Posts tagged ‘economic development’
Last week I started visiting some of Kiva’s borrowers with Transcapital, one of Kiva’s field partners that I’m working with here in Mongolia. While it was really encouraging to see Transcapital’s enthusiasm for Kiva at the head office as well as its various branch offices around Ulaanbaatar (UB), the new insights I’ve gained on urban poverty—both from these visits as well as just day-to-day life here—have left me perplexed so far, with far more questions than answers.
A short term solution?
Our visits began with a stop at Narantuul market, the largest outdoor market in UB where a number of Transcapital’s clients have retail outlets. At a first glance, Narantuul is a colourful and vibrant marketplace where vendors sell everything from food and candy, to winter coats, scarves, belts, jeans, baseball caps, cardboard, and more. It’s the place where Mongolians often go to find cheaper wares, which makes sense considering some of the staggering prices I’ve seen at Ikh Delguur, the State Department Store. We spoke to Bayasgalan, the proud owner of a shop selling winter coats and clothes, a long time client of Transcapital’s, and a Kiva borrower.
Other vendors watched us with curiosity as we chatted with her, and the mood at the market was lively despite the cold. But my translator friend, whose family had sold candy there, explained to me as we left that pretty much all the vendors there need continual loans to in order to sustain their businesses. Without loans, they can’t operate; but even with loans, they struggle to get ahead… which is anything but encouraging.
Harsh working conditions
The next day, we visited Kharkhorin market, UB’s second largest outdoor market, located on the other side of the city. The wares there were slightly different: I saw lots of shoes, but also an eclectic collection of hardware parts, sinks, ropes, tools, and other random second-hand items.
We had trouble locating one of the two borrowers we had to meet, so we wandered around for some time looking for her. In the meantime we met and chatted with Saranchimeg, who had used her loan to increase her supply of winter boots. We had been outside for about 45 minutes by the time we finished chatting with her, and I thought my fingers and toes might fall off. It must have been around -25oC that day with the sharp wind whipping through the stalls. But my thoughts were with the market’s vendors who stand out there all day long, day in and day out. My translator friend assured me that, just because they’ve lived in Mongolia their whole lives, it doesn’t make the cold is any easier for them to bear. I was humbled by how hard they work.
The reality for taxi drivers
We also visited with some taxi drivers. While a male taxi driver may not be one of the sexiest loans on Kiva’s website, you should know how hard these people work to support their families, just like anyone else. And for what? Being a taxi driver is a tough way to make a living in UB: A one-kilometre ride will earn a driver about 1,500 Tugriks (or 1.07 USD).
Moreover, the competition is stiff. Since cars have become ubiquitous in Mongolia’s capital, everyone has become a taxi driver. It’s an overhang from the early days of capitalism, when cars were not that common and the city’s residents would help each other out by giving rides. Now, you see people on the streets with their hand out all the time, and it usually only takes a few minutes for a car to pull over.
Another borrower we met lived in one of the outer ger districts, the slums of the city which lack basic services like running water and sanitation. He was middle-aged and had taken out a housing loan, but he told us that he had been a driver under the socialist regime. He explained that he had had much difficulty in finding employment in his profession. Recently, though, he has started applying for driver jobs again. It’s a mystery to me how he has managed to make ends meet over the years.
Survival of the fittest?
It’s easy to think that people don’t work because they’re too lazy, or because they simply refuse to accept lower-paying positions. This may be true in some cases. But there may also be more to the issue than meets the eye. Mongolia had its Revolution and transition to a market economy in the early 1990s and it seems the transition was difficult for those who were brought up and educated in the socialist era: Many of their skills and experiences have not translated well in the new economy. While a lot of the leadership I’ve seen in white collar jobs are shockingly young—in their late 20s or early 30s—street and market vendors tend to be in their 50s or older. And for many of them, their wares include no more than a couple handfuls of gum and candy, which can’t possibly bring in that much at the end of the day.
Maybe skills training is needed to support these people… or maybe it’s not that simple. Imagine being in your 40s or 50s and getting trained (or competing for jobs) alongside people who are a whole generation younger than you. And the longer you stay out of the workforce, the less confidence you generally have to return to it. One colleague of mine surmised that perhaps self-employment is the way to go for these people.
The fork in the road
Of course, this reflects only one facet of urban poverty here. Another, and perhaps larger, driver is the massive migration of traditional nomadic herders to the capital, as zuuds—extremely harsh winters—have killed off the millions of animals on which they depend for their livelihoods.
Mongolia has gone through some incredible changes over the past several years, thanks to the discovery of the largest unexploited reserve of copper, gold and silver in the world. Roads have appeared where they previously didn’t exist; herders have disappeared from the streets of UB; shiny new buildings have gone up; inflation has gone through the roof. It’s poised to be one of the fastest growing economies in the world in 2013.
