Desk Review on Livelihoods and Self-Reliance for Refugees and Host Communities in Kenya Public Disclosure Authorized Public Disclosure Authorized March 2019 Public Disclosure Authorized Public Disclosure Authorized 1 Acknowledgements Undertaken by the World Bank, this report was prepared in support of the Government of Kenya’s contribution to the IGAD Thematic Meeting on Livelihoods and Self- Reliance of Refugees, Returnees, and Host Communities. The report was authored by Farah Manji (Consultant, World Bank) with support from Joanna de Berry (Senior Social Development Specialist, World Bank). Review comments were received from Rebecca Lacroix (Senior Social Development Specialist, World Bank) and Laura Buffoni (Regional Livelihoods Officer, UNHCR). The report was reviewed and endorsed by Mr. Kodeck Makori, Acting Commissioner for Refugees, Ministry of Interior, Government of Kenya. Funding for the report was provided by the Government of the Netherlands. 2 Table of Contents Acknowledgements .................................................................................. 2 Executive Summary ................................................................................. 6 I. Introduction .................................................................................... 10 Why this report? ............................................................................................................................................ 10 Defining self-reliance ................................................................................................................................... 11 Kenya as a host nation ................................................................................................................................. 11 Kenya’s regulatory context ............................................................................................................................ 13 An introduction to the hosting counties .............................................................................................. 14 Turkana .................................................................................................................................................................. 14 Garissa ..................................................................................................................................................................... 15 Nairobi .................................................................................................................................................................... 15 II. Methodology .................................................................................... 16 III. An Economic Profile of Refugees in Kenya ....................................... 18 Are refugees poor/vulnerable? ................................................................................................................ 18 What are their main sources of income?.............................................................................................. 19 Are refugees moving towards self-reliance? ...................................................................................... 20 Which refugees have better economic outcomes? ........................................................................... 21 IV. An Economic Profile of the Host Communities ................................ 22 Are host communities poor? ..................................................................................................................... 22 What are their main sources of income?.............................................................................................. 23 V. How Different are Refugees and Host Communities in Development Terms? ................................................................................................... 25 Access to services, including education and health ......................................................................... 25 Employment and self-employment ........................................................................................................ 26 Incomes .............................................................................................................................................................. 26 Living standards ............................................................................................................................................. 27 Networks ........................................................................................................................................................... 28 VI. The Economic Impact of Refugees on Host Communities ................ 28 Environmental impacts ............................................................................................................................... 29 Economic growth ........................................................................................................................................... 29 Employment opportunities and labour ................................................................................................ 29 Better service provision .............................................................................................................................. 30 VII. Potential for Growth in Refugee-Hosting Counties ...................... 30 What are the potential sources of growth and opportunity in host areas? ........................... 30 Refugee participation in key drivers of economic growth ........................................................... 33 Energy ..................................................................................................................................................................... 33 Construction and mining ................................................................................................................................ 33 Pastoralism ........................................................................................................................................................... 33 Agriculture ............................................................................................................................................................ 34 Services and trade ............................................................................................................................................. 35 VIII. What’s Holding Them Back? A Discussion of the Barriers to Self- Reliance ................................................................................................. 35 Human capital: Access and quality of education and skills training ........................................ 39 Access to finance ............................................................................................................................................ 40 Markets and economic opportunities in the hosting areas .......................................................... 40 3 Protection ......................................................................................................................................................... 41 IX. Where Are We Now? Current Programmatic Interventions ............. 43 Building livelihoods and self-reliance: Current interventions .................................................... 43 Evaluation of outcomes ............................................................................................................................... 44 Transitioning towards sustainable livelihoods and self-reliance .............................................. 45 Maximizing finance for development .................................................................................................... 45 Devolution and its opportunities ............................................................................................................ 46 X. Recommendations ........................................................................... 46 XI. Unexplored Avenues ........................................................................ 49 References ............................................................................................. 52 List of Annexes ...................................................................................... 55 Annex 1: Outline of Methodology of Studies ...................................................................................... 55 Annex 2: Kenya as a Host Nation ............................................................................................................. 62 One of the world’s most documented refugee camps: The Dadaab refugee complex ........ 62 A growing settlement: An introduction to Kakuma refugee camp ............................................. 63 Gravitating towards urban areas............................................................................................................... 64 Durable solutions: The focus on repatriation ....................................................................................... 65 Annex 3: Kenya’s Hosting Counties ........................................................................................................ 66 Turkana .................................................................................................................................................................. 66 Garissa ....................................................................................................................................................................