Venezuela is a region rich in oil and minerals, yet it suffers from poverty and political turmoil. Venezuelan president Nicolas Maduro is launching a new blockchain currency called Petro, an oil-backed cryptocurrency. The U.S. believes this to be an attempt to circumvent sanctions against the Venezuelan government and is cracking down on Venezuela’s oil-backed cryptocurrency.
Venezuela suffers from the “resource curse,” a phenomenon whereby its large reserves of oil negatively impact its economic growth and stability. Rather than a blessing, these energy reserves lead to fraud, corruption, wasteful spending, military adventurism and the authoritarianism of the Maduro regime. This curse exacerbates global poverty through the destabilization of the oil industry, dulling the effect of foreign assistance and creating a breeding ground for terrorism and instability.
Although the country has a vast supply of oil money, instead of going to Venezuela’s poor, the money ends up in the pockets of the rich. U.S. Senator Marco Rubio tweeted on February 9, 2018, regarding the Maduro regime, “Soldiers eat out of garbage cans & their families go hungry in #Venezuela while Maduro & friends live like kings & block humanitarian aid.”
Venezuelans are deprived of human rights guarantees and press freedoms, facing political persecution and public corruption by the Maduro regime. The U.S. regards the Maduro regime as a dictatorship, whose power has overridden the democratic will of Venezuelans. The nation’s population is greatly subjected to sex trafficking and forced labor, sexual exploitation and domestic servitude. People from other nations are trafficked for sex and labor in Venezuela. Cuba trafficks thousands of Cuban citizens and doctors into forced labor in Venezuelan social programs, in exchange for the provision of resources to the Cuban government.
The most recent U.S. sanctions were imposed in August 2017 against Venezuela’s dictatorship, blocking U.S. citizens from buying new debt, bonds, dividends or other distributions or profits from Venezuelan government-controlled entities and its state oil company, Petroleos de Venezuela (PDVSA). This followed December 2014 sanctions imposed by the U.S., aimed at preventing U.S. entry by persons involved in the erosion of human rights guarantees, political persecution and public corruption. These sanctions do not target the people or the economy of Venezuela; they are aimed at protecting the will of Venezuelans and preventing U.S. involvement with the corruption of the Maduro regime.
Maduro responded to these sanctions by implementing strategies to free the oil-centered economy from the U.S. dollar, despite its universality in global trade. In September 2017, Maduro ceased publishing Venezuelan crude oil market prices in U.S. dollars, instead publishing prices in Chinese yuan. His December 2017 announcement to implement the oil-backed cryptocurrency was in direct response to the August 2017 sanctions, stating that Petro could “help defeat the financial blockade.”
Cryptocurrency is decentralized, uncontrolled by banks or governments. It can benefit those living in politically unstable regions, because the government can neither control its value nor transfer it from state to state. In Venezuela’s case, the cryptocurrency will be backed by oil, an industry largely controlled by dictators. Because Petro is a cryptocurrency, it is difficult for the U.S. government to regulate, threatening the U.S. sanctions that prohibit investing in PDVSA.
Petro is one of many foreign exchange (FX) mechanisms introduced by Venezuela. Most of the FX failed to meet market demand for dollars, resulting in Venezuela’s robust black market. Although FX is prohibited on the black market, it is the driving force of hyperinflation. Continuously on the rise, one U.S. dollar is now equivalent to 9.9875 Venezuelan bolívar.
The U.S. addressed Venezuela’s oil-backed cryptocurrency in a letter by senators Marco Rubio and Bob Menendez to the U.S. Department of the Treasury, stating “we are concerned that a cryptocurrency could provide Maduro a mechanism by which to make payments to foreign lenders and bondholders in the United States, actions that would clearly thwart the intent of U.S.-imposed sanctions.”
