Over the past four years, FSD Kenya’s Building Livelihoods programme in Northern Kenya has explored how extremely poor households can be transitioned out of poverty and into sustainable livelihoods through stronger engagements with markets. Considerable success has been achieved so far with many beneficiaries starting new businesses, increasing savings and assets, and becoming marketable clients of financial institutions. However, the COVID-19 pandemic threatens to undermine these gains, stalling market activity and throwing households back into their previous reliance on traditional pastoralist practices, government safety nets, and NGO food relief initiatives.
COVID-19 forced livestock markets to close and halted exports of meat to key destinations such as the Middle East. Disruptions of livestock market systems can be devastating for pastoralist communities that rely on livestock trade and can also disorient other smaller economies like retail trade. Some small retailers have shut down because of too many customers taking goods on credit because they are unable to sell livestock for money to pay. Requests for credit, combined with surging prices and limited transport of goods to rural areas, are making it difficult for retail traders to sustain business during the COVID-19 crisis. Even beadwork, which had become a fruitful business for women in Northern Kenya, has significantly slowed along with the halt in tourism, although some local sales have continued.
Where businesses are trying to continue to operate, fear of COVID-19 is reducing the volume and frequency of customer visits to marketplaces. There is also fear of contracting the virus through contaminated cash, leaving some afraid of any form of transaction. While mobile money is being hailed as the solution, there are challenges in Northern Kenya that currently limit its potential. These include high levels of illiteracy, cost of withdrawals, lack of float, and scarcity of agents in some locations.
The people of Northern Kenya are no stranger to shocks, which include increasingly severe cycles of droughts and floods, and have evolved sophisticated social and economic systems to cope with these. However, in a context of increasing income diversification and dependence on markets, COVID-19 presents a new kind of shock that hits at the heart of more recent development pathways, especially for populations like the women who benefit from graduation programmes.
FSD Kenya is undertaking research to understand the extent to which the resources built up through the Building Livelihoods programme are supporting the resilience of beneficiary households, and how these compare and interact with the traditional pastoralist practices. Through their agency, newly found skills, networks and assets, as well as older practices and institutions built to survive extreme shocks, the communities we are engaged with in Marsabit County may find ways to be resilient that challenge our preconceptions about the pathways to development. We have much to learn. Stay tuned for updates through this blog series.
Jody Delichte is a Research/programme consultant.
Amrik Heyer is Senior research advisor at FSD Kenya.
Bernard Muthiani Mbithi is Graduation pilot project manager at CARE International in Kenya.
Felistus Mbole is Senior economic inclusion advisor at FSD Kenya.