Study to Map The Existing CSOs In Khentii Province

MONGOLIAN WOMEN’S FUND

STUDY TO MAP THE EXISTING CSOs IN KHENTII PROVINCE, ASSESS THEIR CAPACITY AND IDENTIFY NEEDS FOR TRAININGS Baseline Study Report August 2, 2016

Table of Contents 1.

EXECUTIVE SUMMARY ............................................................................................................................ 5

2.

OVERVIEW OF THE LEGAL FRAMEWORK FOR WORK OF CSOs ............................................................. 13 2.1.

Non-governmental organizations ................................................................................................. 13

2.2.

Cooperatives (khorshoo)............................................................................................................... 14

2.3.

Informal groups (buleg) ................................................................................................................ 14

3.

METHODOLOGY .................................................................................................................................... 15

4.

BASELINE STUDY ................................................................................................................................... 16 4.1.

CIVIL SOCIETY MAP OF KHETII PROVINCE ..................................................................................... 16

4.1.1.Typology of CSOs ......................................................................................................................... 17 4.1.2. Organizational capacity ............................................................................................................... 18 4.1.3. Functions of CSOs…………………………………………………………………………...…21 4.1.4.Collaboration of CSOs .................................................................................................................. 22 4.1.5 Conclusion .................................................................................................................................... 25 4.1.6 Recommendations ...................................................................................................................... 26 4.2 KEY FARMING CSOs ............................................................................................................................ 26 4.2.1 General mapping of the key CSOs................................................................................................ 27 4.2.2.Assessment of the organizational capacity.................................................................................. 36 4.2.3. Conclusion ................................................................................................................................... 45 4.2.4. Recommendations ...................................................................................................................... 47 4.3. COLLABORATION CAPACITY OF THE FARMING CSOS ........................................................................ 48 4.3.1. Collaboration capacity of Kherlen/Murun soum CSOs ............................................................... 48 4.3.2 Collaboration capacity of the farmers in Binder soum .............................................................. 57 4.3.3 Collaboration with non-farming CSOs........................................................................................ 60 4.3.4. Conclusion .................................................................................................................................. 61 4.3.5 Recommendations ..................................................................................................................... 63 4.4 ADVOCACY CAPACITY OF THE KEY CSOs ............................................................................................. 63 4.4.1. Common interests ....................................................................................................................... 63 4.4.2. Past experiences in advocacy...................................................................................................... 65 3.4.3. Strenghs and weaknesses of advocacy capacity ......................................................................... 68 4.4.4. Targets for advocacy ................................................................................................................... 70 4.4.5. Conclusion ................................................................................................................................... 71 2

4.4.6. Recommendations ...................................................................................................................... 72 4.5. PUBLIC PARTICIPATION MECHANISMS/CHANNELS OPEN FOR THE KEY CSOs .................................. 72 4.5.1. State policies and activities in the farming sector ...................................................................... 73 4.5.2 Kherlen Soum policy on agriculture and farming ........................................................................ 74 4.5.3. Assessment of the state policies and activities on the farming sector....................................... 77 4.5.4. Public participation mechanisms ................................................................................................ 78 4.5.5. Assessment of the activities of SDF and SMEDF ......................................................................... 82 4.5.6. Public participation in procurement ........................................................................................... 82 4.5.7. Assessment of procurement process and tender contracts ....................................................... 88 4.5.8.Proposed solutions by the key stakeholders ............................................................................... 89 4.5.9. Conclusion ................................................................................................................................... 90 4.5.10. Recommendations .................................................................................................................... 91 5.

PROPOSED TOPICS FOR TRAINING, SEMINARS AND WORKSHOPS ...................................................... 93

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LIST OF ACRONYMS ASA - Agricultural Support Association BRT - baseline research team CCR – Caritas Czech Republic CRC – Citizens’ Representatives Council CSO – civil society organization GERES - Group for Environment, Renewable Energy and Solidarity ha – hectare IG – Informal group INGO – international non-governmental organization kg – kilogram LA – local authorities LDF – Local Development Fund LLC – limited liability company MNT – Mongolian tugrug MONES - Mongolian Women’s Fund MoU – Memorandum of Understanding NAMAC - National Association of Mongolian Agricultural Cooperatives NGO - Non-governmental organization SDF – Soum Development Fund SME – small and medium enterprise SMEDF – Small and Medium Enterprise Development Fund SWOT – strengths, weaknesses, opportunities and threats TVET – technical vocational education and training

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1. EXECUTIVE SUMMARY Introduction Caritas Czech Republic (CCR), in partnership with National Association of Mongolian Agricultural Cooperatives (NAMAC) and Group for Environment, Renewable Energy and Solidarity (GERES), is starting an action in Khentii province to involve local Civil Society Organizations (CSOs) as the main stakeholders. The action aims at building active CSOs that have solid management and coordination skills and are able to actively conduct advocacy work for improvement of a multi-stakeholder dialogue between CSOs and local authorities (LAs), creating cooperation and co-responsibility among the different actors involved in the farming sector.

As a pre-condition for an effective engagement with relevant CSOs and Agricultural Support Association (ASA) actors, a mapping study was conducted by Mongolian Women’s Fund (MONES) for the classification of different categories of CSOs and for the identification of their added value. The study focused on the understanding roles, the potential, the capacities and the weaknesses of the local CSOs, and on the positioning of the players within the local context. The mapping exercise was also aimed at identifying the existing coordination and cooperation mechanisms between the different stakeholders.

The objectives of the study: 1. The assessment of the individual capacities of the key Non-Governmental Organizations (NGOs) that work in the farming sector, with a particular focus on their management, collaboration and advocacy capacities.

2. Mapping the civil society context in the province and identifying the ability and potential of the key CSOs to collaborate with other CSOs, Networks and Las to develop successful advocacy strategies and initiatives.

3. The identification of the existing mechanisms for public participation in local procurements and budgeting processes with a focus on the key CSOs for possible interventions.

Methodology: The survey was conducted among 47 CSOs in Kherlen and Murun soums of Khentii Province, 16 key farming CSOs in Kherlen/Murun soums and 12 farmers in Binder soum.

Also, 29 public officials from 15 state organizations and 2 supplier companies were surveyed. Data were collected through a combination of several quantitative and qualitative research methods. Quantitative methods included structured self-administered questionnaires and open-ended questionnaires. Qualitative methods included a bibliographic research, in-depth interviews, observations and focus group discussions.

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Statistical Package for the Social Science (SPSS) was used for the statistical analysis of the quantitative data, the results of which have been reviewed and discussed by the baseline research team (BRT).

Main findings: CSOs mapping of Khentii Province The civil society of Khentii province is quite young. 51% of the 47 CSOs, covered by the study, are active for less than 5 years. In 2015, 15 CSOs (31.9%) had no budget at all and 23 (48.9%) had an annual budget under 10 million MNT, with main sources of funding being membership fees (34% of the CSOs), individual donations (23.4%), and profit from their activities (21.3%). Consequently, 61% of the CSOs relied on volunteer work. 21 CSOs (44.68%) out of 47 surveyed, did not implement any project in 20132015. Most active CSOs in Khentii province are those that are based on the mutual interests of their members and involved in networks or coalitions. 40.4% of the CSOs identify the agricultural sector as a priority intervention area. 5 main types of activities of the CSOs are public awareness raising/education (34%), capacity building trainings/seminars (31.9%), state monitoring (29.7%), services to public and target groups (25.53%) and decision-making advocacy (21.3%). Starting from 2014, the CSOs have been collaborating more actively. Most of the collaboration projects were on monitoring and good governance (budget monitoring, public engagement in bag meetings). The coalitions/networks that have most members are Civil Society Network (local), Food and Agriculture Association (local), Khan Khentii Farmers (local), Mongolian Farmers Association (national/branch), Association of Farmers for Reforming Rural Mongolia (national/branch). The most active network is Civil Society Network, with 37 member organizations, of which 14 belong to the board.

Target group: the farming CSOs In Kherlen and Murun soums, 16 key farming CSOs include 7 cooperatives, 6 informal groups, and 3 NGOs. 50% of them have existed for less than 5 years. Their 3 main work areas are farming (93.8%), herding (50%) and environment (25%). 75% of the farming CSOs serve the interests of their own members and 25% of them work on the public interest. In overall, in 2015, the majority of the farming CSOs (75.1%), mostly NGOs and informal groups, had no or very small budget under 5 million MNT. In 2015, the main sources of funding for the CSOs were membership fees (31.3%), profits, state funding, international grants and bank loans (18.8% each). Profit from the activities is low and only 3 farming CSOs mentioned it as a source of funding. 42% of the cooperatives and 50% of the informal groups hire temporary employees, based on their needs, and all the farming CSOs hire temporary employees during farming season.

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Informal groups: Most of the informal groups have basic structure. But, reporting and membership are the capacities that some of the groups have not addressed at all yet. None of them have any long-term (1-3 years) plan approved. Decision-making process is not participatory in a structured way. The group leaders do not have adequate leadership and management skills and the team work is not well organized. In most of the groups, members are not equally engaged in the organization and implementation of the activities. As a result, the level of satisfaction of members is low. The financial security and capacity of the groups is unstable and none of them has any savings.

Cooperatives: The 6 cooperatives pay a strong attention to production and commercialization of their products. However, only half of them have facilities that can support the production cycle (greenhouse and warehouse). Most of the cooperatives are sensitive to market demands and have a sale plan and make promotions and advertisements. However, their long-term planning, management and membership related work are weak. They all have a manager/coordinator to run daily operations, but only half of them attended management training. Most of the cooperatives do not have paid positions as well as job descriptions. The cooperatives have not structured and systematized their financial system. In 2015 and 2016, only half of the cooperatives made profit.

NGOs: The 3 NGOs were established in different years (2008, 2011, 2015), but are all in a nascent or emerging stages of development. In particular, their fundraising and financial management aspects are the weakest ones, which are affecting their ability to grow and expand their organizations and their activities. They are making efforts to document their work, to keep record of participants/beneficiaries and learn from their activities. But, they do not have any training in monitoring and are not able to assess changes that take place as a result of their projects. Public relations are somewhat more leading part of their organizational development, which is mostly related to the attendance of various events/activities organized in the province.

In Binder soum, the key farmers are not currently organized in any form of CSO (NGO, cooperative, informal group). However, 7 farmers (58.3%) have an experience of informal group work due to their involvement in a 5-year farming project (2008-2013) implemented

by World Vision in 2008-2013. They produce vegetables in their own home garden (83.3%) and in their own small size fields (75%), located close to the soum center. The farmers have household-level storage spaces (58.3%), and greenhouses (75%) that have been acquired through the World Vision project. However, the technical capacity for land cultivation, processing of vegetables and water supply is low. They use immediate family (83%), extended family (58%) and hired people (50%), as their labor force.

Financial sources for farming in 2015 came from family support (50% of the farmers), profit from previous year (33.3%), local loans (33.3%) and bank loans (33.3%). Potatoes and carrots productions are common (91.6) but leaf and green vegetables as pepper, 7

artichokes, salad leafs, etc. are also wide spread (83.3%). 41.6% of the farmers plant and sell fruits and berries (sea buckthorn, blackcurrant). Half of the farmers preserve their vegetables to sell them for longer period of time. The farmers mostly sell their vegetables in Khentii province and more specifically in their own soum. Due to lack of cash, farmers often use barter method (75%) and exchange vegetables for meat and dairy products. In 2015, farmers’ annual income from vegetables was between 1 and 5 million MNT (50%), less than 1 million MNT (33.3%) and only one had an income over 5 million MNT. Collaboration capacity of the farming CSOs Despite the relatively small size of large-scale farmers and farming CSOs and in spite of many common problems and issues that directly affect the productivity and well-being of local farmers, the collaboration of the farming CSOs in both areas, Kherlen/Murun and Binder soums of Khentii province, is very basic.

In Kherlen and Murun soums, the farming CSOs are aware of each other. The interactions and collaborations between farming CSOs are mostly based on personal relationships and take the form of money, seeds and equipment lease. They also share useful agricultural information and the NGOs were identified as the main sources of useful information. Farming cooperatives are eligible to participate in tender bidding, but they perceive each other as competitors than collaborators. Some of the farming CSOs participated in the same projects by international organizations and national or local government, but without collaboration or group spirit, and only for individual benefits.

Target CSOs are very interested in collaboration, but do not have a clear understanding on how to collaborate in a mutually beneficial way. Random experiences of the past collaborations have left some negative memories, which prevent initiatives for collaboration. The target CSOs identified the following benefits of collaboration as urgent and important - access to soft loans, funding and grants; obtaining policy-level support from local authorities; reliable and stable access to services (warehouse, specialized vegetable supermarket); capacity building of farmers (trainings, study tours, exchange visits); access to discounted prices on technology, equipment, new seeds; equal opportunity for tender bidding. The main problems that prevent their collaboration were identified as weak capacity to work together, lack of trust in each other, passive attitude, lack of information, and gaps in financial capacity among the CSOs. In Binder soum, the farmers often lend each other money, share information, seeds and equipment and give farming advices. Also, during the peak of farming seasons some of them collaborate to jointly resolve their challenges in land cultivation, watering the farming fields, selling vegetables. However, they rarely join their forces as a sector or group, although the farmers in Binder soum do not see each other as competitors.

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The expected benefits of collaboration are the protection of the local market from selling shipped vegetables, a support from the LAs policies, an access to financial and technical opportunities (from the LAs or international organizations), and the establishment of joint cash fund. In practice, they are expecting an expansion of the farming fields (fences, watering capacities, and soil quality conservation), the increase of the vegetable production, a lengthening of the production cycle (greenhouse, warehouse), an increased support to each other, and a direct access to consumers (specialized vegetable market).

The problems that prevent their collaboration are lack of initiative, lack of time, teamwork is weak (because farming work is seasonal), low technical capacity for farming, absence of joint cash fund, lack of required services (warehouse, winter greenhouse).

Advocacy capacity of the farming CSOs The farming CSOs in both target areas (Kherlen/Murun and Binder soums) have very similar issues and they identify their common interests in 4 main directions: improvement of inputs and production, increasing their market share and income, strengthening their financial capacity and building their collaboration capacity. In overall, the common interests are very practical and self-reliant. In the past, the farming CSOs had some experiences of advocacy, individually or in small groups, to acquire some support from the LAs. The forms of request were very similar (official letter, personal meeting, proposal, written request) and covered production and commercialization issues. In Kherlen/Murun soums the key farming CSOs act as organizations, whereas, in Binder soum, farmers act more like individuals. Therefore, the issues differed by scale. In general, the past advocacy efforts of them were more weighted toward tackling the existing, within local policies and budget, opportunities. In both locations, the advocacy efforts that were in line with local policies and did not require any major revision or adjustment of local policies or budget, succeeded.

But the requests that raised more substantial issues such as building greenhouse and warehouse, protecting local market from imported vegetables, prioritizing the status of farmers and farming sector, were not addressed.

In Kherlen/Murun soums, the farming CSOs have, based on their knowledge of the local context, identified problems with the LAs. The main ones are political allegiances (supporting only those from own party), corruption, nepotism, unfairness, empty promises during election campaigns, irresponsibility, bureaucracy. In addition, they also mentioned weak policies, unsuitable spending of the state budget, bad loan policies (high interest, short term) and a lack of accountability. The farmers assessed that their advocacy capacity as very weak. They defined main reasons as poor legal and financial knowledge, the inability to unite and join their voices to their respective applications, a lack of understanding of channels and methods for reaching out to the local authorities, and poor skills in strategizing and planning.

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In Binder soum, the farmers identified the main problems of the LAs as political allegiances and bureaucracy. The following are the challenges that the farmers are facing: lack of transparency of local budget, weak support from soum SME Development Fund, poor dissemination of information to farmers. Their own capacity for advocacy was assessed as weak due to the following reasons: lack of initiatives, lack of knowledge and information, lack of capacity to define own problems, lack of capacity to express own opinions and demands, lack of capacity to work together, slow exchange of information among farmers, poor knowledge of channels and methods for reaching out the LAs. Public participation mechanisms At the soum level (in both Kherlen and Binder soums), the policies and budget allocations that support the farming sector exist. They focus on increasing the production and supply of local consumers with safe and organic vegetables. The immediate needs of the farming sector are recognized and formulated in the same words as the farmers identified them.

There is a significant discrepancy between the farmers and the public official’s perceptions on how the LAs meet the needs of the farming sector. The public officials assess that their farming sector support is sufficient and consider that many issues of the farming sector have been resolved. However, the farmers consider that the policies and work of the LAs is insufficient. They criticize that the LAs do not pay adequate attention to farmers and to their requirements, and that they do not consider the specificities of the farming sector.

The issued policies remain on paper and the farming sector remains a labor-intensive, high-cost sector with a small potential for growth and expansion.

SDF and SMEDF are not effectively connected to the local agricultural support policies and their loan policies do not give priority to the farming sector. In particular, farming activities are considered to present increased risks to the lenders, and, thus, farmers are in general considered as undesired applicants. Farmers, in general, do not see these funds as opportunities and have a limited understanding of the loan procedures of SDF and SMEDF. Their ability to successfully apply, receive and implement projects with funding from these funds is very low. Also, SMF and SMEDF do not include farmers in their decision-making and farmers do not have any experience of such opportunities.

Article 6.1. of the Law of Mongolia on procurement of goods, works and services with state and local funds outlines the following principles as the guiding principles for procurement: transparency, equal opportunity, efficiency, cost-effectiveness and accountability. A procedure, approved on a public participation-based procurement1, includes a formal role for civil society in bids evaluation, and the monitoring of public contracts implementation.

Therefore, the farmers can participate in tender bidding process but also in selection and monitoring of projects.

1

Procedure on Public Participation-based Procurement Process, Decree #39, Ministry of Finance, February 23, 2013

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Three main decision-making mechanisms, identified as the most relevant and available for advocacy by the target farming CSOs, are Soum Development Fund; SME Development Fund; Procurement/tender bidding. Public participation in Soum Development Fund can be implemented at several levels - soft loans for farmers, project selection and monitoring, access to information. SME Development Fund procedure that regulates participation of public representative was approved in 2015, which makes this mechanism very new.

However, the loan program was started in 2009. Public participation in SME Development Fund can be implemented at two levels – loans and public oversight.

Main recommendations: Civil society of Khentii province -

-

To study and learn from the advocacy and collaboration experiences and achievements of the Civil Society Network; To identify and strengthen one of the farming networks to serve as the main driving force; To build alliances with the local NGOs as the main allies for capacity building and advocacy works; To include in the Project a possibility to keep the CSOs updated on the issues and problems in the farming sector and build their trust and support, to make sure that those CSOs which work in the agriculture/farming sector have accurate understanding of the Project goal, objectives, strategies and budget plans; To include in the Project a possibility to keep the CSOs updated on problems encountered in the farming sector and build their trust and support.

