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the BSCFABelize’s sugar cane production has been a major staple to its economy since the 1800s. Today, it supports the livelihood of around 15% of Belizeans, contributes to 6% of Belize’s foreign exchange income and adds 30% gross value to the country’s agriculture. Due to its overall importance, organizations have taken great steps to help protect sugar farmers and improve their working conditions. A major step toward this goal was when the Belize Sugar Cane Farmers Association (BSCFA) became Fairtrade certified in 2008. Since then, the value of sugar from Belize has grown and better working conditions and human rights have been established.

Sugar Cane Farmers in Belize

Sugar cane farmers and plantation workers often struggle because sugar prices in international markets are low and processing sugar cane is long and expensive. Smaller farms also have trouble getting access to lucrative markets that would buy more sugar. The compensation smallholder farmers receive for cane often fails to cover the costs they incur to produce it, leaving them in a debt trap and with little capital to reinvest in farms. They also cannot pay for newer equipment that would help make the process easier, faster and cheaper. The significant amount of time invested in farming to provide an income often leaves little time to engage in other opportunities that can pull them out of poverty, such as education. Fairtrade aims to alleviate these problems by helping people and organizations get better representation in the market and better prices for their crops.

The Impact of Fairtrade Certification

Since 2008, Belize’s sugar cane exports have increased greatly, particularly in the European market. In the first five years of the BSCFA becoming Fairtrade certified, Belize’s sugar cane gross profit grew significantly. Belize has also been able to increase the amount of sugar cane produced every year due to farmers getting resources to control pests in the early stages of the growing process and access to better farming and processing tools. From 2018 to 2019 alone, Belize went from producing 150,000 tons to more than one million tons of sugar cane.

Impact on Communities in Belize

A huge benefit of being Fairtrade certified is that organizations will receive premiums — extra money that farmers and workers can invest in their businesses or the community. The BSCFA gets around $3.5 million in premiums a year and has used that as grants for education, building and repairs, community spaces such as churches and libraries, funerals for impoverished families, water tank systems and more.

The BSCFA has continued advocacy and empowerment efforts to improve the working conditions of sugar cane farmers. In 2015, the BSCFA took a strong stance against child labor, lobbying the government to make laws against child labor and personally suspending support of farms that violated fairtrade practices.

Due to advocacy efforts such as these, the government of Belize has taken steps to stop child labor, such as working on bills that help others identify child labor situations and updating its Child Labor Policy to add additional protection for children. It also established a Child Labor Secretariat that works on identifying and reporting child labor cases.

Fairtrade and the BSCFA have made significant strides in protecting the rights of sugar cane farmers while expanding the economy. These efforts are lifting people out of poverty and ensuring that fairness prevails.

– Mikayla Burton
Photo: Flickr

investing in BrazilThere are numerous reasons to invest in foreign aid in general. That can include partaking in growing the global economy, promoting international human rights and opening donor countries to potential investment returns. What makes Brazil a particularly good market to invest in is its promising role in the global economy. There are several reasons why investing in Brazil is beneficial.

COVID-19 Response

As of January 2021, Brazil has the third-most COVID-19 cases worldwide. The Brazilian economy was not in its best shape at the start of the pandemic because it has not fully recovered from the 2014-2015 recession. This made the economy vulnerable to precarious economic shocks that resulted in increased poverty, unemployment and small business fragility.

The COVID-19 pandemic has left countries like Brazil with possible lasting economic damages. Many emerging and developing countries rely heavily on foreign aid for financial and humanitarian support. Offering foreign aid to Brazil will not only help pave the way for a domestic post-COVID recovery but also alleviate some of the negative impacts of the pandemic through humanitarian benefits.

Diversified Opportunities in Emerging Markets

The Brazilian economy is classified as an emerging market. Emerging markets are economies that are transitioning into a developed economy. Since the launch of the MSCI Emerging Market (EM) Index in 1988, which measures portfolio performances of emerging markets, investing in emerging countries proved to create new and diversified opportunities outside of common markets.

