Project Evaluation
Summaries
Prepared by the Policy, Planning and Evaluation
Unit (PPEU)
Eritrea
I. Basic Project Data
| Project Number: | ERI/92/C01 |
| Project Title: | Fisheries Rehabilitation in Semhar and Assab Provinces |
| UN Cooperating Agency: | Food and Agriculture Organization |
| Govt. Executing Agency: | Ministry of Marine Resources, and Asmara Municipality Administration |
| Sector: | Fisheries |
| UNCDF Budget: | US$ 4,030,475 |
| UNDP Budget: | 1,624,800 |
| Gov't. Budget: | 174,400 |
| Fishery Communities Budget: | 382,100 |
| Total Budget: | 6,211,775 |
|
Actual Total Expenditures at Evaluation: |
N/A |
|
UNCDF Expenditures, Y/E 1995: |
2,693,103 |
| Date Project Approved: | Sept 1992 |
| Date Project Began: | 1988 |
| Date Project Evaluated: | Oct/Nov 1995 |
| Type of Evaluation: | Mid-term |
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II. Background
After Eritrea's 30-year war of independence and the compounding effect of recurrent droughts, the former Ethiopian province faced a severely damaged national infrastructure and devastated economy. Traditional livelihoods also were severely interrupted during this time. After an accord with the Transitional Government of Ethiopia recognizing the sovereign rights of the Provisional Government of Eritrea (PGE), and prior to the mid-1993 referendum on independence, the PGE began to rebuild the war-torn economy. At least 80% of the population depended on food aid, and priority was given to generating an increase in domestic food production. Particular attention was given to the rich coastal fishing grounds. While marine fisheries had once been very active, the industry and its ancillary infrastructures were largely destroyed during the war years.
In 1991, the Department of Marine Resources and Inland Fisheries (DMRIF) requested a UNCDF/UNDP mission to review the status of the Red Sea fisheries. The mission determined that, given under-exploitation of the fish stocks and the rapid and high returns that fishing investments can generate, a project to support revitalization of the fishing industry would be formulated for Eritrea's Semhar Province, a region on the country's northern Red Sea coast including the chief port city of Massawa and the Dahlak Islands.
UNCDF had, since 1986, operated a fisheries project in Assab Province, on the country's southern Red Sea coast, including the port of Assab and the Afari coast (ETH/83/C01, closed 1992 in Addis Ababa and opened as ERI/83/C01 in Asmara). This project had sought to increase fishery productivity through improving the collection system for the marine catch, facilitating improvements in the distribution and collection networks, by assisting the development of a refrigerated distribution chain to the highlands, and through providing credit to a fishermen's fund. The Assab project was functionally consolidated with the Semhar project through an agreement reached with the PGE in 1992 that transferred the former project from Ethiopia to Eritrea.
III. The Project
The project applies an integrated approach to fishing sector revitalization: recapitalization and reconstruction of the artisanal fishing fleet; development of the domestic consumer market; provision of ancillary sector support services (refrigeration, fuel, and repairs); support to the fisheries department; and social infrastructure investments in the fishing communities. It also aims to improve the living standards of small fishing communities in the Semhar and Assab Region, and to improve nutritional intakes (although primarily in urban areas).
The project is designed to increase coastal fish production in Assab and Semhar provinces, including the Dahlak Islands, and aims to make scarce production inputs (engines, gears, ice boxes, and boat repair and building services) available to artisanal fishermen. Direct beneficiaries include fishing boat owners, fishing crews, fish traders and retailers, the Dahlak Island fishing communities, and fish consumers in Asmara and Massawa.
Project approval was conditioned on the relaxation of fish price regulations. The project is executed by the DMRIF, with technical assistance (TA) from the FAO as an additional TA component of the project. The Fishermen's Association, as the implementing agency, will, upon completion of the project, take responsibility for managing fishing infrastructure inputs such as cold storage and ice plant facilities. It also will lease transportation and market outlet facilities. Meanwhile, public facilities such as piers and slipways will remain under official authority.
IV. Purpose of the Evaluation
The purpose of the mid-term evaluation was to assess the performance and achievements of the project to date, to evaluate ongoing activities, and review all future plans in order to provide any suggestions or advice that may be needed. The areas that were focused on during the mission included implementation, efficacy, government policies, market analysis, and the overall strengths and weaknesses of the implementation strategies. The mission was asked to provide specific recommendations regarding any changes to the project that may be needed and to provide suggestions for future activities to support the sustainability of the achievements.
V. Findings of the Evaluation Mission
A. Assessment of Results Achieved
• Because of inadequate project design and lack of sufficient pre-project data, many of the project outputs fell far short of original targets.