In early February 2018, U.S. Secretary of State Rex Tillerson toured Latin America and the Caribbean. Afterward, Tillerson alluded to U.S. considerations of restricting oil sales from Venezuela due to its worsening political situation. Developments in trade sanctions are imminent as the U.S. cracks down on Venezuela’s oil-backed cryptocurrency.
In opposition to the Maduro regime, the Venezuelan Parliament stated that Petro’s creation only serves to “evade financial sanctions, [and is] openly violating the Constitution and legitimizing illicit transactions.”
As the U.S. cracks down on Venezuela’s oil-backed cryptocurrency, the government aims to combat the use of Petro to circumvent U.S. sanctions, prohibiting investors on U.S. soil from profiting or investing in the PDVSA, the driving source of Venezuela’s poverty and humanity crisis. These policies and sanctions will be heavily enforced in the face of Petro’s introduction to the market and will serve to reject the political corruption and economic failure to its people of the Maduro regime.
– Alex Galante
Photo: Flickr
Floating Schools Provide an Education to Illiterate Adults in India
In February 2017, Loktak Lake, otherwise known as the “lifeline of Manipur,” became the first lake in India to offer a floating school to its community. Floating schools have been employed in high flooding areas in Bangladesh for the past 15 years.
Bangladesh suffers severe flooding every year due to heavy rainfall during monsoon season causing the overflow of the three massive rivers: the Ganges, Brahmaputra and Meghna. The nonprofit Shidhulai Swanirvar Sangstha, now responsible for providing floating education to 70,000 students, was founded in 1998. In 2002, Shidhulai Swanirvar Sangstha opened the first floating school to provide an education to children in affected areas.
Since then, more than 100 floating schools, libraries and health clinics have been set afloat in the most flood-affected countries, including Bangladesh, Cambodia, Nigeria, the Philippines, Vietnam and Zambia. As technology advanced, so did these schools. Many are now solar powered and provide internet access to students.
Loktak Lake is the largest freshwater lake in India and home to many islands and communities. For these communities, Loktak Lake provides fish as a livelihood for rural fisherman, is a source of hydropower generation, provides irrigation for farmers’ crops and provides drinking water.
Floating islands, known as phumdis, were soil-rich fishing hot spots of the lake. However, water levels at Loktak Lake have been high for the last several years, causing the once soil-rich phumdis to begin to crumble and die. Residents of the phumdis were evacuated in attempts to preserve the natural habitat of the lake, ending the work routine of local fisherman and leaving many homeless. The community in crisis turned its focus to educating not only the youth in hopes of creating a better future for Manipur, but the homeless fisherman.
The All Loktak Lake Fisherman’s Union worked closely with the NGO People Resources Development Association to found the first floating elementary school in India that will focus on meeting the educational needs of local children and the adults rendered homeless by the evacuation of the phumdis.
The school has been inaugurated at Langolsabi Leikai of Champu Khangpok village and is currently serving 25 students with two teachers. Like with other floating schools, the People Resources Development Association hopes to see the school continue to grow, with goals of adding more classes to accommodate more students under the project “Empowering vulnerable local communities for sustainable development,” which is funded by Action Aid India.
Not only do floating schools provide year-round access to education for local students, but floating schools introduced in other high flood areas see remarkable results and growth in their local communities, such as increases in literacy rates and decreases in extreme poverty.
Furthermore, the introduction of technology is an important goal for the People Resources Development Association and the community. Locals hope the introduction of technology into the community will improve living conditions, which will increase the earning potential of the residents as a result. Access to technology will continue to inspire the next generation and provide them with useful tools and skills to help lift their community out of poverty.
Oinam Rajen Singh, a Manipur and Loktak Lake local, highlighted the need for education in his village, “As most of us are uneducated and mostly depend upon fishing as a meager source of income, we are unable to send our children to school to another place.” Singh has high hopes for the future of this floating elementary school and what it has to offer the community, “Based on [the] India government drive on free education to all, we will increase the class up to 8th standard so that opportunities are also given to the drop-out students.”
