Tag Archive for: Economic Growth

Information and news about economic growth

Posts

, ,

Workplace Gender Equality in Honduras

latin america genderWorkplace gender equality is vital for economic growth. With women making up 50 percent of the working population, but only contributing 37 percent to the GDP, it’s important to realize that their financial success is crucial for the global economy.

In order to see this success, women will need proper training and economic incentives to be economically stable. One small business owner, Daniel Vàsquez, moved his plantain processing plant from Tegucigalpa to Valle de Jamastràn in order to tap into the markets of smallholder farmers, both male and female alike.

Vàsque’s business, Dartma, processes the plantains that are used to make chips and other snack foods throughout small convenience stores in rural Honduras. His business model prioritizes gender equality throughout the workplace and was created by TechnoServe, a nonprofit that focuses on business solutions to poverty.

Dartma purchases produce from male and female farmers, and has a gender-balanced sales and production staff—individual talent determines who works where.

Vàsquez explains broadly, “There’s balance. Women are more creative in some areas, they’re detail-oriented, they’re better at product quality control. Men are better at activities requiring physical strength, like carrying materials.”

After implementing TechnoServe’s goals towards gender equality in the workplace, Dartma saw a 20 percent increase in revenue after one year. With more growth, he hopes to one day provide parental leave to his female employees.

According to global management firm McKinsey Global Institute (MGI), advancing women’s roles in the workforce can contribute $12 trillion in global growth by 2025.

For women to contribute more to the economy, there must be more gender equity at work. This requires adequate training that provides the skills females need to perform well in higher-productivity jobs, along with equal benefits and pay from the employer.

An MGI report states that in order to achieve gender equality at work, there must be economic development and a change in society’s attitude towards gender equality.

Over the last 30 years, these social attitudes have already improved, which has contributed to a 19.7 percent increase in female workforce participation last year, according to the same report. If this growth is maintained, nearly 240 million people will be added to the world’s labor force by 2025.

Daniel Vàsquez shares why he values the women who work for him and supports gender equality in the workplace. He states, “The main benefit of buying raw materials from women is that they deliver a higher quality product, they always deliver the right order and on time. The other benefit is that the money reaches their hands and they invest it in their children.”

– Kelsey Lay

Sources: McKinsey Global Institute, TechnoServe
Photo: Latin Correspondent

, ,

EU Finances Program Tackling Poverty Reduction in Pakistan

Poverty_Reduction_in_PakistanIn 2015, the European Union (EU) and partners in Pakistan, including the non-profit National Rural Support Programme (NRSP), launched the SUCCESS program targeting rural development and poverty reduction in Pakistan. Based in the Sindh province, the program will provide aid for development in eight districts faced with high levels of rural poverty.

The Sindh Union Council and Community Economic Strengthening Support (SUCCESS) program will be funded for six years by the European Union. During the launch of the SUCCESS program, organizers told Pakistani newspaper The News, that the objective is to “reduce poverty through undertaking the Community Driven Development (CDD) based on the proven social mobilization approach of the Rural Support Programmes (RSPs).”

RSPs have been part of the country’s development strategy for decades. Utilizing community driven initiatives, they have a record for poverty reduction, aiding development and empowering women through community programs. Additionally, Deputy Secretary Sindh Ajaz Ali Khan told The News “it was encouraging that the SUCCESS programme would involve and be led by women.”

Social mobilization is also a key element for the SUCCESS program and NRSP to incorporate the poorest people into the development process. These programs provide a multi-level approach according to the NRSP website. They promote “a culture of participation, inclusivity and solidarity, direct provision of front-line services, planning and development, business creation, savings, conflict resolution, dialogue and interaction with local authorities.”

Approximately 770,000 rural households will be mobilized through the SUCCESS program. Going forward, households will come together in Community Organisations (COs), one of the several tiers the rural support programs use to mobilize and organize.