Target group: farming CSOs -

-

-

-

To build up and strengthen the understanding of the key farming CSOs on the nature, purpose and key principles of their organizations: “NGO”, “cooperative”, “informal group” (such as democratic participation, equal distribution and group interest) To develop and implement an organizational capacity building program for the key farming CSOs to support their growth and sustainability.

Short- and long-term planning needs to be strengthened. Simple planning capacity for few key areas of work should be introduced and practiced, until this becomes an integral part of their work Financial planning and management need to be strengthened. For NGOs, a basic understanding of fundraising strategies and tools would help to raise funds for shortand long-term projects in the farming sector; Team leadership and team management capacity should be introduced to all leaders and managers 11

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All-member group meetings for each CSO should be organized to help their members to assess their work, to understand the principles of that particular CSO type, to discuss their own shortcomings and plans for improvements.

Collaboration capacity of the farming CSOs -

-

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To develop shared goals and values, and build up an understanding that their collaboration will bring results to all of them. As part of this effort, a discussion should be organized to expose past negative experiences and address them in a constructive way; A training program should be developed and implemented to help the farming CSOs to acquire knowledge and skills on collaboration among themselves as well as with other allies and partner organizations.

To build a shared understanding that the farming sector is an important and growing sector in the area and develop collaboration

Advocacy capacity of the farming CSOs -

-

-

To develop long-, medium- and short-term goals and objectives of the farming sector in each of the target areas, which are linked to the local contexts; To develop a long-term (5 years) strategy for advocacy work, with long, medium and short-term goals and objectives, that is owned by the farming CSOs and is based on their capacity and needs; To provide a training program to the farming CSOs that helps them to acquire and strengthen knowledge and skills for a successful advocacy work; To identify a list of key target organizations for concerted advocacy efforts by the key farming CSOs; To identify an umbrella organization (possibly, the recently established Khentii branch of Farmers’ Association) and foster its leadership in advocacy work.

Public participation mechanisms -

To develop detailed indicators for the assessment of the farming sector (for each type of crops and vegetables), to ensure that these reports are open to public; To establish the participation of the farming CSOs in the planning, implementation and assessment of the provincial and soum-level plans for vegetables production; To develop a list of the needs priorities of farmers and advocate for including them in local policies and budgets; To organize capacity building activities (project planning, proposal writing, documentation, certification, etc.) to increase the access of farmers to loans from SDF and SMEDF;

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-

-

-

To develop a close cooperation with SMF and SMEDF in the soums to reflect the needs and specificities of the farming sector in their policies, selection and assessment criteria; To improve the collaboration of SMF/SMEDF with the farming CSOs and advocate for establishing the participation of these CSOs in the policy and in the criteria development of loan selection and project monitoring processes; To develop a public interest and a public support for local vegetables and berries production.

2. OVERVIEW OF THE LEGAL FRAMEWORK FOR WORK OF CSOs Civil society is the arena, outside of the family, the state, and the market, which is created by individual and collective actions, organizations and institutions to advance shared interests2. Constitution of Mongolia guarantees the right to form public organizations and unite voluntarily in associations according to the social and personal interests and opinion3.

2.1. Non-governmental organizations In Mongolia, civil society organizations are largely regulated by Law on Non-Governmental Organizations (1997). Although, the Law refers to “non-governmental organizations”, the definition of non-governmental organization in this Law is applicable to the abovementioned “civil society organizations”. According to this Law, non-governmental organization is “an organization which is independent from the state, self-governing, notfor-profit and established voluntarily by citizens or by legal persons other than State bodies (that exercise legislative, executive and judicial powers) on the basis of their individual or social interests and opinions”4.

Article 4 of the Law sets out two types of NGOs, public benefit and mutual benefit. Public benefit NGOs are non-governmental organizations that operate for the public benefit in the fields of culture, art, education, science, health, sport, nature and environment, community development, human rights, protection of the interests of specific subsets of the population, charity and other such fields. Mutual benefit NGOs are non-governmental organizations other than a public benefit non-governmental organization that operates primarily to serve the legitimate interests of its members.NGO is considered established when founders issue a decision to establish the organization and approve the organization’s charter. Such

2

Definition by CIVICUS – World Alliance for Citizen Participation. See “State of Civil Society 2013: Creating an enabling environment”, CIVICUS, 2014, p. 10 3 Constitution of Mongolia, 1992, Article 16.10.

4 Law of Mongolian on Non-Governmental Organizations, 1997, Article 4.1

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organization can exercise its rights as a legal entity after it is registered with the State registry5.

Article 9 of the Law outlines the relations between the state and non-governmental organizations and articulates that state may support, financially and otherwise, activities of NGOs and that information relating to activities of state bodies, unless it is classified as state secret, should be open to NGOs. Also, it states that NGOs can participate in drafting and implementing of decisions made by legislative and executive authorities, and make public statements on decisions taken by state bodies.

The Law on Non-Governmental Organizations was approved in 1997 and no amendments or revisions have been made ever since. As of today, this is the main legal document that regulates activities of NGOs (CSOs).

2.2. Cooperatives (khorshoo) Cooperative is another form of organization that is established by citizens and it is commonly accepted as part of civil society. For instance, EU Commission defines CSOs as a wide range of actors with different roles and mandates and includes all non-state, notfor-profit, non-partisan and non-violent organizations such as community-based organizations, non-governmental organizations, faith-based organizations, foundations, research institutions, gender and LGBT organizations, cooperatives, professional and business associations, and the not-for-profit media6.

Law of Mongolia on Cooperatives defines cooperative (khorshoo) as an organization that is established by individuals on a voluntary basis for the purpose of satisfaction of their social and cultural needs, governed and supervised in a democratic and collective manner and conducts its business based on common ownership of its members7. Based on its definition cooperative is similar to “mutual benefit� NGO that primarily serves the interests of its members.

Cooperative shall be registered with local registration authority and can conduct activities such as raw material processing, industrial, saving and loans, selling and supplying, service, construction, consumers and other as stated in its chart.

2.3. Informal groups (buleg) Informal, grassroots groups are another form of CSOs that considered to be an important 5

Ibid, Article 6 The roots of democracy and sustainable development: Europe’s engagement with civil society in external relations, Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, 12.09.2012, p. 3 7 Law of Mongolian on Cooperative, 1998, Article 3.1 6

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of civil society. Informal (grassroots) groups are characterized by more democratic forms of governance which is based on the predominance of volunteers who enter and leave such groups voluntarily8.

Conclusion: Based on the overview of the legal framework of public organizing in Mongolia it is legitimate to consider the following organizations engaged in the farming sector in Khentii province as civil society organizations and subjects for this study: -

Non-governmental organizations Cooperatives Informal groups

3. METHODOLOGY Methods: Data were collected using the combination of several quantitative and qualitative research methods to meet the purpose of the study. Quantitative methods included several structured self-administered questionnaires to obtain information from the overall and target CSOs on their current organizational situation. Data on the management and organizational capacities of the target CSOs were acquired through document research, in-depth interviews, and observations. Perceptions and opinions of the target CSOs on their current and potential capacity as well as their needs for partnership and advocacy were collected through in-depth interviews, focus group discussions held with use of various tools. Data on the existing public participation mechanisms, their availability and openness to supporting the farming sector and the key CSOs was collected through document research, semi-structured interviews with key informants (public officials, heads of state organizations) and focus group discussions with the key stakeholders.

BRT: The research team consisted of 5 specialists, who expertise in non-profit management and capacity building, public participation in decision-making at the local level, social development and research methods. The research team designed, planned and conducted the study, and CCR Khentii Branch team provided logistical support.

Scope: Baseline data was collected from 2 locations – Kherlen/Murun and Binder. The initial task of the baseline study included 2 soums, Kherlen and Binder. However, at the beginning of the baseline study, CCR Khentii Branch included Murun soum in the baseline study as it is very close to Kherlen soum and has a similar situation with the CSOs from Kherlen soum. So, based on an agreement with the CCR Khentii Branch, the BRT surveyed these two soums as one target area.

Sampling: The survey was conducted among 47 CSOs in Khentii Province for general mapping of CSOs. An initial list of 96 CSOs was obtained from the Civil Society Network 8

Michael Edwards, The Oxford Handbook of Civil Society, 2011, p. 57

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of Khentii Province. Based on this list, the following criteria were used to develop the final list of CSOs: a) active in the past 3 years (2013-2015), operate as part of civil society (i.e., those CSOs that switched to for-profit activities were excluded). As a result, 47 CSOs were identified as the target for the study, including 16 farming CSOs that were identified by CCR Khentii Branch as the key farming CSOs. An initial list of 20 CSOs in Kherlen and Murun soums, and 16 farmers in Binder soum, was provided by CCR Khentii Branch as the list of the target CSOs that are active in the farming sector. Those CSOs that are no longer active, have for-profit operations and that do not identify the farming sector as their core work were eliminated from this list. Also, some organizations were out of reach. As a result, 16 CSOs were identified as the target for the study (3 NGOs, cooperatives, informal groups).

CCR Khentii Branch provided a list of target farmers based on the following criteria: a) the scope of farming work is large; b) produce vegetables for sale, not only for household consumption. Also, 3 informal groups were identified by CCR Khentii Branch as the target CSOs and were included in the list. During the individual meetings in Binder soum, it was discovered that these informal groups had disintegrated and the former heads work as individual farmers. As a result, 12 farmers participated in the survey. The final list of the key farmers was verified with a public official in charge of agriculture/farming sector of Binder soum.

In addition to the CSOs, BRT held interviews and focus groups discussions with 29 public officials from 15 key local stakeholder organizations and 2 key supplier companies.

Data collection, processing and analysis: The baseline research team (BRT) had 3 field trips to two target locations in Khentii province and collected data through the designed research instruments. CCR Khentii Branch provided assistance in collecting data (administered surveys for the general mapping of CSOs, organized the meetings of BRT with key farming SCOs for interviews, focus groups discussions and site visits). BRT processed the collected quantitative data on SPSS and different members of BRT analyzed relevant types of qualitative data based on the expertise.

4. BASELINE STUDY 4.1. CIVIL SOCIETY MAP OF KHETII PROVINCE The mapping of civil society organizations in Khentii province was conducted to provide up-to-date information on the state of civil society in Khentii province and outline the larger civil society context. The aim was to provide a general cartography of the civil society in Khentii province so that the Project is able to plan and build alliances between CSOs in their advocacy efforts. In consideration of the overall scope and focus of the study, a simple 16

mapping methodology was used with a focus on the overall situation of the civil society and on relevant organizations that can be interested or involved in advocacy efforts in the farming sector.

Objectives: - Identify and categorize the existing CSOs - Provide an overview of civil society actors in Khentii province Based on the study the report provides information on the following: Typology of the CSOs; Organizational capacity of the CSOs (Human resources, Financial resources); Functions of CSOs; Collaboration of CSOs. 4.1.1. Typology of CSOs Table 1. Number of years in existence

Number of years

Number of CSOs

%

0-5 years 6-10 years 11-15 years Over 15 years Not certain

24 13 7 2 1

51.1 27.6 14.9 4.3 2.1

Total

47

100.0

The CSOs of Khentii province are quite young. 51% of the CSOs existed for less than 5 years, 27.6% existed from 6-10 years and only 21.4% existed for more than 10 years.

Table 2. Types of organizations

Organizations Number of CSOs

Fund Professional Associations 1

Trade Union

Cooperat ives

2

14

1

NGOs 23

Informal groups 6

Main 3 types of CSOs are NGOs (49%), cooperatives (30%) and informal groups (13%). 

The most active CSOs are those which have memberships and are based on similar interests of their members, such as Association of Employers, Association of Teachers, Association of Construction Professionals, Farmers’ Association, Scouts’ Association, Association of Women of Khan Khentii.

Scope of service: o Other-benefitting o Self-benefitting

19 (40.4%) 28 (59.6%) 17

40.4% of the CSOs are other-benefiting or public-interest groups that serve their beneficiary groups. And, 59.6% of the CSOs are self-benefitting groups that work to provide benefit to their members.

4.1.2. Organizational capacity Human resources: Table 3. Number of regular staff

Organization s 1-2 persons 3-4 persons 5-6 persons 7-8 persons 9-10 persons Over 10

Total

NGO Coop s 4 2 2 1 2 3 2 1 10 7

Prof Assoc 1 1

Trade Union 1 1

Founda tions -

Inform Groups 1 1

Total 7 4 6 0 0 3 20

Out of 47 CSOs only 20 (42.5%) have staff, who are regularly affiliated with organization.

The half (50%) of those 20 CSOs that have regular staff are NGOs and 7 (35%) are cooperatives. Both NGOs and cooperatives employ 1 to 6 persons on regular basis.

Table 4. Number of irregular staff

Organizations

NGOs

Coop

1-2 persons 3-4 persons 5-6 persons 7-8 persons 9-10 persons Over 10 persons

1 2 3

1 3 4

Total

Prof Assoc 1 1

Trade Found Union ations -

Inform Groups 1 1

Total 2 1 1 5 9

Only 19.1% of the CSOs employ staff, who are affiliated with organization, but work only when required. Again those are mostly cooperatives (44.4%) and NGOs (33.3%).

Table 5. Volunteers

Organizations

1-2 persons 3-4 persons 5-6 persons

NGOs

2 3 -

Coop

Prof Assoc

1

18

Trade Found Inform Union ations Group s 2 -

Total

4 3 1

7-8 persons 9-10 persons Over 10 persons

Total

3 8 16

1 3 1 6

1 1

1 1

-

3 5

4 6 11 29

However, many CSOs rely on volunteer work (61%). NGOs are those that rely the most on volunteer work (55.1%), but cooperatives (20.6%) and informal groups (17.2%) are also using volunteer support.

Table 6. Temporary hires/Contract

Organizations

NGOs

1-2 persons 3-4 persons 5-6 persons 7-8 persons 9-10 persons Over 10 persons

2 1 3

Total

Coop

Prof Assoc

1 1 2 4

-

Trade Found Inform Union ations Group s 2 1 3

Total

4 2 1 1 2 10

Out of 47 CSOs, only 10 CSOs (21.2%) hire temporary help. Those are cooperatives (40%), NGOs (30%) and informal groups (30%). In overall, the most utilized human resources are regular employees and volunteers. And, irregular employees and temporary hires are used by fewer CSOs.

Financial resources: Graph 1. Annual budget in 2015 (by types of CSOs)

19

14 12

12

10 8 6

4

4

2

2

4

5

5

4 2

1

1

1

1

1

1

1

1

0 No funding NGOs

Funds

0-0.9 mln

1-5 mln

Trade Unions

5-10 mln

Informal groups

10-50 mln 50-100 mln Cooperatives

Over 100 mln

Professional Assocations

15 (31.9%) of the CSOs had no budget in 2015. 23 CSOs (48.9%) had annual budget of less than 10 million MNT. 6 CSO (12.7%) had a budget of over 50 million and 3 CSO (6.3%) had a budget of over 100 million MNT. Those CSOs with no or small budget (0-10 million MNT) are NGOs, Informal groups, foundation. Those with higher budget (over 10 million MNT) are cooperatives and Trade Unions.

Table 7.Annual budget in 2015 (sources of funding)

Sources of funding State funding International aid/grants National funds and NGOs National corporations Local corporations Religious organizations Membership fees and member donations Profit of the organization Individual donations Other/ bank loans, own capital/

Number of CSOs

%

6 6 3 0 0 0 16 10 11 6

12.8 12.8 6.4 0 0 0 34.0 21.3 23.4 12.8

For those CSOs that had budget in 2015, 3 main sources of funding were membership fees (34% of CSOs), individual donations (23.4% of CSOs), and profit of the organization (21.3%). 6 CSOs received funding from international organizations (12.8% of CSOs).

4.1.3. Functions of CSOs Table 8. Sectors of interventions

Sectors

% 20

Sustainable development Education Health Sports Human rights, democracy Women’s rights Children and youth issues Elders’ rights and interests Environment Culture Agriculture Herding Traditions and customs Employment Charity Other

17.0 23.4 14.9 6.4 8.5 12.8 8.5 19.1 19.1 4.3 40.4 27.7 8.5 19.1 12.8 48.9

CSOs in Khentii province work on very diverse issues. However, the sector that the CSOs are most active in is agriculture, including farming (40.4% of CSOs).

Graph 2. Types of activities

19

Services to members and target groups

18

Capacity building training and seminars

16

Public education and awareness raising

15

Other

9

Advocacy of local decision makers

Number of CSOs

6

Monitoring of public agencies Research and studies

5

Public discussions and convening

5 3

Charity work 0

5

10

15

20

Out of 9 organizations that have experience of working on advocacy and lobbying of local decision-making organizations 6 are NGOs, 1 is a cooperative, 1 is a Trade Union, and 1 is an informal group.

Graph 3. Number of projects implemented in 2013-2015

21

25

Number of CSOs

22

21

20 15 10 3

5

1

0 No projects implemented

1-5 projects

6-10 projects

Over 10 projects

Although, the surveyed 47 CSOs were selected because they were active in 2013-2015, 21 of the CSOs (44.68%) did not implement any project during this period. 22 CSOs (46.8%) implemented few projects (1-5 projects) and only 4 CSOs (8.5%) implemented more than 6 projects. However, 37 CSOs (78.7%) are implementing or planning to implement at least 1 project in 2016 and 10 CSOs (21.2%) have no projects or plans for implementing a project in 2016.

4.1.4. Collaboration of CSOs 23 out of 47 CSOs are currently members of a network/coalition. 11 of them are NGOs, 7 are cooperatives.

Graph 4. CSOs that are members of a Coalition/Network 12

11

Number of CSOs

10

7

8 6 4 2

2

1

1

1

Fund

Trade union

Professional Associations

0 Informal groups Cooperatives

Table 9. Coalitions/Networks that the CSOs are part of 22

NGOs

Civil Society Network (local)

10

Food and Agriculture Association (local)

8

Khan Khentii Farmers (local)

5

Mongolian Farmers Association (national/branch)

4

Association of Farmers for Reforming Rural Mongolia (national/branch)

4

Mongolian Chamber of Commerce and Industry (national/branch)

1

Kherlen Business Center (local)

1

Association of Agriculture Cooperatives (national/branch)

1

Mongolian Volleyball Association

1

Some CSOs are members of one coalition/network, but many CSOs are members of more than one coalition/network. The coalitions/networks that have most members are Civil Society Network (local), Food and Agriculture Association (local), Khan Khentii Farmers (local), Mongolian Farmers Association (national/branch), Association of Farmers for Reforming Rural Mongolia (national/branch).