Market Expansion and Economic Growth

Since 2016, Brazil has shown an increase in GDP growth with approximately a 1.3% increase. In 2020, Brazil fell back into recession because of COVID-19. However, Brazil’s economy displayed growth and has played an important role in the growth of the Latin American economy as it makes up 35% of the Latin American GDP. It is approximated that the Brazilian market reaches 900 million consumers in just the Americas.

On how quickly the Brazilian economy rebounded, Bloomberg reports boosted domestic demand and exports with a 9.47% rise in economic activity index from July to September of 2020 in comparison to the previous months.

As Brazil recovers from COVID-19’s economic impact, it leaves opportunity for foreign investors to take advantage of Brazil’s growing market, especially with its low interests. Some of Brazil’s profitable sectors include real estate and agricultural goods like coffee, sugar cane, corn and soybean. Participating in these sectors expands Brazil’s domestic market and hence the world market size.

Geographical Location

Especially for the United States, Brazil’s proximity allows easier trade. For other advantages, Brazil’s geographical properties for the agriculture sector also make its commodities attractive. Approximately 28.7% of land is used for agricultural production which makes up more than 4% of the annual Brazilian GDP. Following China, the United States and Australia, Brazil has the fourth-most amount of agricultural land.

Foreign Investment Returns

Encouraging enterprises to invest in foreign aid can ultimately result in great returns. A common type of foreign aid for these corporations is Foreign Direct Investment (FDI). Through FDIs, corporations can potentially gain lasting interests, multinational consumers and flexible production costs. This type of foreign aid also brings developing countries like Brazil innovative technology, investment strategies, jobs and infrastructure from investing corporations of developed nations.

Foreign investment is critical to developing and emerging markets. Investing in Brazil promotes development and sustainability and also benefits foreign investors greatly. Furthermore, foreign investment assists economic recovery following unforeseen economic shocks like that of the COVID-19 pandemic.

Malala Raharisoa Lin
Photo: Flickr

Coca Farmers Poverty traps Colombian coca farmers in an unsustainable, unethical and sometimes dangerous occupation. During the country’s half-century-long civil war, rural communities were built up around the cultivation of coca to be used in the production of cocaine.

The Peace Deal

Militant guerrilla groups such as Revolutionary Armed Forces of Colombia (FARC) were reliable buyers of coca crops as they used the cocaine trade to finance the war with the Colombian government. However, in 2016, a peace deal was agreed upon between the Colombian government and FARC that officially put an end to the civil war in Colombia. The peace agreement included a plan to wean rural communities off of the cultivation of coca by asking them to uproot their own coca plants and then providing them a monthly stipend as well as technical assistance in order to assist them in transitioning from coca to other crops. Due to organizational and financial oversights, however, many coca farmers have not received their full stipends nor have they received the technical assistance to change crops. Despite this, the Colombian government continues to carry out forced coca crop eradication efforts that leave these communities with no viable source of income.

Impoverished Farmers in Colombia

Even though the Colombian civil war is officially over, armed groups still vie for control of the cocaine trade, often employing violent, coercive methods to secure a steady supply of coca from impoverished farmers, putting coca farmers’ families and communities at risk due to the production of coca.

Often struggling to make ends meet, farmers rely on the steady income that coca cultivation provides them, despite their concerns about ethics and danger. With the implementation of the government’s coca replacement program falling flat, coca farmers were given little choice but to continue to cultivate coca crops or watch their families go hungry. Colombian law enforcement officials say 40% of forcefully eradicated coca crops are replanted. Voluntary replacement of coca crops with other crops is much more promising, with replanting rates near zero.

