The supply chain of microfinance. Photos by Miguel Samper for Mercy Corps.

Even as problems with microfinance continue to spread, cross—border microfinance is firing up.

Cross—border finance refers to any financing arrangement that crosses national borders. Consequently, the movement of money is subject to substantial taxes, even when loans or credit are extended by a third party, such as a bank. Simplifying this process is CGAP, the Consultative Group to Assist the Poor, an independent policy and research center.

The latest publication by CGAP, Trends in Cross Border Funding, shows that many cross—border funders, such as Deutsche Bank and VisionFund, the microfinance arm of the nonprofit World Vision, are committed to pulling people out of poverty through financial empowerment. Click here to view a comprehensive list of microfinance investors.

However, doubts linger over the effectiveness of microfinance. David Roodman, a senior fellow at the Center for Global Development, compiled the most complete investigation into the sources and consequences of microfinance. His report, Due Diligence, found no evidence that small loans lift people en masse out of poverty.

Despite critics such as Roodman, opaque business practices, and a lack of acceptable global guidelines and standards, cross—border funding for microfinance increased to $24 billion in commitments through December 2010, CGAP’s research shows, with steady increases in 2011.

However, challenges remain. According to the International Association of Microfinance Investors (IAMFI), some microfinance investors (MFIs) and social investors claim that commercial funding may cause “mission drift”, leading MFIs to lose sight of their core goal of serving the poor. For example, their average loan size may grow, or they may loan to fewer women and to more urban clients. That's contrary to MFI shareholders' and lenders' expectations.

Despite these concerns, the IAMFI has sought greater diversity in how they support microfinance initiatives. Investors and microfinance institutions now act through intermediaries, such as private investment entities or vehicles, removing burdensome banking fees and political roadblocks to reach those in need faster.

Cross—border financing can be complex. However, as the sector develops, IAMFI argues that several improvements should be actively pursued. Full transparency of cross—border funding information, standardized and consistent definitions and metrics, complete and timely reporting and disclosure, and standardized classification systems will allow microfinance investors and other intermediaries an effective means to communicate, collaborate and deliver.

The lingering question is whether this industry can overcome underlying doubts about its effectiveness. Cross—border microfinance isn’t on fire yet, but is slowly heating up.

On Monday, the world welcomed its 7 billionth person. The implications of population growth are similarly staggering in number, but here are five of the more important things to know about the growing world community.

There might not be 7 billion of us. Yet.

The October 31st date was chosen by the United Nations Population Fund, and it’s somewhat symbolic. "There is a window of uncertainty of at least six months before and six months after the 31 October date for the world population to reach seven billion," UN population estimates chief Gerhard Heilig told the BBC. However, the crux of the matter—the ever-increasing world population and the problems that come with it—stands.

Human being No. 7,000,000,000 is probably poor—and it's likely the parents didn't plan the pregnancy.

The developing world acted as the engine for most of the last decade's population growth. It’s home to the world’s seven fastest-growing cities, according to Foreign Policy. As such, it’s attracting the attention of policymakers and crystal-ball-gazers alike. Many, like the Worldwatch Institute’s Robert Engelman, propose extending access to contraceptives and encouraging smaller family size to curb population-related problems, though a recent Economist article says that this would only have a modest effect in the face of scarce world resources.

Sure, resource scarcity is a problem, but maybe it doesn’t have to be.

Not all commentators are equally pessimistic about continuing population growth. Some of the most basic problems, like access to food and water, might really be problems of efficiency rather than scarcity. Global Envision contributor Ben Osborn recently wrote about a study by the Consultative Group on International Agricultural Research that showed that given proper integration and storage of water resources, no one would have to go thirsty. On the food front, a scientific study published in Nature showed that proper agricultural reforms “could increase global food availability by 100–180%,” more than enough to meet the needs of our growing population.

The antidote to population could be migration.

Ensuring good quality of life for the earth’s inhabitants goes beyond just food and water. The UN’s State of the World Population 2011 report identifies migration as a trend that can be used to help aid in economic development. Wealthy countries with declining fertility rates could provide job opportunities for workers disenfranchised in their overpopulated home countries. At the same time, migration is a hot-button issue for developed nations that may not be so keen to open their borders. The report also cites increased access to education as a key factor in reducing population growth and providing better opportunities for youth in developing nations.

Maybe we should all just learn to stop worrying and love the population bomb.

Many fear rapid population growth in a world with limited resources, but given the proper policies it might not have to be so scary. Since there’s no “undo” button for world population, perhaps the best question to ask in light of the 7 billion marker is “How can we make the best of it?”

Want to know where you fit into the 7 billion? Check out The BBC’s “What’s Your Number” tool.

