in both household and public

spheres. While this can also be explained by increasing changes in society at large

due to the growth of access to media (mobile phones, radios and other sources of

news), COCOBA provides an opportunity for members of both sexes to practice

accountable and transparent leadership.

Group activities: To-date, a number of COCOBA groups have established activities

where every member participates. Other groups have members participate in

group activities individually. From the surveys, the leading group activity is

environmental education in which 60% of the members participate. About 53% of

the members engage in craft making. 6% of the members participate in group

beekeeping projects and about 32% participate in goat keeping projects in their

groups. The group participation in beekeeping projects is low because in Zinduka

group – Nyichoka Village, individual member purchases and installs their own

beehives, but they are all within the group’s land.

Figure 3: COCOBAs’ group activities

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4.4.4 Household’s source of cooking energy The majority of COCOBA members (88%) depend on firewood as the main source of

energy. Charcoal is the second source of energy and is used by (11%), and kerosene

by 1%. None of the members uses electricity or gas for cooking among the 72

households who responded to this survey. On average, a household uses 2 bundles

of firewood per week and those who use charcoal spend 1.6 bags each week.

Figure 4: Source of cooking energy

4.6 Peoples’ attitudes, perceptions and views towards COCOBA To understand peoples’ perceptions of COCOBA a number of questions were asked.

The results show that people consider COCOBA has had a beneficial environmental

impact in their area. In the survey, 85% said COCOBA has increased the number of

planted trees in their areas, and 79% and 58% think COCOBA has reduced

incidences of illegal poaching and bush fire, respectively. Also, 36% of the

respondents mentioned that COCOBA has stopped habitat destruction, and 47%

consider COCOBA has brought back some of the previously declining/missing

wildlife species. Nevertheless, these responses were obtained from closed-ended

questions. Therefore, some responses might have been affected by the perception of

social desirability. These findings are by no means minor. Similar responses have

also been provided during the group discussions. For instance, the issue of wildlife

increase is of high concern among members of COCOBA groups because incidences

of large mammals like elephants and zebras eating and destroying farm yields are

37

on the rise. Villagers’ perception that poaching has declined is however contested

by the district game officer. According to the game officer, the number of poachers

caught might have declined due to the increased use of technology such as mobile

phones that may enable poachers to escape game rangers.13

However, as we can see in figure 5 below, there is no significant decline in the use of

natural resources particularly firewood and charcoal by local communities. Since

88% of the COCOBA members still depend on firewood as their source energy, the

11% of those who said COCOBA has reduced dependence on natural resources may

reinforce the former. In addition, the lack of reliable, cheap and clean alternative

sources of energy makes it difficult for COCOBA members to shift away from the

traditional sources of energy. At the moment, all villages where COCOBA has been

initiated are yet to have electricity or gas services. Kerosene which is used by the

single household among COCOBA members is currently an expensive option. By

April, 2012, a liter of kerosene was sold at TZS 1700 ($1.09).

Figure 5: COCOBA’s perceived impacts on environmental conservation

13 Interview with the District Game Officer, January 28, 2012

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4.6.1 Other environmental benefits of COCOBA. In the survey, other benefits of COCOBA groups mentioned by the respondents

include increased income (78%), provision of alternative sources of income (42%).

59% of the respondents think that COCOBA has improved their livelihoods. COCOBA

also has been mentioned as the key poverty reduction strategy in both group

discussions and in-depth interviews. This correlates to the survey results where

74% members of the four COCOBAs mentioned poverty reduction as one of the

benefits of COCOBA.

Figure 6: Other benefits of COCOBA

Also, in the group discussions, it was established that, even though COCOBA has

been in place for only three years, a number of COCOBA groups have made some

significant achievements in conservation efforts. For instance, in the four villages

visited during the field work, groups have either established or are in the process of

acquiring some space for conservation and development initiatives. A Zinduka

COCOBA group in Nyichoka Village has established a protected water catchment

area. Presently, the group uses the same area for its beekeeping project. Also, at the

39

time of this writing the Zinduka group had 22 beehives14 installed and with bees.

The Mkombozi group in Bisarara Village has set up a beekeeping project and has 23

beehives already installed in the area.