The Voluntary Replacement of Coca Crops

The voluntary replacement of coca crops with cacao allows farmers to provide themselves with a reliable income without having to endanger themselves or contribute to the narcotics industry. The National Federation of Cacao Farmers (Fedecacao) has been helping farmers to make this transition. With yields of up to 800kg per hectare, a cacao farmer can earn up to double the minimum wage of Colombia, making coca cultivation a less attractive alternative due to its illegality and the violence that the coca industry brings about. On top of this, the cacao industry in Colombia is growing with 177,000 hectares devoted to cacao­­, 25,000 of which were transitioned from coca cultivation. The increased production of cacao has resulted in Colombia becoming a cacao exporting country.

Joel Palacios Advocates for Cacao Transition

One particular example of a successful transition from coca cultivation to cacao is taking place in the department of Chocó in western Colombia where 60% of people live below the poverty line. Joel Palacios, a native of Chocó, has been devoted to advocating for the replacement of coca by cacao since 2011. For years, Palacios ran a chocolate training center for coca farmers who desire to grow cacao and turn it into chocolate. Palacios then launched Late Chocó, his own artisanal chocolate company based in Bogotá.

Helping Farmers Transition to Cacao

Stories like that of Palacios show the benefits of working with coca farmers to replace dangerous and illegal crops with more legal, profit-earning alternatives such as cacao. Whereas forcible, nonconsensual uprooting of coca produces inefficient results, the prospect of a steady, legal source of income incentivizes coca farmers to make the transition to cacao on their own.

Willy Carlsen
Photo: Flickr

Mobile Data TrafficMany poverty-stricken individuals do not have access to the internet, creating a digital divide. The COVID-19 pandemic has revolutionized mobile data traffic around the globe, particularly in sub-Saharan Africa. Mobile broadband supports access to education, work, healthcare, goods and services. It plays an imperative role in reducing poverty. With nearly 800 million people in the region still without access to the mobile internet, it has never been more urgent to close the digital divide.

The Need for Mobile Broadband

According to Fadi Pharaon, president of Ericsson Middle East and Africa, the increasing demand for mobile broadband provides an unprecedented chance to improve economic conditions for Africa. Currently, Africa is one of the quickest growing technology markets.

In addition to younger populations requiring technology to develop practical computer skills, during the COVID-19 pandemic, access to the internet is also crucial for remote learning and remote work to continue development and economic progression.

In response to the pandemic, sub-Saharan African countries that were able to implement telework adaptations had considerably greater access to the internet, as much as 28 % of the population, as opposed to countries that were not implementing telework, at 17 %.

Due to the increase of digitalization during the pandemic, these developments are expected to positively contribute to the region’s economic recovery post-pandemic. Research suggests that expanding internet access to cover an additional 10% of the region’s population has the ability to increase gross domestic product (GDP) growth by one to four percentage points.

The Mobile Broadband Demand

Fixed Wireless Access (FWA) delivered over 4G or 5G is a more affordable alternative to providing broadband in areas with limited access. By 2025, FWA connections are expected to reach 160 million, accounting for 25% of global mobile data traffic.

The estimated total growth of mobile data traffic is from 0.87EB per month in 2020 to 5.6EB by 2026, an increase of 6.5 times the current figures.

To keep up with the demand, service providers are predicted to continue upgrading their networks to meet their customers’ evolving needs.

Additionally, networks expect to see an increase in customers purchasing mobile data subscriptions. Long-term evolution (LTE) was predicted to amount to 15% of subscriptions at the conclusion of 2020.

Novissi Digital Cash Transfers

The Novissi cash transfer program in Togo is an example of why mobile broadband access is important in developing countries. To support struggling people in Togo during COVID-19, instant mobile cash payments were made to their mobile phones to address urgent needs. The program provided more than half a million people with financial assistance during a crisis.

Closing the Digital Divide Reduces Poverty

Experts suggest that funding infrastructure, increasing electricity access and developing approaches to support digital businesses will aid in economic recovery and continue to close the digital divide. While sub-Saharan Africa has seen an acceleration of mobile data traffic during COVID-19, more action still needs to be taken to support its citizens post-pandemic. Providing affordable access to mobile phones, mobile broadband subscriptions and internet access will help support the recovering economy and alleviate poverty in the region.

