Through the Global Citizen Program by Credit Suisse I’ve been exposed to some serious coaching and have received the opportunity to reflect on the power of questions.
First thing I realized: questions carry the risk of bringing me into trouble. “What’s your name, sir?”, “What is it you like doing in your spare time?”, “When will I receive the status update from your team?” Continue reading How to Ask (the right) Questions?→
There are apparently 56 countries and 4 territories around the world that are affected by landmines and explosive remnants of war that pose a structural barrier to development and economic growth. Civilians become casualties long after the conflict has ended. Clearing mined land is a dangerous and time consuming task. Continue reading Demining Rats from Tanzania – A Success Story→
Old people in rural Tanzania face a difficult life. While health and strength deteriorate they can not hope to be supported by one of their many children, who are either unwilling or unable to help or have been consumed by AIDS.
Gross Domestic Product has become the yardstick by which we measure a country’s success. But, says Michael Green, GDP isn’t the best way to measure a good society. The Social Progress Index determines what it means to be a good society according to three
dimensions: Basic Human Needs (food, water, shelter, safety); Foundations of Well-being (basic education, information, health and Continue reading Judging a Country by Happiness or Unhappiness?→
The Massachusetts Institute of Technology’s Abhijit Banerjee and Ruimin He have undertaken a rigorous study of the relatively few independent evaluations of aid program successes and failures. They suggest the following interventions are usually highly effective forms of aid in normal circumstances:
Subsidies given directly to families to be spent on children’s education and health
Education vouchers for school uniforms and textbooks
Teaching selected illiterate adults to read and write
Deworming drugs and vitamin/nutritional supplements
Vaccination and HIV/AIDS prevention programs
Indoor sprays against malaria, anti-mosquito bed netting
Clean water supplies
(source: Wikipedia and “Making Aid Work”, A. Banerjee and R. He, MIT 2003)
I’d be happy to discuss further successful projects in the comments.
Microfinance promises a lot to many people. It depends on which promise we’re looking at: fight poverty, generate profits, provide financial services to the poorest, empower women, support entrepreneurs and create jobs. Each has its own merits and each only provides a sliver of the “truth”.
Take “fight poverty”. Only 50% of the loans are productive to start with. The other half don’t generate revenues and are used to buy food, pay school fees or medical bills. Obviously a non-productive loan is not considered a success in the narrow sense. But looking at the broader picture it might make sense to provide financial means to smoothen the income of the poor. And from an entirely different angle it is somewhat surprising that the poor repay their debts more easily than they save money beforehand.
Then there is the question of whom you ask: practitioners tend to have a more positive view based on anecdotes while quantitative researchers have a hard time proving positive impact and usually have to slice and dice the data to find impact, e.g. among rural female users of productive loans.
The existence of strong competition, market entry of traditional banks, new technologies and favorable regulatory environment all point to a potential success story, where efficient companies produce profits and operate in a sustainable manner.
To summarize: Microfinance services are helping, just not in the way microfinance’s foundational belief system says it does. If few clients actually use microfinance services in the way the original designers of microfinance programs expected them to, that doesn’t mean it is a failure. Microfinance does address the problem of income unpredictability. A stable, reliable source of credit, combined with savings, allows clients to meet their spending needs even as income ebbs and flows.
I was wondering how the development industry wanted to make this world a better place in the year 2000. Here’s what the global community wanted to achieve between 2000 and 2015: Millennium Development Goals (MDG)
Eradicate extreme poverty and hunger
Achieve universal primary education
Promote gender equality and empower women
Reduce child mortality
Improve maternal health
Combat HIV/AIDS, malaria, and other diseases
Ensure environmental sustainability
Develop a global partnership for development
Do you want to know how well the world has done in 14 years? Here is the latest 2014 chart showing some very real progress. Compare it to 2005 (below) to see how the number of the red cells has gone down. 2014: 6 elements in the red; 2005: 34 red cells. That’s a whopping 75% improvement!
Currently the strategy for the future is being discussed. Find out more in the next post.