Gender and Development

Uzbekistan

Japan Fund for Poverty Reduction (JFPR) 9010 - UZB: Innovative Poverty Reduction in Karakalpakstan, 2001

The economic transition and market reforms in Uzbekistan during the post-Soviet era have pushed increasing numbers of women under poverty as they were the first to lose their jobs under public sector restructuring yet unskilled to initiate their own enterprises. Declines in agricultural production, wage employment and inadequate government services have increased poverty for youth and women in rural areas. Karakalpakstan located in northern Uzbekistan near the Aral Sea has one of the highest unemployment rates of the country. With only 40% of the population having access to safe drinking water, it has the highest infant mortality rate as well. Under the JFPR: Innovative Poverty Reduction in Karakalpakstan Project, the ADB aimed to reduce the major causes of poverty by promoting new income generating activities, employment opportunities and providing access to safe drinking water.

Objectives and Scope

The Innovative Poverty Reduction in Karakalpakstan was approved on 25 September 2001 for $2.54 million. The Project’s objectives were

• promote new employment based on income generating activities in Karakalpakstan
• pilot test decentralized, demand driven, and community owned safe and sustainable drinking water schemes in Karakalpakstan
• use the Karakalpakstan experience as a demonstration case to provide policy recommendations on sustainable income generation, poverty reduction and improving the living standards of people living in environmentally deprived and drought affected areas of Uzbekistan

1. Microfinance and Small Finance Provision:
   • microfinance equivalent to $20-150 per borrower, and small finance equivalent to $150-500 to physical entities
   • small loans equivalent to $500-10,000 to legal entities for employment generation


2. Small Enterprise Employment Promotion:
   • business training support
   • equipment leasing
   • collateral fund for guaranteeing small enterprises‘ credit demand with the banks


3. Livelihood and Social Infrastructure Support: “income generation projects contests” managed by local self-management civil bodies (Mahalla)



4. Provision of Safe Drinking Water: private sector entities and NGOs to undertake innovative water management schemes through
   • feasibility study contests
   • piloting contests
   • replication contests


5. Project Management:
   • project administration
   • labor market, gender, and poverty reduction impact assessments of the various component modalities
   • contingency fund

Framework for Gender and Development Activities

Women’s economic activities in Uzbekistan are usually concentrated in low-paid economic sectors. They face a high unemployment rate as well as a low level of functional literacy, wage employment, economic independence and flexibility. As a result, women are involved in unofficial/informal activities such as street peddling, services, laundering, baby-sitting and tutoring. In rural areas, women work on private plots of land or farms and sell farm produce, consumer goods or needlework. Moreover, women make choices in favor of taking care of their homes, children and parents and give up their professional careers. Based on a social and gender assessment conducted during the design phase, key gender issues identified in project areas were:

• Concentration of women in low-paid economic sectors (agriculture, small shuttle trade, etc) or at low-paid levels (milkmaid, cleaner, etc)
• Insufficient economic and legal awareness especially in remote areas
• Lack of knowledge and skills in business management, savings, lending and investing funds in profitable business ventures
• Low level of economic independence and flexibility of women particularly in the southern part of Karakalpakstan due to existing gender stereotypes and domination of ethnic Uzbeks who are more patriarchal in comparison with Karakalpak people
• Lack of awareness of the current legislation and women’s rights which leads to women’s lack of incentives in starting small business
• Limited access of women to fertile lands in remote areas due to gender stereotyping

Gender-Inclusive Design

To ensure women’s active participation and direct benefits, the Project design integrated gender issues in all of its 5 components:

1. Micro and Small Financing:
Strengthen the operational and financial sustainability of Business Women’s Associations’ (BWAs) microfinance activities while providing $240,000 in micro-credit for women.


2. Small Enterprise Employment Promotion:
Involve the BWA in entrepreneurship training by identifying potential entrepreneurs among the unemployed women to provide them with targeted training between 3 to 20 days. Lease machines up to $10,000 through BWA in order to cover some essential business start-up costs and improve entrepreneurs’ economic sustainability.


3. Livelihood and Social Infrastructure Support:
Include at least 30% women members in the working and selection committees of the livelihood and social infrastructure groups.


4. Provision of Safe Drinking Water:
Ensure at least 30% women members in the working and selection committees of NGOs and other private entities making decisions on innovative water management systems.


5. Project Management:
Ensure 30% women’s representation in the project management office selected from the local self-governing bodies and NGOs. Recruit a gender focal point and conduct gender trainings for project implementation staff and main stakeholders to ensure achievement of gender and development objectives.

Guidance on Gender and Development Activities

The ADB Uzbekistan Gender Specialist was a core team member in the JFPR design to ensure that gender issues were appropriately addressed during project preparation. She conducted a socio-economic analysis in Karakalpakstan, and synthesized information on microfinance projects and NGOs in the country. She led NGO meetings in order to select potential implementers of the microfinance, water and leasing components of the project. She prepared a Gender Action Plan, and conducted working sessions with the Executing Agency staff, leaders of local government and stakeholders to ensure the implementation of the gender and development objectives. ADB and the Government of Uzbekistan conducted annual gender and poverty impact assessments in pilot areas to document achievements and lessons learned.

Achievements and Lessons Learned

1. Micro and Small Financing: 6,637 beneficiaries received credits totaling $1,384,400 from three NGOs providing financial services. Women comprised 94% of BWA clients, 100% of NGO Daulet’s clients and 68% of NGO Paruaz’s clients. As a result of successful business start-ups and 100% repayment of loans, women increased their self-confidence of becoming successful entrepreneurs. As main income earners for their families, their success helped boost their decision-making power and they gained more respect from their families and communities.



2. Workplaces and Leasing of Equipment: Fifty three percent (53%) of the 467 workplaces created were for women. Equipment leasing was used for poultry farming, processing of agricultural production, rice production, flour-grinding mills, and manufacturing of macaronis, garments and building materials.



3. Livelihood and Social Infrastructure Support: Communities were successfully mobilized for assessment of priority needs, creation of initiative groups and development of project ideas for livelihood and social infrastructure improvement. About 50-60% of all initiative group members were women. "Contest to income generation" initiative generated more than 500 project applications. Of the 254 workplaces created, 67% were for women.

• providing credit for women micro entrepreneurs is an effective mechanism for promoting growth of small businesses, expansion of employment opportunities and improving livelihoods
• micro-credit increases income earning opportunities but has to be accompanied by training in business development and management to support business growth
• the high demand from women and other small businessmen for short-term, non-collateral based credit can be met by “group borrowing” which is a low risk mechanism for micro lending in the short term with firm management of loan repayments
• women have incentives to find time and mobilize when their community-based activities lead to poverty reduction by addressing their priority needs and solve community problems