Archive for category: Economy

Information and stories about economy.

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About Zimbabwe Since Mugabe

Zimbabwe Since Mugabe
Zimbabwe, officially the Republic of Zimbabwe and formerly recognized as Rhodesia. Zimbabwe is a landlocked nation in southern Africa bordering South Africa to its south and Zambia to its north. The nation gained independence in 1980 after a long period of colonial rule. Similarly to South Africa, Zimbabwe suffered a period of white-dominated rule in which the country suffered severe human rights violations, especially to the majority black population.

One of the longest-sitting leaders in modern times, some considered Robert Mugabe to be a revolutionary hero. Having led the Zimbabwe African National Union-Patriotic Front (ZANU – PF) and ousted the minority white government of Zimbabwe, Mugabe became the leader of the nation. Serving as President from 1987 to 2017. At first, many in Zimbabwe may have felt optimistic about Zimbabwe’s future, but after 30 years of economic stagnation and rampant hyperinflation, a military coup ultimately ousted President Mugabe. His dismal leadership of Zimbabwe’s economy and reports of many human rights violations are the main reasons for his departure. Here is some information about Zimbabwe since Mugabe.

The Economy

Unfortunately for President Mnangagwa, his predecessor left Zimbabwe in economic peril. With Mugabe gone, there was much elation at the prospect of a new leader in Zimbabwe, with many finally believing that the worst may be behind them. Mnangagwa promised the people of Zimbabwe economic prosperity and more democracy. The President stated at ZANU – PF headquarters that “No one is more important than the other. We are all Zimbabweans. We want to grow our economy. We want jobs.”

However, economic prosperity has yet to come, with some in the nation believing that Zimbabwe since Mugabe has actually worsened. Zimbabwe’s inflation problem seems to have continued under the new leadership, having a 557.2% inflation rate in 2020. However, 2021 saw a 458.66% decline in inflation to 98.55%.

The problem with hyperinflation is that the Zimbabwean dollar is effectively worthless, making it very hard for the economy to grow as foreign imports will simply be far too expensive. Many in Zimbabwe prefer using the U.S. dollar, whereas the South African Rand is the most common. However, the GDP per Capita in Zimbabwe was $1,774 in 2021, a 29.23% increase from 2020.

Poverty in Zimbabwe requires attention. The poverty rate in Zimbabwe was 85% in 2019, a 0.9% increase from 2017, the year Mugabe left the presidency.

Indicating that in the nearly six years since Mugabe, the government has been unable to make any significant change to poverty in the nation. Alongside a disturbingly high poverty rate, the country has an estimated 90% of the citizens either unemployed or work informally to make a living.

Human Rights

Perhaps unsurprisingly, with Mnangagwa being a member and leader of the ZANU – PF party, the same party as former President Mugabe and the only party in power since the ending of the white minority rule in Zimbabwe, human rights in Zimbabwe continue to be an issue in the nation.

Mnangagwa promised change in Zimbabwe, however, according to Human Rights Watch (HRW) the situation continued to decline in 2020 under President Mnangagwa. According to HRW, more than 70 critics of the government were abducted and tortured in 2020. The HRW stated that “Security forces also continued to commit arbitrary arrests, violent assaults, abductions, torture and other abuses’ against anyone critical of the government.”

With Human Rights violations such as these, it is fair to suggest that not much has changed in Zimbabwe since Mugabe. As ex-President Mugabe received criticism for corruption and silencing of critics. 

Government Reaction to Human Rights

Under the leadership of Mnangagwa, Zimbabwe only repealed one law from the Mugabe era. Critics have suggested the government’s slow implementation of its commitment to political reform shows its lack of interest to re-engage with the international community. Instead, the party with a stranglehold of the politics in the nation would rather pursue the continuation of power in Zimbabwe. Al Jazeera spoke to a Zimbabwean citizen who said that “Under Mugabe, things were getting bad. It’s the same group of people (in power) essentially.”

The government however refutes this, suggesting that Mnangagwa has managed to stabilize the currency and committed to opening up the country for business. While the future certainly looks dim for Zimbabwe since Mugabe, there are some glimmers of hope. Zimbabwe actually has the second-largest platinum deposit in the world. The nation also has a significant amount of gold with more than 4,000 recorded gold deposits found so far in Zimbabwe. While the country’s mining sector in the Great Dyke has been inefficient up until now, the government aims to grow its platinum exports considerably.

Looking Ahead 

The potential of Zimbabwe’s mining sector could be huge, generating more revenue, creating new foreign investment opportunities and long-lasting well-paid jobs for Zimbabwean citizens. If done correctly, the government in Zimbabwe may be able to significantly reduce severe levels of unemployment and rampant poverty.