As the management of natural resources evolves, these communal initiatives are

critical. They are likely to lead to sustainable conservation strategies in high value

ecological areas. Empirical evidence indicates that regions with effective community

management of forest resources have little or no deforestation. These communities

have also been recognized for having sustainable livelihoods (Bray 2010). The

initiative to protect water catchment areas in Nyichoka village has an informal

background. The value of water in areas with livestock is understood. This is similar

to the informal protection to guard water sources and wildlife refuge practiced in

Mexico (Bray 2010), thus, contributing to COCOBA’s success in renewing traditional

conservation strategies.

4.7 Household expenditure patterns This section analyzes the expenditure patterns of the household. It shows

household allocations of earned profit on consumption, savings and investment. It

also shows how people spend most of their profits.

4.7.1 Use of earned profit The usage of the earned profit from business activities varies from one household to

another. Among the COCOBA members, about half (55%) of the income earned from

COCOBA businesses is spent on school fees and other things necessary for a child to

attend school, mostly secondary. However, in the absence of comparison with non-

COCOBA members, therefore, it is difficult to know how much other people in rural

areas spend for their children’s education. In Tanzania, the secondary school has

annual fees of about TZS 40,000 ($25.70). The cost of school fees, however, varies

from place to place, particularly when additional charges such as desks and

14 Field visit in both Nyichoka and Bisarara villages, January 25 &28, 2012 and Tumaini Njema. 2011

40

uniforms are included. Another source of spending is on household nutrition (37%).

This might be the result of the households’ demands for manufactured and

processed food products. A number of people re-invest most of their profits in their

groups as shares. According to the survey, 34% of profit is re-invested. Some use

their profits to buy household assets, and/or start building permanent houses. Some

spend profits on health services.

Figure 7: the usage of earned profit from COCOBA businesses

Comparing groups’ performance

To-date each COCOBA group has achieved a changing level of performance Park

Nyigoti Village has few people who have shown progress in terms of resource

acquisition, taking loans as well as buying household assets. From the survey

results, this village has few people engaged in community projects compared to the

other three villages.

There is a need to address the competence of the group leaders and trainees.

Facilitating agencies (FZS and SENAPA) should ensure that the COCOBA leaders and

trainees are themselves enthusiastic about what they are doing, and there should be

41

election period and performance measures. This might include the level of

individual performance in the group as well as a commitment to do his/her

responsibilities.

Left unchecked, weak groups may not make any progress and/or may disintegrate

altogether. Presently, the COCOBA group in Park Nyigoti Village has few individual

projects and has yet to start any group project. Compared to the rest of the villages

where groups have started or already established group projects, Thorani COCOBA

group is also yet to make tangible progress.

The Future of COCOBA

The results from group discussions, in-depth interviews with key informants, and

household surveys show that members of the general public are willing to join

COCOBA groups as means to improve their lives. Government officials support these

groups. A number of them consider COCOBA a basic development unit15. In the

survey, 92% of participants agree that members of their villages are willing to join

COCOBA. While these results are encouraging for conservation organizations

thinking of establishing more groups, there is a need to study the views of non-

COCOBA members about the current COCOBA groups. Any rush to establish more

groups may mean less guidance to the current groups before they actually take off.16

Nevertheless, once sustained the current groups will be an example and model for

new establishment.

Another important aspect that might determine the future of the COCOBA groups is

the repayment of loans. As of today, this has not been an issue. Each group has a set

of rules that originate with the group’s constitution. But, it is worth paying attention

to how groups evolve as they strive to grow and attract more shares from members.

15 Interview with the Serengeti District Executive Director, January 2012 16 Interview with the Serengeti National Park, Outreach Program Officer, January 2012

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5. 0 Discussion

As elaborated in sections above, this study has sought to shed light on the progress

of four COCOBA groups in Serengeti District. There are indeed a number of

promising achievements, but COCOBA is still faced with a number of challenges. This

section discusses those challenges, and provides insights on from the literature and

experiences.

Presently, most people in COCOBA groups are engaged in small activities such as

selling grains, poultry, livestock and charging mobile phones using solar power.