Diana Dopheide
Photo:Flickr

RCEP will benefit Asia's impoverishedOn November 15, 2020, 15 Asia-Pacific countries signed The Regional Comprehensive Economic Partnership (RCEP). The RCEP is a free trade agreement (FTA) establishing new relationships in the global economy. The 15 countries that signed the trade deal account for 30% of all global gross domestic product and impact more than two billion people. The new economic opportunities that will emerge from the RCEP will benefit Asia’s impoverished.

The Introduction of the RCEP

In 2011, the Association of Southeast Asian Nations (ASEAN) Summit introduced the RCEP. Simultaneously, another free trade agreement, the Trans-Pacific Partnership (TPP), was undergoing development. The TPP’s existence failed to come to fruition when former U.S. president, Donald Trump, removed the U.S. from negotiations in 2017. Consequently, this led many Asia-Pacific nations to negotiate with each other to make the RCEP become a reality. The ASEAN Secretariat has declared the RCEP as an accelerator for employment and market opportunities. The RCEP has been seen as a response to the absence of U.S. economic involvement and a form of stimulating the economy due to the COVID-19 pandemic.

RCEP Regulations

The RCEP has a set of new regulations that made it enticing for many nations to join. As much as 90% of tariffs will be eliminated between participating countries. Moreover, the RCEP will institute common rules for e-commerce and intellectual property. The trade deal will also include high-income, middle-income and low-income nations.

RCEP Benefits for the Philippines

Allan Gepty, a lead negotiator from the Philippines, assures that the RCEP will benefit the low-income country in many ways. The RCEP will mean more investments in sectors such as e-commerce, manufacturing, research and development, financial services and information technology. Moreover, the trade secretary, Ramon Lopez, also believes the Philippines will benefit because the RCEP will bring job opportunities. In a country where the poverty rate stood at 23.3% in 2015, the RCEP will benefit Asia’s impoverished.

Supporting Myanmar’s Economic Growth

According to the World Bank, a way to promote the reduction of poverty in Myanmar is supporting the private sector to create job opportunities. Furthermore, vice president of the Asian Investment Bank (AIIB), Joachim von Amsberg, also believes the RCEP will benefit Asia’s impoverished. He sees the RCEP as a way to grant small and medium-sized enterprises (SMEs) more access to markets, thus creating more job growth and promoting infrastructure development.

Industries Impacted by the RCEP

Many other nations will benefit from the RCEP as well. Textile and apparel (T&A) is a key sector under the RCEP. While countries such as Australia and Japan have high labor and production costs, many others do not. The RCEP will increase investment to lower-cost and less skilled countries such as Myanmar, Cambodia and Laos. The trade deal will also impact the country of Vietnam. Vietnam will benefit from its exports which include footwear, automobiles and telecommunications. Furthermore, Vietnam is could also benefit from the exporting of agriculture and fisheries products. Malaysia anticipates greater opportunities in travel, tourism and the aviation industry. Malaysia is expected to increase its GDP between 0.8% and 1.7% through the RCEP.

The Potential for Poverty Reduction

The RCEP is the biggest trade deal in Asia-Pacific’s history. The trade deal is predicted to add US$186 billion to the global economy and 0.2% to the gross domestic product of each participating nation. Also, free trade agreements allow emerging economies to become more sustainable. According to the World Bank, poverty is reduced by boosting international trade. Global trade expands the number of quality jobs and encourages economic growth. The RCEP came at a time when there are future uncertainties due to the COVID-19 pandemic and its economic impacts. Many anticipate that the RCEP will benefit Asia’s impoverished.

Andy Calderon
Photo: Flickr

GiveLight FoundationWhen Alfin Nur was 11 years old, he lost his mother, father and one of his siblings in the 2004 Indian Ocean tsunami. Two years later, the GiveLight Foundation found Alfin and began to invest in his life. He studied at a boarding school in Banda Aceh, Indonesia, which GiveLight fully sponsored, while also providing him with love and emotional support. In 2015, he graduated from Al-Azhar University in Cairo.