From the Focus Group discussion:  Civil Society Network, a local network of CSOs, is the most active network in Khentii province. It has 37 member organizations and 14 of them are on the Board of this Network. o Members of Civil Society Network have been trained as trainers on capacity building of CSOs, monitoring and business administration. o Most of international donors are interested in collaborating or supporting Civil Society Network, for example, Mercy Corps, Caritas Czech Republic contact Civil Society Network for information. o 14 organizations that are on the Board of the Network are the most active ones that jointly implement projects. Other member organizations participate in the Forums or in projects, otherwise, they are not active.  In 2014, CSOs organized a Civil Society Forum, the effort led by Civil Society Network. The Forum had a goal to strengthen the voice of the civil society and increase their influence on the LAs. As a result of the first Forum of 2014, CSOs identified 3 main directions for joint actions: promoting CSOs; monitoring and evaluation of public institutions; exchanging information among CSOs. Also, it was decided to hold this Forum once every 2 years.  Starting from 2014, CSOs have been collaborating more actively. The main driving forces behind this initiative are the projects implemented by donor organizations and their interest in supporting collaborative projects.  A lesson from the past collaborations is that participation of organizations is not equal, so some organizations carry all the workload.

23



The results of the collaboration projects are that there is a study of CSOs in Khentii province, a Forum was organized, a Memorandum of Understanding was signed with Citizens’ Representatives Council, and a website was developed, Local Governor’s Office provided the CSOs with an office.

Graph 5: Number of years that the CSOs are part of a Coalition/Network 6

5 5 4

3

3

3

3

3

3 2

1

1

1

1

6 year

7 year

8 year

1

1

1 0 1 year

2 year

3 year

4 year

5 year

9 year 10 year 11 year Over 60 years

Number of CSOs

Membership in coalitions and networks has increased in the past five years. Out of 23 organizations, 22 responded to this question and 18 of them (81.8%) have participated in an advocacy campaign organized by a coalition/network in the past 3 years.

Graph 6: Advocacy campaign by network/coalition in 2013-2015 10

Yes

8

9

No 7

6 4 2

2 1

2

1

0 Trade Union

Professional Informal groups Cooperatives associations

NGOs

Fund

Out of 18 CSOs that participated in an advocacy campaign organized by a coalition/network, 15 CSOs (83.3%) responded that the goal of an advocacy campaign was achieved.

24

From the Focus Group discussion: Most of the collaborative projects were on monitoring and good governance. We have started prioritizing joint implementation of projects.  Monitoring projects: A project Monitoring of the Glass Account was implemented with funding from Open Forum and one was implemented to monitor the spending of Local Development Fund and SDF.  Good governance projects: the following projects were implemented – AntiCorruption project was implemented in bags, Transparent Budget project is implemented every year, Public Participation project was jointly implemented, a project on Involvement of Bag Residents in Public meetings was implemented.  Marginalized groups: disabilities issues and poor women issues are considered as important  Public awareness work: anti-alcohol campaign is considered as the priority The main challenges in the advocacy projects are a) lack of funding; b) the local authorities do not fulfill their part when a Memorandum of Collaboration is signed with them. For instance, Mercy Corps implemented a project on joint advocacy. It was agreed that the local authorities will support CSOs once the project ends, but since 2013, when the project ended, no much support has been received from the local authorities. The outcomes of the advocacy projects are a) biennial Forum has become an expected event; b) we have become capable of conducting monitoring of the implementation of laws and developing recommendations; c) CSOs got support from the local authorities on office and the website.

4.1.5 Conclusion Civil society is young, but diverse. The most common types of CSOs are NGOs, cooperatives and informal groups. The main human resources are full-time staff and volunteers. Financially, the CSOs are weak, most of them did not have funding or had very limited annual budget in 2015, so they have implemented few projects. Almost half of the CSOs work, to a certain degree, in the area of agriculture/farming, which identified this sector as a large sector in Khentii province.

Most of the CSOs are membership-based CSOs (cooperatives, informal groups, professional associations, trade unions) and aim to serve the interests of their own members. They have more funding, with membership dues and donations serving as one of the main sources of their annual budget. As service providers to their members, CSOs activities include capacity building training and seminars. NGOs are most active type of CSOs, but with least funding. They are more engaged in collaboration and advocacy, but without or very limited funding.

25

CSOs are interested in collaboration in many different forms. To date, 5 networks are the ones with more members. Civil Society Network is the most active and more recognized one, with recent and significant achievements in building collaboration of CSOs and lobbying of LAs. However, out of 5 coalitions/networks with most members, 4 associations (2 local and 2 branches of national associations) identify the agriculture/farming sector as their main sector of activity, which again confirms that the agriculture/farming sector is large and that CSOs recognize it.

4.1.6 Recommendations -

-

To study and learn from the advocacy and collaboration experiences and achievements of the Civil Society Network To identify and strengthen one of the farming networks to serve as the main driving force.

To recruit NGOs as the main allies To introduce the Project to the CSOs through Civil Society Network and to make sure that those CSOs which are working in the agriculture/farming sector have an accurate understanding of the Project goal, objectives, strategies and budget plans.

To include in the Project a possibility to keep the CSOs updated on issues encountered in the farming sector and build their trust and support.

4.2 KEY FARMING CSOs The study of the key farming CSOs of Kherlen/Murun and Binder soums was conducted to provide information on their current state in order to provide a baseline study of their overall situation, organizational capacities and their challenges and opportunities.

Objectives: - To develop an overview of the key farming CSOs - To assess management capacities of the key farming CSOs - To identify the strengths and weaknesses civil society actors in Khentii province Based on the study, the report provides information on the following: Kherlen/Murun soums: General mapping of the key CSOs (general); Organizational capacity of the key CSOs (by types of CSOs); Strengths and weaknesses of the key CSOs (by types of CSOs) Binder soum: General mapping of the key farmers (general); Strengths and weaknesses of the key farmers (general)

26

4.2.1 General mapping of the key CSOs Kherlen/Murun soums Table 10. Number of CSOs, by types

Organizations

Cooperatives

NGOs

Informal groups

Number of CSOs

7 43.75%

3 18.75%

6 37.5%

%

There are 3 types key farming CSOs: NGOs (18.75%), cooperatives (43.75%) and informal groups (37.5%). Farming cooperatives and informal groups are the majority among the key CSOs (81.25%).

Table 11. Beneficiaries Beneficiary Public Members

Number of CSOs 4 12

% 25% 75%

75% of the CSOs serve the interests of their members and 25% of the CSOs serve the public interests. Cooperatives and informal groups are the majority of the key CSOs and they identified their members as their target beneficiaries.

Table 12. Years of existence

Number of years

Number of CSOs 8 7 1 16

0-5 years 6-10 years 11-15 years

Total

% 50 43.7 6.3 100.0

The CSOs of Kherlen/Murun soums are quite young. 93.7% of them existed since less than 10 years. 50% of all the farming CSOs existe since less than 5 years.

Table 13. Geographical scope

Number of CSOs %

Province 3 20%

Soum 9 60%

Bag 3 20%

15 out of 16 CSOs provided answers to this question. 9 CSOs (60%) of the key farming 27

CSOs work at soum level. 3 (20%) at province level and 3 (20%) at bag level.

Table 14. Human resources (regular staff)

Organizations

NGOs

1-2 persons 3-4 persons 5-6 persons 7-8 persons 9-10 persons Over 10 persons

2 2

Total

Cooperatives 2 1 3

Informal groups 1 1

Total 3 1 0 0 6

Only 6 (37.5%) out of 16 CSOs employ regular staff – 3 cooperatives, 2 NGOs and 1 informal group. All of them are employing the minimal number of staff (1-2 persons).

Table 15. Human resources (temporary hire)

Organizations 1-2 persons

-

-

Informal groups 2

3-4 persons 5-6 persons 7-8 persons 9-10 persons Over 10 persons

0 3

1 1 1 3 7

1 3 6

Total On seasonal basis

NGOs

Cooperatives

Total

1 1 1 1 6 16

2

42% of the cooperatives and 50% of the informal groups hire temporary employees, based on their needs. However, all key farming CSOs hire temporary employees during farming season.

Table16. Human resources (volunteers)

28

Organizations

NGOs

1-2 persons 3-4 persons 5-6 persons 7-8 persons 9-10 persons Over 10 persons

2 2

Total

Cooperatives 2 1 3

Informal groups 2 3 5

Total 2 3 2 3 10

83.3% of the informal groups rely on volunteers in their work. And, NGOs and Cooperatives rely on volunteers to a certain degree. However, the number of volunteers that the informal groups recruit is smaller (1-8 persons) than the number of volunteers that the NGOs and the cooperatives are able to recruit (over 9 persons).

The key farming CSOs are naturally focused on the agriculture/farming sector (93.8%).

However, they also work in different sectors. Another major sector is herding as half of the key farming CSOs conduct activities in this sector.

Table 17. Sectors of intervention

Organizations

NGOs 93.8 50.0 18.8 18.8 25.0 12.5 12.5 12.5 6.3 6.3 6.3 6.3

Agriculture Herding Sustainable development Children and youth issues Environment Women’s rights Employment Charity Human rights, democracy Elders’ rights and interests Traditions and customs

29

Graph 7. Types of activities

Services to beneficiaries

7

Capacity building training/seminars

6

Monitoring of public agencies

3

Advocacy of decision-making

2

Charity activities

1

Public education/awareness raising

1 0

2

4

6

8

Number of CSOs

The key farming CSOs of Kherlen/Murun soums have strong background in providing services to beneficiaries (43.75%) and conducting capacity building trainings and seminars (37.5%).

Graph 8. Number of projects implemented in 2013-2015 12 10

10 8 6

5

4 2

1 0

0 No projects implemented

1-5 projects

6-10 projects

Over 10 projects

Number of CSOs

In the past 3 years, 10 of the key farming CSOs (62.5%) implemented 1-5 projects and 5 CSOs (31.25%) did not implement any projects. Only 1 CSO implemented more than 10 projects.

30

Graph 9. Annual budget in 2015 (by types of CSOs) 5 4

4 4 3 3 2

2

2

2

2

2 1

1

1

1

1

1 0 no funding

0-0.9 mln NGO

1-5 mln

10-50 mln

Community group

50-100 mln

Over 100 mln

Coorporative

Those CSOs with no or small budget (0-10 million MNT) are mostly NGOs and Informal groups. Those with higher budget (over 10 million MNT) are cooperatives. In overall, the majority of the key farming CSOs (75.1%) have no or a very small budget of less than 5 million MNT. Table 18. Sources of funding in 2015

Sources of funding Membership fees and donations State funding International aid/grants Profit of the organization Individual donations Other/ bank loans, own capital/ National funds and NGOs

Number

%

5 3 3 3 3 3 2

31.3 18.8 18.8 18.8 18.8 18.8 12.5

For those CSOs that had budget in 2015, the main source of funding was membership fees and donations (31.3%). Profit of the organization for the farming CSOs is low with only 3 CSOs (18.8%) stating as a source of funding

31

Binder soum Graph 10. Farming field 12

10

9

10 8 6 4

1

2

0

0 Own compound

Own field

Rented field, no charge

Rented field, charge

Number of farmers

Most of the farmers use their own home garden for growing vegetables (including greenhouses) and their own small size fields that are located in close proximity to the soum center. There is a very limited experience of renting a larger field since the farmers work individually, and as manual labor is the main issue they will not be able to cultivate larger fields.

Graph 11. Farming labor 12 10 10 8

7 6

6 4 4

3

2 0 0 Immediate family Extensive family

Hired help

Members of the group

Voluntary help

Other

Number of farmers

Most of the farmers rely on family members, including immediate family (83.3%) and extended family (58.3%), to work on farming fields. But, at least, half of them (50%) hire seasonal help who, mostly, are marginalized people (disabled, poor, and unemployed).

Graph12. Places for selling own produce 32

12

11

10 8 8

7

6 4

3

2

1

0 In own soum

Other places

In other soums of Khentii province

In Ulaanbaatar

In other provinces

Number of farmers

In overall, the farmers sell their produce in own soum. However, 7 farmers (58.3%) sell in neighboring soums (but, those are herders from the other soums). Very few of them (25%) sell in Ulaanbaatar, but those, mostly, during big farmers markets, rather than on a business arrangement.

Graph 13. Forms of payment for sold produce 10.2

10

10 9.8 9.6 9.4 9.2

9

9 8.8 8.6 8.4 Cash

Non-cash Number of farmers

Farmers sell their produce for cash (83.3%) and in exchange for goods (75%). The farmers prefer cash but due to lack of cash in rural areas they often exchange vegetables with herders for meat and dairy products.

Graph 14. Annual revenue from farming in 2015 33

7

6

6 5 4

4

3 2

1

1 0 0-0.9 mln

1 - 5 mn

5-10 mln

Number of farmers

The incomes that the farmers earn from selling their produce are low. 11 farmers answered this question, and 6 farmers (54.5%) had an income of 1-5 million MNT in 2015, 4 farmers (36.4%) had an income of less than 1 million MNT. Only 1 farmer had an income of more than 5 million MNT. Graph 15. Financial sources in 2015

Other

12

Family support

6

Profit from previous year

4

Local loans (soft)

4

Bank loans

4

Savings

3

Local support

1

Projects Number of farmers

0

0

5

10

15

Financial sources for farming come from family support (50% of the farmers), profit from previous year (33.3%), local soft loans (33.3.%), bank loans (33.3%).

Graph 16. Types of products for sale 34

Seeds and seedlings

5

Fruits and berries

5 6

Preserved vegetables

10

Leafy and green vegetables Other

11

Common vegetables

11

0 Number of farmers

2

4

6

8

10

12

Potatoes and carrots productions are common (91.6% of the farmers). But farmers also plant leafy and green vegetables such as pepper, artichokes, salad leafs, etc. that are also wide spread (83.3%). Half of the farmers preserve their vegetables to sell them for longer period of time. 41.6% of the farmers plant and sell fruits and berries (sea buckthorn, blackcurrant).

Graph 17. Experience of working in an informal group 8

7 5

6 4 2 0 Yes

No Number of farmers

7 farmers (58.3%) have an experience of working in an informal group due to their involvement in a 5-year farming project implemented in Binder soum by World Vision in 20082013.

35

4.2.2.Assessment of the organizational capacity The key farming CSOs are of 3 different types – NGOs, cooperatives, informal groups.

Although, all 3 types belong to civil society, each type has its own distinctive organizational structure, work specificities and features. Therefore, separate questionnaires were used for the assessment of organizational capacity of these groups.

NGOs (Kherlen/Murun)

3 NGOs participated in the survey: Khan Khentii Farmers, Mongolian Farmers Association, Food and Agriculture Association Main 8 dimensions of NGO capacity were assessed: - Strategic planning - Fundraising - Governance - Human resources - Financial management - Monitoring and Evaluation (M&E) - Public relations and communication - Information Technology(IT) Strategic planning: All 3 NGOs have short-term planning, but they have work plans written and 2 of them occasionally verify their implementation. All 3 NGOs have well-articulated organizational goals and their staff knows them. All three secured certain funding for next 6 months of their work. However, the written plans are not regularly updated and longer-term funding is not secured. All 3 NGOs are in the emerging stage of NGO development.

Fundraising: All 3 NGOs heavily rely on in-kind resources and the funding they receive is usually small, one-time grants. None of the NGOs have long-term fundraising plans and efforts to secure their future.

Governance: All 3 NGOs have Board of Directors that regularly meet and which is engaged in the management of the organization. Those are mostly friends or colleagues of the founders. Basic governance documents do exist.

Human resources: Staffs of the NGOs are mostly unpaid. Job descriptions, in general, exist whether informally or in a written form. But staff works on different tasks, whichever is considered important or urgent. Staff is involved, however, in trainings, mostly offered by the local authorities or international donor organizations.

36

Financial management: All 3 NGOs have small budget. They do not produce financial reports and do not get audited. Mostly, one person is in charge of financial management (signs and cashes checks) Monitoring and Evaluation: The NGOs are making efforts to document their work, keep record of participants/beneficiaries and learn from their activities. But, they do not have any training in monitoring and are not able to assess changes that take place as a result of their projects.

Community and external relations: 3 NGOs are known and their work is recognized within the farming sector. The farming sector actors know them and provide them with support.

They are members of civil society networks/coalitions beyond the farming sector, regularly receive invitations to participate at their conferences/trainings. Some of their work has been covered by media. However, they are well known within the farming sector and they have not been yet able to become strong civil society leaders in the province.

Information technology: The NGOs have computers and they use them, primarily, for word processing, basic registration of expenses and developing reports. They use free emails for communication purposes, but they do not have regular Internet access in their offices. Also, they do not have websites or special software to support their work in the office.

According to the questionnaire results, stages of development of the NGOs were identified: Table 19. Stage of development, NGOs Organizational capacity Strategic planning Fundraising Governance Human resource Financial management M&E Public relations IT

Nascent

Emerging

Developing

2 1

3 1 2 2

1

Strengthening

3

1

3 1 2

2

Based on the assessment, the main strengths and weaknesses of the NGOs were determined:

37

Thriving

MAIN STRENGTHS AND WEAKNESSES Strengths

Weaknesses Strategic planning

Writing work plans for 6-12 months

Short-term focus of work

Commitment and dedication to work

Strategic planning Strategic fundraising Fundraising

Ability to recruit volunteer help

Long-term fundraising

Ability to raise in-kind donations

Support for operational expenses

Participatory decision-making on spending

Fundraising plan

Short-term/one-time funding Governance Official registration and documents

Strategic work of the Board

Board that meets regularly and makes decisions

Effective and strategic functioning of the Board Human resources

Staff work

Capacity building of the staff

Human resource policies

Work directions and distribution of responsibilities Stable staff work (salary/fee) Financial management

Staff handles financial issues

Small/no budget Basic financial system Financial accountability Monitoring and evaluation

Recording activities

Training on M&E

Reviewing progress of participants

M&E reports and analysis

Learning from own work Community and external relations Well-known within the farming sector

Participation in advocacy work

Recognized by other CSOs

Relations with media 38

Members of civil society networks

Relations with state/public agencies

Regular participation in province-level events Relationship with media Information technology Computers

Internet access

Word and Excel documents

Website Accounting software system

Cooperatives (Kherlen/Murun)

6 out of 7 cooperatives took part in this section of the survey: Och Murun, Khentii Suu, Undrakh Bayan Murun, Eren Es, Khailast Kharikhan, Mongol Suu Main 5 dimensions of capacity of cooperatives were assessed: -

Registration, documentation, strategic planning Management, organization, financial management Production inputs Market and business relations Membership

Registration, documentation, strategic planning: All cooperatives are officially registered and they develop and prepare those documents that are required as part of their official status, such as bylaw a yearly financial report. However thedocuments that are not required by state agencies, but useful for effective and sustainable operation, such as financial plan, work plan, long-term business plan, internal policy and procedure are not in place.

