Monday, May 28, 2012

Making the real change happen

As many people who made real change in the world, Evans Wadongo would not be recognized by many in the crowd or on city streets. But the truth is, this young man is truly exceptional and has already changed thousands of lives in his home country Kenya with his solar lamp project. 


While at university, Evans designed a solar lamp which he calls "MwangaBora (Swahili for good light). He told us: "I saved money from my scholarship - it was about $50".  He named his whole project "Use Solar, Save Lives" as the goal is to improve lives in the poor rural communities. The lamps are adjusted and designed based on needs of a particular rural community.

Sauder Africa team usually faces a big challenge when trying to get our students to understand what is the uniqueness of their buisness and what problem they are trying to solve in their community. Evans nailed his explanation. "I was growing up in the village but I did not see any change. People were developing problems with their eye-sight as they were using kerosene lamps and the long exposure to the smoke caused many problems. There is so much going on in the world and you (westerners) can all read about it in the newspapers or on the internet but I did not see change. I did not see any change happen."
There are many Kenyan communities who live on less than a dollar a day. With that dollar, they have to secure food for their family but also buy kerosene for their lamps. For many of them kerosene is expensive. By using solar lamps, they can save money and avoid health problem. Evans' goals is to distribute 100,000 lamps by 2015.


I presume that the biggest reward for him is the change that he sees with his project. But the international community did not overlook his achievements. Evans was voted one of the CNN top ten heroes of 2010. In 2011, he was named one of the three recipients of the inaugural Mikhail Gorbachev Award for "people who changed the world" and also announced as one of the Social Entrepreneurs of the year by Schwab Foundation. 

Having him attend Sauder Africa Initiative team meeting was a lucky break. He was visiting Vancouver for another purpose but made time in his busy schedule to come and speak to the team. Thank you for inspiration Evans and we will see you in Nairobi!



Friday, May 11, 2012

5 Reasons Aid is more Harmful than Helpful


Inspired by Dambisa Moyo’s book “Dead Aid”

When I first started getting interested in Africa, I stumbled upon Dambisa Moyo’s book Dead Aid. It was one of those rare books that totally changed my view of how the world works - and how it should work. 


Aid, as Moyo defines it, encompasses both grants and loans given on a non-emergency basis. Grants are basically a gift of money, and loans given to developing countries’ governments are almost always renegotiated at a lower rate or partially forgiven, meaning that the leaders who receive these loans treat them like free money as well. Emergency aid, such as supplies given after a natural disaster, is not included in this argument.

Aid, Dambisa Moyo argues, is not only not helping African nations develop, it is actively hindering their potential. Here are some reasons she believes this to be true. 

1. Aid encourages corruption.
Foreign aid is easily to redirect, and is unfortunately difficult to track. The very presence of aid gives corrupt leaders something to steal - if the aid weren’t there, corruption would not pay (at least not as well). 

2. Aid reduces social capital.
I’ll have to quote here, because Moyo just says it so eloquently: “By thwarting accountability mechanisms... and removing pressures to reform inefficient policies and institutions, aid guarantees that in the most aid-dependent regimes social capital remains weak and the countries themselves poor. In a world of aid, there is no need or incentive to trust your neighbour, and no need for your neighbour to trust you.”

3. Aid can be inflationary.
This one is pretty straightforward - injecting foreign cash into the country makes everything more expensive for everyone. 

4. Aid stifles local businesses. 
Moyo gives the example of a mosquito net maker in Africa. His net-making capacity is low, but he employs several people. If a multinational enterprise were to enter and give away mosquito nets, he would go out of business. In the short term, far more people are protected from malaria, but in the long term, this well-meaning action has not only prevented gainful employment, it has created a dependency on free, foreign nets because there is no one local to make them any more. 

5. Aid creates dependency.
Because aid has been such a constant source of income for African governments, they believe it will always be there. This discourages them from seeking other, more independent and sustainable solutions for local economies, and destroys any sense of urgency they might have. 

Overall, I find Moyo’s arguments to be very convincing and I definitely recommend that you read her book for more details about why aid is harmful and to find out the solutions she proposes!