 – Josef Whitehead
Photo: Flickr

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The Inspiring Economic Development of Bangladesh

Economic Development of Bangladesh
After gaining independence in 1971, Bangladesh was described as a “basket case” and a collapsing and fragile state as it emerged from the war as the second poorest country in the world. At the time, Bangladesh was a war-torn agrarian economy with a number of human development challenges with dwindling productive assets and weak infrastructure. However, Bangladesh proved the international community wrong as they emerged victorious and resilient in their pursuit of economic development, particularly after the 1974 famine.

The World’s Fastest-Growing Economy

Economic development in Bangladesh in the past 50 years has been impressive, with GDP per capita rising to $2,734 in 2021 from $134 in 1971. Bangladesh quickly recovered from the aftermath of its War of Independence as one of the poorest countries in the world to achieve a steady growth rate, even during the times of the COVID-19 pandemic. Over the past two decades, extreme poverty has significantly declined by more than half, dropping from 34% in 2000 to just 11% in 2022. In addition, other key indicators of human well-being, such as maternal mortality rates, life expectancy and primary and secondary education attainment have also shown significant improvement.

One important factor is that almost all children go to school, with the primary school net enrolment rate at 97%. Moreover, more women continue to enroll in schools, and thus enter the workforce, contributing to growth in a wide range of economic sectors. Consequently, maternal mortality cases decreased significantly from 2000 to 2017, from 434 live births per 100,000 to 173.

Even during the COVID-19 pandemic, Bangladesh still found a way to prosper. Households saw improvements in regard to coping strategies and food security amidst the pandemic, and according to self-reported surveys, families residing in poor and slum areas of Dhaka and Chittagong experienced substantial improvement in their food security. This was linked to an increase in employment opportunities observed between two rounds of surveys conducted. Survey results also indicated a general improvement in the labor market and employment situation in 2022.

How Did They Do It?

There were several factors that contributed to the economic development of Bangladesh, particularly in the agricultural sector of the country. Following the birth of the nation in the 1970s, Bangladeshi scientists helped successfully implement innovations in crop varieties that made the country self-sufficient in food. Advancements in sustainable food production practices, despite the difficulties posed by frequent flooding, have been instrumental in combating hunger, poverty and malnutrition.

Furthermore, Bangladesh became the second largest exporter of ready-made garment (RMG) products in the world which greatly increased employment in the manufacturing sector. The growth of RMG also benefitted female labor, as the number of women entering the workforce increased to 35% in 2021, from 21% in 1990.  Clean energy also became more accessible for the 8.2 million people living in the rural parts of Bangladesh, with every home having access to electricity. These improvements led to increases in immigration and the nation saw an increase in economic contributions from migrant workers.

Partnership with the World Bank

In 1972, the World Bank saw potential in Bangladesh, beginning a partnership by investing a $50 million credit. This turned into more than $38 billion in financing for economic development in Bangladesh over the following years. Today, the World Bank is Bangladesh’s largest external funder. The decision to continue funding centered around Bangladesh’s impressive achievements and the necessary actions required to maintain Bangladesh’s progress toward its goal of becoming an upper-middle-income country by 2031.

Despite these accomplishments, the current challenges of high inflation and declining foreign exchange reserves challenge the notion of stable macroeconomic performance in the country. Furthermore, concerns persist about the nature of growth and its impact on the population. Roughly 24.3% of the population struggles to fulfill basic necessities and the wealthiest 5% hold 27.8% of the nation’s income.

Nonetheless, the impressive economic development and poverty reduction in Bangladesh are inspiring. However, to achieve high-income status and meet the Sustainable Development Goals (SDGs), significantly increased efforts toward inclusive growth are necessary.

– Noura Matalqa
Photo: Flickr

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The Current State of Poverty in India

State of Poverty in India
As India is on track to become the most populated country in the world by the end of the year, many eyes are on the South Asian country in regard to its progress in eliminating poverty. Despite having suffered from chronic poverty for much of its modern history, India has made much progress in raising its poorest over the past few decades. Though factors such as the COVID-19 pandemic have complicated things, India continues to make great strides in its bid to eliminate poverty within its borders.

This Century’s Progress

In the past few decades specifically, the fight against poverty in India has come a long way. Since 2005, an estimated 415 million people have risen out of poverty in India – an impressive feat, considering that the country has a total population of 1.4 billion today. It has a diverse economy, which includes industries such as agriculture and handicrafts. Thanks to a well-educated population of English speakers, India has gained a global foothold in massive modern sectors such as information technology services and software workers. This increase in economic prosperity has given many of India’s poorest opportunities to rise out of poverty.