Organization, management, financial capacity: All the cooperatives have a manager/coordinator to run daily operations, but only half of them (3 out of 6) attended management training. Most of the cooperatives (4 out of 6) do not have paid positions as well as job descriptions. Only half of the cooperatives (3 out of 6) correlate job performance of its members with benefits. If there are any internal conflicts, no internal conflict resolution procedure is in place (4 out of 6). Only 2 of the cooperatives have such a procedure, but only one of those two uses it. The cooperatives mostly plan, decide and report their finances with participation of members (4 out of 2), but they do not have structured and systematized their financial system (financial policy, accounting procedure, hired accountant for preparing yearly financial reports, auditing). In 2015 and 2016, only half of the cooperatives made profit.

39

Production input: All the cooperatives pay strong attention to their inputs to increase their production. They have necessary inputs, which are distributed to members (6 out of 6). They have renovated and control the quality of production inputs. However, only half of them (3 out of 6) have facilities that can support the production cycle (greenhouse and warehouse).

Market and business relations: Most of the cooperatives are sensitive to market demands and make efforts to meet them to ensure their products are in demand. For that, they have a sale plan and make promotions and advertisements. However, these are not done in an efficient way (only half of them have a Sale Committee, promotional materials and add value to their products). But, in 2014 and 2015, more than half of the cooperatives had a contract with a client, participated and won tender bidding.

Members: Services that most of the cooperatives provide to its members are keeping the records of activities of the members, providing them with information on market, involving them in various trainings organized by other organizations and maintaining the joint fund.

However, most of the cooperatives do not hold all-member meetings and does not include them in planning.

MAIN STRENGTHS AND WEAKNESSES Strengths

Weaknesses

Registration, documentation, strategic planning Official registration and documents

Long-term planning (business plan, financial plan, work plan)

Yearly financial report Organization, management, financial capacity Coordinator/manager

Job descriptions for hired employees

Reporting to the members on revenue and finances Participatory decision-making on spending

Internal conflict resolution procedure Financial documentation, bookkeeping, accounting reports, auditing Professional accountant Profit-making

Production input Quality and control of the production inputs Production equipment and tools 40

Market and business relations Market sensitivity and flexibility

Profit-making

Market research Sales plan Contracts with clients Participation in and winning of tender biddings Members Involvement of the members in trainings by others Joint fund

Investment in capacity building of members

Informing the members on market situation Registration of activities of the members

Regular meetings of members

Including needs of members in plans

Informal Groups (Kherlen/Murun)

Kherlen soum informal groups: Gazar Shim, Munkh-bayajikh, Mandal, Olny Khuc Murun soum informal groups: Delger, Tsetseglen Main 7 dimensions of group capacity were assessed: - Group organization - Long-term planning - Internal and external relations - Leadership and management - Human resources - Financial capacity - Market Group organization: Most of the informal groups have basic structure and have resolved or are

close to resolve the group organization issues. Reporting and membership are the capacities that some of the groups have not addressed at all yet.

Long-term strategy and planning: None of the 6 informal groups have any long-term plan (1-3

years) approved. And, only 1 group has discussed its longer term plans. All the groups need help in developing and approving a long-term plan.

Internal and external relations: Two groups have resolved their internal relations issues, but

other 4 groups are still struggling with internal organization of relationship among their group 41

members. In terms of internal relations, decision-making process is not participatory in a structured way. In terms of external relations, the groups collaborate with similar groups.

Leadership and management: In overall, leadership and management capacity of all groups is

weak. Group leaders do not have adequate leadership and management skills. Decisionmaking is not participatory. Members are not consulted in making decisions. However, 4 groups periodically do short-term planning.

Human resources: Group work is not well organized and distribution of duties and

responsibilities is not clear. In most of the groups, members are not equally engaged in organizing and implementing tasks/activities. As a result, level of satisfaction with their benefits is low.

Financial capacity: Financial security and capacity of the groups is unstable. Only 2 of the 6

groups have equipment and tools, 3 out of 6 groups were able to receive some financial support from the LAs. But, none of the groups has any savings and 5 out of 6 groups do not implement a project with external funding.

Market: All groups focus on selling their produce, however, packaging and labeling is not

resolved. Group members try to work together to sell their produce. Only 3 out of 6 groups have a facility to store vegetables and are able to ensure selling for prolonged period of time.

In overall, the informal groups have established their groups with some documentation and rules, but they lack of basic organizational and management capacity skills to improve and sustain their group work.

MAIN STRENGTHS AND WEAKNESSES Strengths

Weaknesses Group organization

Official registration and documents

Structured distribution of responsibilities

Team work

Stable membership Long-term planning Discussion, preparation and approval of longterm plans (1-3 years) Internal and external relations

Collaboration with similar groups

Transparency in decision-making Sharing information with group members

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Leadership and management Short-term planning

Participatory decision-making Equal participation in group activities Management capacity of the leader Human resources Clear duties of group members Active participation of members Satisfaction of members with benefits Financial capacity Farming equipment and tools Savings fund Market relations

Sales

Packaging and labeling (added value)

Warehouse Collaboration in sales

Capacity assessment of the key farmers (Binder)

The key farmers in Binder soum are not organized in any form of NGO, cooperative or community group. They are mostly individuals who grow vegetables based on householdlevel capacity. Since the farmers in Binder soum have not established any form of organization, their capacities were assessed on individual level. The results of the individual assessment of each farmer are covered in details in the section on Assessment of Capacity of Individual CSOs. However, a group discussion was held to identify common challenges and opportunities of the key farmers in Binder soum.

MAIN STRENGTHS AND WEAKNESSES (Based on the results of a SWOT analysis and a questionnaire) Strengths

Weaknesses Production (inputs and outputs)

Grow diverse vegetables and berries

Poor equipment and tools

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Have knowledge and skills to increase the diversity of vegetables and berries Long history and rich experience in farming Attended different trainings on farming

No big warehouse for storing vegetables

Hard working

No formal insurance (natural disasters, cattle)

Many prizes from Khentii Province Farmers market Many farmers specialize in growing certain types of vegetables and berries and teach other farmers Joint efforts (land cultivation, watering)

No written plans

No winter greenhouse No added value (packaging, processing)

Have greenhouses in own compounds Market Cooperate for selling vegetables to herders in remote areas Well-known in local community, so local residents come to their homes to buy vegetables

Barter transactions (in exchange for meat, dairy) Sell in fall season only (when prices are low)

No farmers market in the soum (no direct access to consumers) Mostly sell to shops for low prices Cannot participate in tender bidding (no legal entity) Far from other markets (province center, UB, other soums) Internal relations Know each other well Support each other (advices, seeds, labor) Care for each other (take care of

Interaction/communication is active during farming season only Slow exchange of important/useful information

Exchange information Experience in informal group work Community relations Binder soum had won the 1st place for five years (2008-2013) in Khentii Province

Interaction with the local authorities is mainly restricted to receiving information

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Active participation in all events in the Lack of information and knowledge on soum Financial management Keeping records of revenue and No financial management training expenditures (black book) Experience in getting loans from the No clear information on annual profit local funds Make some profit (enough to sustain No savings own livelihood and support children) Human resources Hire temporary help during intensive periods of work (land cultivation, harvesting) Employ people from marginalized groups (poor, disabled, unemployed, youth)

Rely on family members

Age of the farmers (mostly above 55-60) is

4.2.3. Conclusion According to the assessment, there are 4 main types of target players in the farming sector of Khentii province. Due to differences in their organizational types and structures, they have different features and specific capacities. Although, they all have similar areas of operation, have distinctive needs for production, market relations, planning and organization. Therefore, it was challenging to use the same tool and approach for assessing all different types of the players. Thus, the main observations/conclusion are divided in two parts: an assessment of the players by types and an overall assessment.

Assessment of the CSOs by types NGOs: There are 3 NGOs in Kherlen soum that identify the farming sector as their core work area. They are small, work on short-term projects, but mostly with very small funding that is restricted to one-time projects. Since they don’t have any funding for operational expenses and growth, they tend to stay small and their areas of work and impacts remain very limited.

They are recognized within the farming sector and beyond and they, mainly stay visible through participation in various public events (conferences, seminars) which are organized by other non-farming CSOs. Their stage of organizational development is assessed as “Emerging�, which means that they are established, have mission and objectives, recognize the need for work, implement short-term and small-budget activities, but they do not have organizational capacities to initiate and carry out projects that can bring any noticeable

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changes to their immediate beneficiaries, and they do not have capacities to sustain and expand their operations over years.

Cooperatives: There are 7 cooperatives (khorshoo) in Kherlen/Murun soums that focus on farming as their main operation area. They are all officially registered and comply with basic requirements for running a cooperative. All the cooperatives pay strong attention to production and are sensitive to market demands. However, their organizational management issues, such as absence of short- and long-term planning, financial management and marketing, prevent them from making profit. They all have membership, as required by law, but their services to members are limited to provide them basic information on market, trainings, etc.. As a result, the key principles of cooperative (democratic member control and economic member participation) are not fully exercised. The cooperatives actively participate in tender bidding and half of the cooperatives have won tenders in the past 3 years. However, profit-making is still an issue.

Informal groups: There are 6 informal groups (buleg) in Kherlen/Murun soums. They focus on farming as their main operation area. They plan short-term, which can be related to seasonal nature of their work. The informal groups have established their groups with some documentation and rules, but they lack basic organizational and management capacity skills to improve and sustain their group work. In particular, weak leadership, team management and participatory decision-making aspects of the groups affect the overall satisfaction of the group members towards their groups and the benefits that they receive through their membership in such groups. The low level of satisfaction of members with their group leaders, organization and outcomes of the work may affect the sustainability of these groups.

Individual farmers: There are 12 large-scale farmers in Binder soum who grow vegetables, based on their household-level capacity, but produce not only for household consumption and not only for occasional selling, but for making profit. Most of them have farming fields and use external labor (family or hired) to work on farming fields. They are recognized in Binder soum and in Kherlen province as skillful farmers who grow high-quality vegetables. However, their fields are rather small, they lack technical capacities and have no direct access to market, which makes their annual revenue very small. They have some experiences in working in informal groups (through a project implemented in Binder soum), but they have not made any efforts to self-organize themselves into a group. As a result, they see themselves and are seen by others as ordinary citizens who just produce more vegetables and sell them.

Overall assessment The key farming CSOs are made up of skilled farmers who have a very limited support from external sources and who rely on their own resources to grow and sell vegetables, expand their operations and sustain their work. They pay strong focus on their productions and sales and do not adequately manage their organizational growth and sustainability. In particular, 46

their weak short- and long-term planning and poor financial management affect their production outputs and prevent from making profit. Also, insufficient group organization, limited participation of members in planning and decision-making makes their organizations less sustainable.

4.2.4. Recommendations To build and strengthen the understanding of the key farming CSOs on the nature and purpose of their organizations: “NGO”, “cooperative”, “informal/community group”. In particular, it is beneficial to build the shared understanding that principles and objectives of these civil society groups extend beyond immediate profit-making for few group members and define democratic participation, equal distribution and group interest as the essential requirements.

To develop and to implement an organizational capacity building program for the farming CSOs to support their growth and sustainability. The program should consist of the combination of trainings and coaching, which are planned by stages and involve external and local experts. One-time training sessions will have less impact therefore it should be a stepby-step program.  Short- and long-term planning needs to be strengthened. Strategic planning, annual operation planning, business planning, fundraising planning, marketing and sales planning, membership development and capacity building planning are the main areas of planning that need to be established. These are almost non-existent and basics, therefore simple planning capacity for few key areas of work should be introduced and practiced, until this becomes an integral part of their work.  Financial planning and management need to be strengthened. Cooperatives and informal groups need to have, at least, some financial management capacity to make some profit. Some simple financial management planning and management tools, combined with adequate financial training, can be provided to simplify the acquisition of this capacity by the end of the Project. For NGOs, a basic understanding of fundraising strategies and tools would help to raise funds for short- and long-term projects in the farming sector.  Team leadership and team management capacity should be introduced to all leaders and managers in order that they improve their abilities and skills to lead their teams.  Group meetings for each CSOs can be organized to help their members to assess their work, to understand the principles of that particular CSO type, to discuss their own shortcomings and plans for improvements. If such meetings are organized, these should involve all group members.

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4.3. COLLABORATION CAPACITY OF THE FARMING CSOS The goal of this assessment was to identify the past and existing types of relationships and collaboration experiences among the key CSOs. The key farming CSOs were assessed for different relationships among themselves. The assessment looked at different types of relationships, including personal contacts, memberships of networks, referral systems, exchange and learning programs and collaborative or joint projects. The key CSOs reflected on the importance of these, evaluated their capacity for developing such relationships and identified their weaknesses and strengths Objective -

To identify the past and existing types of relationships and collaboration experiences among the key CSOs

Based on the study the report provides information on the following: -

Collaboration capacity of Kherlen/Murun soums CSOs Collaboration capacity of the farmers in Binder soum

4.3.1. Collaboration capacity of Kherlen/Murun soum CSOs Past collaboration experiences, Kherlen soum

Awareness of other farming CSOs: The farming CSOs, whether NGOs, cooperatives or informal groups, know each other or heard of each other. On average, each of the CSOs knows 11 CSOs out of 15 (excluding own organization). 2 informal groups (Mandal and Delger) and 1 cooperative (Mongol Suu) know less than 10 organizations. Other 13 know more than 10 organizations. During the workshop, it was observed that they know each other by personal names rather than by CSO names and their interaction was very open, informal and friendly.

Participation in same farming events (farmers market, vegetable exhibition): The farming CSOs regularly participate in same farming events organized by the LAs or organizations (local branch of Mongolian Chamber of Commerce and Trade, Local Governor’s office). For instance, a fall exhibition of early harvest is organized every fall. Many farmers (individuals and entities) participate in these events. Those are, usually, organized in a form of farmers market with titles and certificates awarded to best farmers of that year. Also, larger-scale farmers travel to Ulaanbaatar to participate in a similar type of exhibition organized at national level and some CSOs participated in such events together. It was reported that no collaboration takes place during these events.

Participation in same public events (training, seminars, conference, meetings): The farming CSOs often attend same public events and participate in same trainings/seminars. The 48

farming CSOs reported that they try to attend any public event that has some space for them. However, during farming seasons (May-November), they focus on farming and often skip attending events organized by different organizations. On average, 12 organizations out of 16, participated in same events.

Received support from others (tools, seeds, fertilizer, money, etc): The farming CSOs tend to support each other in some tangible ways, especially, during peak time of farming season. When such support is provided, they lend each other money, share seeds (especially, good quality, new seeds), distribute fertilizer, lend tools. Those are the most common types of tangible support they provide to each other. (For example, during the visit of the BRT to one of the cooperatives for an individual interview, another cooperative was borrowing several sacks of onion).

Received useful information from others: The farming CSOs generously share useful information with each other, whether it is strictly on farming issues or on broader topics.

However, this type of collaboration is not as widespread and only some of the farming CSOs regularly share information with most of the CSOs. In particular, all 3 NGOs were identified by other farming CSOs as the source of useful information. 12 CSOs marked National Association of Farmers NGO as a source of useful information, 14 CSOs marked Khan Khentii Farmers NGO as a source of useful information, and 11 CSOs marked Food and Agriculture Association NGO as a source of useful information. Only one cooperative, Khailast Khairkhan Khorshoo was identified by more than 10 CSOs as a source of useful information. Other CSOs share information with others, but not to the such extent.

Collaborated with others for tender bidding: Collaboration among the farming CSOs is very limited when it comes to joint participation in tender bidding. Khailast Khairkhan (cooperative), Gazar Shim informal group, Food and Agriculture Association NGO, Baruun Nomgon NGO have more than 1 CSO in past collaboration for tender bidding. Most CSOs either are not eligible to participate in tender bidding. For instance, informal groups cannot participate in tender bidding because they are not legally registered entities. NGOs do not grow vegetables, so they do not participate. And, farming cooperatives each other more as competitors than collaborators.

Participated in projects funded by foreign aid organizations: Several projects have been implemented by foreign aid organizations in Khentii province. Mercy Corps, World Vision, Caritas Czech Republic are the 3 organizations that local CSOs listed as organizations that have implemented projects in Khentii. World Vision implemented a project that focused on strengthening local farmers. Mercy Corps implemented a project on supporting local entrepreneurship. Thus, some of the farming CSOs participated in the same projects.

However, it does not mean that they participated as a group or collaborated for implementation.

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Jointly implemented projects funded by foreign aid organizations: Only 6 out of 16 CSOs have an experience of jointly implementing a project funded by foreign aid organizations.

Those are Eren Es (it collaborated with 3 other CSOs), Khan Khentii Farmers NGO (collaborated with 5 other CSOs), Food and Agriculture Association NGO (collaborated with 4 other CSOs). 4 other CSOs (2 NGOs, 1 cooperative and 1 informal group) collaborated with 1 other CSO and jointly implemented a project funded by foreign aid organization.

Participated in projects funded by local authorities: 14 out of 16 CSOs participated in a project funded by the local authorities together with other CSOs. Those are mainly national and/or local programs funded by the state or local government to support the agriculture or farming sector. For instance, Mongol Potato program, study tour to China, purchase of farming equipment from Ministry of Food and Agriculture at a discounted price. However, they participated together but for own individual benefits.

Jointly implemented projects funded by local authorities: 9 out of 16 CSOs have experience of joint implementation of projects with funding from national/local government. 2 NGOs (Food and Agriculture Association and BaruunNomgon) and 2 cooperatives (Khailast Khairkhan and Eren Es) are more experienced than others.

Based on the individual answers, the responses for each question were combined to show the overall situation on each of 10 questions. The overall overview of the 10 different types of collaboration was developed in the following table.

Table 20. Overview of the collaboration experiences of the farming CSOs in Kherlen/Murunsoums Types of collaboration 1 2

Number of interactions 188 110

4

Awareness of other farming CSOs Participation in same farming events (farmers market, vegetable exhibition) Participation in same public events (training, seminars, conference, meetings) Received support from others (tools, seeds, fertilizer, money, etc.)