RSPN Chief Executive Officer Khaleel Ahmed Tetlay told The News that the SUCCESS program would focus on sustainable and financially viable approaches to poverty reduction in Pakistan. The program also aims to “link the community institutions with the government service delivery departments.”

The Daily Times in Pakistan reports a fundamental issue for the Sindh province is “to accommodate talented and educated youth into industry and job market.” With the support of the Sindh government, the organizations involved hope the SUCCESS program will help the province retain rural youth by creating new work opportunities.

– Cara Kuhlman

Sources: The Daily Times, National Rural Support Programme, The News
Photo: Google Images

, , ,

Eradicating Extreme Poverty: The 10 Percent Mark

eradicating_extreme_poverty
As the world turns its focus toward the home stretch of ending the likes of world hunger and preventable diseases, eradicating extreme poverty also lands on the agenda. According to the World Bank, extreme poverty will reach an all-time low of less than 10 percent by the end of this year.

However, as great as this news is, millions are still suffering, and it is important to remember the end goal of completely eradicating extreme poverty, both through what has been proven to work and new innovations.

Jim Yong Kim of the World Bank said that “this is the best story in the world today, these projections show us that we are the first generation in human history that can end extreme poverty.”

Knowing this, it is so important to take these findings and act on the opportunity; now is not the time to relax. According to the World Bank, 702 million people (or 9.6 percent of the world) will still be living below the poverty line. Most of these people currently live in sub-Saharan Africa and Asia.

But the progress can be clearly seen when compared with past numbers. In 2012, 902 million people (or 13 percent) still lived in poverty, and that number was higher still at 29 percent in 1999. Since the pledge made by the leaders of the world 15 years ago, more than one billion people have been lifted out of poverty.

Kim believes this steady decline has occurred thanks to a combination of economic growth in developing countries as well as more countries investing in their health and education systems. Resiliency among communities has also been increased through societal safety nets, which help to prevent people from falling back into poverty.

As mentioned above, the work is not over as long as one person still lives in poverty. The world and organizations focused on poverty need to continue to be proactive if they want to be able to completely eradicate extreme poverty.

As Kim says, “This new forecast of poverty falling into the single digits should give us new momentum and help us focus even more clearly on the most effective strategies to end extreme poverty.”

– Drusilla Gibbs

Sources: Al Jazeera 1, Al Jazeera 2, World Bank
Photo: Christianity Today

, ,

Tackling Income Inequality in Asia-Pacific Region

School
Policies that support quality education and provide social protection are investments that can help stem rising income inequality in the Asia Pacific, according to Axel Van Trotsenburg, the World Bank Vice President for East Asia and the Pacific who spoke recently at a meeting of the Asia Pacific Economic Cooperation (APEC) finance ministers in Cebu, Phillippines during a session called “Global Economic and Financial Outlook, Growing Inequality and Regional Connectivity.”

For poverty-stricken households, labor is often the sole asset they depend on. However, Van Trotsenburg said that if labor were to be made more productive through quality education and the addition of skills training, inclusive growth could begin to happen.

Van Trotsenburg suggested focusing education policies on quality teaching and better learning outcomes. The goal would be to reach youth in their primary and secondary school years.

Education initiatives alone could produce significant improvements for the livelihoods of the poor and reduce income inequality. But additional social protection measures can greatly support and enhance these efforts, significantly improving people’s lives, he said.

For example, conditional cash transfer (CCT) programs can raise school attendance, preventive health care and nutrition among the poor and vulnerable. CCT programs have been successful in places like the Philippines, Mexico, Peru and Chile.

In 2010, The Economist magazine praised CCT programs for their effectiveness. “The programs have spread because they work. They cut poverty. They improve income distribution. And they do so cheaply.”