While in the short-run some or all of these undertakings are viable investments,

there is still needs to develop more projects that are sustainable and with long-term

benefits such as beekeeping and retail shops. These are projects that can be

sustained over a long period of time. For instance, during the group discussions

members of the COCOBA groups have expressed their interest in soap making

businesses, but they lack the skills to do so. In Tanzania, locally produced soaps

have been in use for many years. Women groups in Mto wa Mbu, Monduli District

have been producing soaps using locally grown jatropha seeds (Sulle & Nelson

2009). In Bukoba District, the local orphans’ center, the ‘Solidarity With Orphans’

produce soaps to be used by children.17 The center produces liquid and hard soap

soldto the local communities and businesses such as hotels,

hospitals and local transport companies. Indeed, the soap making business has been

reported as successful among the members of MFIs in India. Brook et al. (2008)

observe that a group of 31 women who set up a soap powder-making business, at

one point sold over 250 kilograms per month. This activity has potential short-term

and long-run benefits to COCOBA groups and is thus worth facilitation by all

stakeholders engaged in development and conservation.

17 More about the production and use of locally produced soaps check: http://solidarity-orphans.org/tanzania/projects/soap-projec/

43

As of now, it is clear that a number of investments made by COCOBA members have

direct and indirect benefits to both conservation and poverty reduction efforts. For

instance, more than half (55%) of the total revenue earned by the household is used

to send children to school. This does not have an immediate effect on poverty

reduction and dependence on natural resources. Rather, the attempt to send

children to school will have potential benefits on poverty reduction and

conservation efforts in the longer run. At least, highly educated people tend to

secure well-paid jobs reducing the levels of poverty in the society (Tilak 2005).

However, while the field results indicate higher allocation of earned profit to

children’s education, it is unclear if non-COCOBA members also do the same or not.

People with increased wealth have both positive and negative impacts on the

environment. For instance, some may respond to wealthy by leaving villages and

stay in urban areas engaging in businesses. Also, in some cases, people with

increased wealth reduce their dependence on natural resources through

diversification of economic activities and consumption. However, as a result of

increased wealth some people tend to expand their consumption of natural

resources as they have the capacity to do so. Therefore, income diversification is

not a total cure for present environmental problems. Also, sending children to

school might have also been encouraged by other factors such as the government

policy of establishing more primary and secondary schools at the grassroots level

and therefore, may not necessarily be the direct effect of COCOBA initiatives. From

2005 to 2012 there has been an increasing trend in students’ enrollments in

secondary schools around the country. For instance, in 2010, the enrollment of

students increased from 1,566,685 to 1,802,810 in 2012. This is equivalent to 15%

increase in two years (URT 2012). Also, perception that sending children to school

as proper use of income pleases development partners might have influenced a

number of responses to this study. Therefore, systematic analysis on the use of

earned profit from COCOBA need to be evaluated in next short and long term

studies.

44

At the moment, another noteworthy observation is that the COCOBA groups in

Serengeti are not linked to any of the microcredit institution or commercial banks.

COCOBA operates according to the set of rules and a constitution prepared by the

local people in collaboration with their facilitators and donors. While this gives

COCOBA greater independence from external influence, it reduces its financial

capabilities and potential exposure to modern financial management. Nevertheless,

this approach shields it from national and global financial problems such as an

overpayment of managers in a number of countries in South Asia (Di Bella 2011).

However, without precautionary measures, as this initiative expands, it will require

an experienced management team which will demand reasonable pay.

Also, as observed in other studies, the use of a household’s assets as collateral is one

of the reasons that some poor household can become worse off if they fail to repay

loans. However, at the moment, this is not a problem for COCOBA groups, as none of

them is using land as collateral to secure loans, rather their own shares and the

small group’s guarantee. But, for efficient and sustainable COCOBAs, increased

capital, and hence higher credit to members, is crucial. At that point the use of

physical forms of collateral such as land and house might be used. It would then be

crucial to address the issue of common and individual rights. However, since the

COCOBA is at its preliminary stage, yet its main goal has always been to leave it

grow using its members shares, the challenges of using household’s assets may be

avoided.

