A few years ago, some villagers from the East Usambara Mountains, in Muheza District had lost hope on what to do to earn a living.
They had been depending on working on the land that is now showing signs of wearing off due to climate change effects. The villagers problems were exacerbated by the absence of capital to start or develop income generation projects.
A micro-finance scheme, V illage Savings and Loan Association (V SLA or WEKEZA), implemented as one of the interventions to enable residents of East Usambaras adapt to climate change, shows that access to finance is showing some impact.
According to the Monitoring, Evaluation and Communications Officer, Joynet Mbogo, so far a total of 16 Wekeza Groups of between 26 and 30 villagers have been formed in eight villages where a three year climate change adaptation project, ‘ Integrated approaches to Climate Change Adaptation Approaches’ is being implemented.
That was in accordance with the Indicator result number 1.7 where it was envisaged that at least 16 functional V illage Saving and Loan Associations (V SLAs), within the 8 villages have been established by the end of the project, benefitting over 350 individuals (at least 50 per cent women and 25 per cent from poorer).
Reports indicate that 16 new V SLA groups formed (two groups per village with each having between 26 and 30 members) apart from providing training on business skills to a total of 384 V SLA members (54 per cent women and 46 percent men) once they were provided with the start-up packages such as Kits, record books and training manuals
The project trained 32 CBTs from all 8 project villages on management and monitoring of the V SLA groups and all the 16 V SLA groups received training about basic qualities of good entrepreneur, how to generate business idea, develop business plan, costing and pricing, marketing, record keeping and goal setting.
A study conducted on how the group members have faired found that out of 135 interviewed only 95 members had started making profit at the time of interview and making an average profit net of Sh. 96,110 Tanzanian shillings.
The report further shows that 36 individuals invested their loans in activities which are not business oriented) like paying schools fees (15 members), buying building materials for improving their houses (16 members).
One member bought solar and 4 members bought farms, the loan didn’t revolve and they were supposed to repay back using other sources.
Among the 135 interviewed members 26 individuals invested in agriculture with most of them using the loans for buying seeds for beans. “One member opened bank account and bought V odacom shares while a good number of individuals about 32 out of 135 interviewed are selling food in Restaurants,” the report said.
“The groups have accumulated a total of Sh. 64 million or Sh. 4 million each group and all of them have opened accounts with the NMB bank and we aim at connecting them with finance institutions to access funds,” said Ms Mbogo.
She said that they have already connected the groups with the V ision Fund, a microfinance subsidiary of World V ision which empowers families to create income and jobs.
Ms Mbogo said that members have used credit from the groups to invest in projects that are changing their livelihoods and dissuading them to engage in activities that are accelerate environmental destruction.
A beneficiary, Mwalimu Rose Kiondo said that she has so far borrowed from the group three times to expand her maize farm and she has been able to get profit which she has used to purchase a dairy cow.
“The proceeds from the dairy cow are amazing and enabling me to cover several expenses,” she said. Another Wekeza Group member from Mgambo Miembeni, who owns a perfume shop and a beauty salon, Hussein Mohamed Hussein said he has so borrowed four time to expand his business which has enabled him to employ a few people.
“I am in the process of taking the fifth loan to establish another shop,” he said. He said Wekeza scheme has enabled him to avoid looking for money from other sources that could be destroy detrimental to the environment and efforts to mitigate the climate change effects.
Literature on climate change and risk management strategies identifies several approaches to help farmers adapt to the impact of climate change with one example being access to credit.
While evidence of the effectiveness of access to credit as a poverty reduction strategy is mixed, the micro-finance scheme that is being implemented as one of the interventions to enable residents of East Usambaras adapt to climate change shows access to finance is showing signs that it is an appropriate climate change adaptation strategy.
Integrated Approaches for Climate Change Adaptation is a partnership project between the ONGAWA (Engineering for Community Development), the Tanzania Forest Conservation Group (TFCG), Muheza District Council and Universities (Sokoine University of Agriculture and UK’s Leeds University).
The overall project objective is to demonstrate effective and efficient strategies that support poor rural households in Tanzania to adapt to the negative impacts of climate change and to alleviate poverty.
It is specifically working to support 8 communities living near to high biodiversity forests in the East Usambara Mountains to increase and diversify incomes, strengthen resilience and reduce vulnerability to climate change-related impacts.
- The eight communities are S hambangeda, Mgambo, Kwemsoso, Kazita and Misalai (Misalai W ard), and Z irai, Kwelumbizi and Kizerui (Zirai W ard).