Margo Conner is a senior at Lewis & Clark College in Portland, Oregon, majoring in international affairs. Read her other contributions to Global Envision.

Gap opens in Shanghai. Photo by kreep (flickr)

What would happen if you took off every article of clothing not made in America? asks ABC at New York’s Grand Central Station (video).
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Gap is betting big on China, announcing plans to triple its retail stores there by the end of 2012, reports the Associated Press. But in doing so, the chain will directly compete with its own Chinese suppliers, which for years have been sharpening their teeth making cheap knockoffs of the popular clothing.

Gap is not the only global brand to jump on what they hope will emerge as the next massive consumer class. Apple, Nike, Gucci, Louis Vuitton and Walmart have all positioned themselves to profit from China's nouveau riche. Despite these expectations, the New York Times reports that China’s consumer spending has actually plummeted in the last decade as a portion of the overall economy, to about 35 percent of gross domestic product, from about 45 percent - the lowest percentage for any big economy anywhere in the world.

The remarkable growth the nation has seen has not translated into fruits for middle class families, but rather state-run banks, government-backed corporations and the affluent few with connections, says Carl E. Walter, a former JP Morgan executive who is co-author of “Red Capitalism: The Fragile Financial Foundation of China’s Extraordinary Rise.” Worse yet, low-wage workers who make the clothing sold in stores like Gap simply can’t afford the finished goods. Marketplace’s Kai Ryssdal visited a new Gap store in Shanghai recently; the most striking thing he found about the store was how empty it was. Sales of global “brands” come mainly in the form of the counterfeits and knockoffs sold at busy outdoor markets.

The New York Times suggests the “state capitalism” that’s fueled much of China’s growth must be dismantled before ordinary Chinese citizens will start feeling flush enough to buy Gap’s ‘nostalgic’ 1969 jeans - even the made-for-China version. Chinese Premier Wen Jiabao asserts that the government is ready to make some of those changes. Until then, hedge your bets.

Men in traditional Maasai clothing using their mobile phones. Photo: Mark Kelley (Flickr)

Envy Jared Cohen. At 29, the man has advised two U.S. presidents, shaped relations between countries, and now leads his own think-tank at Google. But his take on technology suggests you could do this, too.

Cohen, at a recent Mercy Corps-sponsored talk in Portland, OR, wowed the audience with personal anecdotes about how technology is changing international affairs. Cohen has seen firsthand the effects of communications technology and understands the potential it holds for the world’s future.

Cohen, a security expert, spent much of his talk describing the effects of communications progress on modern states and their rule of law. He spoke of technological literacy in Iranian youth that was instrumental in coordinating the June, 2009 Green Revolution. He spoke of an unemployed Colombian activist who used social media to coordinate the anti-FARC demonstration, the largest protest against a terrorist group in history.

"The 21st century," Cohen said, "is a really terrible time to be a control freak." But that applies whether you're trying to control peaceful demonstrators in Cairo or violent drug cartels in Mexico. Government control is proving ever more elusive as groups find out just how empowering technology can be.

Jared Cohen.

He painted a picture of exponentially growing networks that are bringing people together from around the globe. This interconnectedness makes it difficult to control and contain groups that are finding ever more ways to use technology that is itself rapidly progressing. These groups tend to be made up of young people, as the empowering effect of these new forms of communication is most potent for those who understand how to use them.

Each of Cohen’s points seemed to return to a basic theme: technology is eroding the barriers to entry to all sorts of games, markets, and movements. And while technology is getting better, people, especially young people, are getting better at using it. Cohen argues that “those who don’t have information technology today will be the most active users tomorrow.” Ten years ago, 361 million people had access to the Internet. Today, that number has increased to 2.1 billion, with the fastest growth in Africa, the Middle East, and Latin America. “Pakistan, in the year 2000, had 300,000 mobile phones. By 2010, it had over 100 million. That's in a population of 165 million,” Cohen explained. Technological growth will have the biggest empowering effect on those who currently find themselves with the least power.

Cohen’s opinions on this topic have authority because of the life he's led and the movements he's witnessed. He’s travelled the world and met with leaders of insurgencies and counterinsurgencies, democracies and autocracies. His own story is a case in point that technology is empowering those who know how to use it.

Technology, according to Cohen, is driving the changing tide of the times and youth tend to have an inherent advantage in understanding and deftly using these innovations. Cohen rode the wave of technology into the most exclusive circles in Washington. And he says we should all be using technology to find our own wave to ride.

Ben Osborn is a 2011 graduate of Lewis & Clark College in Portland, Oregon. Read his other contributions to Global Envision.