LOW COST BUILDING MATERIALS PRODUCTION

The evaluation, covering the period 2/78-11/79, is based on document review, interviews with project personnel, and onsite visits. LEHCO-OP and Production Systems (PS), a subsidiary established under this project, have had difficulties but are now profitably producing joinery products and cement blocks. Manufacturing facilities have been expanded, high-quality materials are being produced and sold at competitive prices, and sales have exceeded targets by 200%. The project has generated building industry employment and income and increased low-cost housing for the poor. Project inputs have been on target but LEHCO-OP has objected to the way in which OPG funds are being disbursed for PS operations. Difficulty in recruiting trained employees and the time needed for on-the-job training have impeded managerial and organizational tasks. A permanent manager has not yet been found for PS. Because of its financial crisis, it is unlikely LEHCO-OP will be able to repay PS the R100,000 it owes for delivered goods and the R25,000 borrowed from PS"s operating capital. It is recommended that: (1) the legal relationship between PS and LEHCO-OP be defined to guaranty PS"s organizational and financial independence; (2) PS Manager and Production Manager counterparts be assigned to develop PS"s management capacity; (3) training of LEHCO-OP managers be dropped; (4) the possibility of hiring an advisor to supplement the current on-the-job training program be explored; and (5) conflicting project goals be redefined and the logframe upgraded to include increased quantification. The project has taught that demand for building materials exists and can be locally met; lack of trained manpower can severely impede project operation; a potential recipient"s financial situation must be clearly explored; and priority should be given to skills training and entrepreneurship in developing small scale enterprises.