Old and New Challenges

Despite this amazing progress over the past 20 years, several hurdles remain in the fight against poverty in India. There are 229 million Indians who still live in poverty, which is the largest number of poor people in a single country anywhere in the world. In addition to this, the urban-rural divide of poverty remains very pronounced; as many as 21.2% of India’s rural-living citizens live in poverty, which contrasts with the much smaller 5.5% of impoverished urban dwellers. To put it into perspective, 205 million of India’s 229 million impoverished citizens live in rural areas, according to Mint. When developing strategies to fight poverty in any location, considering the rural-urban divide is a must.

Though India’s economy has remained steadily robust, COVID-19 had a strong impact on the country – particularly on those living in poverty. The pandemic caused India’s economy to contract by a hefty 6.6% in the fiscal year 2020-21. Particularly, COVID-19 hit hard the informal sector which employs 90% of Indians. The dampening effect on India’s economy has made a significant impact on the country’s most poor and vulnerable households especially.

Looking Forward

Thankfully, even with the challenges that COVID-19 and chronic economic equality still pose today, the fight against poverty in India continues its upward momentum. Much of this is thanks to its economic growth; in 2022, it overtook the U.K. to become the fifth-largest economy in the world. According to other reports, it could also overtake Germany and Japan by 2029 to become the third-largest economy in the world. As the country’s economy continues to grow and stabilize, more opportunities will arise for its poorest residents to climb the economic ladder and rise out of poverty.

Despite many challenges, both institutional and from outside forces, poverty in India has been decreasing at a steady rate, thanks to the country’s booming economy and a continued global awareness of the need to end poverty. As it stands, the current state of poverty in India shows several more hurdles remain in ending its impoverishment, but the horizon looks hopeful for India’s poorest.

– Elijah Beglyakov
Photo: Flickr

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Nepal’s Economic Recovery

Nepal’s Economic Recovery
Nepal, a landlocked nation famous for the mountainous range of the Himalayas on its borders, has been working to restructure its economy, bring new opportunities to its citizens and decrease poverty rates. Historically, Nepal’s poverty rates have been incredibly high, currently leveling at about 25%, with a heavy reliance on agriculture, lacking education and infrastructure, and many more variables that have stunted and limited economic growth for decades. Many feared that Nepal’s economy was on its way to economic collapse and crisis. Instead, Nepal has recently had some of its most promising improvements during the COVID-19 pandemic.

Nepal’s Economic Burdens and Poverty Exacerbators

The factors increasing Nepal’s poverty rates are numerous. One of the greatest is Nepal’s reliance on agriculture. Agriculture serves as Nepal’s primary source of income and food. Such farming practices are known as “subsistence farming, and 68% of Nepal practices subsistence farming. Agriculture is responsible for one-third of Nepal’s Gross Domestic Product (GDP). It connects employees ranging from farmers to small-business merchants and large-scale international traders. Nepal is vulnerable to severe droughts and flooding, resulting in a vicious cycle that upsets the agriculture sector and limits production, income and the food available per family.

A wide class divide has also exacerbated Nepal’s poverty challenges, as the education system in Nepal has exemplified. Nepal’s education system has been slowly expanding to reach the rural regions, specifically the Kathmandu region, where the public and private sectors are integrating to be more inclusive for children of all ages. Net enrollment in schools is up to 97%, but more than 770,000 children are still unable to obtain a comprehensive education as many areas do not have schools or the ones that do exist are understaffed. Minimalized education perpetuates regional poverty, limiting upwards economic progression.

Nepal’s Economic Recovery

Economists have feared that Nepal is due for an economic crisis similar to the one that Sri Lanka experienced in 2022. Sri Lanka’s economy slid into a crisis due to extremely high external debt, a tremendous trade deficit and overwhelming inflation. The crisis is increasing poverty rates, about 25% in Sri Lanka, with the urban poverty rates tripling since 2021. The government is struggling to restructure the economy and take control of the rising poverty rates and joblessness, but Nepal’s economy is not on the same track.

Nepal’s external debts have much lower interest rates than Sri Lanka’s, and the government has implemented new transparent and efficient policies that concentrate efforts on local infrastructure changes. Despite the challenges regarding Nepal’s reliance on agriculture, agriculture became a savior for the nation after the economy lost income from tourism and external support systems. Nepal’s economic recovery would not be possible without the changes to its debt or agriculture system.

The Asian Development Bank (ADB) predicts that Nepal’s economy will again experience a year of modest improvement for the fiscal year 2023, with further decreases in poverty, meaning Nepal’s economic recovery was not temporary. The government has tightened restrictions on imports and exports to ensure the economy remains stable. The new restrictions created new reliances on agriculture, forcing the government to invest extra efforts in the agriculture system’s impact locally before returning to expanding trade externally. The pauses allow the government to take stock of its depleted foreign currency reserves before deciding which allies to renew, strengthen or end.