Despite growth in middle-income East Asian households, poverty and class divide are still very present throughout the region. Van Trotsenburg describes the complexities of the situation:

“In middle-income East Asia, rapid, inclusive growth enabled hundreds of millions to lift themselves out of poverty. Yet, there are still challenges. The bottom 40 percent of the region’s population – almost 800 million people – still live on less than $3 a day in terms of purchasing power parity. These people might fall right back into poverty if the global economy takes a turn for the worse, or if they face health, food-price and other shocks.”

He urged APEC members to continue or accelerate economic reforms to sustain growth that will increase the living standard of those at the bottom of the income distribution.

In particular, he advocated for physical infrastructure investments. “In this region, 142 million households still have no access to electricity while 600 million people lack access to adequate sanitation,” he said. “It will be very important for greater investment to be accompanied by increases in efficiency of such expenditure. And this points in turn to the importance of strengthening institutions, including through public financial management reforms.”

– Nikki Schaffer

Sources: World Bank, Economist
Photo: jonahkessel

Preparing for Smart Cities in India

smart cities
Last year, Indian Prime Minister Narendra Modi announced his plans to revitalize Indian cities through the creation of 100 “Smart Cities” in India. More recently, Mr. Modi has announced that he will be giving annual federal grants of 15 million for the next five years to a list of 98 cities to help them become ‘smart.’

Modi, who has faced critique over the vague nature of his ‘smart city’ concept, has himself argued that “there is no universally accepted definition of a smart city.” Nevertheless, experts argue that the idea of a smart city generally refers to a city with criteria such as good roads, power, access to water, and livable homes–which many Indian cities currently fail to meet.

Mr. Modi’s Smart City project has also more specifically toyed with the idea of promoting mixed land use in area-based developments, creating walkable areas in cities, and creating a variety of clean and safe transport options.

According to Mr. Modi, the Indian Smart City initiative is only one among many urban development projects aimed at keeping up with the pace of economic and population growth within India. Indeed, India, which has a burgeoning population boom that will overtake China’s by 2028, also has the world’s third-largest growing economy, according to the World Bank.

India has also experienced an enormous influx in rural to urban migration in recent years, with more than 30% of India’s once mostly urban population now living in cities. This figure is also expected to rise, as many Indians move to urban areas in search of better job opportunities and diminished caste-based persecution.

In light of the demographic changes occurring in India, many experts have argued that Mr. Modi’s ‘Smart City’ initiative is an enlightened plan that will serve to bring relief to millions of Indians migrating to larger cities.

By focusing on issues in Indian cities–such as poor sanitation and access to water–the ‘Smart City’ initiative is thus not only a retroactive plan that serves to correct the poor state of many cities, but also a proactive plan, that takes into account the strain that a burgeoning urban population will pose to Indian cities in the future.

As Mr. Modi’s plan regarding his list of 98 Indian cities begins to be finalized, the Prime Minister also hopes that the somewhat paltry funds currently allocated to the project will be able to be bolstered by private donations.

Other government officials, such as Home Minister Rajnath Singh, have also proposed ways in which the ‘Smart City’ concept could be further improved. Mr. Singh, for instance, just recently proposed the idea that ‘Smart Cities’ could also be built as ‘Safe Cities’, which would require the installment of security equipment such as CCTV, aerial surveillance, and an increase in female cops.

Other officials have also begun to float ideas for how Indian cities can be better improved–making them overall smarter, safer, and more livable for the millions of Indians who currently live in sub-par urban conditions.

– Ana Powell

Sources: BBC, Forbes, India Times, NY Times, Smart Cities Challenge
Photo: KadvaCorp

Struggles of Cuban Youth in the Face of Political Change

Struggles Of The Cuban Youth In The Face Of Political Change- BORGEN
Although it is banner global news that the U.S. embassy has reopened in Cuba after 50 years of nonexistent relations, young Cubans are less than thrilled about the development. A reestablishment of an American-Cuban relationship may change the political/economic environment for some higher-ups, but it is unlikely to change anything for a young generation in Cuba that faces daily turmoil.