There is immense potential for large-scale economic development and poverty alleviation in Mongolia. Microfinance is helping to tie things over, but how the country handles big issues such as corruption will ultimately determine whether the spoils will be shared by many. So far, everything I’ve taken in only seems to have raised more questions. I’ve only scratched the surface in terms of grasping the complex economic factors at work in this country, much less understanding the solutions.
” After weeks of headline news about the Arab Spring, we seem to have forgotten the man who started it all: Mohamed Bouazizi, the [26 year old] Tunisian fruit vendor who set himself on fire after police confiscated his small cart. It was Mr. Bouazizi, a microentrepreneur, who sparked this revolution in a single act of protest against the same harsh economic realities shared by the majority of citizens across the Arab world.” ~ Elissa McCarter, Vice President of Development Finance, CHF International
By Kiva Fellows in Africa, KF16
Compiled by Tejal Desai
Ow de body! Are Sierra Leone and Rwanda still danger zones? What challenges do Ugandans most commonly face? Kiva Fellows from KF16 bring you another unique perspective from the diverse and vast continent of Africa! We patched together an overview of each of our placement countries that includes: basic socioeconomic stats, common stereotypes (and to what extent they are true or false), greatest challenges, most common loan products at our respective field partners, and the borrowers’ most common use of their profits. Our part 2 series follows the Kiva Fellows through Sierra Leone, Rwanda, and Uganda. We hope our summaries give you a new perspective on the continent and its distinct countries that we’ve been fortunate to explore, thanks to the Kiva fellowship!
By Tejal Desai, KF16, Sierra Leone
Aid: What does it mean for a country recovering from a devastating decade-long civil war that killed over 50,000 of its people? And what does it mean for microfinance organizations that aim to loosen the leash from dependency and push for sustainability? After taking an okada ride through Sierra Leone’s capital, Freetown, one may find the presence of international aid ubiquitous, and acting as a double-edged sword in the fight against poverty.
By Dan Tulchin, KF12, Nicaragua
What do Miskito, Rama, Garifuna, Spanish, Creole, and English have in common? Well, nothing really, besides the fact that you can hear all of them within a block in Bluefields, on the Caribbean coast of Nicaragua – a place where international organizations and tourists rarely venture. While a number of these languages are, in essence, subsets of others, I am hard pressed to come up with another place of such linguistic variety (no, Times Square doesn’t count). Bluefields is, without question, a sociolinguist’s paradise.
By Brandon Vaughan, KF12, El Salvador
Whether it’s the memory of a drawn-out civil war, stories of gangs and violence, or the influence of one of Central America´s most prolific emigrant communities, El Salvador´s complex past directly relates to the challenges it faces today.
By Ilmari Soininen, KF9 in Thies, Senegal
Christmas kicks off a serious week of celebration for Senegal’s Christian minority. Dispersed families unite, meaning a series of sept-place, clando and bus rides from the capital. Like in many parts of the world, roasted chicken (or turkey) is an important part of the Christmas menu here. The bird is carefully prepared, and cooked to tender perfection. Chicken is not an everyday treat for most of Senegal. Indeed, it is quite a luxury item. But why is this so? And can this tell us something about the country’s future?
By Thomas Gold, KF9 Dominican Republic
For English version, click on “(more…)”, then scroll down.
Après quelques jours dans la province de Samanà, une péninsule qui se situe au Nord-est du pays, je n’ai pu m’empêcher de m’interroger sur l’utilité réelle et les bénéfices concrets du travail réalisé par mon institution hôte et surtout par la microfinance en général.
En effet, après avoir passé ces premières journées à faire de longs trajets, dans des conditions difficiles sur les quelques routes bosselées et mal entretenues de la péninsule pour assister aux réunions bimensuelles de remboursement des prêts, j’ai constaté que la majorité des commerces tenus par les clients d’Esperanza, sont en tout points identiques : il s’agit de femmes qui vendent de manière ambulante des vêtements, chaussures et bijoux fantaisie (en toc), et dont la situation n’évolue pas vraiment, même après plusieurs cycles de prêts.
By Sloane Berrent, KF8, Ahon sa Hirap, Inc, Philippines
“How has Ahon sa Hirap, Inc.” (ASHI and my host microfinance institution) “being here in your barangay or in your town helped your community?”I ask the women from ASHI during each Center meeting that I attend. There are a few variations on this question. I ask how their lives have changed and what the Center means to them.
“My husband had a stroke and couldn’t work anymore. I worked as a domestic in town and had to travel very far every day for not a lot of money. I joined ASHI 7 years ago to start a buy and sell fish business so that I could stay closer to home to take care of my husband and help my children.”
