Free Mosquito Nets: Help or Hindrance?

There has been much praise recently for the role of mosquito nets in reducing the spread of malaria, and decreasing infant mortality rates worldwide. As a result, poor countries in Africa, Asia and Latin America have been inundated with donor- funded mosquito net programs that provide free mosquito nets to local communities in an effort to decrease mortality rates among children. While it is clear that disease-carrying mosquitoes are a serious problem and that mosquito nets are an effective form of reducing incidences of malaria and other mosquito-borne diseases, I question the long term effectiveness of donor- funded mosquito net distribution programs to solve this crisis.

The reason for my lukewarm reception to donor- funded mosquito nets lies in recent studies that have shown that the proliferation of mosquito nets from foreign donors into local communities has run many local suppliers of mosquito nets out of business. Why? Because why pay for something that you can get for free? Even websites targeted at younger people such as Myspace, are touting the importance of mosquito nets and offering their followers a chance to purchase nets for $10 from factories in Pennsylvania. While this may seem like a helpful solution, the consequences are dire. Once viable rural businesses are going bankrupt, and entrepreneurs, whose small and micro mosquito net enterprises once provided a steady source of income, can no longer feed themselves and their families.

In her book Dead Aid, Dr. Dambisa Moyo provides an alternative. Rather than donor agencies acquiring mosquito nets abroad and then giving them away in the recipient country, she posits that a more functional and sustainable alternative would be for aid agencies to purchase nets from local suppliers and then distribute them to communities in need. Doing so would provide markets for suppliers and help stop the spread of malaria and other mosquito born diseases…a win- win for all.

While this is clearly a complex and multi-dimensional issue whose scope reaches beyond the bounds of this article, I raise it because this is yet another example of how charitable aid needs to be reexamined if it is to be effective. The provision of mosquito nets to the poor seems like a great idea. But upon closer examination, the distribution of mosquito nets by donor agencies is thwarting small business development in poor communities and running poor entrepreneurs out of business, exacerbating the very poverty that lends itself to the spread of malaria and other preventable diseases in the first place. It’s time to question every “solution” that arises to solve global issues, and take long term consequences, rather than short-term goodwill into account when shaping what we believe to be smart philanthropy.

(c) Alicia Kingue, 2009. All rights reserved

photo credit: Reuters

Redefining Charity

Nelson Mandela once said "overcoming poverty is not a task of charity, but an act of justice." I also think its time for us to redefine how we view charity.

I believe that the world has entered a stage in human development where enough profit has been generated to change the face of charity as we know it. The age of handouts and unbridled aid is over. Tomorrow’s charity will involve investing in the working poor for social, economic and environmental change, and through these endeavors, we can help build and support lives and communities filled with dignity, abundance and self-determination.

Saving our Sisters: NY Times presents "The Women's Crusade"

I read this article last week in the NY Times. It is one of the most well-written concrete, fully-formed examinations of the issues facing the world's women today- and i needed to pass it along. From the benefits of microfinance to support poverty alleviation and income generation for women, to the novel idea that providing sanitary napkins and school uniforms to girls will boost their school attendance rates, the ideas examined in this article are as much a call to action as they are an analysis of current realities. Please take a moment to read this, and if you can, get involved in finding a way to help heal and support our sisters across the globe.

Alicia

photo courtesy of Katy Grannan for The New York Times. "Saima Muhammad, shown with her daughter Javaria (seated), lives near Lahore, Pakistan. She was routinely beaten by her husband until she started a successful embroidery business." Copyright, NY Times 2009. All rights reserved.


The Women’s Crusade
By NICHOLAS D. KRISTOF and SHERYL WuDUNN

IN THE 19TH CENTURY, the paramount moral challenge was slavery. In the 20th century, it was totalitarianism. In this century, it is the brutality inflicted on so many women and girls around the globe: sex trafficking, acid attacks, bride burnings and mass rape.

Yet if the injustices that women in poor countries suffer are of paramount importance, in an economic and geopolitical sense the opportunity they represent is even greater. “Women hold up half the sky,” in the words of a Chinese saying, yet that’s mostly an aspiration: in a large slice of the world, girls are uneducated and women marginalized, and it’s not an accident that those same countries are disproportionately mired in poverty and riven by fundamentalism and chaos. There’s a growing recognition among everyone from the World Bank to the U.S. military’s Joint Chiefs of Staff to aid organizations like CARE that focusing on women and girls is the most effective way to fight global poverty and extremism. That’s why foreign aid is increasingly directed to women. The world is awakening to a powerful truth: Women and girls aren’t the problem; they’re the solution.

Read full article here: http://www.nytimes.com/2009/08/23/magazine/23Women-t.html

In Defense of Microfinance

As microfinance becomes more and more of a household name, criticism about its impact as a tool for poverty reduction has also increased. I recently read an article entitled "Microcredit, the Dream and the Reality" by David Mandelzys that outlined various critiques of the role of microfinance, and in today's blog entry I lay out my responses to some of his points and describe why microfinance is important for development and why it should be supported.

Argument #1:

Microfinance is a tool for capitalist exploitation that does not alleviate poverty, but in fact, preys on the poor.

First, let's be clear. Microfinance seeks to be but one intervention amongst many to promote poverty reduction and entrepreneurial activity within developing countries. Few people are saying that microfinance is the answer to all of the world's poverty problems. As someone that has studied and worked in microfinance around the world for several years, I can tell you, I'm certainly not saying that. Clearly microfinance is a capitalist tool for poverty reduction. And the last time I checked, we were living under a global capitalist system. Most of us anyway. Why wouldn’t we try to create solutions based on this reality?