With rising sea and river levels, many communities are left without power or a means to receive an education, especially during monsoon season. These floating schools provide an opportunity and restore hope to impoverished communities.
– Kelilani Johnson
Photo: Flickr
US Cracks Down on Venezuela’s Oil-Backed Cryptocurrency
Venezuela suffers from the “resource curse,” a phenomenon whereby its large reserves of oil negatively impact its economic growth and stability. Rather than a blessing, these energy reserves lead to fraud, corruption, wasteful spending, military adventurism and the authoritarianism of the Maduro regime. This curse exacerbates global poverty through the destabilization of the oil industry, dulling the effect of foreign assistance and creating a breeding ground for terrorism and instability.
Although the country has a vast supply of oil money, instead of going to Venezuela’s poor, the money ends up in the pockets of the rich. U.S. Senator Marco Rubio tweeted on February 9, 2018, regarding the Maduro regime, “Soldiers eat out of garbage cans & their families go hungry in #Venezuela while Maduro & friends live like kings & block humanitarian aid.”
Venezuelans are deprived of human rights guarantees and press freedoms, facing political persecution and public corruption by the Maduro regime. The U.S. regards the Maduro regime as a dictatorship, whose power has overridden the democratic will of Venezuelans. The nation’s population is greatly subjected to sex trafficking and forced labor, sexual exploitation and domestic servitude. People from other nations are trafficked for sex and labor in Venezuela. Cuba trafficks thousands of Cuban citizens and doctors into forced labor in Venezuelan social programs, in exchange for the provision of resources to the Cuban government.
The most recent U.S. sanctions were imposed in August 2017 against Venezuela’s dictatorship, blocking U.S. citizens from buying new debt, bonds, dividends or other distributions or profits from Venezuelan government-controlled entities and its state oil company, Petroleos de Venezuela (PDVSA). This followed December 2014 sanctions imposed by the U.S., aimed at preventing U.S. entry by persons involved in the erosion of human rights guarantees, political persecution and public corruption. These sanctions do not target the people or the economy of Venezuela; they are aimed at protecting the will of Venezuelans and preventing U.S. involvement with the corruption of the Maduro regime.
Maduro responded to these sanctions by implementing strategies to free the oil-centered economy from the U.S. dollar, despite its universality in global trade. In September 2017, Maduro ceased publishing Venezuelan crude oil market prices in U.S. dollars, instead publishing prices in Chinese yuan. His December 2017 announcement to implement the oil-backed cryptocurrency was in direct response to the August 2017 sanctions, stating that Petro could “help defeat the financial blockade.”
Cryptocurrency is decentralized, uncontrolled by banks or governments. It can benefit those living in politically unstable regions, because the government can neither control its value nor transfer it from state to state. In Venezuela’s case, the cryptocurrency will be backed by oil, an industry largely controlled by dictators. Because Petro is a cryptocurrency, it is difficult for the U.S. government to regulate, threatening the U.S. sanctions that prohibit investing in PDVSA.
Petro is one of many foreign exchange (FX) mechanisms introduced by Venezuela. Most of the FX failed to meet market demand for dollars, resulting in Venezuela’s robust black market. Although FX is prohibited on the black market, it is the driving force of hyperinflation. Continuously on the rise, one U.S. dollar is now equivalent to 9.9875 Venezuelan bolívar.
The U.S. addressed Venezuela’s oil-backed cryptocurrency in a letter by senators Marco Rubio and Bob Menendez to the U.S. Department of the Treasury, stating “we are concerned that a cryptocurrency could provide Maduro a mechanism by which to make payments to foreign lenders and bondholders in the United States, actions that would clearly thwart the intent of U.S.-imposed sanctions.”
In early February 2018, U.S. Secretary of State Rex Tillerson toured Latin America and the Caribbean. Afterward, Tillerson alluded to U.S. considerations of restricting oil sales from Venezuela due to its worsening political situation. Developments in trade sanctions are imminent as the U.S. cracks down on Venezuela’s oil-backed cryptocurrency.