• Based on financial and technical evaluations of each capital asset and/or activity, it was determined that most of the infrastructure investments face short-term and possible the long-term financial viability problems. Among the capital assets, the most promising is the refrigeration workshop in Massawa. The ice plant/coldstore complex has viable commercial and financial sustainability potential in the fishery sector if recast as an export venture. Investment from the private sector in support services for fisheries is minimal. A supportive government role in directing private sector investments should be encouraged.
• Basic cooperative organizational structures are in place, but need to be strengthened.
• The Massawa and Assab fishery Centres are viable assets and were fully operational by early 1996.
• Some fish markets have been constructed and are ready for use. In the Dahlak Islands, fishery centre construction is a key task for the next project period.
• Market development has not received the necessary attention, particularly in terms of encouraging fish consumption, which is among the lowest per capita in the world. Little attention has been given to low cost, appropriate technology, innovative and viable options for fish distribution and marketing.
• The boatyard component is marginally sustainable and lacks a business plan. The domestic market for new vessels and repairs has not been determined.
• The cooperatives are still inexperienced in credit and business management.
• While the government has conflicting policies regarding the artisanal fishery sector, increased export earnings, inward investment from licensed fishing, and the maintenance of low domestic prices, there has nonetheless been progress in the deregulation of sector prices.
B. Assessment of Project Design
• During the design stage of the project there was a lack of basic analysis in several areas that are key to the project's sustainability. First, the estimate of both current total catch in Eritrean waters and of maximum sustainable yield (MSY) vary by a factor of five; the high-end estimate of current catch already matches the low-end estimate of sustainable yield. While there may be considerable room for sector expansion, there also could be no room at all without depleting fish stocks. Second, the domestic consumers' market for fish is not sufficient to absorb any significant expansion of fish catch. It is therefore unrealistic to divert a major part of any increased output from the current "unofficial" exports that go to the Yemeni market.
• There were inadequate linkages between the fishery sector and the primary market outlet for the catch, which is in Yemen, not in Eritrea. The very high level of Eritrea's fish catch that landed in Yemen was the core problem in the project's design.
• There was inadequate analysis of the institutional and financial arrangements for operation and maintenance of the various infrastructural investments, as well as of credit fund management.
• The component for social service provision in the Dahlak Islands was inappropriate to a fishery sector project, and neglected operational and staffing problems.
• Total fishery employment will remain low because fish are very unlikely to become a low-cost protein supplement in Eritrea's highlands. Any potential for growth that may exist in this industry is in the export sector.
VI. Recommendations
• The project boatyards should be transferred to the private sector.
• The main opportunity for growth in the fishery sector in the short-term is expansion into the export market, where there are higher prices for fish and fish products. This expansion should primarily be achieved by the private sector, utilizing such project inputs as storage and refrigeration facilities, boatyards and jetties.
• A TA consultant should be engaged to assess current demand of the domestic market for fish, in particular dried and salted fish that are not refrigerator reliant, as consumption items and in particular as fish meal. Further research is required to identify and quantify the relationship between the Yemeni market and development of Eritrea's fisheries, as well as the overall estimate of sustainable catch in local waters.
• TA assistance to further develop the credit and cooperative system is still needed, and an Eritrean institutional link to supervise the funds is recommended. The provision of credit by the project should be more carefully applied to a realistic assessment of sectoral needs, and in the context of other sources of credit and inputs through other donor projects. No additional credit funds should be allocated until the present status of the assets is clarified.
• Careful attention to the placement, efficacy, and capital requirements of project inputs is needed. The planned fish shop should be dropped from the project, and the town fish market/restaurant in Massawa should be delayed until a feasibility study can be conducted. Refrigeration workshops should be relocated from the boatyards to the fishery centres or to the ice factories. While working capital for the Assab boatyard and refrigeration workshops is sufficient, it should be increased in Massawa, and more technical assistance should be provided. The ice plant/cold storage complex at Assab should only be continued if it can be linked to an export business venture.
VII. Policy Implications and Lessons Learned
• Clear data and careful analysis are needed to justify a strategy that entails a major shift in existing economic and social practices. It is extremely important to understand why people engage in certain practices, particularly regarding food consumption, before designing changes to them for the sake of improving their standards.
• Careful analyses of institutional arrangements for ownership and management, as well as a thorough analysis of all financial implications, are needed before infrastructural investments can be undertaken.
• Analysis of difficulties in access to inputs should distinguish between i) lack of credit access, and ii) lack of local supply sources for these inputs, when appropriate strategies to tackle the two problems are different.
• Flexibility in procurement (of supplies, equipment, spare parts, etc.) would improve staff motivation and project sustainability. Increased local procurement and independent, project-managed business activities are examples of flexibility that could improve project success rates.
VIII. Mid-term Evaluation Team
The mid-term evaluation team consisted of Simon Diffey, fisheries economist and team leader and Jens L. Knudsen, fisheries cooperative and credit specialist.