The GiveLight Foundation

GiveLight Foundation is a nonprofit organization that provides orphans with stability so that they can rise out of the cycle of poverty. Its mission is to build quality homes for these children and support them in receiving proper education that will serve them long-term. It emphasizes raising children in a loving and supportive environment and providing a sense of belonging.

“GiveLight Foundation is one big home for all orphans,” described Fatima Jaber, the founder of the GiveLight Baltimore Chapter, in an interview with The Borgen Project.

The same disaster that destroyed Nur’s family, hit and devastated the hometown of Dian Alyan, in Aceh, Indonesia. The tsunami killed a quarter of a million people overall, leaving many orphans. Alyan decided to build an orphanage called Noordeen Orphanage. A year later, with the help of friends, family and generous donors, the orphanage was housing 50 orphans. Through that, the GiveLight Foundation was founded.

It now has orphanages in many countries including Pakistan, Bangladesh, Indonesia, Morocco, Sri Lanka and Cambodia, providing a loving home for around 1000 children.

The Baltimore Chapter

GiveLight provides opportunities for people to start “chapters” in their own city. The chapters focus on raising funds and sponsoring the orphans of GiveLight. Most of these chapters are located within the United States in cities like Chicago, Southern California, Seattle, Baltimore, New Jersey and Orlando. GiveLight is also beginning to focus on opening chapters internationally. Currently, there is one in South Africa, Paris and Toronto and there are efforts to open chapters in Istanbul, Sydney, Brussels and Dubai, UAE.

Jaber, the founder of the Baltimore Chapter, talked about how she opened up the chapter in Baltimore around three years ago. “I heard Dian Alyan’s story when I lived in California in 2012 and knew I wanted to be involved. After moving to Baltimore and meeting supportive friends and a generous community, I thought it would be great to start a chapter here.”

Raising Funds for Orphanages

The Baltimore Chapter raises funds by hosting galas, game nights, scavenger hunts and walkathons. Soubia Balkhi, one of the other members of the Baltimore Chapter, told The Borgen Project in an interview that the last two galas had been very successful, with the team raising more than $10,000.

Because the cause is so broad, beforehand the team decides which GiveLight project the funds will contribute to. They typically like to focus on where the need is the most for that year. “For example, this year Bangladesh needs it the most and so the money from this year’s fundraiser will go to building an orphanage in Bangladesh,” said Balkhi.

The funds are then sent to the headquarters which has on-site representatives distribute the money specifically where it is needed.

Despite the limits due to COVID-19, the Baltimore Chapter continues to raise funds. Jaber discussed its latest event, taking place next month. “I’m excited to announce our next virtual scavenger hunt event! It is a fun and interactive social event where families can join, create teams and still follow all COVID-19 protocols.”

Empowering Orphans Alleviates Poverty

GiveLight is not a typical orphanage that solely provides children with a place to stay. It ensures that the orphans under its care are given a home and a proper life. The strategy that GiveLight uses allows the orphans to become self-sufficient through education, enabling them to be independent and to be able to give back. This is especially important considering that education is proven to positively contribute to reducing poverty.

Alfin Nur was not the only orphan who was able to graduate due to the opportunities that GiveLight provided for him. Rahmat Mico is now on his way to become a scientist and  Nursawami is a working mother who continuously gives back to GiveLight.

With more time, orphanages, chapters and supporters, GiveLight will be able to broaden its support in the qualitative manner that it has been doing since the very beginning.

– Maryam Tori
Photo: Flickr

Tourism in Latin America ReducesLatin America is a vast region with diverse weather, geography, culture and foods. Each year, millions of tourists flock to Latin America to enjoy its natural beauty. A vacation haven, tourism in Latin America is a driving force for economic development in the region. Furthermore, tourism in Latin America reduces poverty.