Improvement to Education in Nepal

Nepal’s education system has improved as the COVID-19 pandemic forced the schools to reconfigure their newly developed teaching styles and practices. The pandemic’s pauses in everyday life presented Nepal with the opportunity to implement new teaching programs nationwide. The original interruption of the COVID-19 pandemic in daily life slowed the pace at which Nepal can reach the United Nation’s Sustainable Development Goals (SDG). The government aimed to hit benchmarks by 2022 to exemplify the progress in academia throughout Nepal, but the new plans restructured the older outline for the education goals. The alterations to the Nepalese education system can provide new academic opportunities for an education that can lift children out of poverty.

Despite Nepal’s economic strife in years past, the COVID-19 pandemic was a window of opportunity for the government to restructure the nation’s reliance on agriculture and deficient education system and reconfigure trade deals with international allies. Nepal’s economic recovery shows that the country is nowhere near an economic crisis, as the private sector may have feared, but it is on a stronger path to recovery than ever before.

– Clara Mulvihill
Photo: Flickr

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Honey Pride Arua and Its Effect on the Local Economy in Uganda

Honey Pride Arua
Honey Pride Arua, a private organization started in 2015 by Sam Aderubo offered an innovative approach to inclusive economic development across the region of Arua, Uganda. Specializing in honey, the organization aims to construct sustainable markets for beekeeping and production, alongside raising awareness amongst local farmers of the commercial potentials of beekeeping.

A comprehensive program offers education on all aspects of beekeeping and the honey production process, from apiary management to the packaging and distribution of goods. Through this, the organization enables existing local farmers and anyone with a desire or interest to enter into beekeeping to convert their hobbies into economic output, sustaining themselves and their families.

The Effects

As Betty Ayikoru, a local beekeeper and councilor outlined beekeeping benefits communities in more ways than selling honey. Honey Pride Arua has grown commercially in the scale of operations and income, but what is more significant is the effect this has on the surrounding community and stakeholders.

Today working with more than 1,700 farmers – 30% women and 60% youth, the organization makes emphasis on targeting marginalized members of the community. A holistic and immensely effective approach in addressing local unemployment by gearing their project to those in the community most likely to be unemployed, or equipped on average with lower prospects.

Honey Pride is also noted for the inclusion and support of refugees in economic activity for local development. Arua, in Northern Uganda, is a region largely populated with refugees compared to other parts of the country. Honey Prides’ inclusivity played a key role in gaining external funding from the United Nations Capital Development Fund (UNCDF).

Stable markets offer stable incomes and Honey Pride’s activity has helped local farmers put children through school, financially sustain households and their families, as well as offering a nutritious element to their diet, according to a U.N. News podcast.

Previously it was difficult to find a reliable market with stable prices to sell one’s honey in Arua. However, prospects for beekeepers have drastically changed since Honey Pride entered the industry. Delivering on one of its central tenets, a stable honey market has emerged across the region. A kilogram of honey in 2015 was worth 3,500 Ugandan Shillings, today the market price is around 7,000 Shillings per kilogram. Encouraging statistics motivates many young members of the community to venture into beekeeping.

Another noteworthy aspect of Honey Pride’s operations is the efficiency of its practices. The organization works to eliminate waste by offering excess produce and residue to the community to fertilize local gardens and land, as well as feed livestock, according to a U.N. News podcast.

Investment

The most significant challenge to the organization has been financial. As Sam Aderubo himself states in the podcast, “finance is the lifeline of a business.” The organization in its early years, like most small Ugandan businesses, was unable to get investment from commercial banks. Aware of its social impacts and inclusivity practices focused on a community-benefit model, the UNCDF found a worthy beneficiary, investing over $117,000 to help Honey Pride Arua reach a certain threshold at which it will begin to attract investment from larger commercial banks and private equity firms.

This came in the form of loans for processing equipment and operations, alongside technical assistance and support in designing a sustainable and viable business model. Through these efforts, Honey Pride procured the likes of professional filtering equipment, an electric honey press for the extraction process and eight honey settling tanks each with a capacity of 1,000kg, UNCDF reported.

A direct impact of such measures saw a substantial increase in output from three to five tonnes per month post-investment, which, according to UNCDF, in 2021 amounted to a monthly increase in income by over $8,000.

Following the successful implementation of these loans in growing the organization, in the case of Honey Pride, several private equity firms have since displayed an interest in investing, offering a blueprint for further upscaling and aligning the company for greater success in the future, according to the U.N. News podcast.

What the Future Holds

Further expansion and entry into new markets is the next step for Honey Pride, having met international standards with its product. With increases in output and income, Honey Pride can begin to invest more in outreach and marketing, further consolidating the stability of local markets in addition to developing foreign ones as well.

