Archive - 2012

Date

May 21st

Western Union and Roshan launch a beautiful partnership in Afghanistan

From the press release:

"Roshan, Afghanistan's leading total communications provider, and Western Union, a leader in global payment services, have today jointly launched the Western Union Mobile Money Transfer service in Afghanistan that enables Roshan's M-Paisa customers to receive money from abroad. Roshan launched M-Paisa in 2008, and became the first company to bring mobile financial services to the people of Afghanistan.

Now, M-Paisa customers in Afghanistan can receive Western Union Mobile Money Transfer transactions from around the world directly into their mobile wallet accounts from families, in particular from countries with the largest population of Afghans living abroad, like UAE, Germany and Canada.

"Roshan launched M-Paisa using technology from Vodafone, one of the world's leading international mobile communications groups. Today, since the launch of the mobile money service in November 2008, M-Paisa has over 1 million customers enabled to receive their salaries, pay bills, receive and repay microfinance loans, send and receive money and purchase airtime directly from their Roshan phone."

Shainoor Khoja, former director of corporate social responsibility at Roshan, helped lead efforts to launch mobile money in Afghanistan.
Shainoor Khoja, former director of corporate social responsibility at Roshan, helped lead efforts to launch mobile money in Afghanistan.
Next month, former Roshan director of corporate social responsibility, Shainoor Khoja, will be speaking at Mercy Corps' Action Center. Join us:

Pioneering Mobile Money in Afghanistan
How do you build a struggling, war-torn economy if money can't change hands? Hear Shainoor Khoja, former director of corporate social responsibility at Roshan, Afghanistan's leading telecommunications firm, talk about how mobile technology moves money and other precious social commodities, like health, education and equal opportunity.

Nearly 70 percent of Afghans survive on less than $2 a day, so it's no surprise very few have bank accounts. But a substantial number—about 17 million—own cell phones. Harnessing Roshan’s technology edge and deep reach into the country’s most remote areas, Khoja and her team have worked to transform basic mobile phone knowledge into financial literacy.

Event: Thursday, June 7, at Mercy Corps in Portland, Oregon. Doors open at 6:30.

Loans without banks: Afghan farmers and USAID cut the middlemen out of finance

Small-scale farmers in Afghanistan benifit from a joint financing program administered by USAID and Development Associates International. Photo: <a href="http://www.flickr.com/photos/dfid/573327368">UK Department for International Development (flickr)</a>
Small-scale farmers in Afghanistan benifit from a joint financing program administered by USAID and Development Associates International. Photo: UK Department for International Development (flickr)

Small-scale farmers in Afghanistan, considered "high-risk" borrowers, are finally getting the credit they need to buy good seeds and equipment, but not from traditional banks.

NextBillion reports on how an innovative direct loan program cuts out banks and puts the power of credit in the hands of agricultural organizations while sticking to culturally-appropriate rules. The Agricultural Credit Enhancement (ACE) program, funded by USAID and implemented by Development Associates International (DAI) is changing financing and credit for Afghan farmers, showing that they're a risk worth taking.

ACE staff...hit upon a novel idea: forgo traditional lending institutions altogether and create a new lending system, based within agricultural organizations and agribusinesses, such as farmer associations and cooperatives, manufacturers of agricultural machinery, and export firms.

Aiming to make the [Agriculture Development Fund] fully Shariah-compliant, ACE has established separate bank accounts, an accounting, portfolio management and reporting system, customized loan contracts, and a Shariah Advisory Board, while also training staff in Islamic finance practices.

After almost two years, the Agriculture Development Fund has lent $37 million to 13,000 farmers in 25 provinces of Afghanistan. Through prudent lending practices and strong borrower relationships, it has also maintained an incredible 100 percent on-time repayment rate.

Read more about how this novel program is helping Afghanistan’s farmers here.

May 17th

By shopping local, the UN puts food aid to work for African economies

Food aid procured by the World Food Program in Tanzania has injected millions of dollars into the country's economy. <a href="http://www.flickr.com/photos/theroadtothehorizon/2175363898/">Photo: WFP/Tom Haskell (Flickr)</a>
Food aid procured by the World Food Program in Tanzania has injected millions of dollars into the country's economy. Photo: WFP/Tom Haskell (Flickr)

The benefits of food aid go beyond feeding the hungry.

As humanitarian agencies like the UN World Food Program (WFP) rush to respond to famine and crisis in Africa, it's easy to forget where emergency food aid comes from. But according to an article this week on the blog allAfrica, local food aid purchases in Africa have played a major role in bolstering regional economies. For example, between October 2011 and March 2012, the WFP purchased nearly 100,000 metric tons of Tanzanian maize, and has injected an estimated $13 million into the country's transport industry in last six months alone.

