Kickstarting Prosperity in Africa

A major plank of the Obama administration's Africa policy is to improve food security. Small-scale farmers in sub-Saharan Africa are woefully unproductive (for a whole variety of reasons) which translates into high levels of malnourishment and hunger on the continent.

What if you wanted to help these farmers grow more and earn more? What would you do? Some people, Jeffrey Sachs perhaps most vocally, want to supply farmers with needed materials such as seeds and fertilizers either for free or at a highly subsidized rate.

Here's a story about a different approach: Martin Fisher and his NGO, KickStart, sell portable water pumps to farmers in Africa. Dependence on rain is one of the many reasons why African farmers are so unproductive. If farmers are able to irrigate their fields they are able to grow more (assuming other factors remain constant) and may be able to scale up production and sell some of their crop in the market -- earning more for themselves and their families.

The catch here is that KickStart does not give the pumps away -- the company sells them at hundreds of retail stores. KickStart has been in business since 1996 and has sold pumps to thousands of Kenyan farmers claiming to have helped them generate millions of dollars a year in profits and wages. Here is some more information about claimed impact.

Farmers "vote" for this approach with their hard-earned Kenyan schillings. These sales give Kickstart resources to meet their mission of reducing poverty. It's a very different approach from the traditional aid paradigm -- and it seems to be working.

- Karol

(The photo is from the Kickstart website.)

To Condition or Not to Condition (Grants)?

A relatively new approach in the foreign-aid world involves giving families or individuals cash grants to meet their needs.

The most famous of these grants is the Bolsa Familia program in Brazil that gives families cash grants if they keep their children in school and get them regular medical care. These are "conditional" grants (CCTs) -- the grant is conditioned on meeting the government's to-do list. The results have been mostly positive though, as the article so nicely points out, the program is not a panacea (hope springs eternal for the silver bullet that will slay poverty).

What would happen if governments gave unconditional grants (UCTs) to poor families (via donor funding)? Would families take the money but keep children out of school? This article discusses a recent experiment in a very poor district in Malawi to test out this question. People were broken into three groups: some got conditional grants, others unconditional grants, and the third group got no grant money. Here's the crux of the findings:

"An average of US $10 per month was handed out to a group of girls participating in the study on condition that they attended school 80 percent of the time so to remain eligible for the stipend. It made no difference to the outcome when no conditions were imposed - the girls participating in the study attended school 80 percent of the time, and in both cases the school drop-out rate also fell by 40 percent. The school attendance findings were among others."

The "others" finding was that young women who receive small cash transfers are less likely to trade sex for money and thereby expose themselves to the risk of HIV infection.

Is it paternalistic or demeaning, as one person cited in the IRIN story argues, to condition aid grants? Or, might conditions provide a way to shift social norms that limit girls' access to education or to health care? Do the costs of monitoring conditional programs outweigh the benefits or vice versa? Do these grants create dependency or help people step up the economic ladder towards a more stable and secure life? These are as much moral questions as they are economic ones.

- Karol

(The photo is one I took at an orphanage in Botswana.)

Mapping Social Enterprise Success

Here's an interesting project called iuMap.

The folks at NextBillion (which focuses on "bottom of the pyramid"or BOP approaches to development and has a good blog), as part of their Ayllu Initiative, have created what they call the world's largest social enterprise directory -- a world-wide map of social enterprise efforts designed to help new entrants to this world learn from others already at work. The project is just getting started but hopefully will provide a great tool for people entering the world of social entrepreneurship, or those expanding/growing social enterprises as well as academics and others interested in studying this dynamic field.

Here's a description:

"Our goal is to make it easier for social enterprises and funders to get the information they need to make decisions; we share trends and best practices, and connect social enterprises with support. We believe that resources like The Next 4 Billion report are appreciated because they summarize data that is critical to understand the size and nature of the opportunities in this space. However, we also believe a huge leap in efficiency can happen with an up-to-date, centralized source of information on social enterprise, which tracks them and distributes that information in a digestible way. That's where iuMAP comes in; to disseminate its information we'll use interactive reporting, allowing people to sort information by the criteria they need, as opposed to long reports."

(this is a screen shot of the current map from the website)

- Karol

Indego Africa & Goldman Sachs 10,000 Women Initiative

As you may have heard, Indego Africa is proud to announce that Emelienne Nyiramana, Treasurer and Master Seamstress at Indego Africa’s partner cooperative Cocoki, has been admitted to the Goldman Sachs 10,000 Women Initiative program at the School of Finance & Banking in Kigali. Emelienne started the six-month Entrepreneurship Certificate Program this July.

Less than three years ago Emelienne, 33, carried water 17 kilometers a day for 25 cents to support her five children, including an orphan from the 1994 Genocide. Today, as a result of her hard work and Cocoki’s ground-breaking partnership with Indego Africa, Emelienne’s life is dramatically different. Cocoki now sells its masterful accessories and home décor crafts to more than 30 high-end retailers across the U.S. and on Indego Africa’s Webstore. Cocoki’s wine bottle bags and wine coasters were even featured in Food & Wine Magazine (article here). Emelienne now earns more than $4 a day and is brimming with pride and confidence.

“I am one of the founding members of Cocoki,” said Emelienne. “It started with so many problems, but with our increasing sales and Indego Africa’s training programs in financial management, entrepreneurship, literacy, and computers, it has grown into a business that makes us proud. Now I can also buy little things when I want to and save some money too.”

The Goldman Sachs 10,000 Women Initiative is a $100 million, five-year campaign to provide 10,000 underserved women around the world with a business and management education. Emelienne’s personal achievement represents the kind of transformational impact that Indego Africa seeks to achieve as an organization. “Indego Africa helped me know my responsibilities as a leader,” Emelienne said.

The Goldman Sachs 10,000 Women Entrepreneurship Certificate Program in Rwanda is organized by the William Davidson Institute at the University of Michigan in partnership with Rwanda’s School of Finance & Banking. The program, which includes rigorous classes, mentoring, and an extensive business plan competition, equips women with the knowledge and skills needed to expand a successful enterprise in Rwanda.

Go Emelienne!

- Ben