In opposition to the Maduro regime, the Venezuelan Parliament stated that Petro’s creation only serves to “evade financial sanctions, [and is] openly violating the Constitution and legitimizing illicit transactions.”
As the U.S. cracks down on Venezuela’s oil-backed cryptocurrency, the government aims to combat the use of Petro to circumvent U.S. sanctions, prohibiting investors on U.S. soil from profiting or investing in the PDVSA, the driving source of Venezuela’s poverty and humanity crisis. These policies and sanctions will be heavily enforced in the face of Petro’s introduction to the market and will serve to reject the political corruption and economic failure to its people of the Maduro regime.
– Alex Galante
Photo: Flickr
Financial Reforms Aim to Expand Credit Access in Montenegro
As with many countries in the region, the real estate bubble that burst in 2008 exposed longstanding weaknesses in the Montenegrin financial sector and left a laundry list of obstacles for the country to overcome in its wake. These obstacles have become major inhibitors of credit access in Montenegro.
As is often the case, small and medium-sized enterprises have been hit particularly hard by this credit squeeze. Fortunately, the international community has stepped in to improve short-term credit access in Montenegro in the short term while the Montenegrin financial sector modernizes for the long term.
Prior to 2008, the Montenegrin financial sector was plagued by poor governance, little oversight and inadequate and outdated financial infrastructure. In the wake of the crisis, key stakeholders have been working to rectify these problems against a backdrop of ongoing deleveraging. While these changes were needed, this restructuring has left Montenegrin banks incapable of meeting the demand for credit.
Business owners who can secure loans from Montenegrin banks complain of high interest rates, extensive collateral requirements and overall a very risk-averse lending policy. For many business owners, securing a loan from a Montenegrin bank is simply not an option. This gap between supply and demand is being filled in two different ways: by the informal economy and by international actors.
Many would-be business owners (and individuals) have turned to the informal economy to meet their financing needs. This often entails borrowing under the table from loan sharks. Not only does this open borrowers up to unnecessary risk, but it also presents an obstacle to modernizing the financial sector.
The other option is to secure financing from international actors. Many organizations are working to provide improved credit access in Montenegro while the country’s financial sector gets back on its feet. These include the EBRD, the Investment-Development Fund of Montenegro, internationally-backed microfinancing institutions and other international organizations that have stepped in in a microfinance capacity.
There are signs that positive change is coming. In late 2017, the government passed a law aimed at comprehensively reforming the financial sector and improving credit access in Montenegro. The law creates new financial instruments available to business owners and opens up new opportunities for those struggling to secure a loan to avail themselves of financing and guarantees from the government.
The law also updates the regulations that govern the Montenegrin financial industry and help to bring Montenegro into line with international best practices. It is hoped that these laws will help to prevent another disaster like 2008 and ensure that credit access in Montenegro will not be affected by the next economic downturn. This legislation serves to prove that developing economies often need just a little bit of international support while they work to modernize their financial infrastructure, and that this support enables them to create improved frameworks that provide greater confidence moving forward.
– Michaela Downey
Photo: Flickr
How Credit Access in Dominica Ensures Growth
It is particularly important for people to have credit access in Dominica. Borrowed money is the main reason why Dominica has been able to rebound following Hurricane Maria individually and on a national level.
Two Category 5 hurricanes devastated Dominica in September and October of last year and caused heavy damage to the country’s infrastructure and the livelihoods of its citizens. Half a year later, the situation in Dominica has improved. A majority of water systems have been repaired, most schools have reopened and diverse foodstuffs have reappeared on market shelves.
There is still a need for reconstruction. Forty-four percent of the buildings on the island were destroyed, and another 55.5 percent had some degree of roof damage. As of early February, electricity was unavailable in 80 percent of Dominica. Credit access in Dominica functions as an important crutch to help people rebound during this time of reconstruction. A large portion of the population had their livelihoods threatened, especially those in agriculture and tourism.
