Tanzania banks on ‘Pay-for-Results’ model to boost dairy sector

DODOMA: Deputy Minister for Livestock and Fisheries, Ms Ng’wasi Damas Kamani, has said the AgResults Tanzania Climate-Smart Dairy Prize Competition will transform investments and services into measurable improvements for smallholder farmers.

Speaking at the launch of the AgResults Tanzania Climate-Smart Dairy Prize Competition in Dodoma recently, Ms Kamani emphasised that the project’s success should be measured not only by the prize money, but also by its broader impact on farmers, productivity and the resilience of Tanzania’s dairy sector.

“It should be measured by the change created at farm and market levels, when smallholder farmers, especially women and young people, access quality services and Tanzania builds a productive, competitive, inclusive and climate-resilient dairy sector,” she said.

The two-year, US$2.8 million competition will operate from 2026 to 2028 in Mbeya, Iringa, Njombe and Morogoro regions. It is supported by AgResults’ donor partners, while the Government provides policy and sector leadership and Heifer International serves as Project Manager, coordinating implementation and stakeholder engagement.

The AgResults Climate-Smart Dairy Prize Competition uses the Pay-for-Results model, which rewards businesses only after eligible products and services have been delivered to dairy farmers and independently verified.

Private-sector input providers and fodder producers will invest in expanding their services, submit evidence of verified sales and receive quarterly prize payments based on the results achieved. This encourages reinvestment, business growth and lasting commercial relationships with dairy farmers.

Eligible services include vaccination, parasite control and artificial insemination, rewarded at US$3, US$4 and US$15 per cow, respectively. Fodder businesses receive US$25 for each verified 450-kilogram package sold. Competitors must reach at least 200 eligible dairy farmers to qualify, while best performers may compete for separate US$125,000 grand prize pools.

Markus Mueller, representing the AgResults Secretariat, said the competition builds on more than a decade of experience using results-based incentives to address agricultural market barriers.

“When businesses are rewarded for results rather than activities alone, they find creative ways to reach farmers, overcome market barriers and build lasting commercial relationships,” Mr Mueller said.

Heifer International Tanzania Country Director, Mr Mark Tsoxo, said the model would catalyse private-sector innovation and expand dairy farmers’ access to quality services.

The competition complements the Climate-Smart Dairy Transformation Project, a 10-year, US$231 million investment by the Government and the International Fund for Agricultural Development (IFAD). Together, the initiatives will advance productivity, resilience, market development and private-sector investment across the dairy value chain.

The competition also supports Tanzania Development Vision 2050, which seeks to improve livestock production, increase productivity and market value, strengthen private-sector participation and build a competitive, inclusive and climate-resilient economy.

Project Team Leader, Ms Elina Lusuva, said the competition expects to reach approximately 28,200 dairy farmers and stimulate an additional 7,500 metric tonnes of fodder production.

Nelson Msuya, from PricewaterhouseCoopers (PwC), said the firm had been appointed as the Independent Verifier. It will examine accounting books, sales receipts, product records and other evidence submitted by competitors before results are approved.

Dairy Producers Association Chairman, Mr Hamisi Mzee, said participants would act on the Government’s guidance to increase milk production.

Dairy farmer Anna Almas of Mvomero urged stakeholders to use the competition to improve fodder production and services available to farmers.

By rewarding verified results, AgResults is turning private-sector investment into lasting impact through more productive dairy farms, stronger businesses and resilient livelihoods that can continue growing long after the competition ends.