Further development of COCOBA might need to consider collaboration with village

leaders at the grassroots level. This is because in the rural areas village leaders are

trusted by their followers who extend beyond the COCOBA members. Therefore,

COCOBA initiatives need to engage these leaders strategically. This will enhance

activities of the COCOBA groups such as environmental education, traditional

businesses as well as conservation related initiatives. As pointed out earlier, it is the

village government and village assembly that have to approve development and

conservation initiatives that may require village lands. Indeed, the findings from the

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field interview indicate that there are a number of COCOBA members who are also

part of the village government. However, any political domination by village leaders

needs to be avoided

Gender and poverty are key features that any stakeholder engaged in an initiative

like COCOBA might not want to underestimate. Presently, the COCOBA targets are

mainly men, previously identified as bushmeat hunters. Yet, as the institutions

expand, it is likely to attract more women. A number of previous studies have

indicated women form a larger population of MFIs. The Microcredit Summit Council

of Practitioners reports that women in rural communities are the poorest and the

most responsible for household compared with men (Grown et al 2005). This poses

a challenge to these women to benefit from their efforts in a society where most of

the household decisions are made by men. However, during group discussions

participants explained that decisions are jointly made at the household level. But, it

is at least understood that many traditional aspects favor men as the head of the

households in many African tribes and thus most decision at the family level is done

by men. Since women carry out at least 60% of the domestic responsibilities, they

deserve to have a voice in household decision making. Left unaddressed, this will

affect women’s participation in COCOBA activities when men continue to hold

powers on resource spending.

As observed in the findings, a majority of the COCOBA members use their loans and

profits to send their children to school. While this is a tangible long term investment

assuming that children succeed in their education, it has less of an immediate

environmental impact. It also poses a risk on loan repayment. This is, therefore, one

of the aspects that donors and environmental stakeholders engaged with COCOBA

initiatives need to watch. However, this study had no participants outside COCOBA

members, thus unable to compare the rate of children’s enrolled between COCOBA

and non-COCOBA members.

46

As detailed in the section above, the purchase of mobile phones, bicycles and

mosquito nets among the COCOBA members has increased in the past two years.

While one explanation for the increase in the purchase of mosquito nets might be

the increase in household income, it is also possible that this has been influenced by

the government’s campaigns to reduce malaria endemic in the country. But, in any

case this has a potential impact on the productivity of members in both the short

term and long term as it possibly reduces their spending in medical services. The

demand for bicycles among the COCOBA members increases as they engage in small

trades and therefore transport goods and services in search for markets as well as

collecting raw materials. In 2010, there were about 63 household that reported

owning bicycles and in 2012 the number increased to 71 households with bicycles.

This is an increment of 8% of household members that purchased bicycles.

5.1 Challenges While the initial findings indicate some positive progress among the COCOBA

members and groups at large, a number of challenges persist. These include:

Inadequate entrepreneurial skill and technical knowhow

In all four group discussions, COCOBA members have expressed their appreciation

about the trainings they have received on entrepreneurship. But, they have also

indicated the need to have more guidance to equip them with more business skills

and financial management. Members want to get skills on how to make marketable

goods such as crafts, soaps and candles. Materials for these goods can be produced

locally, and it is likely that market for soaps and candles will be available in both

rural and urban areas. Crafts for instance are sold to curio shops in Serengeti

National Park and Ngorongoro Conservation Area. Lack of basic education among

the COCOBA members makes it difficult to work faster and effectively in terms of

recording and reporting. The majority of the respondents (67.12%) have only

primary school education and only 9.59% have the secondary school education

while 4.11% have no formal education. This speaks volumes in terms of the need for

47

training to equip members of the COCOBA groups to understand basic business and

entrepreneurship skills. Only one person in all four groups had a college Diploma

while two with vocational training education. In rural Tanzania, this is a generic

problem, but, the possession of basic skills is crucial for individual or group’s

success in business.

Available empirical studies indicate a higher correlation between the levels of

education and poverty among the rural communities. Studies carried out in India

show that people with post-elementary education have better chances to improve

their livelihoods than those with only elementary education (See Edwards 2002;

Tilak 2004).

Market availability

While the term markets might trigger minds as a common problem, it is much more

complicated at the grassroots level. Markets for local produce are volatile and highly

affected by government policies. The availability of sustainable markets will create

incentives for local communities to produce goods and services to meet demand.