Dominica’s national bank requires that individuals be employed for a continuous one-year period with their current employer in order to qualify for a personal loan. For people who depended on tourism and agriculture to survive, meeting this requirement is a high bar. The hurricane ripped plant life out of the ground, damaging crops. The tourism industry experienced hard times as well, with all tourism halted for months.
Corporations have recognized the high level of need for credit access in Dominica and have done their part to allow borrowed goods and services. Flow, a subsidiary of Cable & Wireless Communications, began operations to restore mobile services to Dominica in good faith, even extending free credit to help mobile customers communicate with friends and family.
Ensuring credit access in Dominica is beneficial to the companies that provide it. Dominica’s economy as a whole was on the rise in early 2017, with a decrease in government debt and an increase in tourism. Negative growth in Dominica was estimated at 6.4 percent due to Maria, but the island’s economy is expected to rebound, with an estimated 6.9 percent growth in 2018 as it rebuilds.
Credit access in Dominica comes in the form of both individual and national needs. Over 400 higher-ups from governments, civil society organizations and the private sector mobilized to support reconstruction efforts following Maria. Support for Dominica totaled over $1.3 billion in pledges and over $1 billion in loans and debt relief.
Despite the setback from the hurricanes, Dominica’s economy is still expected to trend upward, which bodes well for those supplying lines of credit. The Eastern Caribbean Currency Union (ECCU) is one such company supplying financial aid to the people of Dominica.
The ECCU recorded slow growth in the country’s economy, and Dominica’s Prime Minister Roosevelt Skerrit noted that the potential capital of banks in the ECCU has improved since non-performing loans are trending upward as a consequence of recent hurricanes.
Dominica has a long history of bouncing back from natural disasters. Credit access in Dominica ensures that the nation becomes stronger and more resilient, as well as offering an immense opportunity for those providing capital.
– Sam Bramlett
Photo: Flickr
Feedie and the Lunchbox Fund Fight Childhood Hunger in South Africa
This has daunting consequences. Lack of adequate nutrition can cause growth stunting. In fact, 27 percent of children under the age of five have stunted growth in South Africa. In many cases this is irreversible. Malnutrition causes not only physical damage but mental deterioration as well. It negatively affects children’s learning ability and capacity to concentrate. When the top priority of a household is to fulfill hunger, and it struggles in doing so, the importance of school drops to a negligible level.
An app and a nonprofit have partnered to fight this problem and reduce childhood hunger in South Africa.
Feedie
Feedie is an app that allows food lovers to share photos of their meals on social media pages. However, this is not just any food photography app. It allows foodies to take their love of photographing food to a humanitarian level.
With the app, people can upload photos of their meals at participating restaurants, and that restaurant will donate 25 cents to the Lunchbox Fund, which provides lunches for impoverished South African schoolchildren. There are approximately 100 participating restaurants, including Del Posto, The Spotted Pig and La Esquina in New York.
The Lunchbox Fund
The Lunchbox Fund is a nonprofit that focuses on childhood hunger in South Africa. They work to provide a daily nutritious meal to orphaned and poor school children in townships and rural communities in South Africa. They believe that food insecurity should not inhibit children from achieving a basic human right: going to school.
The Lunchbox Fund has created a menu revolving around nutritious foods that children love, including maize, rice, lentils, beans, samp, gravy, soya mince, porridge, soy milk, 100 percent juice, peanut butter and vegetables. These meals have been approved by the Nutrition Information Centre at the University of Stellenbosch, ensuring that they contain adequate amounts of macronutrients and micronutrients that are essential to healthy brain and body development.
They work in all nine provinces and are dedicated to providing daily lunch meals to schoolchildren yearly. The Lunchbox Fund has calculated that 4,719,480 meals are necessary to feed vulnerable children in all provinces. They aim to reach four million children that do not receive government food subsidies at school.
