The sand river alliance wishes to further develop and upscale our first experiments from the anecdotal to a more robust level, in order to be able to convince financiers (initially donors and development banks and subsequently governments and institutional investors) with more reliable figures.
Business model
The main challenge is to develop business models that can introduce the irrigation package in a sustainable and scalable way to smallholder farmers. Developing and validating Lease-to-Grow and Rent-to-Own modalities through action-research is therefore needed to understand how they can trigger a sustainable uptake of the technically-tested irrigation pack, and kick-start the supply chain and market in particular localities with potential, such as in Chókwè and Guijá districts in Gaza province in Mozambique and Matabeleland South province in Zimbabwe. These context-specific modalities will allow vulnerable smallholder farmers to make investments in the irrigation starter pack themselves and get year-round access to water for food and vegetable production, in an economically, socially and environmentally sustainable manner.
These business models may need to include and/or address:
- marketing options and market linkages, contract farming and combinations of crops for markets and crops for subsistence;
- financing modalities that are fit for the specific purpose (motivated but poor smallholder farmers with ambition to become entrepreneurs), which could encompass more “informal” saving clubs and more formal credit schemes and lease-to-buy contracts;
- possibilities to include crop insurance to ensure that farmers won’t be trapped into a debt cycle;
- the feasibility of setting up local micro enterprises that can service smallholder farmers (in siting, installing and equipping hand-drilled wellpoints, repairing solar-powered pumps, etc.), and link them to local pump suppliers and distributors.
Also, we have the ambition to influence government policies for irrigation development and climate smart agriculture. All this could be achieved in the form of pilots at scale. This could also help to strengthen and expand the current network of experts and practitioners that are involved in sand river irrigation development.
Pilots at scale
The A4Labs and related projects (a4labs.un-ihe.org) co-developed a proof-of concept involving 15 farmers. What is next needed are pilots-a-scale that test the proof-of concept with sufficient farming families as well as the most appropriate business models to demonstrate the feasibility, including the economic feasibility, of the proposition. This may convince other parties, including development banks and institutional investors of the viability for local outscaling within the selected basins. The last step would be to international outscaling to other basins in these and other countries. So this is a four-tiered programme, for which the sand river alliance now seeks support for the second tier.
To start developing and testing these business models, we will develop pilots involving at least 2×50 farming families in the Limpopo river basin in Zimbabwe and Mozambique:
- In Mozambique a feasibility study has already identified a potential of 15,000 ha benefiting at least 30,000 farming families. [1]
- In Zimbabwe we still need to ascertain the potential of some 1,000 km of sand rivers in the Limpopo, potentially benefiting 10,000 ha or 20,000 farming families.
A successful pilot could therefore not only demonstrate the economic feasibility of our proposition, but will also have a significant out-scaling potential of 50,000 farming families along the Limpopo basin in Zimbabwe and Mozambique alone, a scaling multiplier of 500.
[1] Feasibility study – irrigation package for sand rivers. Report for RVO. Acacia Water, Gouda, April 2019; GIZ supports the local outscaling in Mozambique.