10.91 Million Dollars Loan from IFAD for the Rural Poor in Kenya

Release No. IFAD/2001/10
Rome, 27 February 2001. The International Fund for Agricultural Development (IFAD) will provide a loan of 10.91 million dollars on highly concessional terms to finance the newly approved IFAD-initiated Central Dry Area Smallholder and Community Services Development project in Kenya. The total cost of the project is 18.08 million dollars. The loan agreement was signed today at IFAD headquarters by the President of IFAD, Mr. Fawzi Hamad Al-Sultan, and by Mr Cyrus Tai Gituai, Director, External Resources Department of the Ministry of Finance and Planning, Government of Kenya.

The project is co-financed by the Belgian Survival Fund (BSF) with a grant of 185 million Belgian Francs (approximately 4.10 million dollars). The Government of Kenya will contribute 2.66 million dollars, while the beneficiaries' contribution is estimated at 410 000 dollars. Pre-project activities to assist in timely and orderly start-up of project operations will be covered by an IFAD Special Operations Facility (SOF) of USD 60 000.

With a land area of 583 000 km2, Kenya has a wide range of ecological zones. Over 70% of the land area is classified as semi-arid, 12% as arable but subject to periodic droughts, and only 13% having a medium to high potential for agriculture. The Central Kenya Dry Area Smallholder and Community Services Development Project will cover five districts of Kenya's central province that have been identified as the poorest dry areas, and will directly benefit an estimated rural population of 36 400 households or 220 000 poor farmers (selected among the landless or owners of less than two acres each).

Initially, the project will aim to reduce morbidity and mortality and to improve the nutrition and health status of the defined target group. Later, a wider area will be covered extending basic socio-economic services aimed to strengthen the poor's capacity to improve their livelihoods. Specifically, the project will provide primary health care (including reproductive health and HIV/AIDS control), safe drinking water (construction of protected shallow wells and roof catchments) and promote better sanitation and diet practices; raise the productivity of smallholders and improve food security by promoting drought-resistant crops and small livestock and by encouraging other income-generating activities for diversification away from agriculture; strengthen the institutional capacity of the district to plan, implement and monitor the beneficiaries' participation in the planning and development of district services; and promote agricultural techniques to protect the area's fragile environment.

To date, Kenya has benefited from nine highly concessional IFAD loans and from four BSF grants, supporting eleven development projects, two of which are still on-going. With a total financial assistance of approximately one hundred million dollars, Kenya is the fourth largest recipient of IFAD/BSF support in the sub-Saharan region of Africa.

The International Fund for Agricultural Development (IFAD) is a specialised agency of the United Nations with the specific mandate of combating hunger and poverty by providing assistance to rural inhabitants in the most disadvantaged regions of the world. IFAD helps them to increase their foodcrop production and their income, and to improve their nutritional, health and educational levels. Between 1978 and 1999, IFAD committed about USD 7 000 million to financing loans benefiting over 250 million people. By the end of 1999, it had undertaken 568 projects in 116 countries, as well as making 1 337 grants for research and technical assistance. For each dollar disbursed from its own resources for initiatives to help the poor, IFAD has raised USD 2.09 from other donors and the governments of beneficiary countries, thus financing a portfolio of projects for a total cost of USD 20 000 million.