“After my husband died, I was so lonely. My children are all grown up and out of the house. I was sad. I joined ASHI 13 years ago and now my life is so different. I laugh. I come here every week to see my friends.”
“My house was very bad and made from old bamboo. When typhoon season came, my family had to run to our neighbors because we were scared our house would collapse. With my ASHI loan, I was able to move my Sari Sari store to a busier corner where workers pass by on their way to the fields. I open at 4AM and close at 8PM but am very happy. Now 10 years later, we now have a house made of stone and we don’t run from the typhoons anymore.”
But has it changed MORE than that? What about an entire town?
I had heard that seeing microfinance in action could be like watching grass grow. So gradual, so slow. How could I say that there is indeed a larger change in the landscape of where microfinance sets up shop?
I turned to the ASHI staff. It was a Saturday night and we were going to go out to dinner together. The two Kiva Coordinators asked me if we could stop in the new local mall that opened so that could grab a few things.
“Sure,” I said. No problem.
We walked to the end of the drive and hopped into a tricycle and took off towards the mall. There was light traffic, the road wasn’t too bumpy, we arrived to throngs of people gathering outside the mall, in the entrance, more teenagers and families gathered.
“This has been huge for our town,” the one Kiva Coordinator said.
By Alison Carlman, KF8 – Kenya
As a graduate student of International Development at an African university, I wish that the answer was as simple as finding the “one thing” to alleviate poverty. For marketing purposes, NGOs and “experts” tell us that the answer is so simple, whether it’s access to clean water, economic liberalization, universal healthcare, education, modernization, or microfinance. But 50 years of “Development” in practice teaches us that it’s not so black and white.
Kiva will be the first to tell you: microfinance is not the solution to poverty. Provision of financial services is simply an important part of helping people improve their lives; microfinance is only a “tool” that can help people to meet a portion of their basic physical, social, psychological, and spiritual needs.
I’m working with Kisumu Medical & Education Trust (K-MET), a reproductive health organization in Kenya. One of the many services that K-MET provides is reproductive health education and life-skills training to at-risk young girls ages 10-24. These girls are often young mothers, survivors of rape and unsafe abortion, children of polygamous families, girls who had to drop out of school and work as prostitutes in order to meet theirs and their families’ basic needs.
A loan alone won’t solve these girls’ problems; they need counseling, support, marketable skills, food, daycare, education, encouragement, mentorship…. the list goes on.
By Nancy Tuller, KF8 Ghana, Africa
“Akwaaba!” (Welcome!), I heard, over and over in my first few days here in Ghana, and what a wonderful welcome it has been! When I stepped outside the Kotoka International Airport in Accra, my heart lept at the feel of the warm and humid summer night clinging to my skin and the cacophony of voices in Twi, which is the most commonly spoken language here in Ghana. It sounded to me like a kind of chaotic harmony, blending perfectly with snatches of disparate Ghanaian music coming from various vehicles as I left the airport for my hotel. Every face I encountered could only be described as friendly, every voice warmly welcoming me!
Now I have been in Kumasi, the city of about three million residents, where Sinapi Aba Trust (SAT) has its headquarters, for four whole days as a Kiva Fellow. That is enough to know that I am exactly where I am supposed to be! One Kiva staff member told me that she felt that Africa was her home. I wonder if I will be next to express that sentiment! Already I am calling the apartment where I am staying with one of the SAT staff members and his wife “home”. Joshua, Nana and I live in a two bedroom apartment on the third floor in a complex that at one time was a prestigious address, but has lost the right to that claim since the corporation who owns the complex decided not to maintain the roads, lights, security or even the reservoir that should be pumping water to the complex. The apartment itself is modest, simple, clean and lovely, and I am very comfortable here, but all residents suffer a lack of running water. A water truck brings water, and persons are paid to carry water in 20 liter buckets on top their heads, up the stairs (no elevators) to each apartment. Water is used very sparingly, and of course the water problem is not just in this complex, it extends all over Africa, and much of the developing world. The effects of climate change are very real-time here. Nana says the monsoon season definitely is bringing less rain (it’s only rained briefly one time since I’ve been here and it is monsoon season now), and the large river that has always supplied the Kumasi area with water is low. Though there is a large water table beneath Kumasi, very few can afford to bore a hole to access it. This is a country where almost everyone, and perhaps especially the poor, have to pay market prices for clean water or make do with polluted water, increasing their exposure and vulnerability to illness and disease. Add to this the absolutely alarming rate of inflation (currently 20.6%), in which the price of a banana or a cassava (and water) might go up by almost 0.66% overnight, and where unemployment is (depending upon whom you ask) between 30-40%!! Such are some of the most visible factors of poverty here in Ghana, making microfinance,the provision of basic financial services such as savings, loans, and insurance, all the more crucial to the ability of the poor to weather such tumultuous financial storms.