"Over 300 lock trucks leave [the capital] each month," explained WFP's country director in Tanzania, Richard Ragan. "Through the port, WFP operates the movement of 140,000 metric tons of food per year for delivery to East and Central African countries. This means that we are the biggest commercial partner the port has."

In a previous blog post, we explained how the U.S. is the only country that continues to send domestically procured food aid, essentially preventing local markets from benefiting from large-scale food purchases.

Given evidence that food aid helps spur regional development, and eventually the need for less foreign assistance, it's time the U.S. rethinks its food procurement aid policies.

New legislation paves the way for business development in Mongolia

Herders in Mongolia's vast rural plains now have access to commercial loans for their small businesses. Photo: Thatcher Cook for Mercy Corps.
Herders in Mongolia's vast rural plains now have access to commercial loans for their small businesses. Photo: Thatcher Cook for Mercy Corps.

For years, the only thing harsher than Mongolia's winters was the country's business climate. But spring may be on its way for Mongolian entrepreneurs.

Powering the thaw are efforts by the government and NGOs to improve access to credit for small businesses through the use of information communications technology (ICT) and collateral guarantees.

A decade ago, starting a business in Mongolia was no easy task. An aversion to risk meant that banks simply weren't extending loans to small businesses, usually because they lacked the necessary collateral. According to Jennifer Butz, Mercy Corps' country director in Mongolia, "The lack of access to collateral denied or delayed small business investment, which in turn denied or delayed economic development."

On top of poor access to credit, businesses and banks both faced huge transaction costs in the world's least densely populated nation—Mongolia's three million inhabitants are spread across a country that is roughly equal in size to Western Europe.

But over the last six months, the government of Mongolia has taken extraordinary steps to support business development. In December 2011, the government approved new e-money regulations that pave the way for the expansion of mobile baking services. Just a few months later, in February, Parliament also passed the Law on Credit Guarantee, creating a fund to provide struggling small businesses with the collateral necessary to secure commercial loans.

The recent legislation represents an unprecedented opportunity for both small businesses and the development community, including Global Envision's parent organization, international development agency Mercy Corps.

For 13 years, Mercy Corps has been working to spur economic development in Mongolia from the ground up by giving small businesses and entrepreneurs the tools they need to succeed. Seeing a lack of financial services for rural small businesses, the NGO joined in 2001 with the UN Development Program (UNDP) to co-found XacBank, Mongolia's first commercial bank focused on financing rural enterprises.

To overcome collateral concerns, Mercy Corps also introduced a 'loan guarantee mechanism,' to help businesses gain access to loans by extending collateral guarantees. Since 2005, the program has provided 2,641 rural businesses across Mongolia with $7.6 million in loans to support business growth and development. In general, XacBank serves as the provider of commercial loans under the loan guarantee mechanism.

"The difference between Mongolia in 2005 and now is incomprehensible," said Butz.

The loan guarantee mechanism program currently has a 98.8 percent repayment rate, with many loan recipients graduating to direct relationships with banks. Still, Butz argues:

Banks need to take more risks, because as Mongolia becomes a middle income country, there has to be a maturation of the market.

Until banks decide to loosen restrictions on lending to small businesses, she says, "there will always need to be an organization providing collateral assistance." The new Law on Credit Guarantee and the establishment of a Credit Guarantee Fund, which provides collateral of up to 60 percent on a loan of MNT 20 million (about $15,000), represent a first step toward making such assistance sustainable long term. But Mercy Corps will still have a role to play as the fund grows and can serve entrepreneurs nation-wide, particularly those in less accessible rural areas.

The new e-money regulations also promise to strengthen rural business development.

Small businesses like this bread-baking shop need access to financial services to grow and become sustainable. Photo: Thatcher Cook for Mercy Corps.
Small businesses like this bread-baking shop need access to financial services to grow and become sustainable. Photo: Thatcher Cook for Mercy Corps.
XacBank and Khan Bank, two of Mongolia's largest commercial banks, are currently expanding their mobile banking services into rural areas. XacBank's AMAR (which means "easy" in Mongolian) service is already catching on among rural populations, with account-to-account transfers and mobile payments for merchants and consumers emerging as the most popular services. XacBank management estimate that it could reach more than half of the population by the end of 2012 by partnering with mobile network providers such as MobiCom, which already serves 53 percent of the mobile phone market, and reaches 60,000 customers across the country through its own mobile money service called MobiXpress.

There certainly is market potential. As of this year, mobile phone penetration in the country has reached an astonishing 90 percent of the population. Remarks Butz:

It's not uncommon to see a herdsman, hundreds of kilometers from the capital, texting on horseback.

According to Butz, the future of economic development in Mongolia lies in information communications technology (ICT). All 329 county seats are now connected to the Internet through a fiber optic cable, and with mobile phone use on the rise, technology is reducing transaction costs and creating new opportunities for rural businesses.

