TERMS OF REFERENCE Country of assignment: Kenya Key contact person: Elikanah Kiarie: Regional Technical Assistance Officer 1. Background on consulting assignment Oikocredit is an international development finance institution which operates in Latin America, Asia, Africa and Eastern Europe. It provides micro-entrepreneurs, small businesses, agricultural cooperatives and other productive enterprises with the capital they need to expand their businesses and improve their livelihoods. As Worldwide cooperative society, it promotes global justice by challenging people, churches and others to share in their resources through socially responsible investments and by empowering disadvantaged people with credit. The International Support Office is based in Amersfoort. Oikocredit has regional office in 34 countries and is active in 69 countries.Oikocredit has regional office in Kenya that serve the East Africa countries. As a leading private development organization in the world Oikocredit is a member of different development Networks that share common values. One such Network is Agri- ProFocus. The Network promotes farmer entrepreneurship in developing countries. The Agri-ProFocus office supports this by facilitating effective cooperation between the Agri-ProFocus members in country programmes and joint trajectories and by stimulating exchange and learning among professionals and farmers. In the month of May 2009 Agri-ProFocus organized a workshop in Kenya and different stakeholders in agricultural sectors were invited. It was agreed during the workshop that focus should be on a few agricultural sectors, to enable us to build success on them, before we can move on to other sectors. The Sub-sectors that were selected include the following: Dairy Coffee Extensive livestock Domestic horticulture Potatoes It was also noted that there are a number of cross-cutting issues that affect the sub- sectors above and other sectors as well. The key selected cross-cutting issues include the following: Farmers empowerment and representation Youth and gender Value additions and market access Financial services Financial services for agriculture were unanimously chosen as an essential cross cutting issue. It is an important challenge to adapt financial services to the needs of the high risk, but also potentially highly profitable enterprise called smallholder agriculture. Oikocredit Kenya office and Pamoja Women Development Programme (PAWDEP), a leading Microfinance Institutions supporting women in farming and trading, were selected to take a central role in spearheading this cross cutting issue. To take the process forward Oikocredit and PAWDEP would like to engage the services of a consultant to study and analyze the five sub-sectors and propose appropriate ways of financing these Sub-sectors. The financing methodology should be analyzed both from a wholesaler (Oikocredit) point of view and retailer point of view (micro-finance or direct financiers to small holder farmers). 2. Objectives of the consulting assignment The main objective of this assignment is: a) Conduct a market study on the five sub-sectors mentioned above and to determine the specific challenges, opportunities and linkages available. b) Validate financial services available – criteria, funding capability and geographical representation c) Secondly, the Consultant should use this information for product development at both wholesale and retail level. d) The third objective is to assess the capacity building interventions that can be made in tandem with financing e) Potential for Fair trade financing in Kenya. 2. Key activities To address the above objectives the consultant needs to do the following: Visit Dairy sector institutions and conduct a financial needs assessment. These can be Dairy farmer’s co-operatives, Small dairy farmers, or processors of dairy products. Visit Coffee sector institutions and conduct a financial needs assessment. These can be Coffee farmer’s co-operatives, Coffee marketers, and Value adding institutions in coffee sector. Visit institutions/ farmers involved in Extension livestock and conduct a financial needs assessment. Visit institutions/ farmers involved in production of potatoes/ value additions and conduct a financial needs assessment. Visit institutions/ farmers involved in Domestic Horticulture and conduct financial needs assessment. Visit farmer organizations for overview of the various sectors. Identify financing opportunities that exist in all the five sub sectors in terms of wholesale and retail financiers. Analyses the financing challenges taking into account the risks in each sub-sector. Recommend Capacity building needs in different sub sectors that can be done in tandem with financing. Propose areas where fair trade can be recommended. Prepare a comprehensive report i.e. Market Study report capturing the findings. This report should also capture how the study was undertaken and recommendations on the way forward. . 4. Main Deliverables and Expected Outcome of the assignment: After this consulting assignment, it is expected the following will happen: The consultant will prepare and present to Oikocredit and PAWDEP a final comprehensive market Study capturing the findings and giving concrete recommendations on the way forward. The consultant should also advise on possible financial products and services to be introduced in these sectors Agri-ProFocus members will understand the financing opportunities as well as risks in the sub-sectors proposed. 5. Other accompanying documents The consultant is free to include any supporting documents that may enhance the Market Study report. 6. Profile of Technical Assistance provider It is foreseen that the assignment will be carried out by an experienced consultant with the following qualifications: A Master Degree in Business Administration/Economics/Finance Agriculture/Agri-business and other related field. Must have carried out a similar assignment for other lenders and/or donors. Experience in market research and analysis of agriculture sectors is critical. Knowledge on the five sub-sectors is essential. Excellent analytical skills especially on financial statements are important. Excellent proposal writing/report writing skills. 7. Compensation Oikocredit and PAWDEP request the consultant to suggest the amount for delivery of the assignment along with a budget. 8. Forms of payment Describe here installments and timeframe as connected to deliverables. This will be further detailed in a contract. 9. Timeline. Qualified consultants should respond to this Terms of reference by 20th October 2009.
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