Looking ahead, Honey Pride Arua aims to implement a program to equip local farmers or those with a desire to venture into beekeeping with the required equipment and facilities. This way, it is helping to establish more local beekeeping businesses that return on the investment they received from Honey Pride through their yield. An innovative, circular model of business. As Honey Pride grows commercially, its inclusive practices and reach spread, benefiting ever greater numbers of people.

– Bojan Ivancic
Photo: Unsplash

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Indonesia’s Economy Prospers Despite Being Dubbed ‘Fragile’

Indonesia’s economy
Indonesia’s economy was a part of the “fragile five” emerging economies according to U.S. investment bank Morgan Stanley in 2013. Experts considered it to be the most vulnerable to any jumps in U.S. interest rates. However, Indonesia has remained surprisingly stable a decade later as U.S. interest rates have risen rapidly and a global energy, food and climate crisis are happening. With a booming economy and a stable political arena, Indonesia’s currency is currently performing the best in Asia. In addition, the country’s stock market is hitting record highs. As other countries in the region struggle to keep afloat, Indonesia prospers due to unique circumstances.

Indonesia’s Economy in 2022

The southeast Asian country, with a population of around 276 million, is extremely resource-rich. It has undergone impressive economic growth ever since the 1990s Asian financial crisis. According to the World Bank, Indonesia is not just the largest economy in the South-East Asian region but is also the 10th largest economy globally in terms of purchasing power parity. Since 1999, Indonesia has cut poverty rates by more than half to about 10% prior to COVID-19.

The COVID-19 pandemic caused a slight halt in the progress of Indonesia’s economy. For example, poverty rates rose from 9.2% in September 2019 to 9.7% in September 2021. Estimates indicated that the GDP growth of the country was 5.1% in 2022 as Indonesia recovers from COVID-19’s impact. One of the most significant impacts the pandemic had was on children’s learning capabilities. The pandemic resulted in the closing down of schools and could result in the stunting rate of the country increasing.

However, as of September 2022, Indonesia sees unprecedented growth and stability. The country has one of the lowest inflation rates in the world at 4.7% in August 2022, and the country’s GDP has expanded to 5.4%, much more than the amount that was estimated. With exports also increasing to 30.2%, the highest they have been on record, Indonesia’s economy stands in stark contrast to other countries in the region that have struggled with COVID-19’s impact.

Reasons for Indonesia’s Prosperity

One can credit the success of Indonesia’s economy to multiple factors:

  • Political Stability: A large part of Indonesia’s success lies with President Joko Widodo. He has remained popular with the population as well as investors for eight years. A poll that Indikator Politik conducted this month showed his approval rating to be 62.6%, a 10% drop from May 2022, but still significant to show his immense support in the country. With Widodo also hosting the G20 summit in Bali in November 2022, his popularity has kept investors interested in the country’s future.
  • Low Inflation Rates: In comparison to many neighboring countries, Indonesia’s inflation rates have remained consistently low. Combined with interest rates raised for the first time in three years to 3.75%, there have not been major shocks to the system for Indonesians. Although exports are quite high, other factors have also had a significant impact. For example, Widodo’s “omnibus law” aimed at job creation by reducing employment regulations.
  • Indonesia’s Nickel Reserves: With one of the biggest reserves of nickel in the world, Indonesia stands at an advantage, particularly in the electric vehicle industry. The country will likely provide a significant chunk of the nickel supply that the global electric vehicles industry requires going forward. This will also further help the exports of the country.

Concerns for the Future

While Indonesia’s economy has remained stable, there are some concerns for the coming years. While the economy’s stability is not causing concern, the political factors are. Widodo’s lack of a clear candidate combined with the recent drop in his popularity due to cuts in fuel subsidies has raised concerns. Moreover, the country’s main commodity exports like coal are still a huge driving force behind the economy. Additionally, future commodity prices should drop. Many also predict an increase in inflation by October.

Despite such concerns, Indonesia has shown to be invulnerable to shocks like the COVID-19 pandemic and continues to outperform other countries in the region.

– Umaima Munir
Photo: Unsplash

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Infinited Fiber Ending the Cycle of Fashion Waste and Poverty

Fashion Waste and Poverty
Infinited Fiber is a Finnish start-up company developing new clothing from old materials. The impact of waste management for textiles is more than $1 billion annually, and garment workers globally receive, at best, mediocre pay. Infinited Fiber strives to create longer-lasting clothes to reduce textile waste while paying garment workers appropriate salaries. Longer-lasting clothes will be more cost-effective for the individual and help with the more significant issues of fashion waste management and poverty, including the ever-rising costs in the clothing market.

Poverty in the Fashion Industry

Fashion waste and poverty are significant problems in the fashion industry that Infinited Fiber is tackling. Garment workers are incredibly subject to poverty while working in the fashion industry. There is an overwhelming wage gap between garment workers and their company’s CEOs. The Industry We Want, an organization fighting for fair wages for garment workers, found significant wage gaps between the workers’ earnings and what they should be earning. Globally, garment workers earn only about 55% of the wages they need to have a living wage.