ICT will also be important for Mercy Corps as the organization looks to expand its programming. From using SMS technology to disseminate market information to developing webinars and e-learning systems for rural entrepreneurs, technology is changing the way Mercy Corps approaches rural development. For example, the organization plans to use technology to increase its outreach and eliminate costly rural offices in a country where poor infrastructure and low population density make it difficult to maintain a rural presence.

Despite the promising legislative developments, government remains focused on funding urban development, leaving rural communities to suffer from a lack of investment. Mercy Corps is quick to note that there is still work to be done. "Mercy Corps' attention to the rural areas has always been a counterbalance to growth centered around the capital, Ulaanbaatar, and has helped to support inclusive growth," says Butz. "We're more relevant now than ever."

May 16th

Innovation challenge! Sierra Leone women compete for business funding

Women in Sierra Leone are gaining business acumen and entrepreneurial skills. Photo: UNIFEM.
Women in Sierra Leone are gaining business acumen and entrepreneurial skills. Photo: UNIFEM.

In Sierra Leone, an NGO sponsors a business plan contest that strives to change the gender makeup of the country’s entrepreneurs.

The African Foundation for Development in Sierra Leone (AFFORD-SL) creates jobs for underrepresented individuals and offers coaching and mentoring services. Despite Parliament's current review of a 30 percent quota for women to assume positions in government and leadership roles, women are largely marginalized in society. Most rural women don’t work outside the home unless it’s in agriculture, and those that do are subject to the largesse of their husbands and other males.

But AFFORD-SL, along with the Sierra Leone Ministry of Trade and Industry and the Department for International Development, seeks to improve their status through a competition called Business Bomba.

Entrants from four regions in Sierra Leone—Freetown, Makeni, Bo and Kanema—pitch business plans to NGO representatives and independent business advisors. The rigorous four-phase competition includes workshops, training and mentoring. Twenty-two finalists are selected with 12 winners representing five categories, one of which is open only to women. Each finalist must pitch a business plan to the panel of judges—a daunting task to many, as a large percentage of the population isn’t college-educated. The top winners in each category receive $23,000 to help jumpstart his or her business. Former winner Eva Roberts developed Morvigor Tea, a homegrown variety that is now available throughout the capital, Freetown.

AFFORD's contests are a low-cost way to shine light on those innovative, effective small business ideas, one Eva Roberts at a time.

May 15th

Reform in Myanmar brings growth but needs caution

Social services provided by aid agencies at refugee camps just outside the Myanmar border should not be ended too swiftly, or returning populations won't be ready to access new opportunities that may await them. Photo: Jacqueline M. Koch for Mercy Corps
Social services provided by aid agencies at refugee camps just outside the Myanmar border should not be ended too swiftly, or returning populations won't be ready to access new opportunities that may await them. Photo: Jacqueline M. Koch for Mercy Corps

Reforms and investment are opening new doors and promising growth for Myanmar. But what’s exciting for some Burmese and the West brings a downside for many refugees.

The country, also known as Burma, has made headlines recently for its rapid political reforms and promotion of economic opportunity. These days in Yangon, “foreign businessmen in well-tailored suits are driven down potholed streets and past crumbling colonial buildings to meet potential partners...[and] hotel owners, whose businesses suffered during [recent] years are raising prices for what few rooms they have available,” reported the New York Times last month. But as the West eases longtime sanctions against Myanmar and begins to invest, the changes could further shut out an already suffering group: refugees from the country’s six decades of internal strife.

Large numbers of Burmese continue to live outside their country in refugee camps. Most hope to return and find work in their homeland someday. But if they lose access to education and other social services now, they also lose the chance to gain from market access down the road.

Last month, the U.S. Treasury Department announced it was easing restrictions on financial transactions of private groups involved with development and humanitarian assistance work in what has become Southeast Asia’s poorest country, according to the Huffington Post. The relaxed restrictions come as a response to civilian elections in the military-dominated country, which brought parliamentary seats to the opposition party of long-time human rights activist Aung San Suu Kyi. Other western countries quickly followed suit, as the European Union and Japan also loosened sanctions, according to The Development Newswire.

But amid growing foreign investment and glimpses of promising market-based growth, rapid internal changes also bring challenges for the refugee population.

Close to 150,000 refugees who fled conflict currently live in tent camps on the Thai side of the Thai-Myanmar border. Most are from the Karen state, a region ensnared in turmoil for decades. Unable or afraid to return home, and not permitted to work in Thailand, they depend on international aid for survival and livelihood. But between global economic pressures on aid groups and the exploding need for aid within Myanmar, outside support to border camps is drying up fast.