Successes and Donations
The Lunchbox Fund has been feeding children since 2005. Since its birth, it has served an impressive 14.4 million meals. Just in 2017, 4.9 million meals were served. Even more astounding is that 25,000 children receive meals every day.
Schools that have nutrition programs tend to see higher academic achievement among students. Attendance and academic retention increases when children can focus and look forward to eating a fulfilling meal. Schools partnered with the Lunchbox Fund can expect to experience these trends.
Every cent that is donated goes toward fighting childhood hunger in South Africa. Impressively, if the average amount of money that Americans spend weekly on groceries ($151) were donated, it would feed three students for an entire year. This illustrates the huge impact that an inexpensive meal can have on a child’s health and education. The success of the Lunchbox Fund can serve as a model to help children at risk of hunger all over the world.
– Mary McCarthy
Photo: Flickr
Togo Charity Works to Help Rural Villages Out of Poverty
A report by the International Monetary Fund found that in 2011, the percent of the rural population that lived below the poverty line was 73.4 percent. In urban areas, the rate was 44.7 percent.
Water Sanitation and Access to Clean Water
Specifically in regards to water sanitation and drinking water, work has been done by various organizations to improve access to these necessities, and as a result, help rural villages out of poverty.
The Water Governance Facility (WGF), backed by the United Nations Development Programme (UNDP), stated on its website that in 2015, 63 percent of Togo’s urban population had access to drinkable water, while in rural areas only 44 percent had access. The same report found that only 11 percent of Togo’s population benefited from water sanitation facilities.
These statistics were reported as part of a larger program called Governance, Advocacy and Leadership in Water, Sanitation and Hygiene that was implemented by the WGF in conjunction with the UNDP from 2014 to 2017.
The Power of Local Aid Groups
However, assistance has also come from organizations closer to home, which strive to help rural villages out of poverty and address its accompanying effects.
Recently, the Togo charity Christian Charity for People in Distress (CCPD) was awarded the Kyoto World Water Grand Prize for the work it has done to help a village of 290 people improve its water sanitation.
CCPD is based in Kpalimé, Togo and was created in April 2004 as a nonprofit Christian charity. The organization’s mission statement declares that its goal is to help rural villages out of poverty by further developing water access, sanitation and hygiene, as well as improving agricultural development, the environment and education.
On its website, CCPD lists four main objectives it seeks to accomplish through its charity work:
Making a Difference
Since 2006, CCPD’s water, sanitation and hygiene programs have aided more than 6,000 people. These programs usually involve the construction of wells, latrines and ECOSAN toilets, which is a waterless toilet designed to save water in countries that do not have water security. In addition, CCPD has worked to help rural villages out of poverty by providing school supplies to primary and secondary school students, aided in the construction of new schools and improved computer skills in adults and children.
The charity is the second African organization to win the Kyoto World Water Grand Prize, which will not only improve sanitation and water conditions, but will also decrease deaths related to illnesses such as cholera that are caused by poor sanitation.
CCPD has been aiding impoverished, rural areas of Togo since its creation, and does far more than just water and sanitation work. The charity’s efforts in regards to education, agricultural development, business development and environmental protection have all impacted communities in Togo and given them the help they need to transition out of poverty.
– Jennifer Jones
How the US Benefits from Foreign Aid to Mali
Since its inception as an independent country, Mali has maintained diplomatic relations with the U.S. Over the years, the foreign aid Mali received from the U.S. has helped it to foster democracy and reduce poverty in the country. For instance, conflict in the country since 2012 has resulted in displacement, and food insecurity still remains an issue in Mali. Due to the foreign aid it received through USAID, Mali has been able to improve the availability of food and basic services, which led to the return of 60,200 displaced people to their areas of origin. Additionally, aid through USAID/OFDA helps improve access to emergency healthcare, protection services, safe drinking water and sanitation infrastructure in Mali.