During the COVID-19 pandemic, the treatment of garment workers worsened. Many garment workers went extended periods without receiving any compensation. When in-person shopping stopped globally, many factories paused operations, leaving the garment workers destitute. In those factories, garment workers deal with poverty regularly due to the economic status of their home countries. Still, the stopped income left them facing starvation. Fashion waste and poverty do not end with garment workers. Unfortunately, their poverty and economic struggles are a large portion of why Infinited Fiber seeks new techniques and practices in the fashion industry.

Devastating Fashion Waste and “Fast Fashion”

“Fast fashion” is cheap, easy-to-produce fashion that often goes to waste quickly. Fast fashion is a sector of the fashion market that employs exceptionally cheap labor. This form of fashion marketing took over the global-fashion market when large-name brands like Zara and Forever 21 began expanding business operations. Fast fashion proved to be a profitable market, causing fashion industry markets to see substantial increases in generated income. Despite the promising outlook of fast fashion, due to the quick turnaround in products, the industry will likely see decreases of up to $52 billion in profits due to waste management and textile losses. Management for textile waste costs up to $100 billion annually.

One of the methods for waste management that will also cut costs globally for waste management is transforming the clothing production process. There are calls to improve recycling methods for textiles, beginning with policymakers. Textile recycling is an expanding market for investment in the fashion industry. As of 2021, the textile recycling industry had a value of $4.5 billion in 2021, with expectations for fast economic growth. Thankfully, textile recycling also reduces the costs of dealing with textile waste management. While textile waste costs continue to mount and landfills fill up rapidly, textile recycling benefits all involved by taking the wasted textiles, cleaning them and repurposing them workers create a new product. The repurposed textiles save money in landfill and textile waste management and create new job opportunities as textile recycling grows in popularity. Infinite Fiber’s goal is to end the cycle of fashion waste and poverty through textile recycling.

Infinited Fiber’s Goal to Ending the Cycle of Fashion Poverty

The company’s founder and CEO, Petri Alava, hopes the clothing the company produces will be low-cost for the consumer, long-lasting and reduce textile waste. The company creates “circular fibers” by taking old materials, cleaning them and breaking them down to a polymeric level. The process requires fewer chemicals and leaves less waste than the typical processes of fast fashion.

Infinite Fiber is partnering with large-name brands, such as H&M and Inditex. Inditex is Zara’s parent company and is known not to pay its garment workers a fair wage. As the company is expanding and creating its partnerships, Infinite Fiber is receiving significant investment opportunities that are proving beneficial to the company, and its workers, while spreading its influence of eliminating fashion waste and poverty.

Infinite Fiber recently signed a new deal to develop a partnership with Patagonia, a U.S.-based clothing retailer with operations worldwide. One of the keys to operating with Patagonia is that Patagonia implements safety precautions that many garment factories do not. Patagonia also pays its garment workers fair wages. The connections Infinited Fiber makes with companies like Patagonia prove its commitment to a “Fair Trade” life with improved wages and social and economic improvement is on the horizon globally.

Infinite Fiber’s work creating new textiles is becoming a global operation, presenting job opportunities everywhere the company reaches. In Brazil, Infinite fiber’s work to erase fashion waste and poverty involves taking wood pulp and turning it into new textiles. The company’s goal is to slash fashion waste and poverty that result from waste. Infinite Fiber is dedicated to improving the quality of the fashion industry, which comes with living wages for all workers, minimal waste, and job opportunities worldwide.

– Clara Mulvihill
Photo: Flickr

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Economic Improvement in Asia: Improving Digital Skills for Millions of Women

Economic Improvement in Asia
Technological expansion facilitated a globalized community that improved industry and revolutionized society. There are, however, inconsistencies with the level of technological innovation that each country receives. Further inequalities in the field of technology exacerbate issues such as poverty and advancements in education and medicine. Many organizations make goals to advance the utilization of technology and work on economic improvement in Asia.

The Asia Foundation

One prominent organization that provides an inclusive environment for addressing issues related to gender equality, the environment and economic improvement in Asia is the Asia Foundation. The Asia Foundation began making an impact in the world in 1954 when several members from different sectors of society including leaders of corporations, university presidents and writers united to develop the unique organization.

The international nonprofit works primarily in the Asia-Pacific region through its 18 offices as well as its Washington, D.C. office and its headquarters in San Francisco, California. In 2021, the programs of the Asia Foundation provided direct support valued at $82.7 million.

