Kaaba Microfinance Project for Low-Income Women Farmers
In spite of the huge agricultural potential of Somaliland, the growth in agricultural production has not been able to keep pace with that of the demand for food and agricultural products. Somaliland relies heavily on the large quantities of food it imports despite the fact that the country has the land and appropriate climate to grow crops. With high local demand and low food domestic production the country is facing an upward pressure on food prices. High food prices are also adversely impacting low-income farmers because they sell at low prices at harvest time to finance essential needs and buy back at high prices later in the season when their own stock runs out.
The agricultural sector in Somaliland is predominantly made up of smallholder farms which produce the sector’s output. However, the current situation of these smallholder farms is constrained and not sustainable. The majority of these farmers are women and are unable to adequately feed their families, and their livelihoods are not sufficiently diversified to insulate their households from external shocks, due mainly to their low production base. Offering opportunities to increase the socio-economic welfare of these smallholder farms, which are mainly owned by women, is of a paramount importance for Somaliland’s food security.
Providing credit for farm investment, improved post-harvest practices, greater household cash flow, all enable better access to markets, promote better management of risks and encourage non-farm income generating activities. It is against this background that K-MFI aims to increase the production of the targeted smallholder farms owned by women.