But lack of markets for the rural and urban communities in Tanzania and Africa at

large is a common phenomenon. In April, 2012 the daily newspaper ‘The Citizen’

published an Op-Ed written by Jimmy Smith the director general of the International

Livestock Research Institute with the title “African farm produce wasted for lack of

reliable markets”. Smith points out that lack of markets in Africa is critical and

suggests that the issue should be treated as equally important as poverty reduction

and economic growth. One way this can be done is to ensure small holders have

access to financing and to market information, to crop storage and transport.

Effective policies also need to eliminate bureaucratic delays and price volatility,

providing incentives to local producers (Smith 2012). This is one of the timely

revelations of the small producers’ situation on the ground in developing countries,

and it is an eye opening message to conservation and development practitioners.

48

While the conservation NGOs and TANAPA may not have direct responsibility for

arranging markets for the produce of COCOBA members, the two organizations have

a key role to play in enhancing their members’ access to market.

TANAPA has an obligation to mobilize conservation stakeholders including hotel

owners in Serengeti to buy goods and service produced by the local communities

surrounding the park. Also, through the private-public partnership, FZS may well

fund sustainable business initiatives in the area.

Also, as indicated above most of these groups are located in the rural areas and they

do not have organized transportation systems. Roads are also seasonal, making

business difficult during the rainy season, and before they are paved. Improved road

network will not only improve the business environment, but also reduce the time

and number of avoided health risks due to long distances for getting health services.

The challenges identified by common people in the visited groups are not new. As

pointed out in the literature, Wild et al (2008) observed that microfinance is

unlikely to bring about tangible benefits in the absence of supportive interventions

such as institution building capacity, environmental education, common property

resource management, enterprise development, judicious resource protection,

development and conservation education and cost and benefit sharing. In the case of

COCOBA, effective management training is crucial to keep community conservation

and development initiatives productive and sustainable.

Insufficient capital

Groups do not have enough money to enable members to take a lump sum amount

of money to start up sound businesses. With the current amount where individual

takes an average loan of TZS 150,000 ($93) it is economically difficult to start up a

substantial business without other sources of capital. However, while members

have decided to increase their shares, there are some increments in the amount of

loans taken by individual members.

49

Lack of proper policies

While culpability may be directed at local communities for continuing activities that

degrade local resources such as firewood cutting and charcoal making, the greatest

blame needs to be placed on local and national policy makers. Firewood and

charcoal are the only affordable sources of energy in rural, urban and semi-urban

areas. Therefore, the lack of proper and permanent energy alternatives to the large

populations that currently dependent on traditional energy sources continues to

create the market incentives for local communities to supply these large markets,

even at a time when they are engaged in COCOBA-like initiatives.

Insecure banking system

Presently, groups save their money in a locally made credit kit. While the kit is

difficult to break, it is a primitive and risky way of storing valuable items and cash.

The kit is vulnerable to robbery by force and fire accidents. A safe box is crucial for

dynamic and sustainable COCOBA groups.

Lack of expertise

At the moment, members of the COCOBA groups have no readily available poultry

expert to obtain basic advice on better ways of keeping chicken. They are also short

of agriculture extension officers, marketing and cooperative officers, as well as

community development experts. However, during the interview with the district

agricultural officer, it was learnt that the district had just received 47 new

agricultural extension officers. This was in addition to the existing 27 agricultural

officers, meaning that each ward will have at least one extension officer in the

district.18

18 Interview with Mwita Marungu, District Agricultural Officer January 28, 2012

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6.0 Recommendations

Based on the survey’s evidence, discussions with key informants and group

discussions held during the field work, this report has identified a number of issues

necessary for sustainable development of COCOBAs. Members of COCOBA groups

depend on their own sources of income and knowledge to run their groups.

Additional sources of funding, knowledge and skills will boost the development of

COCOBA groups and hence the performance of individual businesses. At this

juncture, this paper provides six specific recommendations for all stakeholders

engaged in COCOBA initiatives.