Despite much buzz surrounding the shift that is underway in the country, a sense of cynicism remains among the Cuban youth who believe that the ideals of Fidel Castro’s revolution are dated and irrelevant in the modern age. Hope of prosperity is shrouded by the belief that the Cuban government will not possibly allow young lives to change.

“Change? My life won’t change,” said 17-year-old Yunior Rodriguez Soto, gesturing to the dilapidated basketball court that surrounded him as evidence. “[The government] won’t let it happen […] That’s just how they are.”

The youth are open to political freedom and socioeconomic reform, but due to the Cuban government’s desire to maintain control and reach the highest possible level of national economic success, it is unlikely that changes will trickle down to their level.

Efforts of the government to balance economic growth with state control are causing private sector development to be difficult. Thus, the overgrown public sector is failing to persuade young people to stay in Cuba and start families. They have no guarantee that if they work hard they can support themselves and their children.

Government prices make buying products difficult for small business owners, and Cubans are often forced to turn to the black market in order to get the supplies they need at affordable prices. This black market activity does little to bolster the national economy.

While many developing nations see large youth populations, Cuba faces a serious demographic problem in their lack of young people. Approximately 20 percent of the Cuban population is over 60, making it the oldest Latin American nation, on average. Like Japan and the nations of Northern Europe, Cuba is a society struggling to support their older citizens without a thriving youth population on the economic rise.

There is evidence of a growing Cuban economy–new bars, clubs, and restaurants opening daily in Havana. But the lives of many Cubans have barely improved. The citizens opening these establishments were better off to begin with than many living on the streets. As one young Cuban remarked “the only way to see change is to make a boat and sail off.”

Cuban citizens want the change in their country to be immediate and to live up to the hype, but officials continue to insist that steps toward change will be gradual and take a while to pay off.

Cuba faces a conundrum–it is the youth that they most need to be involved in order for the country to prosper, but it is the youth who are least optimistic that the nation can change. The young people of Cuba, like those in other countries, on the whole are not overly interested in politics. Without some inspiration, it is unclear when the Cuban economy will see any significant change for its impoverished youth.

– Katie Pickle

Sources: New York Times, BBC
Photo: Flickr

, ,

Innovative Policies that Spur Growth and Reduce Poverty

reduce_poverty
A handful of standard policies have been used throughout the world over many decades to attempt to decrease poverty. However, poverty is still a massive problem worldwide. It is also known that healthy economic growth is vital to reducing poverty. What are some new, innovative policies that can be used more widely in conjunction with existing policies to maximize poverty reduction and spur economic growth?

One of the most well-known innovative systems of reducing poverty has been the microcredit or microfinance system that has been perpetuated throughout areas with high densities of impoverished people. Bill Gates has said that he believes that providing more access to mobile banking (an extension of the ideas behind microfinance), will have huge impacts on the way the poor deal with money and will help reduce poverty.

Many innovative new policies are aimed at specific demographics in order to fully leverage the investment in a way that affects the poor best. For example, many of the poor live in rural areas and are involved in agriculture.

Due to the large role of agriculture in many impoverished people’s lives, one organization named Katalyst gives out small packets of high-quality seeds to farmers in Bangladesh. The result? Incomes for these farmers increased on the whole by over 300 million dollars.

The United Nations Development Programme (UNDP) has begun to fund proven methods of development. Two programs, one from Colombia and one from Haiti are being funded by the UNDP. Both programs focused on job training and development for people in vulnerable areas of the respective countries.

A third program was aimed at helping the government of Laos address the infrastructure concerns and problems in local areas, which eventually helped over 300,000 people to get better goods and services as well as local infrastructure.

Another idea which is incredibly simple is now being more widely accepted as a method that would prove valuable. Give poor people money. Giving unrestricted cash transfers to the poor has not been a popular policy in the past because many fear that the money would be wasted on nonessential goods or illegal activities.