Tourism in Latin America

From the beaches of Cuba to the Andes mountains in Peru, any traveler can find a destination of their preference. The most visited countries in Latin America are Mexico, Brazil and Argentina. According to the World Bank, more than 113 million tourists traveled to Latin America in 2018, bringing $103 billion worth of revenue. Tourism in Latin America has created more than 15 million jobs, which accounts for 7.6% of all employment. Furthermore, international tourism contributes roughly $348 billion to the GDP of the countries in the region.

Ecotourism in Costa Rica

According to the World Tourism Organization (UNWTO), Central America saw a 7.3% growth in its tourism sector, the biggest subregional growth in Latin America. Moreover, the country of Costa Rica has attracted millions of international visitors thanks to its ecotourism. Costa Rica is a leader in preserving its environment while attracting millions to come and enjoy its natural beauty. Beaches, rainforests, volcanoes and wildlife attract tourists which contributes to the economic development of the nation. A study conducted by the National Academy of Sciences correlates ecotourism with improving the lives of Costa Ricans. The study found those living near protected areas and parks saw a 16% reduction in poverty. Furthermore, tourism in the country accounts for 5% of the GDP.

Poverty Reduction in the Dominican Republic

Punta Cana is the dream destination for many, with captivating views of the ocean and exciting nightlife, the beach town welcomes 60% of all Dominican Republic’s tourists. Moreover, the country has benefited more from international tourism than any other Latin American nation. The tourism industry contributes to 9.5% of the island nation’s GDP. Even though poverty is still an issue for the country, extreme poverty decreased to 1.6% of the population in 2018. Furthermore, malnourishment has also decreased and life expectancy has increased. Tourism has steadily contributed to the well-being of Dominicans.

COVID-19 and Mexico

Mexico’s tourism is very important for its economy. Mexico is dependent on its tourism sector since it accounts for 16.1% of its GDP and employs nearly nine million people. Destinations such as Cancun, Puerto Vallarta and Cabo are very popular for tourists to visit. Furthermore, Mexico’s tourism was thriving until the COVID-19 pandemic brought challenges to the country. The pandemic brought a halt to tourism and hurt the economy of Mexico. Nonetheless, Mexico still manages to keep the industry alive. Mexico began to limit hotel and restaurant capacity to curtail the virus. Mexico is also working with the CDC to ensure U.S. travelers going back to the United States are returning uninfected. Even though tourism has decreased because of the pandemic, flights to the state of Quintana Roo, where Cancun and Tulum are located, were averaging 460 air arrivals compared to an average of 500 pre-pandemic.

Tourism and the Future

Tourism in Latin America has positively impacted many lives across the region. The U.N. acknowledges that tourism is a way for a developing country to economically sustain itself. Moreover, tourism in Latin America reduces poverty. Challenges such as the COVID-19 pandemic put a setback to the growing tourism sector. Regardless, Latin America has an abundance of beauty and adventure, thus ensuring tourism will be kept alive once the pandemic is over.

– Andy Calderon Lanza
Photo: Flickr

Solar Energy in UgandaAs of 2016, it was estimated by the World Bank that only 26% of Uganda’s population has access to electricity. In urban areas, the percentage is higher, at about 60%. However, in rural areas, the amount of people with electrical access is limited to only 18%. The use of solar energy in Uganda hopes to bring increased access to electricity, specifically in rural areas, as well as make electricity more affordable for the population.

What is Solar Energy?

Solar energy is energy from the sun that can be used electrically or thermally. It is a renewable energy source that provides a sustainable and clean alternative. Through photovoltaics (solar thermal collectors) solar power is collected and then converted into an energy source that can be used as a heating system or for electricity.

Solar Energy Fighting Poverty

Solar energy in Uganda can bring poverty reduction. It is an affordable and reliable source of energy that rural areas can depend on. It can also produce jobs within the community. Since solar energy makes household chores easier, women and girls have more time available to search for jobs or pursue education and development opportunities. Overall, renewable energy is a valuable component to provide electricity access, financial empowerment and sustainable economic and social development.