Recommendation #1: Stakeholders’ strategic engagement

It is understood that much can be done in a collaborative way. Conservation and

development stakeholders need to engage village government leaders in their

programs in a non-political way. Strategic engagement will enhance the COCOBA

groups’ activities such as environmental education, supporting businesses as well as

conservation related initiatives. Current success shows that village leaders’ support

to COCOBA groups is impressive. In Nyichoka and Bisarara villages leaders have

been helpful in groups’ acquisitions of beekeeping and conservation areas.

Engaging village leaders, apart from being a positive gesture to them, also provides

room for them to practice their democratic role as elected leaders of all the people

in the village.

Collaboration here means the established network of organizations, agencies and

other private actors that are in one way or another linked to COCOBA activities.

TANAPA through SENAPA has been working with FZS to strengthen these groups

since 2010, but officials from the community development, cooperatives and natural

resources departments at the district have much to offer to the development of

COCOBA groups. The private sector can also be engaged in the development

processes of these groups through business agreements or networking. The

51

government needs to give incentives to members of the private sector such as

tourists’ hotels and lodge owners to buy locally processed produce of the COCOBA

groups such as chicken, eggs, honey and vegetable as well as fruits. While it might be

difficult to engage most of these stakeholders at the beginning, there is a possibility

for partnership because most of the local commodities such as chicken are in high

demand at tourist hotels.

Recommendation #2: Link COCOBA to potential funding

While the current effort to address the lack of sufficient credit is by increasing the

individual contribution to the group’s pool, it is somewhat uncertain if this will ever

meet their increasing demands. It is, therefore, important for the members of the

group or the group as a whole to have some access to additional credit. The

sustainability of COCOBA initiative will depend on the availability of sufficient credit

to meet ever-increasing demand. Linking COCOBA to potential funding such as

government grants and loan schemes, existing microcredit institutions and potential

private donors, is crucial to improve credit availability. This will improve members’

business opportunities and expand the existing ones. For instance, the grant

donated by the owner of the Grumeti Reserve Lodge was helpful to Zinduka group in

Nyichoka village to buy and install modern beehives.19

In recent years, sub-Saharan Africa has recorded more rapidly growing investment

in microcredit institutions than other parts of the world. This is therefore, an

advantage for advanced MFIs initiatives to benefit from the currently established

microfinance in the East African Community. However, for groups such as COCOBA

to benefit, proper policies, rules and an institutional framework need to be in place.

Otherwise, without effective measures, groups like COCOBA where members’

education, financial management and entrepreneurial skills are low might be

challenged in handling outsourced funds. In addition, experience indicates that one

of the major weaknesses of Grammen Bank and other MFIs in Bangladesh was the

19 Group discussion with the Zinduka group in Nyichoka Village, December 28, 2011

52

provision of multiple credits, encouraging borrowers to take new loan to repay

previous loans. This raised members’ debt, and later led to the collapse of the

institutions (Bond & Alam 2010). Therefore, comprehensive strategies need to be in

place before members of COCOBA groups access more sources of credit facilities.

Recommendation #3: Education and training

The majority of the people in the rural areas have primary school education or none

at all. This makes it harder for them to start and run the business successfully. It also

makes it difficult for untrained and inexperience leaders to manage the group’s

funds especially when the contribution of these groups expands in the future. It is

therefore, prudent for participating stakeholders in developing these COCOBA

groups to design programs that will ensure that at least the group’s facilitators and

leaders are trained about specific courses such as leadership and management,

financial control and also encourage these leaders to take their own initiative to

study more about business, leadership and financial management.

Although not specific to COCOBA members, but, part of the education needs to be on

the best choices of agricultural crops in the region. For instance, in Serengeti District

today there is growing tobacco cultivation, but is this crop is already the source of

deforestation in central regions of Tanzania. In Urambo District alone tobacco

clearing for tobacco farming represents annual deforestation of 6.1% (Mangora

2012). This does not represent trees used for drying or curing tobacco. Therefore,

early education among the COCOBA members and later in the district, particularly to

the villages near the national park will help reduce deforestation and risks of people

tempting to look for woods in the park. Another option as pointed out by the

agricultural official is to use planted trees to dry tobacco, but it is uncertain if

planted trees will be sufficient to meet the growing farming demand. Therefore,

giving a clear message of what is happening in other parts of the country will be

helpful to the communities around Serengeti.