“Before, we were in a very difficult position, but at least we had the food that we needed," Saw Eh So, a refugee living on the border, told The Christian Science Monitor. "Now we have to find ways to find the food ourselves."

Social service money is running low, too. The Karen Refugee Committee - Education Entity, which oversees education in the camps, reports that it has lost much of its funding. While cuts in aid began before the easing of sanctions and are heavily influenced by global economic and political pressures, rapid changes in Myanmar’s relations with the West are expediting the process.

Many NGO workers on the border are “concerned that the funding is being withdrawn too quickly, without proper withdrawal plans, and before the refugees are ready to go back,” according to the Christian Science Monitor. But some see exciting new opportunities within Myanmar and believe that refugees will quickly seek to return home as reforms continue.

The return of Burmese refugees to their homeland is clearly desirable. But it won’t happen overnight, and refugees need to return to a safe and stable home with promise of economic opportunity. Market growth is slower than one election, and the home region of most refugees is still far from being a peaceful land of economic promise.

Saw La Plan, a Karen leader in Umpiem refugee camp, says he's not going back yet, because his home state has a long way to go despite broader reforms in the country. “There is still fighting, no development, and landmines everywhere," he told the Christian Science Monitor. "We have to stay here.”

But when refugees do eventually return, they’ll need education and skills to compete in the growing market-based economy that has the West so excited about Myanmar.

European Union officials respond to the easing of sanctions against Myanmar in this video from Agence France Presse.

May 11th

Honduras: Up for sale

Can a city start over from scratch? NYU economist Paul Romer's original TEDtalk got people wondering, and Honduras bit.

In this week's New York Times Magazine, Adam Davidson, co-founder of NPR's “Planet Money,” describes what Romer's Honduran utopia might be like, and what's needed to make it work.

Wealthy countries spend billions per year on projects designed to reform governments, build modern utilities or teach their workers new agricultural techniques. For all the cash, there has been very little success. Sponsoring a charter city, Romer said, may be a better (and cheaper) way to help.

RELATED: Honduras envisions a Caribbean Hong Kong, but 'charter city' meets criticism

May 10th

Transforming poo into a valuable resource

Inspection of SOIL's new toilet system.
Inspection of SOIL's new toilet system.

In Haiti, one nonprofit may have figured out how to make a pot o' gold out of a port-o-pot.

Sustainable Organic Integrated Livelihoods, or SOIL is dedicated to protecting soil resources, empowering communities, and transforming human waste into a valuable resource in Haiti. Leah Nevada Page, SOIL's development director, has the scoop on poop.

What's the importance of ecological sanitation and how is it perceived in Haiti?

When SOIL first started in Haiti, we provided seminars and trainings on a range of different environmental designs (water treatment, solar energy, etc.) but improved sanitation quickly emerged as the most hotly requested intervention. Our "ecological sanitation"-generated compost has also been well received—our first compost buyers were local community organizations based in the areas using SOIL toilets. People knew they were producing a good thing!

Given the Ecosan training seminars' popularity, are there plans to grow?

Due to high demand, SOIL offers monthly seminars on EcoSan in Port-au-Prince, alternating every month between English and Creole. SOIL is currently working with the Haitian government department of water and sanitation (DINEPA) to organize and host the first ever national EcoSan conference this summer.

From the toilet, to the collector, to the aeration pit, to the farmer, to the crop. How many people does SOIL's ecological sanitation team directly/indirectly impact?

Toilet wastes are picked up regularly by the SOIL Poopmobile and driven to a decentralized SOIL waste treatment site where they are composted for a minimum of six months in a process that adheres to the highest public health safety standards. The resulting compost is then used in SOIL's own demonstration farms or sold to organizations working on agricultural and reforestation programs. SOIL is currently providing sanitation to an estimated 20,000 people and is generating compost at a rate of 5,000 gallons per week.

Have you seen this model elsewhere?

Ecological sanitation is actually surprisingly prevalent in large urban centers in the U.S. Los Angeles and New York, among many others, actually treat some or all of their waste using these techniques and sell the resulting compost to landscaping supply companies. In Los Angeles they've found that this significantly reduces the city's sanitation costs as they don't have to pay to dispose of the waste (instead they are paid for their "wastes"). SOIL's model for Port-au-Prince is not that different from what is already working in large urban centers across the developed world—we just cut out the need for water and large sewer infrastructure, thereby making it affordable, replicable and sustainable.

Check out SOIL's video.

RELATED: Expensive poo: The World Bank tells us how much poor sanitation costs

May 9th

Why agricultural research should not end with the harvest

One-third of all food produced for human consumption never makes it to the table. Photo:  <a href=”http://www.flickr.com/photos/sunnyshine80/5042513304/sizes/m/in/photostream/">SSTUDIO Samuel Bietenholz (Flickr)</a>.
One-third of all food produced for human consumption never makes it to the table. Photo: SSTUDIO Samuel Bietenholz (Flickr).