The Upskilling Initiative

On September 9, 2022, the Asia Foundation announced its partnership with the U.S. Department of Commerce and the U.S. Office of the Trade Representative to begin the Indo-Pacific Economic Framework (IPEF) Upskilling Initiative. Participants include Brunei, India, Indonesia and the Philippines among others. The IPEF is a program that began in May 2022. The program hopes to facilitate economic improvement in Asia to become more connected, resilient, environmentally friendly and fair. The Upskilling Initiative is one way in which the program begins economic improvement in Asia through the implementation of digital skills training for women and girls.

The intention of the project is to expand the middle class by allowing women and girls the opportunities that promote this goal. The initiative is beneficial primarily because it includes partnerships between nonprofit organizations such as the Asia Foundation, governments such as the United States of America and U.S.-based companies such as Amazon, Apple and Microsoft. These private businesses will arrange digital skills improvement opportunities in IPEF countries through 2032. Concrete skills include training in innovative areas like artificial intelligence, cyber-security, business development and digital literacy and content creation.

Digital Literacy and the Economy

Increasingly, the ability to utilize technological resources relates to the improvement of the economy, which is why many organizations throughout Asia emphasize digital skills improvement as one step in economic improvement in Asia. According to the United Nations International Children’s Emergency Fund (UNICEF), digital literacy falls for those populations that are rural or those in the population minority, and digital literacy is lower for least developed countries in Asia.

Many young people in Asian countries state that digital literacy assists in skills development and education. Examples of the shortcomings of the lack of digitalization include the fact that 61% of South Asians do not use the internet despite installed infrastructure. Likewise, inequalities exist. For example, while Singapore experiences a high level of digital inclusiveness, more than 150 million people throughout South-East Asia are not able to use certain types of technologies. South-East Asia receives a ranking of fifth out of seven regions around the world for digital inclusiveness due to low scores on affordability and digital literacy.

The COVID-19 pandemic accelerated the rate at which the world uses technology to facilitate interactions among various communities. Economic growth in Asia and Southeast Asia is improving significantly with digitization with countries such as the Philippines and Malaysia leading the increase in e-commerce retail. The process reveals new opportunities, especially for the younger generation.

With continued input from partnerships such as the Asia Foundation and the U.S. Department of Commerce, countries in Asia will continue on the journey to improve the lives of the Asian population, especially women and young girls, to become a key player in the world economy.

– Kaylee Messick
Photo: Pexels

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5 Local Startups in Kenya that are Improving Living Conditions

Startups in Kenya
Startups in Kenya are notable contributors to its economy, making up 30% of the national value. Home to more than 200 startups, Kenya is a regional leader in terms of a successful startup ecosystem, which is improving the lives of Kenyans by bringing modern and sustainable solutions to society’s biggest day-to-day issues. According to a 2022 report by StartupBlink, Kenya is amongst the top five startup ecosystems in the Middle East and Africa region and is third in Africa.

Startups in Kenya Increasing Capital

Kenyan startups broke their own records in the amount of funding raised yearly since 2019. In 2021, Kenyan startups had $291 million worth of investments in total. A major portion of investments goes to startups operating in financial tech, agriculture and energy industries.

With more than 30% of the population having access to the internet compared to 17% in 2017, Kenyans are able to reap more of the benefits tech startup companies bring. Government support to local tech startups began with the project of Konza Technopolis, a hub for tech companies just outside of Nairobi.

The idea for one of the first startups in Kenya emerged in response to the problem of insufficient systems set up for money transfers. For Kenyans working in the city to send money to their relatives in the countryside, the logistics of money transfers have always been complicated. Startups such as M-Pesa helped facilitate money transfers through mobile phones, eliminating the reality of a commute from the city to the countryside.

M-Pesa

M-Pesa allows Kenyans to use their mobile phones to keep and transfer money, without the need for the internet. Mobile numbers act as account numbers and transactions only need a SIM card to go through, making it more accessible to the communities without internet access. Essentially, M-Pesa’s goal is to achieve financial inclusion in Kenyan society.

Although M-Pesa came to life through the joint partnership of two well-established communication companies, the idea of M-Pesa emerged both from the companies and the Kenyan people to respond to a long-lasting problem that has occurred for a long time.

M-Pesa is currently available and used in 10 countries with 50 million active users in Africa. Analysts estimate the company’s value to be around $3 billion.

M-KOPA

With six global offices and more than 1,000 employees, M-KOPA came alive in 2010 with the dream of improving living conditions for Kenyans by making goods and services easier to attain. The company’s 2021 impact report shows that less than half the adults in Kenya have access to bank accounts, limiting Kenyans’ participation in the formal economy.

With limited access to financial institutions and tools, establishing a credit score becomes a challenge. M-KOPA provides a pay-as-you-go financial model for the ownership of tech products ranging from phones to solar energy home products like TVs and refrigerators. The enterprise further loans cash and an insurance plan called Hospicash.

