Emergency Food Assistance through Cash Transfer Program: Kyrgyzstan

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1 Emergency Food Assistance through Cash Transfer Program: Kyrgyzstan Penelope Anderson, Director of Food Security Feed the Future, Stakeholder Meeting March 10, 2011

2 Cash Transfer Programming Cash Transfer Programming or Cash-Based Initiatives include: Cash for Work, Cash Transfers, Vouchers Cash is a tool of market-integrated relief a means to support multiple sectors- not a sector itself a means to achieve specific objectives an option among a wide range of responses appropriate and complementary depending on context potentially not sufficient alone

3 Market-Integrated Relief meets immediate basic needs minimizes market distortions leverages the private sector for relief jump-starts the private sector promotes the re-emergence of markets

4 Potential cash advantages: promotes empowerment and dignity provides choice allows for variation in need can be efficient, timely & costeffective fewer recipient costs (transport) multiplier effects; knock-on economic benefits provides assets avoids disincentive effects contributes to long-term social welfare programs

5 Potential cash disadvantages: inflationary risks security risks may be more difficult to target may be more prone to diversion less available from donors anti-social use concerns does not meet consumption/ nutrition objectives may be more difficult to monitor

6 Cash is appropriate if people used to purchase essential goods & services through market mechanisms a shock has caused inability to meet basic needs and/ or adoption of negative coping strategies sufficient goods available locally markets are accessible & functioning or expected to be soon delivery can be done safely and effectively people prefer it over other response options

7 Cash & Market guidelines: market integration influences impact set cash transfer size relative to household income carefully target beneficiaries determine if traders can expand supply at or near existing prices analyze market competition monitor consumption patterns conduct regular price monitoring conduct analysis of market multipliers socio-economic analysis necessary to Do No Harm assess capacity of local institutions for cash delivery options

8 Context: Kyrgyzstan in 2010 Map of kyrg Ethnic conflict begins June 10, ,000 refugees into Uzbekistan, 300,000 people displaced within Kyrgyzstan and 765,000 people remaining in affected areas unable to access services and markets. Also many young people left to work in Russia. Food assessment finds that 560,000 in need of food assistance. IDPs also gathered in schools, mosques and other institutions. Internally Displaced Persons (IDPs) moved to villages surrounding Osh and the capital Bishkek,to stay with relatives (homehosted), increasing the burden on already vulnerable households. Prices for basic commodities including food are rising in Bishkek and Batken in reaction to the events in Osh and Jalalabad.

9 Community Needs Returning IDPs need assistance to supplement lost livelihoods (through fire and damage to stores, taxis, homes) Those displaced who do not wish to return because of safety concerns (mostly ethnic Uzbeks targeted in the conflict) are now living with families who need assistance to support additional members Those in targeted areas who are too afraid to leave their homes for security concerns and therefore need assistance to replace their livelihoods. Access to food has become an urgent issue in certain areas-prices have been increasing since As of 2009, 33% of the Kyrgyz population were found food insecure- an average of 80% of household income spent on food Remittances fell by 22 % percent from 2008 to 2009.

10 Was cash right for Kyrgyzstan? Cash distributions are appropriate when: Kyrgyz context People used to purchase essential goods & services through market mechanisms Especially in urban areas, markets were the primary source of food purchases. A shock has caused inability to meet basic needs and/ or adoption of negative coping strategies Ethnic conflict in June, 2010 Sufficient goods available locally Markets are accessible & functioning or expected to be soon Delivery can be done safely and effectively People prefer it over other response options Yes Markets were functioning 10 days after the conflict. Cash distribution contributed to market reestablishment. Through Kompanion, who has 90 offices around target areas and experience with cash transfers. This is true from focus group discussions and PRAs.

11 Emergency Food Assistance for Jalalabad and Osh Funded by USAID/FFP, July 22, 2010 Emergency Food Security Program Objective: to provide urgently needed food assistance to vulnerable households affected during the conflict

12 Methodology: Targeting Participants chosen from areas where markets are well-stocked and functioning. Participant criteria: Direct losses due to conflict (i.e. loss of family member, home, business and/or assets); Internally Displaced Persons and host families- 50% of beneficiaries had been displaced Households in conflict-affected communities. Community selection committees prioritize participants. Total of 7,720 households (48,000 individuals)

13 Methodology: Cash Distributions Unconditional cash transfers $35 per month x 9 months (disbursed in three tranches of $105) Tranche 1: stabilize acute food insecurity situation Tranche 2: assist households through the winter when harvests are unknown and local stores that offer credit for food purchase have reduced capacity due to conflict-related damage to their shops Tranche 3: assist with further recovery- in particular, prepartion for upcoming planting season. Cash transfers distributed through Mercy Corps partner, Kompanion Microfinance Company- most recipients can reach a branch via a short trip on public transportation.

14 Methodology: Market Monitoring & Evaluation Market monitoring Initial market assessment Monitoring of key staple foods for duration of the transfer Learning Alliance Evaluation Initial survey, Final household survey Nutritional survey (HDDS)

15 Challenges Because start up was so quick, market information was not collected until the start of the program. Due to elections in October, distributions were delayed because of poor involvement of local officials. Some misunderstandings among community members about the criteria to choose beneficiaries- resulting in tension.

16 Points of learning Need community consensus and agreement The program- especially targeting- must be well-understood by the community Pay attention to safety concerns for cash handling in large amounts (look for alternatives for cash distribution mechanism i.e. bank accounts or mobile transfers) Match cash transfers with times of greatest food security vulnerability (need to do seasonal calendar) Ensure in initial planning that funds are sufficient to meet all people who meet criteria Tracking of beneficiaries should act as an accounts sheet, to ensure that those taken out of the database are not lost completely. Keep documentation of everything.

17 Results: Approximately 7,720 households (around 48,000 individuals) received cash transfers successfully in two tranches. More than $1.6 million was distributed over two quarters. 86.9% of respondents reported food as the primary expenditure with the cash transfer. Other top expenditures included clothing (4.1%) and other (3.4%).

18 Benefits to date: Timing: cash transfers began 26 days after award letter signed Cost-effectiveness: partnership with Kompanion- no costs of distribution, because of presence in participating communities No costs of storing food or distributing food Do no harm : market prices of staple foods did not increase significantly for the first quarter. In the second quarter, food prices have increased, but in concert with world food prices. Social benefits: families were able to buy necessary items with their cash, such as food, coal for heating in the winter, transportation to get drinking water, pay bills and debts. Households are able to get the type and quality of food that they choose.

19 THANKS! For more information: Penelope Anderson

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