The next great agricultural innovation might come from years of scientific research in agricultural yields, or it could be something as simple as a $2 bag to protect cowpeas from weevils.

Worldwide, 1.3 billion tons, or one-third of all food produced for human consumption is lost or wasted post-harvest every year. But researchers spend almost nothing on solving this. A 2009 study by the University of California-Davis found that 95 percent of all agricultural research dollars are spent on production, leaving only five percent for the post-production phase.

Fortunately, some solutions to curb post-harvest losses are surprisingly simple. A bag designed by Purdue University to seal off cowpeas from the weevil parasite sell for $2 and are expected to reach sales of over 1.7 million across Western Africa this year. Before the bags, cowpea farmers lost up to 50 percent of their annual harvest to the infestations. Now, uninfested cowpeas are selling for 20 percent more and increasing annual incomes by $150.

The Purdue cowpea bag is a great innovation for a specific problem. But pests such as weevils are not the only problem. Some farmers prematurely harvest their crops due to an immediate need for food or cash.

A lack of infrastructure hurts developing areas, too. Without refrigeration (both in storage and in transport) or other preservation techniques, many farmers sell the majority of their crops immediately after harvest. For farmers, this means unstable income; for food buyers, it means price hikes of 20 to 30 percent in non-harvest months.

Investment in technology that reduces post-harvest losses might be cheaper and better for the planet than more production research. The World Bank claims "it is likely that promoting food security through post-harvest losses reduction can be more cost effective and environmentally sustainable than a corresponding increase in production, especially in the current era of high food prices. Assuming only a 1 percent reduction in post-harvest losses, annual gains of $40 million are possible, with producers as the key beneficiary."

These problems are not exclusive to the developing world. When one-third of the food is produced and not eaten, one-third of the the water, carbon emissions, fertilizer, labor, production and transportation costs are all used in vain. Decreasing post-harvest losses will vastly increase the effectiveness and sustainability of global agriculture.

RELATED: A simple solution makes a big impact for Ethiopia's farming families

May 8th

Tinker, tailor, programmer: Entrepreneurship is subverting gender in Afghanistan

In southern Afghanistan, the promise of a well-paid urban career is luring women to keyboards and men to needlework.

INVEST, a vocational training program by Mercy Corps in Helmand Province, teaches men and women trades that can lead them out of poverty. Only 28 percent of the adult Afghan population is literate, and most children can’t attend school due to either the rigidly conservative society or safety concerns. INVEST trains locals in various trades, from construction to calligraphy to mobile phone repair to sewing. So far, INVEST has enrolled nearly 9,000 students, 900 of them women.

Program organizers assumed male students in Lashkar Gah, a city of more than 200,000, would vie for construction jobs such as masonry and metal work. But some, such as former farmer Agha Wali, have chosen less stereotypically male occupations such as tailoring because it offers a chance to own their own business. Many women, on the flip side, have bypassed home-based occupations such as embroidery and embraced the tech sector.

While older students are learning skills to work from home and don’t expect office jobs due to societal constraints, the younger generation aims to forge a career path, even the women. Some liberal-minded parents are happily sending their daughters to the school. Twenty-year-old Shamsiya’s parents have encouraged her passion for learning. She hopes to one day become a computer teacher.

I want to serve my country so that our country has a good future as its future depends on us youngsters,” she told Mercy Corps. “When I go home, my parents encourage me to study and attend my lectures...every member of the society should have knowledge as through knowledge, we can solve all our problems.

Food quality is more important than quantity, UN says

Topics: Agriculture, Food
We've got plenty of wheat. A new UN report says agricultural investments shouldn't prioritize yield over quality. <a href="http://www.flickr.com/photos/martinlabar/152693541/sizes/z/in/photostream/">Photo: Martin LaBar (Flickr)</a>
We've got plenty of wheat. A new UN report says agricultural investments shouldn't prioritize yield over quality. Photo: Martin LaBar (Flickr)

When it comes to global food security, more doesn't always mean better.

As the international community prepares for the UN's Rio +20 Conference on Sustainable Development in June, the UN Department of Economic and Social Affairs (UNDESA) has released a report that criticizes what it sees as a singular focus on increasing farm yields. According to the report's contributors, the "more production" approach is straining the environment and natural resources, while contributing to a growing nutritional imbalance in which one billion of the world's people are overweight or obese and another one billion are undernourished.

Instead of pursuing policies that emphasize increased farm productivity at any cost, the report argues for more sustainable approaches to agricultural development that mitigate the effects of climate change and promote equal access to nutritious foods.