5 6 7 8

Received useful information from others Collaborated for tender bidding with others Participated in projects funded by foreign aid organizations Jointly implemented projects funded by foreign aid organizations

106 13 49 16

9 10

Participated in projects funded by local authorities Jointly implemented projects funded by local authorities

31 18

3

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196 70

The target farming CSOs know each other well, but their collaboration varies by types of activities: -

-

-

High-level: The most active collaboration (or more specifically the awareness of each other’s activities) concerns the participation in the farming events and in the public events organized at the provincial and soum levels.

Medium-level: The level of collaboration,at individual level, in supporting each other with cash loans, sharing important information, lending equipment and seeds is relatively good. This is explained by the need to mutually support each other since they all know each other work in the same sector.

Low-level: The level of collaboration through joint participation in tender bidding, joint implementation of projects funded by external organizations (INGOs) and local government is very low. Only few organizations stated they have this experience. One of the main reasons for that is that they see each other as competitors.

Strengths and weaknesses in collaboration, Kherlen/Murun soums

Because the two soums were included in one workshop and were composed of 3 CSOs categories, the strengths and weaknesses of collaboration were identified by the following groups: -

Kherlen soum NGOs Kherlen soum cooperatives Kherlen soum informal groups Murun soum cooperatives Murun soum informal groups

In both locations, each group identified the existing/potential strengths and weaknesses in their collaboration among their own group and with the other groups.

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Table 21. Strengths and weaknesses of collaboration by NGOs, Kherlensoum

STRENGTHS

WEAKNESSES Collaboration among the NGOs -similar goals and objectives -lack of initiative and commitment to -collaborated for many years and know each collaboration other well -lack of information and lack of willingness to -the issues are overarching share information -possibility to jointly participate in various -poor financial status and capacity projects -lack of understanding what is NGO and how - collaboration will bring tangible results (joint it works meetings, actions, etc) -competition among NGOs - can joint, stronger voice to decision-makers -conflict of interest (an NGO would have a - possibility to jointly develop a local brand cooperative, an informal group, a private that is promoted nationwide (for instance, enterprise at the same time) Khentii garlic) -lack of understanding how to collaborate -possibility for joint preparation of seeds and -different degrees of treating each other (kind fertilizers of discrimination) -possibility to establish a joint warehouse - using other’s names to advance own (and end renting) interests -possibility to keep the prices stable through direct access to consumers (specialized vegetable market/shop) Collaboration with the cooperatives -open to collaboration on many issues such as -possibility of conflict of interests market, experience, information, equipment, -risks of not being able to meet requirement finances, social protection of tenders and loans -to develop eco (organic) and brand products -prices on rent, equipment are high -to develop value-added products and SME -standards of production and infrastructure -to promote the work of farmers -hygiene requirements Collaboration with the informal groups -common interests -lack of initiative -joint promotion of interests of the farmers -poor capacity of the groups -integrated system of delivering information on -poor finances farming, selling, market -nearly nonexistent support from the local -joint addressing of social authorities insurance/protection issues (health, holidays, -inability to meet the financial requirements etc.)

-non-stable source of income (seasonal work -practical resolution of many issues and seasonal income) -professional support with methodologies and experiences

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Table 22. Strengths and weaknesses of collaboration by cooperatives, Kherlen soum

STRENGTHS WEAKNESSES Collaboration among the cooperatives -joint participation in tenders will prevent price -weak unity and lack of initiative losses -poor experience in collaboration -access to joint equipment, tools and services -weak financial capacity (for joint projects an -possibility to establish a large warehouse fund) -possibility to increase production per hectare -lack of interest in working together (because of land through using better quality seeds and everyone has own work approach) technology -strong competition among cooperatives in -possibility to specialize the production by tender bidding (including taking each other’s different types of vegetables prices down) -increased access to various projects with -lack of trust in each other discounted prices and by foreign aid -when a joint request is delivered to the local organizations authorities, there are no follow-up actions -some cooperatives misuse other cooperatives’ names to advance own interests Collaboration with the NGOs -sharing information -NGOs have similar missions and similar -participating in trainings activities, but work separately -exchanging experiences -local authorities disregard the NGOs -receiving quality seeds because they do not unite -NGOs representing the interests of farmers at -NGOs lack collaboration among themselves local-level decision making (complaints, and weaken own work requests, proposals) -they increase prices on seeds and fertilizers

Table 23. Strengths and weaknesses of collaboration by informal groups, Kherlensoum

STRENGTHS WEAKNESSES Collaboration among the informal groups - Each IG has some equipment/tools and -Lack initiatives to collaborate exchange them when needed (it saves time) -Have no legal right to participate in local - Old acquaintances from the same area, tenders have neighboring homes and fields -Have no past experiences of collaboration - Jointly discuss marketing/selling strategies (no best practice) - Share similar goals and aspirations -Inability to voice and deliver own needs to decision-makers -Don’t have financial capacity/support

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Collaboration with NGOs -Protection of the interests of farmers and -NGOs are not strong enough (their work is delivering their requests and ideas to the local not stable yet) authorities -Not every idea is put into work -Providing with various trainings and -Capacity of the NGO leaders is weak information -Promoting the value of farmers’ labor -Sharing information on various projects, study tours Collaboration with cooperatives -Share same work direction and approach -Don’t share information -We are from the same area -Don’t know how to collaborate -Cooperatives have better tools/equipment, -Don’t manage time well so they can lease to the IGs -There are very few cooperatives and they -If we cooperate, the cost of production will go are not financially strong down and revenue will increase -There is no cooperative that can serve as a role model and give good example

Table 24. Strengths and weaknesses of collaboration by cooperatives, Murun soum

STRENGTHS WEAKNESSES Collaboration among the cooperatives -Possibility to overcome many challenges -lack of understanding each other through joining the forces -inability to collaborate under one goal - Joint selling -financial challenges - Common expertise and experiences (skilled -lack of good equipment/tools farmers) -unstable and differing prices on vegetables - Possibility to keep the prices at one level -lack of a warehouse - Possibility to support each other -constant competitors in tenders, projects, - Possibility to make the work easier through work field, selling mutual help - Sharing experiences and lessons, learning from each other - Joint raising some common issues with the local authorities - to supply the local market with quality products Collaboration with NGOs -increased access to discounted prices on -NGOs do not provide financial support to the seeds, pesticides, etc. cooperatives -increased access to projects (through NGOs) -NGOs are not as keen in cooperating with -strengthened collaboration of the farmers the cooperatives Collaboration with the informal groups 54

-supporting with land cultivation (through leasing equipment and tools) -collaboration on weeding, growing seeds that are adapted to the local climate -collaboration on transportation of vegetables -collaboration on storage (warehouse)

-despite having the same goals, understanding of each other is insufficient -disputes on access to watering system -unequal participation in common works (fixing watering channel, etc) -lowering prices during selling

Table 25. Strengths and weaknesses of collaboration by informal groups, Murunsoum

STRENGTHS

WEAKNESSES

Collaboration among the informal groups -basic equipment/tools are acquired -personal conflicts and misunderstandings -joint fund has been established -leadership is weak and leaders are not -experience in farming accepted -were able to identify goals and objectives -very weak support from the local authorities -are confident that income can be generated -no jobs and no work spaces through farming -limited work scope -despite the willingness to transform into cooperative, bad examples of some cooperatives (for example, no profit distribution) prevent this work -poor leadership qualities of the leaders Collaboration with the cooperatives -common interests and goals -inability to participate in all activities -open membership -weak financial capacity -creating new jobs -previous experiences of collaboration -possibility to access loans and discounted damaged the trust prices -cooperatives operate more like business -cooperatives are legal entities allowed to enterprises participate in tenders that have sufficient -cooperatives are, mostly, led by elder people technical capacity so the support from the local authorities is weak -cooperatives are not able to consistently operate Collaboration with NGOs -open to collaboration -no financial capacity -NGOs are good at distributing information and -slow decision-making, low impact on advices decisions by the local authorities -no discriminatory attitude -very little support from the local authorities -joint voicing of the common issues -lack of understanding how to collaborate -access to various projects

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COMMON STRENGTHS AND WEAKNESSES(Kherlen/Murun) Strengths

Weaknesses Collaboration capacity of the NGOs

Know each other well and have experience of collaboration Work on similar issues and understand each other Represent the interests of farmers at local decisionmaking level Have access to seeds and other inputs and tools offered at discounted prices Have access to various projects

Weak organizational and financial capacity Competition and lack of coordination of work among the NGOs Conflict of interests (same person runs an NGO, a cooperative, an informal group and a business enterprise) Lack of understanding how to collaborate Low impact on local decision-making

Are open to collaboration Good at sharing information Collaboration capacity of the cooperatives Access to a pool of equipment/tools

Lack of initiative

Possibility to increase production, specialize in production Have same work goals and objectives

Poor experience and understanding of collaboration Strong competition for tenders, market

Are from the same area

Luck of trust in each other

Collaboration can reduce cost of production and increase revenue Can supply the local market with quality products

Prioritization of individual interests

Possibility to keep the prices stable and even

Misuse of others’ name to advance own interests

Financially not strong

Can support the informal groups Collaboration capacity of the cooperatives Common interests

Lack of initiative

Experience in farming

Poor capacity

Have interest in collaboration with NGOs and cooperatives Old acquaintances and know each other

Non-stable source of income and weak financial capacity No past experiences of collaboration

Share similar goals and aspirations

Lack of ability to formulate and voice own issues

Have a pool of tools/equipment to exchange when needed

Weak leadership

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Can jointly discuss market strategies, exchange farming experiences

4.3.2 Collaboration capacity of the farmers in Binder soum Past collaboration experiences, Binder soum

Participation in the same project by INGOs: World Vision implemented a project in Binder soum in 2008-2013 and most of the farmers had participated in this project. For instance, several of them received greenhouses from World Vision, attended farming trainings, some of them had been leaders of informal groups (buleg). Therefore, 13 out of 15 marked that they had been a part of the same project with others. However, the numbers of marked connections are low, which means they may had attended different types of activities.

Experience of being a part of the same informal group (buleg): Although 13 out of 15 farmers mentioned their participation in a project funded by international organization, only 3 out 15 responded that they still belong to the same informal group. World Vision project strongly focused on establishing and strengthening informal groups (bulegs), but this table shows that the farmers who participated in this study do not have connection through informal groups.

Received support/help from others (information, seeds, fertilizer, tools, etc.): 13 out of 15 farmers mentioned that they received a support from the other farmers. In particular, D.Baigalmaa, Ch.Dulamsuren and J.Baatar are identified by the farmers as frequent sources of help. But, in overall, it is evident that different connections among different farmers exist to call on help and receive it.

Joint organization of farming work (land cultivation, selling vegetables, watering, etc.): 8 out of 15 farmers have collaborated in the past for joint organization of farming work. In particular, Gan-Erdene, Baigalmaa, Zulbadrakh, Bold, Munguntsetseg are identified as those who have the more frequently collaborated with others in farming work.

Joint approaching of banks and/or local authorities: 7 out of 15 farmers mentionedthat they have some past experiences in joint approaching of banks for loans or LAs for addressing their common issues. In particular, Bold and Baatar are the ones who have the greater experience in such activities.

Based on the individual responses, the answers for each question were combined to show the overall situation on each of 5 questions. The overall overview of the 5 different types of collaboration was developed in the following table.

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Table 26. Overview of the collaboration experiences of the farmersin Bindersoum Types of collaboration 1 2 3 4 5

Participation in the same project by INGOs Experience of being a part of the same informal group (buleg) Received support/help from others (information, seeds, fertilizer, tools, etc.)

Joint organization of farming work (land cultivation, selling vegetables, watering, etc.)

Joint approaching of banks and/or local authorities

Number of connections 25 3 46 20 9

The farmers in Binder soum also have variable levels of collaboration: High-level: The highest level of collaboration among the farmers is about supporting each other when asked or when they see that another farmer is in need. This support is mostly provided in the form of lending money, sharing information, giving advices, sharing seeds and equipment. The reason is that they know each other well and care for each other because they know ‘farming is a hard labor’.

Medium-level: The collaboration at individual level was initiated during high seasons to jointly resolve the same issues they faced (land cultivation, watering fields, selling vegetables). Also, many of the farmers participated in the same project (by World Vision) implemented in their soum.

Low-level: Being members of the same informal groups (i.e., jointly producing vegetables), jointly approach banks or LAs is the lowest level of their collaboration. Only very few of them are experienced in this way.

Strengths and weaknesses in collaboration, Binder soum

During the SWOT analysis, the farmers worked in 4 separate groups and identified strengths, weaknesses, opportunities and threats of their collaboration. After the groups worked separately, each group introduced own assessment for the large group to discuss and add comments.

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Table 27. SWOT analysis of the farmers’ collaboration in Binder soum STRENGTHS 1. Know each other well 2. Respect each other’s hard-work 3. Care for each other (for example, if we see animals grazing on someone’s field, we rush to help).

4. Exchange experiences (for example, a farmer who has more knowledge on growing one particular vegetable will teach others) 5. Help each other with seeds, tools, equipment, etc.

6. Recognized farmers with demonstrated success (many prizes won at different exhibitions. During 5 years in row, from 2008 to 2013, Binder soum was named the Champion Farmer Soum) 7. Exchange information 8. Good team-work 9. Joint experiences of attending trainings and participating in projects 10. Big variety of vegetables and berries 11. Experience and practice of helping each other with selling vegetables

OPPORTUNITIES 1. Increased access to various opportunities present in the soum (by local authorities or various funders) 2. Expanding the farming fields and increasing production to fully supply the local demand) 3. Extending the farming season (through a joint winter greenhouse) 4. Extending the selling period (through a joint warehouse) 5. Reducing cost of farming (land cultivation, seeds, watering, etc.)

6. Establishing and running a vegetable packaging factory (for example, tetra pack) 7. Strengthening own knowledge (attending training and study tours) 8. Operating a vegetable wholesale store 9. Establishing a joint fund 10. Organizing trainings and exchange visits with neighboring soums 11. Increasing the variety of vegetables and berries

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WEAKNESSES 1. Lack of initiatives for collaboration 2. Lack of time commitment 3. Weak team work (due to seasonal nature of farming work) 4. Lack of united strategy for selling vegetables (often sell for non-cash payments) 5. Lack of financial management (for example, no joint fund) 6. Lack of initiatives for specialized trainings 7. Poor equipment and tools for farming 8. No farmers market in Binder soum 9. Lack of facilities and equipment for storing vegetables 10. No winter greenhouse (cheap but poor quality vegetables are sold in winter and spring seasons) 11. Challenges in getting a winter greenhouse

1.

2.

3.

4.

5.

6.

7.

THREATS Natural disasters (rain, winter, etc.)

Financial issues (budget for winter greenhouse) Selling of vegetables Imported vegetables Decisions the local authorities Poor support from the local authorities Unstable economy (inflation)

4.3.3 Collaboration with non-farming CSOs Assessment of the farming sector by the non-farming CSOs

The farming sector is just emerging in Khentii province, especially when it is compared to the farming sector in Selenge province. Vegetables are not grown in all soums. Farmers in Kherlen, Murun and Khurk soums produce vegetables in big quantities. Others grow vegetables mostly for household consumption. In recent years, local people do not want to eat Chinese vegetables and are becoming more interested in consuming locally grown vegetables. However, farming is a very hard manual labor. Farmers from Murun soum have developed a nationally-recognized brand – Murun garlic.

Main challenges of the farming sector: -

Storing vegetables is a big problem. A vegetable warehouse was built, but it is not meeting the demand.

Selling is a challenge. Farmers have quick cash needs which should drive them to commercialize their products during the peak of harvest, therefore for cheap prices.

Loans are not accessible. In 2016, banks did not provide loans to farmers.

Main achievements: -

Governor’s Action Plan includes a policy on procurement of vegetables from local farmers Local state organizations pay attention to buying vegetables from local farmers Farmers are more involved in supplying local organizations with their vegetables (when compared to the situation 3 years ago).

Past collaboration of the farming CSOs and non-farming CSOs -

-

Employers’ Association, in collaboration with Agricultural Association, conducted a monitoring of procurement. As a result, kindergartens and schools have started procuring vegetables from local farmers.

Civil Society Network worked together with Agricultural Association on building lighting in the farming fields. Also, some trainings were organized.

Together with the local branch of Chamber of Commerce and Trade, a study tour was organized to Sukhbaatar province. Also, fall farmers exhibition-market is organized.

Strengths and weaknesses of collaboration of non-farming NGOs with the farming NGOs (CSOs) Several non-farming NGOs participated in the workshop and took part in a SWOT analysis of the collaboration capacity.

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Table 28. Strengths and weaknesses of collaboration, by non-farming NGOs, Murun soum

STRENGTHS/OPPORTUNITIES WEAKNESSES Collaboration with farming NGOs -to organize various trainings -very little knowledge on farming NGOs -to support during harvest season -collaboration with farming NGOs has not -to advocate for procurement of local been established yet vegetables by schools and kindergartens -past experiences of collaboration are -to collaborate with the farming NGOs on limited to attending same trainings and building the capacity of farming CSOs shared activities that were more related to -to promote the best experinces of local NGO sector than farming sector farmers -to jointly organize various activities for school children (practice of working on farming fields, training on growing vegetables)

Possibilities of collaboration of non-farming NGOs with the farming NGOs (CSOs) -

-

To jointly organize information sharing (for example, to share information on the activities of this project funded by Caritas Czech Republic) To organize capacity-building trainings and to provide consultation services to the farming CSOs To collaborate with the farming CSOs on monitoring of the project implementation.

In particular, Employers’ Association is very experienced in monitoring, so there is a possibility for collaboration To collaborate with Labor Union on protection of interests of farmers To work jointly on advocacy to keep the vegetables prices stable

4.3.4. Conclusion Despite the relatively small size of large-scale farmers and farming CSOs and in spite of many common problems and issues that directly affect the productivity and well-being of local farmers, the collaboration of the farming CSOs in both areas, Kherlen/Murun and Binder soums of Khentii province, is very basic. They are more limited to interpersonal relationships than based on organized and planned efforts to support each other and promote own interests. Since the key farming CSOs have differing natures in two locations, their capacity and past experiences in collaboration as well as the strengths and weaknesses of collaboration were assessed in slightly different ways to match the characteristics of the key actors in both areas.