European Investment Bank (EIB)

With solar energy, more of the country will have access to electricity. The European Investment Bank (EIB) is using its finances to help people without electricity in Uganda. As it is the rural communities that are more affected by a lack of electricity, programs are more focused on maintaining reliable resources for those areas.

Through EIB’s efforts, more than one million people in Uganda will have access to electricity for the first time, making for easier cooking and the ease of many other household activities. Families will also be able to save money since the household will not be using as much kerosene, candles or charcoal. Indoor pollution will decrease from less kerosene usage and fire hazards will be reduced.

Reliable electricity has many benefits, with access to health opportunities being one of them. With access to phones, radios and televisions, farmers will be open to markets that can increase their income. EIB has given a loan of $12.5 million to build 240,000 solar home systems throughout Uganda, increasing economic and social opportunities.

Sustainable Energy for All (SEforALL)

Sustainable Energy for All (SEforALL) created an agenda that was adopted by Uganda’s government to help provide an increase in accessibility. The goal is to provide more than 99% of the population with access to electricity by 2030 and improve the energy efficiency of power users by at least 20% by 2030. SEforALL plans on accomplishing this ambitious goal by building energy savers throughout the country in households, industries, commercial enterprises and more.

It is clear that Uganda is in need of more access to electricity throughout the nation. Solar energy is one of the sources that hopes to increase those numbers. There is still a lot to be done to raise access to electricity from 26% to 100%, but with efforts from Sustainable Energy for All and the European Investment Bank, the situation looks exceptionally hopeful.

– Sarah Kirchner
Photo: Flickr

BRAC’s Ultra-Poor Graduation ProgramOf the United Nations 17 Sustainable Development Goals, the first one sets an ambitious target. To end poverty in all its forms, everywhere and to leave no one behind. One such organization embracing this challenge is Bangladesh’s BRAC. BRAC is one of the world’s largest nongovernmental development organizations founded in Bangladesh that has done a tremendous amount of work fighting extreme poverty in Bangladesh. BRAC’s Ultra-Poor Graduation program has seen success globally.

Poverty Progress in Bangladesh

Nestled between India and Myanmar in South Asia, Bangladesh has made enormous strides in combating extreme poverty in a relatively short amount of time. In a little over a decade, 25 million people were lifted out of poverty. Between 2010 and 2016, eight million people were lifted out of poverty in Bangladesh.

Although poverty rates were seeing a steady decrease, those living in extreme poverty in Bangladesh still lacked basic safety nets and support from NGO services.

BRAC’s Ultra-Poor Graduation (UPG) Program

In 2002, BRAC introduced the innovative Ultra-Poor Graduation (UPG) program in an attempt to apply innovative approaches to solve extreme poverty in Bangladesh and across the globe.

The UPG program aims to provide long-term holistic support for those in extreme poverty to lift themselves out of poverty and graduate to a more resilient and sustainable life. This is done by addressing the social, economic and health needs of poor families while empowering them to learn new skills and better financial management.

BRAC believes that while traditional government interventions such as food aid and cash transfers are impactful and have a role to play, these benefits, unfortunately, remain out of reach for many in extreme poverty and are certainly not a long-term solution.

BRAC’s UPG program sets to build skill sets and assets to ensure families are equipped to become food secure, independent and achieve economical sustainability.

The Success of UPG Programs Globally

The program has found success inside and outside Bangladesh and has received praise and acknowledgment in some of the world’s most impoverished regions.

Take for example the country of South Sudan. From 2013 to 2015 BRAC piloted a project involving 240 women. The program provided support for the women to receive food stipends, asset transfers and various skills training that included financial and basic savings skills.

Shortly after the women received training and support, the South Sudanese Civil War escalated, ravaging the country and causing inflation and food shortages.

Despite these shocks, 97% of the 240 women were still able to increase their consumption thanks to the resources, assets and skills they obtained during the program. Also, their children were 53% less likely to be underweight and malnourished, compared to those who had not been in the program.