If you would like to learn more about Sinapi Aba Trust and the provision of microloans to Ghanaian entrepreneurs, go to: http://www.kiva.org/about/aboutPartner?id=88&_tpg=fb
Browse through SAT borrower profiles, make a loan, and and make a positive change in someone’s life at: http://www.kiva.org/app.php?page=businesses&partner_id=88&status=fundRaising&sortBy=New+to+Old&_tpg=fb
I am living in Kisumu, Kenya. Here is a picture of the street where I volunteer, in the Nyalenda slum.
Walking around the slum, one quickly comes across evidence of the post election violence. Burned buildings are common. As are random herds of goats.
White people in Kisumu are usually in self-contained SUVs. Not too many ever enter the Nyalenda slum. As a result, as I walk, I am usually chased by children.
If I stay in one place for too long, they gather to stare.
In the slum, you find many teenage girls. Their stories show a lot of common themes.
I am 20 years old. My parents passed away when I was 14. A lack of school fees made me leave school. We were left 10 children. Everyone searched for places to stay but I was left alone and went to be a street girl. A guy hired me as a maid but forced me to have sex. Within one month he raped me and I was pregnant. I went to the Kenyan police and they did not take any action about that case. They wanted money but I didn’t have even a single cent to give them. I became a mother of a child but there was no job or anything to do. I wake up early in the morning to wash clothes for people. They only give me 50 shillings (*equivalent of less than $1USD) in order to get food to eat with my child. Without washing clothes, we go to sleep hungry. If I can get someone to take care of me and return me back to school, then I can be proud and be happy as some people are. Maybe my life can change and I can be someone different.
I’m a girl of age 20 years. I dropped out of school in 2005 because I did not have money to continue my education. I have been staying at home doing nothing. I have no money to start a business. I have no knowledge of anything. I tried to convince my father to look for money to take me to high school but he did not. I have been walking day and night to look for employment even as a housemaid but the salary is as low as 100 shillings a month (*$1.31 USD per month). There is a time I succeeded in getting employment in a rich man’s house. He promised to pay me well but was exploiting me sexually. When I threatened to report him he sent me away. I was frustrated beyond words.
I am 22 years old. I am the first born in a family of five. I live with my mother and step-father and dropped out of school. I used to go clubbing and really had a bad company. I got pregnant and now I have a kid, he’s 2.5 years old. Life has been so hard I even tried marriage to find happiness and comfort. I was married to a young man who gave me everything but mistreated me and my kid. I had no choice but to stay with him since he provided me everything. Nobody cared about me. My husband was cheating on me but there was nothing I could do. Now I am HIV positive.
Kisumu Medical and Education Trust (“KMET”) is one of KIVA’s partners. In 2006, KMET created a program to address the seemingly hopeless situation for teenage girls. KMET recruited orphans, single mothers, high school drop-outs, HIV/AIDs patients and commercial sex workers for a program called Sisterhood for Change. The stories above are taken from profiles written by the girls recruited by the program.
When Sisterhood for Change began, KMET expected that upon graduation, the girls would immediately get jobs in local communities. Unfortunately, Kisumu just… doesn’t have jobs. So even with their new vocational skills, the girls were still unemployed and relying upon men for income.
So KMET conceptualized an idea for Safe Spaces. KMET has purchased a building in the Nyalenda slum and stocked it with the equipment needed to run tailoring, hairdressing and catering businesses. KMET will train the girls in business and entrepreneurship, and then they will be free to work in the Safe Space for as long as they wish. The girls will be purchasing supplies using KIVA loans.
For a long time, I wondered whether it could work. We held a lot of preliminary meetings to discuss our plans for the Safe Spaces, and the girls usually yawned in indifference. I would smile. I would pump my fists in excitement. I would lure them with cookies. Still, they seemed disinterested.
But now it’s actually happening! They are working in the Safe Spaces, selling french fries, avocado juice, and sassy hairstyles. Training takes place from April 29th-May 7th, with the generous help fof the Child at Venture Foundation. I still sometimes wonder if they are ready. I still sometimes wonder if Muhammad Yunus would approve. These girls really are the poorest of the poor, and we are trained that microfinance is not always effective with that group. Will high school drop outs be able to run their own businesses? We’ll find out…
Milena Arciszewski is a year-long Kiva Fellow. She has been in Kenya since January 2009, helping to develop the Safe Space initiative. She loves getting emails, and can be reached at firstname.lastname@example.org.