However, a study based on a model like this was done in Uganda and resulted in a 38 percent increase in wages by the end of the study in the group that was given the unrestricted cash transfers. In addition, hours worked and business assets both increased significantly. The myth that the money would simply be wasted via this simplistic approach seems to be being dispelled.

Most of these ideas are not based on some new understanding of poverty. The existing rationale behind each one is held in commonly held knowledge about the different attributes of poverty and those in poverty.

The innovations are creative ways of tackling the most basic traits of the impoverished, unemployment (specific job training centers), lack of money (unrestricted cash transfers), and giving high quality seed packets (agriculture as a means of income).

By addressing these known factors in new ways, these policies have proven to be of use in the instances they were used, and should be more widely spread across the globe to help increase the rate of poverty reduction.

– Martin Yim

Sources: OCED Insights, United Nations, Social Science Research Network
Photo: CNN

,

Kenyan Bitcoin Startup Receives Gates Foundation Funding

gates_foundationThrough innovation and funding, Kenyan bitcoin startup Bitsoko promises to revamp the way commerce is conducted in bustling markets in Nairobi and cities across Africa. The company has invented a digital wallet that employs blockchain technology to allow a smoother, cheaper transfer of funds between individuals.

Used in Bitcoin, blockchain technology saves and encrypts transaction records that allow for safe, speedy monetary transactions at a low cost.

This form of technology expands access to financial services for merchants and their customers. For sellers, such programming allows them to view and track customer payments while aggregating this data to produce complete financial and stock records, customer invoices and receipts, financial statements, and tax returns.

The acceleration of blockchain technology will also make transferring funds between individuals cheaper, encouraging mobile commerce.

Developments such as this will provide an alternative to inconvenient, slow transactions using cash or credit cards and will follow at the heels of the economic boom occurring in Africa. Such technology will foster economic growth and pair customers with suitable goods and services in a more efficient way.

According to Allan Juma, co-founder of Bitsoko, the brand hopes to be a leader in mobile finances, noting how “the financial structure in Kenya and throughout Africa has changed rapidly since the birth of mobile money by M-Pesa. We believe that this will only continue to grow”.

The company has recently attracted attention from international investors and organizations as well. It was recently awarded $100,000 from the Bill and Melinda Gates Foundation through the Global Challenges Explorations, an initiative providing support to groups working toward solutions to global problems.

Programs such as this one provide an incentive for entrepreneurs who have experienced societal challenges to develop efficient, sustainable strategies for improvement.

With its GCE funding, Bitsoko plans on expanding its access internationally, bringing mobile banking services to Ghana, Zimbabwe, and Sierra Leone in a project co-founder Daniel Bloch has named “Enable Universal Acceptance of Mobile Money Payments”.

Bringing this technology to new countries will spur economic growth and technological innovation that has been heating up Africa in recent years. With increased transactional accessibility, sellers can expect to create a larger, more diverse consumer base and enhanced output.

Partnerships between international organizations such as the Gates Foundation and local businesses can lead to far-reaching global solutions that empower entrepreneurs and their communities.

– Jenny Wheeler

Sources: Disrupt Africa, Grand Challenges in Global Health, Bitsoko
Photo: Coin Telegraph

, ,

Engage Emerging Nations, Improve Education Spending

Engage Emerging Nations, Improve Education Spending
Global Education is a hot topic. It has been a part of the Millennium Development Goals and the post-2015 Sustainable Development Goals. There was a recent Education Summit in Olso, Norway, in July. Education was also part of the discussions at the International Conference on Financing for Development.

Education leaders believed that there was a downturn in funding and supporting quality education for boys and girls around the world. However, after this year’s attention to education, this trend may be behind us. Mobilizing donors has had positive results. The financing committees work to enable traditional donors, private philanthropy and emerging nations.