Kherlen/Murun soums: The target farming CSOs in Kherlen/Murun soums are aware of each other. But their awareness is limited to each other’s activities as farmers since they work in the same sector and jointly participate in various farming and public events. However, when it comes to interaction and collaboration, those are more based on personal relationship, and 61

farmers frequently respond to each other’s requests for help. For instance, they lend each other money, seeds, lease equipment and share information. This mutually support exists because they know each other and work in the same sector. But, collaboration for tender bidding and joint implementation of projects funded by external organizations (INGOs) and local government are very low. One of the main reasons for that is that they see each other as competitors.

The past experiences of collaboration as well as assessment of own and other’s capacity for collaboration demonstrate that there are many commonalities in strengths and weaknesses of the key farming CSOs. They are familiar with each other, have good experience in farming, understand that collaboration will advance their own financial interests and social status in the soum. They are very interested in collaboration, but do not have clear understanding on how to collaborate so that the collaboration is mutually beneficial. Random experiences of the past collaboration have left some negative memories and hurt feelings, which damaged trust and prevent any effective collaboration.

Also, due to seasonal nature of farming work, the key CSOs are not able to spend time for any other activities during the farming season (May-November). They do not initiate much of collaboration during peak. But during off-peak seasons they lack initiatives to collaborate as well, which seem to be due, again, to the seasonality of farming work.

Binder soum The farmers in Binder soum willingly and regularly support each other when asked or when they see that another farmer is in need. They often lend each other money, share information, give farming advices, share seeds and equipment. They see each other as hard-workers and care because they know ‘farming is a hard labor’. Also, during the peak of farming seasons some of them collaborate to resolve own challenges in land cultivation, watering fields, selling vegetables. However, they tend to resolve own challenges through seeking support from others and do not see themselves as a significant sector in the soum.

Thus, they rarely join their forces as a sector or as a group, although the farmers in Binder soum do not see each other as competitors. The farmers in Binder soum see themselves as individuals who should work hard for their own well-being. They help each other beyond their personal relationships and those who do not receive any support from the LAs or other sources (for example, banks).

Non-farming CSOs of Khentii province (Kherlen soum) Collaboration of the key farming CSOs with the non-farming CSOs (NGOs) has been weak.

The non-farming CSOs assess this collaboration as non-existent. The non-farming CSOs only have a very general understanding of the farming CSOs which is mostly developed through the participation in the same events, organized at the province level. There are just a few examples of collaboration, which are rather sporadic than well-planned.

However, the non-farming CSOs are open to collaboration and recognize that the farming sector is a growing sector which deserves more attention. Moreover, the non-farming CSOs are well aware of the main challenges and main achievements in the farming sector.

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The3 mains areas for a possible collaboration are exchange of information, capacity building and advocacy.

4.3.5

Recommendations

-

Consorted efforts should be made to help the key farming CSOs realize that their goals, interests and approach are very similar and that they have more in common than they recognize and accept. Shared goals and values may contribute to build an understanding that their collaboration will bring results to all of them. As part of this effort, a discussion should be organized to expose the past negative experiences and to address them in a constructive way.

-

A training program should be developed and implemented to help the key farming CSOs to acquire knowledge and skills on collaboration among themselves as well as with other allies and partner organizations. Such a training should be conducted in a participatory way that allows the participants to reflect on past experiences, understand their own mistakes and build strategies and tactics for future collaboration.

-

The key farming CSOs should be helped to develop an understanding that they are an important and growing sector in the area and, if they plan to succeed in making profit, in elevating their status and in becoming a recognized and respected group, they should spend time and efforts to build their collaboration and accept the risks.

4.4 ADVOCACY CAPACITY OF THE KEY CSOs The advocacy capacity of the key CSOs was assessed. The goal of this assessment was to provide an understanding about the ability of organizations as a group to conduct and sustain advocacy efforts over time and their level of commitment to engage themselves in advocacy actions or campaigns. Several methods were used to identify the following: -

common interests of farmers (by location) past experiences of advocacy work (by location and types of organization) strengths and weaknesses of the advocacy capacity targets of advocacy work

4.4.1. Common interests Kherlen/Murun soums

Inputs and production -

To renew seeds To use new technologies and equipment To establish an integrated watering system To increase productivity 63

-

To create an access to a pool of shared equipment/tools (that farmers can rent for a modest fee) To establish a specialized warehouse (passive solar greenhouses) To establish a winter greenhouse in each soum To establish a fertilization plan and use locally produced fertilizers To join work forces and cooperate (for farming) To produce value-added products To be able to meet standards and hygiene requirements

Market -

To fully supply the local market (prevent any importation of vegetables) To establish direct access to market without intermediaries (a farmers market) To keep the prices on vegetables stable To establish an eco-brand of the province To participate in farmers exhibitions-markets in Ulaanbaatar To change local consumption and increase consumption of fresh vegetables To make profit and improve livelihoods

Financial capacity -

To increase access to funding, loans and project implementations To establish an access to a collateral fund for soft loans (low interest and long term) To increase availability of soft loans to farmers fromstate and commercial banks (for example, by Khaan Bank)

Organization/Collaboration -

To have a lead organization (NGO/CSO) To have an equal access to the support from the state/local administration To have a regular dissemination of information (all kinds of information) To address farmers’ health protection (same with herders) To systematically promote the farmers’ value and importance To implement the law on incentives to farmers To strengthen the interaction between farmers and herders (for instance, for herders to sell manure to farmers) To learn domestic and foreign experiences in farming

Binder soum

Inputs and production -

To build 2-3 different warehouses for different types of vegetables To acquire and use equipment and tools to reduce manual labor To build a winter greenhouse To protect farming fields from various risks such as natural phenomena, cattle, insects, etc. (for example, to build a fence) 64

-

To grow new types of vegetables To increase the productivity of the fields To acquire vegetable processing and conservation equipment

Market -

To prevent commercialization of imported vegetables To establish direct access to consumers (farmers market) To make profit from vegetables commercialization

Financial capacity -

To establish a joint fund and improve financial management capacity

Organization/Collaboration -

To develop an integrated system for the dissemination of information among the farmers To exchange information and experiences To include provisions on supporting local farmers in local policies

4.4.2. Past experiences in advocacy Kherlen/Murun soums

NGOs Targeted local offices: Province Governor’s Office, Province Development Policy Department, Province Environment and Tourism Department, Ministry of Industry and Agriculture, Procurement Department, Technical Vocational Education and Training (TVET), Province Labor Department, Professional Inspection Department, Province Land Department, Child and Family Development Department Issues raised: Extending the electricity grid to the farming fields; learning from farming experiences; establishing a winter greenhouse; procurement of locally grown vegetables by state-funded organizations; soil protection; establishing a shelterbelt for stopping desertification; providing rewards to farmers; acquiring financial support; testing of vegetables; extending farming fields; establishing a micro Eco Park; providing an office space; acquiring potato seeds Forms of advocacy: official letter; meeting; proposal; request

Achievements of advocacy work: 65

-

In 2013 an electricity line was built to the farming lands (total budget 20 million MNT) A group of farmers has visited China to study some experiences on winter greenhouse Priority was given to local farmers in procurement In 2014 NGOs received a contract to build a shelterbelt for soil protection In 2013, farmers were included in the system of performance evaluation and rewarding (so far 10 farmers were awarded) Baruun Nomgon NGO was able to get its land extended by 2.8 hectares Khan Khentii Farmers NGO was able to get its issue of potato seeds resolved

Failed advocacy work: -

Winter greenhouse (no financial resources) Micro eco-park (CRC of Kherlen soum gave a vague, verbal response that there is no need for an ordinance by CRC and that it could be resolved through a contract) Office space

Cooperatives Targeted local offices: Ministry of Industry and Agriculture (Department of Crop Production); Province Governor’s Office; CRC of Khentii Province and Kherlen soum; Province Development Policy Department; Procurement Committee of Procurement Department; TVET; Province Labor Department; Employment Support Fund; Province Land Department; Professional Inspection Department Issues raised: equipment, seeds, participation in tender bidding; expanding farming fields; support in soft loans; support in building a vegetable warehouse Forms of advocacy: official letter, tender proposal; meeting; proposal; request (signed by over 40 farmers) Achievements of advocacy work: -

2 cooperatives were able to purchase 2 small-scale equipment for a discounted price 1 cooperative won a tender bid to supply vegetables to 4 organizations

Failed advocacy work: -

Expansion of the farming fields (2 cooperatives). It’s been 5 years and the explanation is that they do not meet the requirements for certificate Financial support requested from SDF for purchasing seeds and fertilizers, and land cultivation (the explanation was given that the head of the cooperative is elderly and the financial capacity of the cooperative is not sufficient)

Informal Groups 66

Targeted local offices: Soum Development Fund; Labor Department; Procurement Department; Ministry of Industry and Agriculture; SME Development Fund; Local Social Welfare Fund Issues raised: supporting the building of a vegetable warehouse; supporting the expansion of green vegetables production; supporting the building of a winter greenhouse; purchasing equipment; acquisition of farming field; request for soft loan Forms of advocacy: official letter; meeting; proposal; request Achievements of advocacy work: -

a warehouse with the capacity of 40 tons was built (9 million MNT) a funding was received from the SDF for the production of green vegetables

Failed advocacy work: -

purchasing equipment acquiring land receiving soft loans common failures: land, soft loans, equipment, greenhouse

Binder soum

Targeted local offices: Department of Land of Binder soum; Labor Department of Khentii Province; Bag Governor; SME Department of Khentii Province; Khentii News newspaper; Soum Governor; Soum Governor’s Secretariat; Communications Regulatory Commission of Binder Soum; Issues raised: to acquire a farming field; to acquire financial support for purchasing equipment; to prevent cattle entering into the farming field; to receive a project funding; to protect local market from imported vegetables Forms of advocacy: through World Vision; meeting; proposal; during a conference; newspaper article; written request; Achievements of advocacy work: -

Soum CRC issued a permission for 0.75 hectares of land (but land certificate has not been received yet) A permission was given for an area, but the soil quality is too poor for vegetables production A permission for 1 hectare of land was issued (for berries production) A project with funding of 1.1. million MNT was received (purchased a pump hose) A project with funding of 1.5 million MNT was received (for vegetables production)

Failed advocacy work: 67

-

purchasing equipment acquiring land (to change the location of the farming land in order to improve the quality of soil) receiving soft loans publishing the article on farming protection of local market from imported vegetables protection of farming field from cattle

3.4.3. Strenghs and weaknesses of advocacy capacity Kherlen/Murun soums

Strengths -Have established an umbrella organization (Food and Agriculture Association) - Have experience - The sector is recognized in the province - CSOs are established and stable - Have established a foundation for collaboration - Have experiences of promoting own interests at decision-making level (in particular, for tenders) - Have own customers/consumers - Regularly participate in exhibitionmarkets

Opportunities - to announce a Year of Farmers - to advocate for increased support to farmers from province and soum SME Support Funds - to explore the possibilities for equal participation in tenders - to develop an integrated system of information distribution on vegetable consumption in the province - to explore the possibilities for accessing soft loans and funding - to explore the possibilities for purchasing equipment/tools for discounted prices - to explore the possibilities for tax cuts for farmers

Weaknesses -Weak legal capacity and knowledge -Poor capacity for information processing -Weak initiative -Lack of unity and poor capacity in collaboration -Weak financial capacity and unequal access to possibilities (most CSOs do not meet financial criteria) -Inability to formulate and deliver own demands -Lack of understanding of open channels for advocacy -Lack of trust in each other -Poor financial management and marketing skills -Poor strategic planning capacity -Lack of joint funds and savings -Insufficient ethical behavior -Lack of young generation of farmers (TVET does not have a class for farmers) Threats -Corruption in state organizations -State support often channeled to people who belong to the same party as political officials (politicization) -Nepotism of public servants/officials -Poor professional capacity of public officials and specialists -Empty promises of local administration (for winning election) -Weak state policies on supporting farmers -Loans have high interest and are for short term -Heavy bureaucracy (abuse of power by public officials) 68

- to explore the possibilities for a support by the local administration for integrated farmers market - to unite own voices and forces and promote own interests

-Misuse of public funds by local administration -No insurance for farmers production/products -Lack of social security for farmers -Poor monitoring of food security -Public officials are dishonest (it is not in their interest to be open and honest) -Public officials have poor time management

Binder soum

Strengths -Experience in informal group work -Farmers Association was established -Farmers are able to supply the local market with locally grown vegetables of good quality - Farmers are able to grow new types of berries that are adapted to local soil

Weaknesses -Weak initiatives -Lack of information -Weak collaboration capacity -Farmers are slow in dissemination of information -Inability to formulate own needs -Lack of knowledge how and where to go -Weak coordination/interaction among the farmers -Lack of capacity in expressing own opinion

Opportunities -To advocate for support from Soum Development Fund -To advocate for support from SME Development Fund with low-interest, longterm loans - To renovate the existing warehouse (which was damaged and does not function currently) - To promote the achievements of local farmers - To advocate for an integrated system of distribution of seeds - To advocate for acquiring farming fields through privatization policy, not through auctioning

Threats - Politicization - Vagueness of local budget - Support from Soum SME Development Fund - Information is not distributed to the farmers - Distribution of seeds is not stable - Bureaucracy

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4.4.4. Targets for advocacy National level Members of Parliament (elected from the area) Ministry of Industry and Agriculture

Province level CRC of Khentii province, Governor of Khentii Province Department of Land Department of Food and Agriculture Labor Department SME Department Development Policy Department Procurement Office Professional Inspection Office Tax Department Department of Environment Kherlen River Catchment Department Department of Urban Planning Department Standards and Metrology Office National Statistics Office SME Development Fund Local Development Fund State Fund TVET Soum level CRC of Kherlen and Murun soums Governors of Kherlen/Murun soums Soum Development Fund Department of Land State Fund Allies from the civil society in advocacy work Association of Agriculture Cooperatives Civil Society Network Women’s Federation Farmers’ Association Civil Council for Environment Elders’ Association Association of Food and Agriculture World Vision 70

4.4.5. Conclusion The key farming CSOs in both target areas (Kherlen/Murun and Binder soums) have very similar issues and they identify their common interests in 4 main directions: improvement of inputs and production, increasing their market share and income, strengthening their financial capacity and building their collaboration capacity. In overall, the common interests are very practical and self-reliant. In other words, the key farming CSOs are interested in making their production less manual (through purchasing more advanced equipment and tools), more profitable (through supplying the local markets for stable prices and for a longer period of time, through production of value-added products), more efficient (through renewing seeds and using good fertilizer), more secure (through farm insurance), and they want to extend the production and selling cycles (through building winter greenhouses and vegetable warehouses).

In the past, the key farming CSOs have had some experiences of advocacy work, individually or in small groups, to acquire some support from the local authorities. The supports that the farmers requested were very similar in nature. In both locations, the farmers requested support for production and selling of vegetables. The forms of advocacy work were very similar (official letter, meeting, proposal, written request).

However, the issues differed by scale. In Kherlen/Murun soums, the key farming CSOs raised a range of issues including electricity grid to the farming fields, protection of the soil, procurement of local vegetables, extension of farming fields, receiving financial support, etc. In addition, some issues were related to the status and recognition of farmers, such as rewarding farmers, providing office space to an NGO. In Binder soum, the farmers were more concerned with individual issues such as acquiring a farming field, protecting farming field from cattle, financial support for purchasing equipment.

However, an effort was also made to promote the status of the farming sector. This difference is mostly due to the differing organizing scales. In Kherlen/Murun soums the key farming CSOs act more like organizations (whether it is NGO, cooperative or informal group), whereas, in Binder soum, farmers act more like individuals. In general it is clear that the advocacy efforts of the farmers in the past were more weighted toward tackling the existing, within local policies and budget opportunities.

In both locations the advocacy efforts that were in line with local policies and did not require any major revision or adjustment of local policies or budget, succeeded (for example, acquiring a land, receiving small-scale financial support from local funds, including farmers in reward system, etc.). However, the requests that raised more substantial issues such as building greenhouse and warehouse, protecting local market from imported vegetables, prioritizing the status of farmers and farming sector, were not addressed.

The strengths and weaknesses of the advocacy capacity of the key farming CSOs in both locations are, again, very similar. In overall, the key farming CSOs do not see 71

themselves as an emerging and important local economic sector. They neither see themselves as a group with similar issues and needs. They lack skills to recognize and formulate their own issues as a group, they do not have much initiative, they lack understanding of local mechanisms and channels that allow them to promote own interests, they do not have the capacity to strategize and plan advocacy work. The targets of advocacy work, of the farming sector are numerous, with a wide range of issues starting from taxes to the protection of environment.

4.4.6. Recommendations -

To develop long, medium and short-term goals and objectives of the farming sector in each of the target areas, which are linked to the local contexts

-

To develop a long-term (5 years) strategy for advocacy work that is owned by the farming CSOs and is based on their capacity and needs

-

To provide the farming CSOs with a training program to help them to acquire and to strengthen the capacities required for a successful advocacy work

-

To identify a list of key target organizations for concerted advocacy efforts by the key farming CSOs

-

To identify an umbrella organization (possibly, the recently established Khentii branch of Farmers’ Association) and foster its leadership in advocacy work

4.5. PUBLIC PARTICIPATION MECHANISMS/CHANNELS OPEN FOR THE KEY CSOs The assessment of the public participation mechanisms that are open in Khentii province was conducted to provide a basis for the key CSOs in order that they use these mechanisms in their advocacy efforts. The Project Team conducted a thorough study and identified the existing public participation mechanisms for procurement and budget allocation processes at local level for the farming sector. In its inception report, the BRT conducted a desk review of the existing legal and policy documents on public participation mechanisms for procurement and budget allocation in Mongolia. A follow-up research was conducted to identify the status and level of implementation of the identified public participation mechanisms in Khentii province, with a focus on procurement and budget allocation/investment for the farming sector.

Objectives: -

Identify the existing public participation mechanisms for procurement and the budget allocation processes at the local level for the farming sector

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Based on the study, the report provides information on the state policies and activities in the farming sector 4.5.1. State policies and activities in the farming sector National policy on agriculture

Parliament approved State Policy on Food and Agriculture in 2003, which was implemented in 2 stages: 2003-2008 and 2009-2015. The policy that covered the period 2003-2015 was completed in 2015 and the Government has developed a policy to cover the next period of 2016-2025, which will be also implemented in 2 stages.

Based on the assessment of the policy implementation during the period 2003-2015, it is reported that in 2003 Mongolia was not able to supply its demand for potatoes and vegetables. In 2014, the overall production of potatoes and vegetables increased to over 270 thousand tons, which constituted 54% of the total domestic demand. The State Policy on Food and Agriculture (2016-2025) is projecting the full supply of domestic demand for potatoes and vegetables by year 2025.