53

Recommendation #4: Markets for local produce

Availability of reliable markets will incentivize local communities to engage deeply

in the production of marketable goods. Efficient supply in the market will further

strengthen market forces and thus increase the profitability for the private sector.

However, in Africa such an outcome is rarely the case. Despite the market

liberalization, states still interfere significantly with the market processes. The most

common types of interventions include restriction on cross-border trade and local

taxes (Poulton et al 2006). This finding correlates with the field observation on the

situation facing farmers including COCOBA members in Serengeti District. Every

time the government issues a warning about food insecurity in Tanzania, it blocks

the export of grains to Kenyan markets denying citizens large sums of revenues.

Enhancing market accessibility to COCOBA members will be one step in fostering

conservation as communities will be earning reasonable amounts of money from

their produce such as vegetables, grains and livestock, crafts and honey. This will

further give income to buy alternative sources of energy, transportation and buy

household assets and improve nutrition. The potential disadvantage that might be

associated with stable market though, is the possibilities of farmers expanding their

farms to increase output and income. This can be checked by increasing yield or

efficiency of the farm output through the provision of effective extension services

and environmental education.

Recommendation #5: Individual and community Initiatives

Members of the COCOBA groups should also understand that they need to take

initiatives on their own. They need to understand that the private and non-

governmental organization cannot do everything for them. Therefore, they need to

improve business skills, understand market dynamics even for locally produced

goods and services, and improve transparency and accountability in their groups’

activities. All these are things that individual members can practice for having

sound and viable COCOBAs.

54

This approach only requires individual members of COCOBA to work out their way

through various training and learning processes. However, initially, all stakeholders

might need to provide information and to communicate the importance of this

initiative to COCOBA members and the public in general. Some of the skills and

knowledge may not even require formal education, rather can be gained through

reading of prepared brochures and pamphlets such as market availability, ways to

produce honey that meet standards and safety measures for human consumption.

However, the challenge of implementing this recommendation is the persistent

poverty among the COCOBA members and poor reading culture among the majority

of Tanzanians. From the result of this survey where a mere 14% of the earned profit

by the members of COCOBA groups is allocated to personal training, it is therefore,

of less priority, as such external motivation is essential.

Recommendation #6: Consistent studies

Since COCOBA has been in place for only four years now, it is ideal to have

systematic studies that analyze the impact of this organization in both short term

and long term. The reason for these studies is that COCOBA is still a new initiative in

Serengeti District and Tanzania at large. Presently there are few studies that show

the early impacts of COCOBA and other related initiatives in different parts of the

country.

Throughout the survey, it has been observed that members of the COCOBA groups

participate in a number of environmentally friendly activities such as beekeeping,

tree planting, environmental education and solar uses for charging mobile phones

and lighting. These are impressive initiatives, however, their monetary values need

to be analyzed over time to have a clear picture of how they contribute to the

conservation of ecosystem, poverty reduction efforts and improve livelihoods.

55

Acknowledgement

I am thankful to Professor Robert Nelson – my supervisor, and academic mentor at

the School of Public Policy, University of Maryland College Park. His professional

advice and encouragement was exceptionally helpful to make this project a reality. I

am grateful to Dr. Dennis Retsch for his tireless support to me from the day I started

to work on this project to its completion. I owe deepest gratitude to my research

committee, Professor Amy Amon, Dr. Anke Fisher and Dr. Stivin Nindi who offered

their time to provide consistent guidance, feedback and constructive comments. I

am grateful to Daniel Yamat, Florentina Julius and Pamela Kereri who worked

tireless to ensure my field work was a success. Dr. Janemary Ntawilwa facilitated the

acquisition of my research permit at TAWIRI. I am indebted to all COCOBA TOTs

who worked diligently to carry out the household survey. Lastly, I want to thank all

the people I interviewed at the Serengeti District offices, FZS and SENAPA for

offering me their valuable time for interviews and reports they shared.

This study was part of the conservation research for East Africa’s threatened

ecosystems (CREATE) five years project co-financed by the Frankfurt Zoological

Society (FZS) and the European Union (EU).

56

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