The report also warns of a possible conflict between public and private interests as large corporations play an increasingly dominant role in the global food system. It urges policymakers to focus on investments in small and medium farmers, which are seen as a more sustainable approach to strengthening food security.

Read the full report here.

May 7th

Challenges to lighting a pathway for solar in Uganda

Bad roads and infrequent bus service is just one bump in the road to bringing solar to rural Uganda. Photo: Thatcher Cook for Mercy Corps.
Bad roads and infrequent bus service is just one bump in the road to bringing solar to rural Uganda. Photo: Thatcher Cook for Mercy Corps.

This article is the third in a three-part series exploring the role Mercy Corps played in bringing solar power to rural Uganda.

In our first article, we explored how Mercy Corps conducted a comprehensive market analysis, which painted a picture of strong potential demand for solar lanterns from rural farming families. In the second, we discovered how Mercy Corps connected suppliers to shops and shops to customers by building buzz about solar.

Bringing any new product to market is bound to hit some bumps in the road. While smoothing those bumps to get solar products to rural families in Uganda, Mercy Corps discovered that they had cleared a path for more life-improving products, too.

Let’s talk about the bumps in the road first:

Bump #1: Not all suppliers are created equal
In choosing supply partners, Mercy Corps looked for solar companies that not only offered highly rated products but companies that were also interested in entering the northern Ugandan market and who had the bandwidth and appetite for the risk required to meet the needs of rural customers. A few partners jumped on board. But, even after careful vetting, one company and its products failed to meet quality expectations of early businesses and customers. This company was dropped from participation in Mercy Corps’ project due to its poor performance. “Market spoilage” is a serious risk for new technology and one Mercy Corps worked hard to both overcome and mitigate.

Crowding-in a new and unfamiliar product that doesn’t work as well as advertised, breaks too easily and for which there are no trained technicians, is a fast way to lose most potential customers in a market,” said Kim Beevers, Mercy Corps’ then project manager. “Quality control is an important role for a nonprofit to play in a market facilitation project that necessitates building relationships between suppliers, resellers and buyers.

Another way to dampen seller confidence and to lose customers is to market a great product with an inconsistent and unreliable supply. One of the selected solar company participants offered a higher-quality, multifunctional and lower-cost product that shopkeepers promoted and customers demanded. But, shortly after the project got off the ground, the company mismanaged its inventory, causing a large -- but thankfully temporary -- gap in supply. In the interim, local business partners were forced to turn away customers.

Bump #2: Getting there is half the battle
To boost the supply side of the chain, Mercy Corps hosted a ‘meet and greet’ for rural shop owners to develop personal connections with the urban solar companies and local financial institution branches to find out more about the products and what financing might be available to begin or to grow their businesses to sell solar. Though many shopkeepers expressed interest in selling solar through prior information sharing events, fewer than expected attended the event.

Mercy Corps discovered that the main culprit here was transportation – travel is expensive and takes significantly longer in places where the roads are bad and buses are infrequent. Often, there is no mode of transport at all. Simple solution? To keep these shop owners involved, Mercy Corps took to the phones and even met them in their shops in-person to reiterate the information shared at the networking event and to deliver contact information for solar companies. Then, the Mercy Corps team shared shop owner contact information with each solar company. In their expansion plan, the team will be hosting more meet and greets in more locations closer to shopkeepers in hopes that transport will not be as big of an impediment to connecting interested parties.

Bump #3: Perceptions vs. Reality + Money

A shopkeeper stocks solar products for sale. Photo: Kim Beevers/Mercy Corps.
A shopkeeper stocks solar products for sale. Photo: Kim Beevers/Mercy Corps.
Facilitating markets is not necessarily expensive but it is certainly time-consuming and labor-intensive. Building relationships with a foundation of trust and building confidence in a totally new product takes a lot of time and effort. For the Uganda team, one hurdle was overcoming the popular misperception that northern Uganda still requires humanitarian responses to its needs and isn’t ready for market-driven, long-term economic development approaches. They proved this wrong; had Mercy Corps given away solar lanterns rather than facilitated sustained, market-driven access to solar lanterns, the number of products and the duration of availability would have been cut short. Understanding the gap between perception and reality, beginning with a thorough market assessment, is the first step to bridging it.

Introducing solar products to rural, northern Uganda took one person—with support from colleagues—nine months and $19,000, that included conducting the energy poverty survey research, managing the market analysis, identifying and matching up solar companies and local shopkeepers, managing a range of partners, hosting product demos for consumers and handling marketing and communications.

Because much of this upfront work can inform the project’s expansion, piloting solar in new regions will be even more efficient. Mercy Corps Uganda plans to scale their solar project across four districts in the coming months and another three next year. They are looking for new, improved and varied products and services for which this market facilitation model could also be applied.