Table 29. Projection on production of vegetables (from State Policy on Food and Agriculture) 1 2

Local production of vegetables meeting domestic demand % of agricultural budget in the total state budget

2014 54%

2020 70%

2025 100%

2%

3%

4%

Provincial Plan on Food and Agriculture for 2015

The Plan has 19 objectives and 2 of them are directly related to the farming sector (potatoes and vegetables): 1. To plant crops on 19.3 thousand hectares of land, potatoes on 460 hectares of land, vegetables on 200 hectares of land, and to harvest 28 thousand tons of crops and vegetables.

2. To organize “Fall Festival – Best Products� annual exhibition-market that demonstrates achievements and best products by farmers Table 30. Cultivated land in Kherlen province, 2015 Cultivated land

Plan

Actual

Comments

1 2

Crop Potatoes

19,3 ha 460 ha

26,3 ha 326,4 ha

Over-implementation by 7 ha Under-implementation by 133,6 ha

3

Vegetables

200 ha

169,2 ha

Under-implementation by 30,8 ha

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Table 31. Harvested crops and vegetables in Kherlen province, 2015 №

Type of harvested product

1 2 3

Crop Potatoes Vegetables

Plan (tons)

Actual (tons)

Total (tons)

28,000

19610,7 4204,4 2543,4

26359 tons

Monitoring and Evaluation Department of Kherlen province evaluated crop and vegetable farming as implemented with 92% of success. The evaluation was approved by CRC of Kherlen Province. The production of crops and vegetables was assessed as overimplemented by 40.8%.

Khentii Province Governor’s Action Plan for 2012-2016

The Governor’s Action Plan included 3 objectives for supporting local farmers: -

To build a winter greenhouse To introduce technological solutions to potatoes and vegetables productions To build a vegetable storage warehouse

However, objectives for building a winter greenhouse and introducing technical solutions have not been achieved.

-

-

-

A 100 tons capacity vegetable storage warehouse was built in 2014 with the total funding of 92 million MNT from LDF. There are some minor works required to complete the building.

A tender for building a winter greenhouse was announced (with funding from Chinggis Bond). However, the cost per square meter is estimated at 135,000 MNT. No farmer has the capacity to manage this kind of project. Therefore, this work is halted.

In 2014, an order was issued in Khentii province to provide an award of 1 million MNT to those farmers who built a vegetable warehouse. So far, only 1 farmer received an award (but, due to financial challenges, the award amount was reduced to 0.5 million MNT)

4.5.2 Kherlen Soum policy on agriculture and farming The Socio-Economic Development Plan for 2015

The Development Plan of Kherlen soum was implemented in the following way: 1. To support herders and farmers, to organize activities to supply the town residents with vegetables grown by soum farmers, to support initiatives of soum citizens According to the statistical data of 2015, Kherlen soum produced 1,175 tons of potatoes, which is 27.9% of the total production of potatoes in Khentii province in 2015, and 397.5 74

tons of vegetables, which is 15.6% of the total production of vegetables for the same period. Monitoring and Evaluation working group of Kherlen soum concluded that the work on supporting farmers was satisfactory and the number of farmers increased, with the town residents supplied with safe and high-quality vegetables.

2. To build a vegetable storage warehouse that meets standards, to organize activities to supply the town residents with vegetables grown by soum farmers In 2015, the vegetable storage warehouse was opened and Administration Office of Kherlen Soum Governor took over the management of the warehouse. At the same time, Administration Office of Kherlen Soum Governor signed a lease agreement with Khan Khentii NGO authorizing it for running the warehouse.

3. To establish vegetable greenhouses in Undurkhaan (Chinggis) town to supply the town residents with early harvest vegetables During the period of 2013-2015, 59 vegetable greenhouses with the total area of 5,111 square meters were established by 24 citizens, 1 agro park, 4 enterprises, 4 organizations.

As a result of this work, Kherlen soum farmers were able to successfully participate in national and Khentii province farming markets and supply residents of Chinggis town and nearby soums with early harvest vegetables.

4. To support initiatives on production of berries and establish a berry production enterprise in Undurkhaan town Within the framework of Sea buckthorn Program, a series of trainings on planting berries, protection of plants from insects, technologies for processing berries were conducted and the total of 180-200 citizens had attended these trainings. Those citizens, who participated in this Program, planted berries on lands acquired for farming and increased the number of berries grown in this soum.

As a result of this Program, 23 citizens, 1 company and 22 organizations have planted 27,625 bushes of sea buckthorn and other berries and have harvested 2.37 tons of berries.

KherlenSoum Governor’s Action Plan for 2012-2016

The Governor’s Action Plan included 3 objectives on supporting the development of the farming sector. Those were included in the review of the Kherlen Soum Governor’s performance by Khentii Province Governor.

3 To keep the farming areas and production of potatoes and vegetables over the level of 2014 In 2015, 78 hectares of land were used for production of 1,185 tons of potatoes and 30 hectares of land were used for production of 1,397.5 tons of vegetables. Kherlen soum produced 27.9% of potatoes and 15.6% of vegetables produced in Khentii province.

4 To implement Sea buckthorn Program 75

In 2015, 6 citizens participated in this program and planted 365 bushes on 0.5 hectares of land (new land).

5 To provide support from SDF for increasing technological solutions for potatoes and vegetables productions Tractors able to plow were purchased from Ministry of Agriculture for 25 citizens. The advance payment of 25 million MNT is planned to be funded from 2016 budget of SDF. Monitoring and Evaluation working group of Kherlen soum concluded that the work on supporting farmers was satisfactory and as a result of this work by the Kherlen soum authorities the number of farmers increased and city residents were supplied with safe and high-quality vegetables.

Binder Soum policy on agriculture and farming

The Long-Term Development Plan of Binder soum (2014-2030) lists, among its priority directions, the goal of meeting 100% of the soum demand for main food products (meat, milk, potatoes and vegetables, fruits, berries) from local producers. The following programs and projects are outlined as the main activities to achieve this goal: - To increase the production of potatoes, vegetables, fruits and berries - To support greenhouse farming and new types of vegetables production - To intensify the production of potatoes and vegetables through the introduction of advanced technology and equipment - To develop small and medium enterprises - To establish a vegetable processing factory - To develop business support services - To establish a cold storage warehouse for vegetables The indicators for assessment of progress show that production of vegetables is expected to increase almost twofold from 474.2 tons in 2013 to 757 tons in 2030.

Table 32. Potatoes and vegetable production projection in Binder soum PRODUCTION Potatoes

Vegetables

TOTAL

Cabbage Turnip Carrot Cucumber Tomato Onion Garlic

2013 (tons) 320 46,7 31,2 26,5 9,3 3,1 31,2 6,2 474.2

76

2019 (tons) 380 60 35 30 12 3 40 10 570

2024 (tons) 420 70 40 40 15 3,3 50 15 653.3

2030 (tons) 480 80 45 50 18 4 60 20 757

CRC of Binder Soum approved 36 projects on the 29th of May 2014 for economic development of Binder soum. 3 out of these 36 projects involve vegetables and berries production. Those are: - Supporting greenhouse enterprises and production of new types of vegetables - Increasing of the berry plants and bushes plantation - Intensifying production of potatoes and vegetables through introduction of advanced technology and equipment These projects are at the stage of implementation.

On April 14, 2015, Administration Office of Binder Soum Governor held a public consultation with a title “Living well in our soum” and issued a slogan “We are a model soum”. Under this slogan, the following statements were adopted: - Let’s grow vegetables to fully meet local demand - Every household to become a producer - Every household to plant no less than 10 bushes These statements, initiated by the Administration Office of Binder Soum Governor, demonstrate the commitment of the soum authorities to vegetables and berries production in the soum.

4.5.3. Assessment of the state policies and activities on the farming sector

BY STATE RERPRESENTATIVES

BY FARMERS

Policy support is provided to farmers - Most of the farming fields are located in the western part of the soum, so Chinggis town development has been planned to the western direction.

- 50 hectares of unused crop fields were distributed to farmers - several programs on supporting farmers and individuals, who want to grow vegetables and berries, have been implemented

There is a need to conduct a study of local demand for and local supply of vegetables Although, CRC issued a guidance for settlement of disputes among herders and farmers, it is not implemented During the tough for farmers years (drought, destruction of the fields by cattle) local administration did not respond to the request on support

Sufficient support is provided in a form of trainings (but, farmers do not use the acquired knowledge and skills effectively)

Local administration does not pay adequate attention to farmers

Many issues of the farming sector have been resolved (warehouse, land, seeds, disputes with herders)

Farmers lack technical capacity to sustain and increase production of vegetables (water system, warehouse)

Information is sufficiently and timely distributed to agricultural specialists and farmers in every soum

Farming of vegetables is predominantly manual (weak mechanization) 77

Equipment and technologies are outdated CRC highly values and praises farmers (every year, best farmer and agronomists are selected and awarded)

No integrated selling system Land is a big issue. People who are not farmers get big farming fields. Yet, for several years I try to get an additional field with no success

In 2016, it is planned to increase the number of farmers who want to expand their farming fields In the past, water and electricity issues were focused on the needs of herders.

This year, the needs of farmers are being considered There is no separate state program on supporting vegetable farming Many activities in the farming sector that require financial investment are not implemented 4.5.4. Public participation mechanisms

Environment and Rural Development Committee at Citizens Representative Council of Khentii Province

On the 16thof June 2014, the 9th meeting of CRC of Khentii province issued a decree on “CRC Committees, their structures and scope of duties” that revised the structure and organization of the CRC Committees.

According to the new structure, CRC has 7 Committees. The duties of Environment and Rural Development Committee include the oversight of farming, food production and supply sectors. The Committee is required to include representatives of state organizations and representatives of farming and livestock enterprises.

A Memorandum of Understanding (MoU) on the collaboration of Khentii Province CRC and Civil Society Network was drafted. It covers the interconnections between the CRC Committees and cooperation responsibilities. As reflected in this MoU, the civil society organizations that are selected for collaboration with Environment and Rural Development Committee on the issues related to ‘livestock, farming, environment, food production and services’ are Environmental Council of Citizens NGO and Kherlen Toonot Eco NGO. Decisions and reports on the activities of CCR of Khentii Province are regularly posted to the CCR website.

Local Development Fund 78

In 2014, a vegetable storage warehouse with a capacity of 100 tons was built with funding from Local Development Fund of Khentii Province. The warehouse opened in September 2015 and the Administration Office of Kherlen Soum Governor took over the management of the warehouse. At the same time, Administration Office of Kherlen Soum Governor signed a lease agreement with Khan Khentii NGO authorizing it for running the warehouse.

Public participation in decision-making in SoumDevelopment Fund

In the recent years, decision-making authority has been increasingly transferred to soum level for the purpose of improving local-level development and strengthening the sustainability, with the participation of the local residents. In particular, in 2011, an opportunity for soums to make decisions on budget revenue and spending was established. Certain portion of provincial budget is allocated to soums for financing soum development projects.

Government Ordinance #134 on “Procedure for collecting, spending and monitoring Soum Development Fund” was issued in 2011. The Procedure outlines 4 different ways of public participation in SDF work: a. Loans: The Fund will support establishing and expanding small and medium enterprises at soum level, creating new jobs, providing soft loans to small and medium enterprises9 b. Project selection: Public representatives (citizens and CSOs) will participate in selection of project to be funded from the SoumDevelopment Fund through soft loans10 c. Project monitoring: Activities of SDF should be transparent and soum public has a right to monitor spending, payment and reporting of the funds11 d. Access to information: Project Selection Committee is responsible for conducting, at least twice a year, the monitoring of the project implementation, the fulfillment of loan contract obligations, and for reporting the results to Soum CRC and to the soum public12 Soum Development Fund in KherlenSoum

The SDF was started in Kherlen soum in July 2011. Since then, the total of 901 million MNT has been spent on financing the projects by 116 individuals and entities. These projects have contributed to keeping 152 jobs and creating 225 new jobs. Financing of loans from SDF have prioritized those sectors that play significant roles in Kherlen soum.

Table 33. Loans from SDF of Kherlen Soum for years, 2011-2015 (by sectors) Loans by sectors

% from total budget

9

Government Ordinance #134 “Procedure for collecting, spending and monitoring Soum Development Fund, 2011, Clause 1.5 10 Government Ordinance #134, 2011, Clause 3.2.1 11 Government Ordinance #134, 2011, Clause 5.1 12 Government Ordinance #134, 2012, Clause 3.1.5

79

1 2 3 4 5

Agriculture Food production Light industry Production of construction materials Public utility services

20% 25% 16% 12% 27%

During the period of 2011-2015, four farmers acquired loans for the total amount of 49 million MNT for the purposes of growing vegetables, renovation of winter greenhouse.

In 2014, SDF of KherlenSoum focused on supporting the farming sector and provided loans to 3 farmers. Tserenhand, Odbayar and Erdenetsetsg received loans and built vegetable warehouses.

In 2015, SDF of KherlenSoum prioritized the meat and dairy production sectors.

In 2016, SDF loans for the farming sector will prioritize building vegetable warehouses over planting vegetables.

However, the maximum amount of a loan is 30 million MNT, which is not sufficient for building a big warehouse. In addition, requested loan amounts are often cut in more than half. For instance, a loan request for a total amount of 5 million MNT is approved for an amount of 2 million MNT. Those farmers, who received such loans, are not able to accomplish their plans and often face burden of debt, rather than increased productivity.

Loan payment schedule is based on monthly payment system. This does not reflect the specifics of the farming sector when farmers earn income predominantly in fall season.

No public participation mechanism exists in SDF of Kherlen soum. Establishing Evaluation Committee is under discussion.

Soum Development Fund in Binder Soum

SDF was started in Binder Soum in 2011 and since then 25 individuals have received loans for the total amount of 303.7 million MNT. The loan payment has a rate of 95.6% and the outstanding loans of 2 individuals for the total amount of 9.4 million MNT have been transferred to court.

A procedure of an Evaluation Committee to monitor and evaluate all projects implemented in Binder soum was approved on the 11th of October 2013 by CRC of Binder Soum.

According to the procedure, the Committee should comprise of no less than 20 members and include representatives of public (NGOs, community groups, informal business groups).

The Evaluation Committee was established in 2015. Projects pertinent for the long-term development of Binder Soum are distributed to the Committee members for monitoring and evaluation. A Project Selection and Evaluation Group was also established under the Committee to announce and select projects.

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Public participation in SMEDF

Law of Mongolia on Small and Medium Enterprises (2007) states that Small and Medium Enterprise Development Fund shall be established with a purpose to provide funding for supporting small and medium enterprises13. This SMEDF operates within the framework of the state policy in support of small and medium enterprises and it provides soft loans to owners of such enterprises. A procedure for loans was approved on the 18th of May 2015

by Minister of Industry and Agriculture by Ordinance #100. According to Clause 3.1 of this Ordinance, a Soft Loan Committee should include 1 representative of civil society. At local level, a Small and Medium Enterprise Sub-Fund is operated by local Labor Department and provides loans to small and medium business owners.

SMEDF in KherlenSoum The SMEDF of Kherlen Soum provided loans for the total amount of 560 million MNT to 340 individuals. 25% of the loans were acquired by farmers. The loans were mostly acquired for canning vegetables. However, 4 farmers that have acquired loans for this purpose are not performing well.

No public participation mechanism exists in Kherlen soum. Establishing Monitoring Committee at SMEDF is under discussion SMEDF in Binder Soum In 2009, Binder soum started provision of soft loans to small and medium enterprises.

Since then, SME Fund has provided soft loans for the total amount of 389.8 million MNT to 107 individuals. The rate of loan payment is 95.2%. The SMEDF has submitted to the court 4 outstanding loans for the total amount of 18.6 million MNT. Table 34. Loans from SME Development Fund of Binder Soum for years 2011-2015 (by sectors) Loans by sectors 1 2 3 4 5

% from total budget

Services Auxiliary facilities Bread and bakery Vegetables Dairy products

22.5% 22% 28.1% 27.2% 17.8%

Based on the recommendations of the SMEDF Council, CRC of Binder Soum made a decision the 21st of April 2016 to provide soft loans to 8 vegetable farmers for the total amount of 11,130,000 MNT.

13

Law on Small and Medium Enterprises, 2007, Article 22.1

81

Also, CRC of Binder Soum made a decision to include 24 farmers in ordering greenhouses for year-round production of vegetables and production of vegetables that require special conditions.

4.5.5. Assessment of the activities of SDF and SMEDF

By State representatives

By Farmers

Submitted projects lack interconnections with existing context and other projects

No long-term loans with low interest are available

Weak organization and partnership among the farmers

Loans from the Funds are not given to good candidates

Farmers are not active, their participation is weak

Loans are often given to friends/relatives Requested loan amounts are reduced

Farmers are not capable of uniting and getting their issues resolved Farmers cannot organize themselves to access the existing opportunities Weak financial capacity Farmers are considered bad/unreliable borrowers Farmers do not have sufficient collateral for loans Some NGOs do not work honestly Loans are not used effectively

Loans for farmers are given to nonfarmers Information is not transparent Cooperation and dialogue between the state organizations and farmers are absent Ministry of Agriculture has made a decision that houses and compounds cannot be used as collateral for loans If properly supported, we are able to fully supply the local demand for vegetables and berries

Loans are not paid back in time

4.5.6. Public participation in procurement The main legal document that identifies public participation mechanisms in making decisions on budget-related issues is Law of Mongolia on procurement of goods, works and services with state and local funds approved in 2005 and amended the 9th of June 2011. The purpose of the Law is to govern matters of planning, organizing, overseeing, and settling disputes pertaining to public procurement of goods, works, and services with state and local funds and of holding responsible the violators of the law. The 2011 amendment included provisions on public participation to make procurement more transparent and accountable. The amended Law includes a formal role for civil society in 82

evaluating bids and for monitoring implementation of public contracts. This amendment enables the disclosure and participation in public procurement.

According to the Law, state organizations have to procure goods and services once a year.

The process of procurement by state agencies is guided by a procedure approved by Ministry of Finance on the 5th of January 2007 by the decree #04.