Microfinance is based on the premise that access to credit, savings and other financial tools can help people that commercial or formal banks would not otherwise serve. Within informal economies, entrepreneurial activity dominates because of a lack of formalized labor structures, legal frameworks among other reasons. Within those economies, people shunned from the formal financial sector go to loan sharks and pay up to 400% interest. Is this a just alternative? If small business loans were not available by credible microfinance organizations, what financial solutions would one offer to those that can’t walk into a commercial bank because of the color of their skin, their illiteracy, their sex, or the fact that they don’t even own proper shoes to walk in with?

Argument #2:

Microfinance does little to empower women, and in fact has worked against women’s solidarity.

The empowerment of women through microfinance has been documented many times over since the inception of microfinance nearly 30 years ago. Within that time, there has been a plethora of studies that show a direct correlation between microcredit, business skills training for women and increases in income. In fact, technical assistance and skills training is a key component of many microfinance organizations and is the main ingredient in making it sustainable, particularly for women who are often times the main developmental agents in poorer countries. Furthermore, studies have shown that interventions of microfinance and the social programs they integrate, have lead to decreases in domestic violence, the prevalence of HIV/AIDS, and other valuable social contributions.

Argument #3:

Microfinance has moved away from its social value and is now purely a tool to maximize profit.

All things considered, supporting tools that provide loans to low income people is not an exploitative evil, particularly when combined with skills training that can continue to grow and that can’t ever be taken away from them. Do some microfinance organizations abuse interest rates? Yes. Are some microfinance organizations motivated primarily by maximizing returns to their shareholders? Yes. But at the end of the day, it’s a business. A business that provides social value, but a business nonetheless. In the west, we take for granted the ability to walk into a bank and get a loan to start our business—even if we aren’t particularly thrilled about the interest rates or the bureaucratic requirements. Why should the world’s poor be denied this access? One cannot let a few “bad” decisions made by some microfinance organizations taint an industry that seeks to help provide a better life for people, or at the very least, that provides equal access to financial services no willing and capable person should be denied based on where they happen to live.

Microfinance might fail occasionally and it’s certainly not perfect. We can either choose to continuously support the fight against poverty in the abstract, or we can build solutions for change and decide to look into the faces of real women and men that are living slightly more satisfying and dignified lives because of microfinance and support them. I have chosen to do the latter. I hope you’ll join me.

©Alicia Kingue 2009. All rights reserved.

African Leaders Request Obama’s “Partnership, Not Patronage”

African leaders issued a clear and bold statement to the Obama administration last week: Africa is to be treated as partners in solutions, not welfare recipients. The call came from four of Africa’s most distinguished leaders: President Kagame of Senegal, President Ellen Johnson Sirleaf of Liberia, President Seretse Khama Ian Khama of Botswana, and President Abdoulaye Wade of Senegal –all at the forefront of leading their countries towards equitable growth and political stability.

The article, which appeared in Forbes magazine on August 3rd, laid the framework for revisiting US-Africa trade and economic relations. It called for an increase in loan guarantees to American firms wishing to invest in Africa-- currently valued at $400 million compared to China’s $13 billion for Chinese investors. It called for a reevaluation of U.S. agricultural subsidies which distorts market forces by decreasing global commodity prices, the foundation of economic and trade development for most emerging markets. Lastly, it called for longer term solutions to PEPFAR, the U.S. government’s HIV/AIDS program in Africa, which currently funds emergency support relief but does little for more sustainable and enduring life-saving treatment support.

Now is the time to implement solutions to Africa’s economic challenges, and to do so on equal footing. The downturn of global market activity resulting from recessions in the U.S. and Europe has greatly diminished private capital inflows on the continent, as well as precipitated a sharp decline in Africa’s share of global exports. The gains made by many African countries in recent years through policy and regulatory improvements and infrastructure and alternative energy development are now in jeopardy, and the Obama administration has a unique opportunity to turn the rhetoric surrounding US-Africa relations into an action plan that will help dictate the course of Africa’ s development through the next decade. As Hillary Clinton descends on the continent this week, all eyes will be on the new administrations’ policies, and how it will partner with African leaders to support African solutions to Africa’s problems.

"Father of Microfinance", Muhammad Yunus Awarded Presidential Medal of Freedom

On July 30, 2009 the "father" of microfinance, Dr. Muhammad Yunus was one of 16 recipients awarded the Presidential Medal of Freedom. This is big news in the microfinance world and particularly exciting for the Grameen Bank-the Microfinance Institution founded by Yunus in 1976 to provide microloans to the poorest of the poor in Bangladesh.

In many ways we have Yunus to thank for bringing microfinance out of the academic, NGO and specialized social entrepreneurship sectors and into the mainstream, where microfinance and Yunus are now practically household names.

My hope is that along with this notoriety, comes a call to strength smaller microfinance organizations that do not receive critical donor dollars because of the disproportionate amount of these funds going to support a few large global MFIs. If we really want to see growth within the sector, bring these services to scale, and reach the millions of estimated individuals that could be served by microfinance, we must turn our gaze to smaller or “tier two” MFIs that have a lot of potential for impact within their communities but that receive scarce funding due to concentrated competition.

Bravo to you Yunus!!!

Stay tuned-Review of Dr. Dambisa Moyo's highly Controversial Book, "Dead Aid"

After hearing about a young, Harvard and Oxford educated Zambian woman economist, Dr. Dambisa Moyo, making waves in the world of African development finance, I became intrigued. She is enormously critical of aid to Africa and sees it as a hindrance towards sustainable development in the region. I share many of these perspectives and I'm curious about her thoughts on the subject. Stay tuned for a review.