The startup currently has 20 million customers in its network and has helped 75% of customers earn additional income by making pay-as-you-go devices available for their use to further support their enterprises. Besides finance-tech startups, retail and e-commerce startups in Kenya play a significant role as well, in improving livelihoods by facilitating the integration of sellers into the market.

Twiga Foods

The startup set off by facilitating the selling of bananas from farmers to retailers. The goal of the company is to lay out a durable and modern solution to the insufficient and inefficient supply chain in Kenya. By signing up for the software as a vendor, Kenyans can easily bring together their good with retailers with the facilitation of Twiga Foods startup. A solution as such brings food security to the people and real financial profit to the sellers struggling to safely put their goods on the market. Generating $50 million in income in 2021, Twiga is a great asset to the Kenyan economy.

Lory Systems

Launched in 2016, Lori Systems is an app providing logistics services and controlling haulage across markets. In Africa, more than 70% of a product’s cost is due to logistics, compared to 6% in a country like the U.S. Lori Systems aims to lower the cost of logistics which automatically lowers the cost of the product, making it easier to attain. Lori Systems operates in six countries in Africa and specializes in the transport of goods such as bulk grains, fertilizers, containers steel and bitumen.

Apollo Agriculture

Apollo Agriculture is an agro-tech company that assists small-scale farmers in maximizing their profits. Apollo combines all of a farmer’s requirements, including guidance, insurance, market access and finance for farm inputs in order to provide them with the services they need to grow their businesses and maximize crop productivity.

The startup uses satellite data imagery of farms and machine learning to run the process of determining a farmer’s credit score. Apollo Agriculture is rather new to Kenya’s startup ecosystem, as the company originated in 2016. About 30% of Kenya’s Gross Domestic Product (GDP) comes from agriculture, making agriculture a notable asset for the Kenyan economy. The creation of startups such as Apollo Agriculture is a big first step in improving livelihoods from the roots. Startups in Kenya raised more money in the first half of 2022 than they did in 2021, coming close to $1 billion, leaving a promising impression for the rest of the year and the future.

– Selin Oztuncman
Photo: Unsplash

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USAID And Walmart Are Changing Guatemalan Economy

Guatemalan economy
In 2018, the Guatemalan economy produced one new job per every 15 workers joining the labor force. Furthermore, in 2018, 70% of the Guatemalan economy was informal, with workers severely challenged by low wages, low efficiency and a lack of access to economic opportunities. USAID has been in a partnership with Walmart Mexico and Walmart Central America since 2002 to increase economic opportunities in Guatemala and reduce poverty through “the empowerment of women-led small businesses.” This initiative is aimed at creating more jobs, expanding markets for goods produced in Guatemala and making business more inclusive and accessible to all people.

USAID’s Collective Focus in Guatemala

The initiative puts particular focus on micro, small and medium-sized enterprises that have the potential to eradicate poverty and transform the Guatemalan economy. This is especially true in emerging cities in Guatemala, where USAID helps provide vocational training to young and indigenous workers.

USAID’s work in Guatemala does not end with Guatemala’s economy. USAID has also partnered with the local government and local communities to fight food insecurity, chronic malnutrition, environmental protection and biodiversity initiatives. USAID believes that decentralizing key resources and services in Guatemala can be productive for its economy. Moreover, USAID has also tried to drive more civilian participation in decision-making processes and encouraged the people of Guatemala to hold their government accountable.

USAID Partnership With Walmart

Walmart is one of USAID’s top 40 corporate partners and USAID has worked with Walmart in Latin America and the Caribbean since 2002. Since joining forces, the organizations have provided training and granted financial support and market opportunities to small-scale farmers, women, at-risk youth and local entrepreneurs. Moreover, these organizations also launched the “Women’s Economic Empowerment Initiative” in 2011 which focused on women and farmers.

Fighting Infrastructural Battles in Guatemala

Although these commitments have helped to improve Guatemala’s economy, there are still some structural difficulties that need addressing in the coming years. For instance, Guatemala’s population is predominantly young, with more than 60% of the population being below the age of 25. More than half of the local population lives in urban areas and the country continues to urbanize rapidly, however, there is a lack of infrastructure connecting cities.

In 2022, a large number of migrants traveled to the U.S.-Mexico border from Guatemala, Honduras and El Salvador. Consequently, this has created a temporary vacuum in the labor market, but USAID and Walmart are working to strengthen their partnerships to help create more jobs and uplift the Guatemalan economy. In spite of these challenges, Guatemala is expected to see a 3.4% growth in GDP in 2022. Although this number is not drastic by any means, it shows that economic growth and poverty reduction are possible when countries commit to creating new jobs, expanding markets and investing in their youth. With the help of initiatives by USAID, Walmart Central America and numerous others, Guatemala’s economy will continue to steadily grow.

– Samyudha Rajesh
Photo: Unsplash