The Key to Building Resilience in Rural Communities: Women Entrepreneurs

This blog was originally posted on Agrilinks and was written by Michael R. Carter and Wendy Chamberlin. Michael R. Carter is a professor of agricultural and resource economics at UC Davis and director of the Feed the Future Innovation Lab for Markets, Risk & Resilience. Wendy Chamberlin is the global program director at The BOMA Project.

Even before the COVID-19 pandemic, women in Samburu, Kenya faced significant risks to their livelihoods. In 2016, severe drought left over half a million people food-insecure across northern Kenya. In 2020, heavy unseasonal rains bred two swarms of locusts, the second twenty times larger than the first. While we can’t end drought or heavy rain, we can help communities become resilient to these kinds of shocks, and at the foundation of that resilience are women.

With support from USAID, the MRR Innovation Lab, The BOMA Project, and the International Livestock Research Institute (ILRI) have been collaborating on a large-scale resilience-focused project in Samburu that helps women to build up and keep their assets in spite of natural and manmade shocks. This joint project pairs The BOMA Project’s poverty graduation program for women with an effective and low-cost form of livestock insurance to ensure they can hold onto their gains.

This work is critical in areas like rural, arid Samburu County, which has very high levels of poverty and risk. Samburu is just over 200 miles north of Nairobi where the 2016 poverty estimate of 71 percent is significantly higher than Kenya’s national poverty rate of 45.2 percent. Nearly all families in Samburu rely on livestock for their livelihoods.

Focusing Resilience Efforts on Women

The BOMA Project’s Rural Entrepreneur Access Project (REAP) creates an opportunity for women to build up an independent and sustainable income through cash transfers with training and mentorship to start businesses and build savings. REAP also provides life-skills sessions on household decision-making, the importance of educating children—especially girls— family planning, and the women’s rights under the Kenyan constitution. A 2018 analysis from The BOMA Project found that five years after participating in REAP, 81 percent of women continued to operate a business that provides at least one source of income, while the amount of savings for women with bank accounts increased by 78 percent.

The concern lies among the 19 percent of women who have not continued to operate a business. Because drought is the biggest threat, insurance could help women hold onto their hard-won gains. Index-based Livestock Insurance (IBLI), first launched by ILRI in Kenya in 2010 in collaboration with researchers from the MRR Innovation Lab and Cornell University, has become the world’s most effective and successful index insurance program. In a severe drought, IBLI triggers payouts so insured families can buy the forage and medicines needed to preserve their livestock.

While men in Samburu typically have ownership and control over the family’s livestock, women have a direct stake in what happens to it. Women understand very well that when livestock are lost to drought, the whole family suffers and women’s assets are likely the first to go to keep the family afloat. Research from the Clinton Global Initiative has shown that when women work, they invest 90 percent of their income back into their families, compared to 35 percent for men.

The MRR Innovation Lab tested a “household” drought insurance with women in Samburu that would direct payouts to them in the event of drought. We learned that women were very interested in this kind of insurance and that their first spending priority after consumption, was schooling for their children. These priorities are part of why investing in women provides the greatest return on investment for achieving resilience.

Becoming business owners and generating their own incomes allows women to educate their children and provide for their families. Owning a business can also give women a stronger voice in their homes and the broader community. Women holding onto those businesses in the face of shocks is key to long-term poverty reduction in the region.

Resilience and the COVID-19 Crisis

COVID-19 and Kenya’s response to it have created new challenges for the women taking part in the REAP/IBLI collaboration. While IBLI can cover drought, COVID-19 is a novel shock that is wreaking havoc on poverty-reduction programs worldwide. In April, The BOMA Project conducted a survey with its REAP business owners in three regions across northern Kenya. REAP business owners most frequently cited the challenges raised by curfews and other restrictions, followed by reduced business hours and a reduction in customers.

Grace Naker Endnog was one of the participants surveyed in April. Her retail business suddenly had far fewer customers, so she started baking donuts and delivering them to her customers. The survey found several examples of women entrepreneurs adapting to new income streams. However, as in much of the world, a continued stimulus package will be instrumental in helping REAP businesses navigate the unexpected shock of COVID-19, especially as some have reported having to cut down on their business assets as a way to cope.

The MRR Innovation Lab research team has just launched a new phone survey to learn more about how REAP families are coping with the COVID-19 shock both economically and emotionally. The survey is collecting information on measures of material and psychological wellbeing as well as questions that focus more specifically on changes reported during initial qualitative work on the impacts of COVID-19.

Designing the Resilience Interventions of Tomorrow

A severe income shock, like the one many families face right now in Samburu, can undercut a family’s resilience in a profound way. Research has long shown that when a family loses their income, the resulting psychological depression makes it harder for them to find new opportunities even when they are available. Income losses also force families to make hard decisions on who eats and how much, leaving children especially vulnerable to undernourishment at a critical period of their physical development.

Field research from economists are finding that resilience in itself can accelerate development. When rural families know they can withstand a shock, they invest more in agricultural and other economic activities. The MRR Innovation Lab calls this phenomenon Resilience+. In other words, done well, resilience liberates families to prudentially focus on building a better livelihood for themselves and their children.

The steps to build resilience among women in Samburu are the same as they will be in nearly all vulnerable communities. Empowering women with access to capital and markets is an approach that has helped bolster resilience as demonstrated by how the women of Northern Kenya have battled alternate cycles of droughts and flood, two swarms of locusts, and most recently, the COVID-19 pandemic. If poverty graduation has taught us one thing, it’s that investing in women can have long-lasting benefits for their families, their communities, and our world.