More Success in Afghanistan and Other Countries

Another example comes from Afghanistan, where a widowed woman in the Bamiyan province received a flock of sheep and training from BRAC. Since then, she has been able to generate enough income to feed her family, send her grandchildren to school,  sell additional products and save for the future.

From 2007 to 2014, a large-scale UPG program across Ethiopia, Ghana, Honduras, India, Pakistan and Peru saw a 4.9% increase in household consumption, 13.6% increase in asset values and a 95.7% increase in savings pooled across all countries.

The success of BRAC’s Ultra-Poor Graduation program can be clearly seen from the results. It is an innovative program that aims to end all poverty and leave no one behind and is successfully on its way to doing so.

– Andrew Eckas
Photo: Flickr

Impact Investing in RwandaImpact investing is a growing industry with huge potential for combatting poverty around the world. The practice consists of firms and individuals directing capital to businesses and enterprises that have the capacity to generate social or environmental benefits. Traditional businesses tend to avoid such investments due to the high level of risk, low liquidity and general difficulty to exit if returns are not satisfactory. Most impact investing is done by particularly adventurous capitalists as well as nongovernmental organizations (NGOs) that aim to create social change. Impact investing in Rwanda, in particular, has yielded positive results.

AgDevCo

AgDevCo is an example of a social impact investing firm that aims to invest with the intention of reducing poverty and increasing opportunity in developing regions. Based in the United Kingdom, AgDevCo was incorporated in 2009 and has engaged in numerous projects since.

The firm’s specific area of investment is in African agriculture, where it believes that impactful investments have the potential to be a significant force in reducing poverty. The firm is currently investing in eight different African countries. Its portfolio includes $135 million worth of funds in 50 different companies. These investments have engaged more than 526,000 customers and have created or sustained more than 15,000 different jobs.

Uzima Chicken Limited

One of its investment projects is a partnership with the East African poultry company, Uzima Chicken Limited. Uzima Chicken produces and distributes the Sasso breed of chickens. Sasso chickens are resistant to disease and can feed through scavenging. These beneficial traits make Sasso chickens particularly useful in the struggle to reduce poverty in East Africa.

In 2017, AgDevCo invested $3 million to support Uzima’s establishment in Rwanda. As a result of the investment, Uzima gained funds necessary for rapid operational growth as a domestic producer of poultry. This is in line with the government of Rwanda’s strategy to achieve poultry self-sufficiency in two to three years. Uzima has also been able to expand into Uganda, where its business is rapidly scaling upwards.

The Uzima Business Model

The Uzima model of business involves the employment of company agents who raise the chicks for six to eight weeks before selling them to low-income households in rural areas. Such a model provides benefits to farmers, who can increase income through the sale of the more valuable Sasso chickens, as well as the agents.

Agents typically make a 25% profit from selling chickens. A survey of Uzima agents found that, on average, 27% of household income came from selling Sasso chickens. By providing a reliable source of extra income for employed agents, Uzima helps to alleviate the burdens of poverty for these people. As of 2017, the efforts had created 150 new jobs, 40% of which are held by women. Rwandan women have benefitted significantly from Uzima’s employment with 64% of women agents reporting that the income they earned from selling Sasso chickens led to a positive change in the decision-making power they had in their households.

Impact Investments for Poverty Reduction

Uzima’s Sasso chickens grow faster, live longer, produce more eggs and have higher market prices. They are disease-resistant and thrive in local, rural conditions. Out of all the customers buying these chickens, 54% live below the $2.50 poverty line. AgDevCo investment gave Uzima the capital necessary for operational expansion, and as a result, a greater quantity of impoverished people in East Africa could buy superior chickens and increase income. Uzima’s business also has clear potential for women’s empowerment, making it a great tool in the effort to reduce poverty and inequality in the region.

The impact investments made by firms like AgDevCo have clearly measurable impacts in impoverished regions, particularly noting the success of impact investing in Rwanda. This makes impact investment firms an important part of the global effort to reduce all poverty.

Haroun Siddiqui
Photo: Flickr