Solar is just the beginning
Perhaps most significantly, the channels built to get solar products to rural families have paved the way for other important—sometimes life-saving—products.

We asked ourselves, how can we leverage the channels we’ve created to get more supplies to farmers, more useful products to families?” said Beevers. “How can we drop a Wal-Mart into rural, northern Uganda?

Mercy Corps is working to develop a mobile-based catalogue of items that shopkeepers or households can purchase via phone, have shipped to their shops to stock for local consumers to buy or directly to their homes. The team is focusing on pro-poor products that have been proven to make a strong impact in the lives of low-income families. Poor distribution models and mechanisms prevent the market penetration that these kinds of products could--and should-- have. Products include, oral rehydration salts, hand pumps, water filters, adjustable eye glasses, brick presses, fuel efficient stoves, micro-irrigation systems, mechanized tillage and borehole spare parts.

Our model will use innovations in mobile technology to provide a marketing, payment and information management backbone,” said Tim Sparkman, Mercy Corps Uganda Deputy Country Director and Director of Programs. “We want to leverage economies of scale for both companies and consumers.

If solar smoothed the bumps along the road to northern Uganda, the team’s next plan will turn that road into a super-highway of critically needed goods that improve lives.

May 6th

Humanity’s impact in time lapse: Watch how we’ve changed the Earth

There’s no question that human activity has had a profound effect on our planet. But this time-lapse video from Fast Company shows just how rapid and dramatic those changes have been.

Some scientists say our impact as a species on the Earth has ushered in a new geologic era known as the Anthropocene. Meaning ‘age of man,’ it is “defined by our own massive impact on the planet” that will have permanent effects, according to National Geographic.

In the course of one lifetime, we’ve created a complex nerve system connecting global civilization. People, energy, information and money flow around the world more easily than ever. For much of the population, these nerves bring economic opportunity, and quality of life has dramatically improved.

But a look at “A Cartography of the Anthropocene,” a series of maps produced by Globaia, shows that the benefits are not equally dispersed. Opportunity and growth reach some people and places more easily than others.

Fast Company’s video, compiled from Globaia’s maps, shows the “rapid rise of our influence on the planet since 1950.” Watch, and as the globe turns, see what the Anthropocene looks like.

May 3rd

Sometimes, nonprofit status is a burden, not a halo (VIDEO)

Topics: Corporations, Livelihoods, Women, Youth
Countries: Pakistan

When social entrepreneurs feel pressure to run inefficient businesses just so they can label themselves "nonprofit," the system is broken.

That's the dilemma faced by Saba Gul. Her startup Bliss gives Pakistani girls a monetary incentive to attend school, training them in handbag stitching and marketing their products.

In the video above and coverage by Co.Exist, Gul explains her indecision over what sort of company to incorporate:

My biggest reason for wanting to be a nonprofit was people's perception of the organization. … At the end of the day, my goal is to create impact. And I can't create impact if we don't have revenue. And I don't think there's a better way to sell your products than to build a really efficient business, which is really hard as a nonprofit.

To operate efficiently, Gul says, Bliss must get big—"scale to a million people," she says. And unless she can sell equity in her organization to investors, that'll be very hard.

Over the last few decades, the nonprofit industry and its fans persuaded much of the public that nonprofit status is proof of good intentions—and, even worse, that for-profit status is proof of bad intentions.

For nonprofits, this has turned out to be a very successful marketing campaign. But Gul's story shows how badly the world needs to smash it.

Related content: Flexible-purpose corporations stretch the meaning of charity

Yale economist to world: Don't panic. Embrace uncertainty and innovation.

Jeffrey Garten explored the massive shifts taking place in the global economy with an audience at<a href="http://www.mercycorps.org/portland"> Mercy Corps' Action Center</a>. Photo: Kyla Springer/Mercy Corps.
Jeffrey Garten explored the massive shifts taking place in the global economy with an audience at Mercy Corps' Action Center. Photo: Kyla Springer/Mercy Corps.

Presented by Jeffrey Garten at Mercy Corps

The world is not ending, and the sky is not falling. But the rise of the global South and East promises to reward the world's most innovative risk-takers.

Despite virtually all the underpinnings of the global economy shifting, we have reason to be “extremely optimistic.” To an audience at Mercy Corps, international economist and Yale School of Management professor Jeffrey Garten shared a critical appraisal of the shifting world economy, noting that only two such “super-cycles” have occurred in the last 500 years: the industrial revolution and post-World War II recovery. Garten observed that today's historic transformation is shifting the engine of demand--once emanating from the U.S. and Europe, it will now be driven most strongly by emerging markets.

Ten years ago, Garten estimated, emerging markets accounted for perhaps 28 percent of the global economy. Today, it’s over 50 percent.