One of the biggest game-changers is the Emerging Nations. They have a lot of potential to improve education standards and bring education to more people. The Global Partnership for Education brings together its developing nations partners and constituents before board meetings. The countries come together and exchange ideas and practices that work or didn’t work for them, allowing knowledge to spread more easily. It also gives the board an idea of how to tackle problems and how to approach education in these areas.

The meetings show that emerging nations are engaging in educational discussions and want to invest in the improvement. That is why it is important to mobilize these nations to spend on education. Show them where and how their money will be most effective.

Developing Nations are said to be growing economically more than developed nations. They will account for 65 percent of global growth up until 2020. It is important to reach out to them on such an important topic such as education. These countries have the resources to better education not just for their citizens, but for all global citizens by donating to global education. They can be the ones to close the $39 billion deficit in global education financing. The emerging nations are the ones that will benefit the most from education spending.

– Katherine Hewitt

Sources: Devex, Global Partnership, ICEF
Photo: Higher Education Development

,

Three American Companies Investing in Africa

american_companies_invested_in_africa's_growth
Africa was once known as “The Dark Continent,” a place of mystery and hardship. While many hardships continue today, Africa is not nearly so dark as it once was: with electricity and economic growth sweeping across the continent, wealthy foreign investors have set their eyes on the potential wealth hidden in emerging African markets, and some American companies are making it their mission to launch Africa into the future. As of 2011, U.S. companies had invested over $48 billion in Africa. The following are three American companies investing in Africa.

Google
The search engine giant turned jack-of-all-trades has been pursuing countless investment opportunities over the last decade, the least of which is its foray into Africa. With mobile technology and Internet access rapidly changing the face of Africa, it’s a no-brainer that the tech mogul wants in. Google Africa has a number of on-going projects in Africa, from simply expanding its network, to installing the hit Google Fiber, to hosting a development summit for technical officers, devs and designers. The massive corporation has even invested in renewable energy development, which some economists have touted as the “cure for poverty.” In addition to developing its own enterprise, Google also launched Google.org in 2004, a nonprofit formed to create awareness about climate change, global public health and global poverty.

Cummins
This global designer and manufacturer of diesel engines has been present in Africa since 1946. The company describes its activities across the continent as including “an extensive network of company-owned, joint venture, and independently owned distributors and dealers.” Much of their business in the 51 of 54 African countries they operate in is selling and servicing products, namely power generators for homes and businesses. Unlike many large multinational corporations, Cummins works to keep a portion of its works dedicated to establishing locally-owned branches of the company, keeping a portion of the profits within the local community. The company also makes a point of embracing its responsibility as a corporate leader “to help improve the communities in which employees work and live,” and Cummins works to have a positive impact in its areas of operation.

Ford
The original auto manufacturer has also had a long-standing presence in Africa, having been involved in the South African automotive industry since the 1920s. Ford employs over 3,700 people in South Africa and recently announced plans to establish a production plant in Nigeria, hoping to eventually spread throughout Sub-Saharan Africa. Besides making cars, the Ford Motor Company has been developing a customizable electric bike that they hope will revolutionize urban travel and expand local business opportunities. Ford is also working with a number of African initiatives to improve access to education and healthcare, including World Vision in Africa and Riders for Health.

“As much as we are a car company, Ford is also a people company. Our investment in the community across Africa–through various health, education and mobility projects is as fundamental to our business as producing vehicles, as this is key to unleashing the potential of the African continent,” said Jeff Nemeth, president & CEO of Ford Motor Company of the Sub-Saharan Africa region.

Africa’s emerging and veritably booming economy is drawing more and more international attention, with investors convinced that “the dark continent” will be the home of the next gold rush. Whether or not all corporations eyeing Africa for their next venture are considering the positive impact they can make across the impoverished continent, their presence is having a dramatic impact and is pulling the struggling economy towards a brighter future.

– Gina Lehner

Sources: American Outlook, Automotive World
Photo: IB Times