Eradication of Extremism
Similarly, the U.S. benefits from foreign aid to Mali since it is committed to the eradication of extremism. Extremism negatively impacts every nation including the U.S., and the focus on Mali is crucial, as it has been called the deadliest country for U.N. peacekeepers. Extremist groups have carried out violent attacks in the country, and most of the recruits associated with such groups explained that their actions were not affected by their religious beliefs. In fact, they expressed the anger they felt due to the longstanding neglect of their communities, which led them to seek a sense of community in extremist groups. In order to eradicate extremism, the USAID has taken some key steps.
Utilizing locally-informed assessment and analysis, USAID has focused on “youth empowerment, social and economic inclusion, media and messaging, improving local governance, reconciliation and conflict mitigation.” The USAID tailors its activities to meet specific threat levels, the political environment and other material needs of each community, especially focusing on groups that need more assistance, such as at-risk young men. Armed bandits and extremists still occupy northern Mali, which accounts for nearly two-thirds of the country. Poor governance and extreme poverty contribute to the rise of extremist groups, which is why many of the USAID activities focus on improving these areas.
For instance, in order to stop the spread of extremism and foster development, USAID and Mali have jointly taken a different approach than previous ones that concentrated more on individual projects. USAID and Mali will target the country’s institutional weaknesses while contributing to ending extreme poverty, and the projected $600 million in investments for fiscal years 2016-2010 will focus on four key objectives:
Combating Human Trafficking
Human trafficking is another serious issue in the country. The U.S. benefits from foreign aid to Mali because it is committed to fighting human trafficking globally, and Mali is a source, transit and destination country for women, men and children subjected to forced sex and labor trafficking. The government of Mali does not fully comply with the minimum standards for the elimination of human trafficking. Hence, the aid it receives from the U.S. makes a considerable difference. For example, foreign aid from the U.S. through the Office to Monitor and Combat Trafficking in Persons provides not only crucial training and technical assistance, but also child protection compact partnerships, emergency victim assistance and research projects that focus on innovative ways to combat human trafficking.
In short, the U.S. benefits from foreign aid to Mali because the latter is facing some dangerous challenges that the U.S. has committed to eradicating. By working together with Mali, the U.S. could help put an end to the violence that is caused by extremism and human trafficking.
– Mehruba Chowdhury
Photo: Flickr
Increasing Microfinance Improving Credit Access in Serbia
In the wake of the 2008 financial crisis, Serbian banks have set very rigid requirements in order to secure a line of credit. Interest rates tend to be prohibitively high for small business owners, and there are many regulations in place that discourage lending to small businesses and startups because they are perceived to be too risky. The government has introduced subsidies and risk-sharing programs to try to mitigate this problem at great cost to the state, but this has not been sufficient to really improve credit access in Serbia. It is estimated that small and medium-sized enterprises in Serbia are collectively in need of €267 million worth of financing that Serbian banks are not willing to lend.
This is not to say that the Serbian financial industry is underdeveloped or ill-equipped. The World Bank is quite satisfied with the state of credit access in Serbia at a broad level. However, it does acknowledge that small and medium-sized enterprises experience more difficulty than they should when trying to access credit.
There have been several positive developments over the past several years that bode well for the future of credit access in Serbia. Recently, banks have begun to change the risk assessment procedures that they use when dealing with small and medium-sized enterprises. Where previously these entities were assessed in the same manner as a large corporation would be, many banks now use a procedure that takes into account the comparatively small size of these enterprises and does not allow size or inexperience to negatively impact the applicant.
Additionally, many international entities have stepped in to extend additional microfinancing money to be used to improve credit access in Serbia. The European Investment Bank recently provided €30 million to ProCredit Holdings in Serbia. This is intended to promote long-term, stable credit access in Serbia that will encourage economic growth and development for years to come.