“This is a massive shift in the gravity of the world economy from the West to the East and the South,” said Garten. “Emerging markets, whether it’s China, India, Brazil, Turkey, South Africa, or Nigeria, are where all the locusts of demand and investment will be.”

“In the last 30 years, the middle class outside the U.S. grew from about 700 million to 1.8 billion people,” he said. In the next 30 years, the World Bank predicts it will grow to five billion.

This massive increase in the number of consumers who want the luxuries of “the West” has incredible implications for health, food, water, infrastructure and communications. Though we can’t predict the full repercussions, we know it will mean hyper-urbanization.

Every day, 180,000 people move from the country to the city in emerging markets. That means six New York cities arise every year in emerging markets.

Though hyper-urbanization may not seem like a positive change right now, he admitted, urban centers have always been the motors of global advancement and innovation. Garten’s optimism arises from his expectation that this urban growth will be the birthplace of the next great advancement for humanity, if we can harness it.

In super-cycles, explained Garten, geopolitics change drastically. After the Industrial Revolution, Europe and the U.S. changed from agrarian to manufacturing societies, with the U.S. and England running the show. After World War II, much of the industrialized world was leveled, but recovery took on a speed unseen before, and Germany and Japan joined the U.S. in running the show. In Garten's analysis, today we have an "extreme multilateral" situation where no one is running the show, and serious disagreements about the rules of the game.

“We may never again see global trade negotiations like the kind we knew. There are just too many differing views about how they should be conducted.”

“When I put all these elements together I see a world of very rapid change, very disorienting change. It’s breaking down of all the models that we used to know, with big changes...especially in the way companies are going to behave.”

In this setting of extreme volatility, Garten described the characteristics global organizations need to be competitive: a very clear purpose, set of principles and strategic vision that provide guidance through all the gray areas. Plans should be challenged every six months and constantly reevaluated.

“You have to ask yourself: Does this strategy help us be resilient and adaptable? Because like soldiers entering a war, the minute the first bullet is fired, all the plans fall by the wayside,” said Garten. At the peak of a super-cycle, "the organizational winners will be those that are...constantly envisioning new scenarios, and asking 'what if.'"

An organization must be obsessed with innovation at every level, from the janitor to the boardroom. “If I wanted to find out whether an organization is innovative, I’d probably sit down with the CEO and ask:

Tell me three things you’ve been working on, two of which are likely to fail.' If you aren’t working on anything that’s likely to fail, you’re not far enough out on that edge.

Jeffrey Garten's lecture was sponsored by Global Envision and hosted at Mercy Corps' Action Center in Portland, Oregon.


Stories We're Watching

Biofuels goals 'may lead to food shortages'

Science and Development Network - Mon, 05/21/2012 - 02:00
A global study finds that some developing countries may face significant economic and food security impacts by 2020 if their ambitious biofuels targets are met.

Land grabbers: Africa's hidden revolution

The Guardian's Poverty Matters - Sat, 05/19/2012 - 16:05
Vast swaths of Africa are being bought up by oligarchs, sheikhs and agribusiness corporations. But, as this extract from The Land Grabbers explains, centuries of history are being destroyed.

Sustainable development is the only way forward

The Guardian's Poverty Matters - Sun, 05/20/2012 - 23:00
Development co-operation needs to shift focus from poverty eradication to a broader, more inclusive framework.

The Real Story on Charcoal for African Cookstoves

Triple Pundit - Sun, 05/20/2012 - 13:11
You may have seen pictures of women in Africa cooking their daily meals on a small cookstove. These cooking implements look remarkably similar to the portable charcoal grills an American family might bring to the beach for an afternoon of grilling hot dogs and hamburgers.

Could Glass-Steagall Have Stopped JPMorgan Loss?

NPR - Sat, 05/19/2012 - 15:13
The banking giant's $2 billion loss has many lawmakers and economists wondering what happened to the 2010 financial overhaul, which was supposed to prevent risky hedging. Many are also looking back further — to a Depression-era law, repealed in 1999, that separated commercial and investment bank activities.

Recent comments

Countries

An initiative of Mercy Corps
“You must be the change
you wish to see in the world”
Mahatma Gandhi
Learn more about Mercy Corps >

Efficiency

Over the last five years, more than 89% of Mercy Corps' resources have been allocated directly to programs

Excellence

America's premier charity evaluator gives Mercy Corps four stars in organizational efficiency. Click here to learn more.

High Value

Every dollar you donate to Mercy Corps helps us secure $11.16 in donated food and other critical supplies.

Mercy Corps — Dept. W — 45 SW Ankeny — Portland, OR 97204
All original content Copyright © 2009 Mercy Corps. Quoted and linked content is property of the creator(s). Mercy Corps will not sell, rent or trade your personal information.