Audit of Zambia agricultural development research and extension project

First audit report covers the period 9/80-6/85 and is based on a review of relevant documentation; interviews with GOZ, contractor, and USAID/Z officials; and site visits. The project, which is consonant with the small farmer orientation of GOZ policy, is making good progress in conducting research on cereal varieties that could be effectively grown by small farmers and in providing participant training to upgrade the skills of select MOAWD staff. The project"s main weakness has been the failure to effectively disseminate research results to small farmers. This has been due to the project"s early overemphasis on research and to a poor economy, which, along with bureaucratic complexities, has kept the GOZ from releasing P.L. 480 local currency generations to support extension services. The GOZ has also been unable to meet its commitment to provide local currency for operating costs of project vehicles. These problems augur the project"s failure after A.I.D. support ceases and illustrate the GOZ"s overall inability to absorb research operational costs both now and in the future. It is recommended that USAID/Z disburse P.L. 480 funds earmarked for the extension service and engage in policy dialogue with the GOZ to ensure that the latter assumes project costs before the project ends, as prescribed in A.I.D."s established recurrent cost policy. The GOZ provided a counterpart to the contract extensionist only in 1985, and even then its failure to furnish onsite housing prevented the counterpart from working with the extensionist and thus learning the skills needed to indigenize the project. Efforts are being made to redress this situation. In response to an audit recommendation, USAID/Z is establishing quantifiable targets to permit measurement of the project"s impact on small farmers. Finally, some unnecessary farm equipment was ordered and some needed for research was not. Further, there has been no inventory of AID-purchased equipment since 1983. USAID/Z should either conduct annual inventories or dispose of the equipment.