Lessons for East Africa from food aid monetization : the case of the 416(b) small farmer recovery program for disaster recovery in the Dominican Republic

Monetization proceeds were used to fund grant proposals to rehabilitate small- or medium-scale farmers in the affected regions. The program was managed the U.S. Department of Agriculture (USDA). The structure of the 416(b) program was important for its success. An agreement was reached to establish a Program Executive Council (PEC) consisting of representatives from USDA, USAID, the Dominican Ministry of Agriculture (SEA), and the Dominican Technical Secretariat of the Presidency (STP). A grants program with applications from a broad range of organizations was proposed. All 100,000 MT of 416(b) food aid were sold during FY 1999 in accordance with the 416(b) agreement. The sales produced revenues of approximately US $16 million. One of the most important outputs of the PEC was the development of a manual detailing guidelines and criteria for the proposals. In all, 33 proposals, totaling US $16 million, were funded. In addition, the projects leveraged more than US $8 million from public and private agencies in the Dominican Republic. Many of the constraints that face monetization of food aid in East Africa were also present in the Dominican Republic, but these did not preclude a successful program. Lessons learned regarding monetization indicated that a small market and lack of competition among firms for the use of wheat and wheat products did not prevent USDA from obtaining an acceptable price. The Dominican Government did not have much experience with managing auctions. An open negotiating table brought all parties together, increasing transparency. Although shipping and monetization were not speedy, the program"s success at rehabilitation and reconstruction was evident. The project structure facilitated clear criteria for the grants program and led to a wide proportion of the funds reaching the appropriate beneficiaries. The establishment of the Executive Committee with representatives from two U.S. and two Dominican agencies was a unique and important component of the management structure. The balance between donor and recipient government agencies was successful. Both USAID and USDA were able to advocate for small farmer support. Problems that resulted from working with a large number of smaller grantees were minimized by ensuring that proper documentation existed and that project staff had minimum implementation capacity. The umbrella grant structure frequently used in East Africa was not necessary, but NGOs were encouraged to collaborate to ensure proper management and monitoring capacity. Another important lesson learned from the program concerns the focus of project activities on rehabilitation activities with a mitigation emphasis. Disaster recovery should incorporate the best techniques and technologies available in order to incorporate disaster prevention and mitigation components. In this case, a focus on environmental rehabilitation introduced and diffused forestry management techniques and soil protection measures, especially in areas with steep slopes. The rehabilitation of small-scale plantations provided an opportunity to introduce clean plant materials and reduce certain diseases. These rehabilitation activities will result in a more stable agricultural sector that will be more resistant in the next hurricane disaster. The coordination between the agencies involved, particularly USAID and USDA, was critical to program success. The investment in dedicated management was also necessary to facilitate the coordination of the four organizations that implemented the grants program. Although the exact configuration of these offices is rarely present in East Africa, the important element was dedicated management oversight for the program, which cost less than 10% of project funds.