While credit access in Serbia remains less than ideal, these recent developments represent major improvements over the previous situation. If similar improvements continue to follow, it can be expected that improved credit access will precipitate much greater economic development in Serbia in the coming years.
– Michaela Downey
Photo: Flickr
Peace Initiative in Samoa: The Peace Road Embraces Taufusi Market
Samoa did its part to carry out Moon’s vision by implementing the Peace Road initiative across the country in August 2015. Moon’s vision focused on the physical connection between cultures; this peace initiative in Samoa can bridge cultural gaps and promote peace throughout the region. Samoa’s 2015 and 2016 Peace Road initiatives focused on Savai’i churches and schools in Salelologa, Sapapali’i, Sili and Puleia.
The Peace Road’s 2015 implementation revolved around several themes:
Samoa’s 2017 Peace Road initiative centered on Taufusi Market. Universal Peace Federation Samoa adopted Taufusi Market’s road as their designated “Peace Road” in November 2017. Taufusi Market’s stalls were adorned with colorful banners, drapes and flags.
The Peace Road programs of 2017 included:
Although officially completed in November 2017, Samoa’s Peace Road initiative extended to the January 16 inauguration of the International Association of Parliamentarians for Peace. The addition of the Peace Road to infrastructure in Samoa actualizes the global peace initiative proposed by Moon.
Although it is a new peace initiative in Samoa, the Peace Road in Taufusi Market promotes cultural education and empathy. It continues the global peace initiative undertaken over 35 years ago. Samoa has joined 120 other countries in supporting the annual Peace Road; nearly 62 percent of the world actively supports and promotes world peace.
– Carolyn Gibson
Photo: Flickr
How the US Benefits from Foreign Aid to Jamaica
Tourism
Although a popular destination for travelers, Jamaica faces many economic issues, including high unemployment rates, crime and corruption. The country is also prone to natural disasters. Although tourism helps support the economy of Jamaica, it is not enough to sustain it.
Jamaica believes that foreign aid and investment is a key aspect of growing its economy and has made governmental reforms to better accept and use these funds. This makes the funding process easier for countries like the U.S. and provides greater assurance that the funds will be allocated and implemented properly.
The way the U.S. benefits from foreign aid to Jamaica far outweighs the risk of investing in the county. Jamaica is a major economic partner to the U.S. The country is already a major tourist destination with developed infrastructure. Jamaica’s infrastructure boasts world-class transportation on land, air and sea, as well as a developed telecommunications system.
Funding toward the tourism sector would only strengthen it further, improving Jamaica’s economy. This, in turn, would help provide for Jamaica’s funders. This includes the countries that directly fund it through foreign aid, as well as those investing privately through businesses. These businesses include tourism but also focus on a variety of other fields such agribusiness, mining, energy and manufacturing.
Investing in Business
There are many ways in which Jamaica has made investing more accessible to countries like the U.S. and helped to ensure that both countries benefit as much as they can from it. One example is the improvement of credit access, which makes the starting of a business more accessible in consideration of price, especially for the electricity sector. It also affects how businesses are taxed and generally start-ups have a lower tax. Improved credit access provides the opportunity for more businesses to be formed and for more investments to be made toward them.
Democratic Ally
Another way the U.S. benefits from foreign aid to Jamaica is through similar political interests. The government of Jamaica is already a prime example of democracy, having elections every five years. Continuing aid and investment in the country will only help improve it. Jamaica is a democratic ally to the U.S., which not only benefits both countries politically but also economically. As aid continues to grow and both countries benefit from one another, this will serve to further an alliance between them.
There are many ways in which the U.S. benefits from foreign aid to Jamaica, which is an incredibly beneficial country to invest in. Not only has government reform made it easy to fund and aid the country but also provides many ways for businesses and their investors to flourish. Jamaica is a strong economic benefit and ally to the U.S., as well as a great representative of democracy. A partnership and alliance will continue to grow between the two countries with the continued support of the U.S.
– Keegan Struble
Photo: Flickr