Diagram 1. Procurement process stages

1. Approval of budget 13. Evaluation of contract implementation

12. Implementation of contract

2. Development of procurement plan 3.Announcement of a list of goods and services for procurement 4. Establishment of Evaluation Committee

11. Development and approval of contract

5. Selection of the procurement level

10. Granting procurement contract rights

6.Preparation of tender materials

9. Evaluation of tender bids

7. Preparation and announcement of request for tender bids

8. Accepting tender bids

Public participation has been evaluated in 2 main areas: - Participation in the process of organizing and evaluating tenders - Participation in tender bidding Participation in the process of organizing and evaluating tenders

Procurement budget (Stage 1): At the beginning of the year, based on approved on the 1st of January annual budget, the state organization organize procurement work (once a year). Schools and kindergartens develop procurement plan in accordance with the approved variable cost per child14: - Kindergarten: 1,650 MNT per child - School: 2,315 MNT per child (in dormitory), 600 MNT per child (lunch for children in grades 1-5)

14

Government Decree #106 from October 27, 2012

83

This is the main justification for organizing the procurement. All schools and kindergartens procure food products falling into the following categories: - Category 1: Meat and meat products - Category 2: Potatoes and vegetables - Category 3: Bread and flour products - Category 4: Dry/baking goods - Category 5: Milk and dairy products The Category 2 is the main target for the farming sector and includes potatoes, turnip, cabbage, onion and optional vegetables (pepper, garlic, etc.).

Procurement plan (Stage 2): State organizations develop procurement plan within the 15th of January that determines the total budget for procurement. Procurement has 2 levels, open (over 30 million MNT) and comparative (less than 30 million MNT). Schools and kindergartens procure at the comparative level: Table 35. Procurement budget and level, schools and kindergartens in KherlenSoum (2016) Kindergarten #4 of Kherlensoum Procurement level Category 2: Budget

open

Kindergarten #8 of Kherlensoum comparative

Temuujin School #1 TVET School Complex comparative comparative comparative

10,267,200

3,586,100

5,053,200

9,079,000

18,006,620

Public participation in Stages 1 and 2 are restricted since those are developed and approved in accordance with the variable costs and are based on number of children enrolled.

Announcement of a list of goods and services for procurement and announcement of request for tender bids (Stages 3 and 7): The Law requires announcements for openlevel procurement to be announced through national media outlets and for comparativelevel procurement to be announced through local media outlets.

Table 36. Announcement of the procurement lists and tender bids, schools and kindergartens in KherlenSoum (2016)

Procurement National media Local media

Courier service

Kindergarten #4 of Kherlen soum open Daily News

Kindergarten #8 of Kherlen soum comparative

Temuujin School Complex

School #1

TVET

comparative

comparative

comparative

2 local TV stations

2 local TV stations Local paper Delivery to farming enterprises

2 local TV stations

2 local TV stations

2 local TV stations Local paper

Delivery to farming enterprises 84

No documented copies of announcements were archived in the organizations, and the above information on announcements was recorded through interviews. Also, the lists of the farming enterprises that received announcements through the courier service were not enclosed in the tender materials. The common practice for such lists is to include supermarkets that sell vegetables and enterprises that participated in the tender bidding in the previous years.

Public monitoring of announcements does not exist.

Procurement Evaluation Committee (Stage 4,8,9,10): According to the Law, decisions on the composition of open tender Evaluation Committee are made by Soum Governor and the composition of comparative tender Evaluation Committee are made by Head of the procuring organization. Evaluation Committee should comprise an uneven number of members and should include public representative(s).The duties of Evaluation Committee include development of technical proposal, request for tender bidding and tender materials; accepting, opening, evaluating tender bids; approval of tender contract right.

Table 37. Composition of the Evaluation Committees, schools and kindergartens in Kherlen Soum (2016) Kindergarten #4 of Kherlensoum

Kindergarten #8 of Kherlensoum Head of Committee: Head of U.Enkh-Ariunaa, Committee: Social Policy D.Erdenetuya, Specialist,Governor’s Accountant, KG office #8 Members: Secretary: Ts.Altansolongo, O. Altannavch, coordinator of Bag Head of Cultural #1 Center B.Davaatsetseg, Members: Assistant Teacher, A.Odonchimeg, KG #1 Stockkeeper, D.Erdenetuya, KG #8 Accountant, KG #5 N.Batsaikhan, D.Oyunkhishig, Head Accountant, of Laboratory, Tahilgat Village Inspection Agency L.Regzedmaa, Parent

Temuujin School Complex Head of Committee: D.Undarya Secretary: Erdenesolongo Members: D.Ariumaa Ch.Gajidmaa Ch.Doljiimaa E.Altanzul

School #1

TVET

Head of Committee: Altannavch, Head of Cultural Center Members: D.Erdenetuya, Accountant, KG #8 J.Davaasuren, NGO representative Tsetsegtuya, Accountant, KG B.Enkhtsetseg, Teacher, School Dormitory

Head of Committee: D.Batkhuyag, Representative of TVET Secretary: B.Enkhtuya, TVET J.Davaasuren, NGO N.Darkhanbayar, Public representative S.Munkhtuya, TVET

The Evaluation Committees of schools and kindergartens are mostly composed of the representatives of procuring organizations. This is explained by the fact that the Law requires to select only the people who have attended trainings on the procurement procedure and have acquired A3 Certificate. Therefore, the public participation in Evaluation Committee is weak in Kherlen soum and the participation of representatives of the farming sector is non-existent.

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Participation in tender bidding.

The core criteria for tender bids are: -

tender amount should not be less than 80% of total sale volume of the tenderer tenderers are required to provide a financial report for the last year tenderers are required to provide a financial report and a list of similar activity in the last year tenderers are required to provide a list of goods, works and services carried out over the last 1 year of similar nature along with costs letter of guarantee confirming no outstanding tax payments

Table 38. List of the applied and selected entities, schools and kindergartens in KherlenSoum (2016) Kindergarten Kindergarten #8 Temuujin #4 of of Kherlensoum School Complex Kherlensoum Entities that submitted tender proposals Art Margad LLC 99 Cooperative Art Margad LLC Khailast Art Margad LLC Khailast Khairkhan Khailast Khairkhan Cooperative Khairkhan Cooperative Cooperative 99 Cooperative SarigGol LLC Khan Orgil KhishigLLC Entities that were won tender bids Art Margad LLC Khailast Art Margad LLC Khairkhan Cooperative

School #1

TVET

Art Margad LLC Khailast Khairkhan Cooperative

Cooperative Khailast Khairkhan Cooperative Sarig Gol LLC Art Margad LLC

Art Margad LLC (lunch) Khailast Khairkhan Cooperative (dormitory)

Khailast Khairkhan Cooperative

Information on the other contracted entities for supplying vegetables in other schools and kindergartens: -

School 2: Khan-Orgil LLC (lunch), Ankhjinbaatar LLC (dormitory) Nursery: Art Margad LLC KG #1: Art Margad LLC KG #3: Art Margad LLC KG #5: Art Margad LLC KG #7: NogooKhur LLC

In Kherlen Soum, there are 4 schools and 8 kindergartens. In their tender bidding, 2 organizations have predominantly won – Art Margad LLC (in 7 places) and Khailast Khairkhan Cooperative (in 3 places). In other words, two entities, one company and one cooperative, are the winners of most of the tender bids for schools and kindergartens.

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These 2 entities are linked to the key farming CSOs of this project. Chimgee, who is one of the owners of Art Margad LLC, is a Head of Food and Agriculture Association NGO. Khailast Khairkhan Cooperative is the target cooperative of the project, but Erdenetsetseg, Head of this cooperative, participated in these tender bids without involvement of other 8 members of Khailast Khairkhan Cooperative. Therefore, it is difficult to state that the key farming CSOs participate in tender bidding in Kherlen soum.

Based on the tender bidding materials of the selected schools and kindergartens, the following factors were taken into consideration for making decisions: The key indicators for selection: - Locally grown vegetables – considered as advantage - Low price – primary indicator - Quality and completeness of documents of tender bid proposal The key reasons for not selecting: - Not a farmer - High price - Incomplete documentation The reasons why so few organizations participate in tender bidding: - Only officially registered entities are entitled to participate (very few farmers have official registration) - Tender proposal writing and preparation of documents is a complicated process with several stages (weak capacity of local farmers) - Local farmers cultivate small fields and harvest small quantity of vegetables.

Therefore, they sell vegetables in fall season only and are not able to provide vegetables year-round - No vegetable warehouse is available, therefore, farmers are interested in selling vegetables quickly, while these are fresh (in fall season) - Farmers do not collaborate - Farmers are not always aware of procurement opportunities Participation in monitoring and evaluation of contracts

The job of Evaluation Committee is completed with the selection of a tenderer that is granting tender rights. Procuring organization, i.e., school/kindergarten is responsible for developing and signing contracts, implementing, monitoring and evaluating contracts.

The main indicators considered during for monitoring and evaluation of contracts are stable supply and price fluctuation to stay within 10% of the initial price.

The common issues with supply of vegetables are: 1. Locally grown vegetables are supplied until January only 2. Vegetables supplied after January are vegetables shipped from elsewhere 3. The only locally grown vegetable supplied year-round is potatoes.

87

The main reason is that there is no spacious vegetable warehouse in the soum, which prevents year-round supply of locally grown vegetables. For instance, both Art Margad LLC and Khailast Khairkhan Cooperative supply shipped vegetables to the procuring schools and kindergartens.

Although, the selected schools and kindergartens evaluate the implementation at the end of year, no documentation on monitoring and evaluation of contracts was found in the files.

4.5.7. Assessment of procurement process and tender contracts

By State representatives Guidance was issued to local state organizations (schools, kindergartens, hospital) to prioritize purchasing vegetables from local farmers We purchase vegetables for prices as set in our budget We have to buy vegetables for cheap prices, because this is how it is budgeted Farmers supply shipped vegetables in spring time as they run out of own produces by spring It is important to employ more flexible pricing policy Prices for vegetables are low in fall season and expensive in winter and spring seasons, so they should be purchased and stored in fall season Buying and consuming locally grown vegetables is much healthier

By Farmers We face losses if we win tenders. We have to supply vegetables on a regular basis, but pricing is the problem I supply vegetables to 8 organizations, but I can supply own vegetables in fall and winter seasons only. In spring, I have to purchase vegetables for high prices to supply to the contract organizations. I pay for difference in prices from my own pocket.

Although, number of enrolled children increase, budgets for vegetables go down.

This affects price per kg Procurement prices are almost 50% lower than market prices Schools and kindergartens do not pay money in time Because there are no warehouses, we can’t store big quantities of vegetables and, in spring time, we face losses. If such conditions continue to exist, no farmers will participate in tender bids.

Evaluation Committees are not fair, they support own bidders I received a proposal to win in a tender bidding (for a price) Tender conditions and prices are not flexible 88

4.5.8.Proposed solutions by the key stakeholders Proposed solutions from the state representatives

Policy-related solutions -

To develop a separate policy/program on supporting farmers who produce potatoes and vegetables To include a comprehensive framework of the farming sector in the core directions for the province and soum development To address medical and social needs of farmers To implement the agreements and memorandums signed with CSOs To connect farmers with grants and projects announced by international and national organizations To contribute to strengthening the farmers’ knowledge and skills To resolve the protection of farming fields (to work with farmers and herders) To provide legal and organizational support to Farmers’ Association To influence the state policy on vegetables imported from abroad To develop a more flexible loan policy

Budget-related solutions - To financially support enterprises that work on building warehouses and greenhouses - To develop a system of transportation to/from a joined storage place - To resolve the issue of integrated warehouse - To support the farming sector with compact machinery and equipment - To research companies that supply farming machinery and equipment and connect with farmers - To fund from the local budget water supply of farming fields - To support farmers with discounted prices on warehouses, greenhouses, tractors, equipment, seeds - To support a vegetable warehouse with funding from LDF - To support and fund transportation and storage of vegetables - To support vegetable processing and canning with equipment - To introduce more accurate and realistic calculation of prices for vegetables Proposed solutions fromthe farmers

Self-organization related solutions - To get better organized (into cooperatives, groups) - To develop goals, objectives and outcomes - To improve team-work and jointly implement projects - To organize regular meetings of farmers and discuss cooperation/partnership possibilities

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Self-improvement related solutions - To improve sustainable production - To organize trainings on processing vegetables and berries - To switch from imported vegetables to locally grown vegetables - To obtain certificates for farming products Policy-related solutions - To develop and sign agreements with LAs and herders (on protection of farming fields) - To collaborate with LAs on supplying local demand with locally grown vegetables

4.5.9. Conclusion State, provincial and soum policies provide some basic support to the farming sector.

However, the state organizations do not disseminate information on these policies to farmers and farmers have very limited understanding of what policies, programs and projects are in place. For instance, the implementation of State Policy on Food and Agriculture was completed in 2015. However, implementation evaluation was not conducted and the results were not reported to public. Moreover, farmers were not engaged in the process of development of the next stage State Policy on Food and Agriculture covering the period 2016-2025 and they are not aware of this policy.

Evaluation of the agricultural sector does not differentiate farming of crops and farming of vegetables, and the assessment of the state policies and activities is done for the total production of crops and vegetables. However, both the land for vegetables and the productions of vegetables have decreased in the recent years.

State organizations and international organizations conduct trainings for farmers to build and improve their knowledge and skills. However, the quality of trainings may not be sufficient to actually impact the actual application of the acquired knowledge and skills.

The province and soum-level projections for increasing the production of vegetables are optimistic. But, actual planning and support for gradual increasing of the production is deficient. Also, concrete reasons for the reduction of vegetable production are not analyzed.

The identified needs of the farmers (warehouse, winter greenhouse, mechanization of the production process, water supply, etc) are urgent and directly affect their productivity and profitability. However, these needs are not delivered to local authorities in an official way and they are not reflected in local policies and budgets.

SDF and SMEDF are not effectively connected to the local policies on supporting the farming sector. Funds do not prioritize the farming sector in their loan policies and farmers are, in general, considered as undesired applicants. Their policies do not reflect 90

specifics and needs of the farming sector and tend to destruct rather than support the efforts of farmers to increase their productivity and profitability. Farmers, in general, do not see these funds as opportunities.

Farmers have limited understanding of the loan procedures of SDF and SMEDF. Their ability to successfully apply, receive and implement projects with funding from these funds is weak. Moreover, SMF and SMEDF do not include farmers in their decisionmaking and farmers do not have any knowledge of experience of such possibilities.

Needs and problems of the farmers are, mostly, considered as the problems and needs of this particular group of producers. However, increased productivity of the farmers, their ability to produce vegetables year-round, their possibility to sell vegetables on a separate vegetable market are beneficial not only to these producers, but to local communities as well. Because, farmers are not able to upgrade their capacity, technology, equipment, their produces finish during the fall season, despite their potential. As a result, local consumers (individuals and organizations) consume lowquality vegetables imported from China most of the time.

Article 6.1. of Law of Mongolia on procurement of goods, works and services with state and local funds outlines the following principles as the guiding principles for procurement: transparency, equal opportunity, efficiency, cost-effective, accountable.

Also, a procedure was approved on public participation-based procurement15. But, public participation in procurement for the tenders with amount less than 20 million MNT is not enabled due to a requirement of A3 Certificate. In other words, the legal opportunity16 for public to participate in a procurement of goods and services with local budget for any amount less than 20 million is not utilized and implemented.

4.5.10. Recommendations -

To make the national, province and soum policies and activities in the farming sector transparent and to deliver this information to farmers.

-

To develop detailed indicators for the assessment of the farming sector (for each type of crops and vegetables), to ensure that these reports are open to public.

-

To establish the participation of the farming CSOs in the planning, the implementation and the assessment of the provincial and soum-level plans for vegetables production.

15

Procedure on Public Participation-based Procurement Process, Decree #39, Ministry of Finance, February 23, 2013 Law of Mongolia on procurement of goods, works and services with state and local funds, Amendment of 2011, Article 71.2 16

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-

To develop a list of the needs priorities of farmers and advocate for including them in local policies and budgets.

-

To organize capacity building activities (project planning, proposal writing, documentation, certification, etc.) to increase the access of farmers to loans from SDF and SMEDF.

-

To develop a close cooperation with SMF and SMEDF in the soums to reflect the needs and specificities of the farming sector in their policies, selection and assessment criteria.

-

To improve the collaboration of SMF/SMEDF with the farming CSOs and advocate for establishing the participation of these CSOs in the policy and in the criteria development of loan selection and project monitoring processes.

-

To develop a public interest and a public support for local vegetables and berries production.

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5. PROPOSED TOPICS FOR TRAINING, SEMINARS AND WORKSHOPS

1.

2.

3.

4.

5.

6.

7.

Training Seminar / Workshop Name Descriptions Capacity Building Framework for civil society organizations  Knowledge on nature of civil society and and their work CSOs (NGO, cooperative, informal group)  Laws, policies and other legal documents in Mongolia that define the legal framework, roles, rights and responsibilities of CSOs (NGO, cooperative, informal group) Nonprofit management  Management and coordination of CSOs  Conditions and strategy for stable work of CSOs Nonprofit planning (long and short terms)  Strategic planning  Annual planning  Activity and action planning  Business planning  Marketing strategy and planning  Fundraising planning  Communication planning Financial management of nonprofits  Financial planning  Financial management  Bookkeeping  Financial documentation Leadership and teamwork  Leadership by leaders and by team members  Management of collaboration  Management of information flow and internal communication  Distribution of work responsibilities of team members  Development and implementation of monitoring and accountability mechanisms Proposals to Local Funds  Proposal writing  Project implementation  Documentation Collaboration of CSOs  Methods, mechanisms and coordination of collaboration  Distribution of roles and responsibilities in within the group  Network as a form of collaboration, its methods  Facilitation of network work and members  Motivating participation of network members  Methods of collaboration with stakeholders 93

8. Lobby and advocacy work

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Lobby and advocacy (concept, stages, methods) Role of CSOs as advocates Organizing collective advocacy (network) Stages of policy advocacy Advocacy strategies and tactics Mapping policy decision-making and identification of points of intervention Organizing advocacy campaigns Organizing media campaign Methods of working through social media Planning of advocacy work

Public participation mechanisms 1. Legal framework for public participation  Laws and national policies on public participation in decision-making processes at local level  Local policies on farming sector in Khentii province 2. Public participation in policy planning and development

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3. Public participation mechanisms and methods of participation

4. Collective public participation (NGOs, cooperatives, informal groups)

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5. Public participation in procurement of goods and services with public funds

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Policy-making process and public participation mechanisms Budgeting process and public participation mechanisms Monitoring processes and public participation mechanisms Access to information Monitoring and evaluation Participation through open public participation mechanisms Participation from public spaces Establishing collective approach to public participation Using the existing public participation mechanism for collective participation in planning, development and monitoring of farming policies Collective participation in Soum Development Fund and SME Development Funddecision-making and monitoring Identification of stable and effective approaches to collective public participation in procurement (Evaluation Committee) Trainings for CSOs to obtain A3 Certificate