Opinion Blog : Entries Tagged With 'globalization'
| August 8, 2008 01:45 PM |
Chinese Activity in Africa, Part 1: Feeding the DragonThis post is the first in a two part series exploring China’s role in Africa’s development. Part 1 focuses on the breakdown and impact of African exports to China, and Part 2 focuses on the role of Chinese investment and imports in Africa. I think that those of us who are interested in the potential of market-based development need to initiate a conversation around one of the biggest elephants in the room, and that is the role that Chinese foreign direct investment (FDI) and aid is playing in Africa’s development. In particular, how this inflow could fuel potential base of the pyramid (BoP)-focused enterprises and mean new opportunities in both employment and a greater access to choice in goods and services for BoP consumers. I became interested in doing this piece on a recent trip to Hong Kong, where I was studying strategies that have been taken to propel corporate social responsibility in Asia. One morning at breakfast I came across the headline, “China’s Investments ease Africa’s Poverty, says World Bank report” in the South China Morning Post. This July 12th headline grabbed my attention, as it was clearly at odds with those I had been seeing in the U.S., such as last August’s New York Times story entitled, “China’s Trade in Africa Carries a Price Tag.” So, which is it? Clearly, the two seemingly opposing articles demonstrate that this is a very divided issue, and the strong journalistic stances risk convincing people one way or the other, when the reality of the effect is probably somewhere in the middle. As China and Africa’s economic relations have strengthened, on some indicators, life has improved for those Africans at the BoP. Some are able to access cheaper, “Made-in-China” products, while others have benefited from the much-needed investment in infrastructure, which has contributed to everything from energy to ICT development. However, many argue that China’s no-strings attached aid packages ignore some of the structural changes that need to occur to ensure long-term peace and prosperity in the region, and that cheap Chinese goods have crowded out native industries. The World Bank seems to be optimistic, saying that China’s “newfound interest in substantial international commerce with Africa—home to 300 million of the globe’s poorest people and the world’s most formidable development challenge—presents a significant, and in modern times, rare, opportunity for growth, job creation, and the reduction of poverty on the Sub-Saharan continent….” While the prospects for job creation and poverty reduction surrounding greater exports are promising, there should be valid worries when it comes to the social and environmental implications of this resource plunder. According to the World Health Organization, developing nations, which emit the fewest greenhouse gases, will have the most serious problems associated with climate change. The jobs afforded to those in extractive industries are dirty, dangerous and unpredictable. In addition, from a long-term poverty-reduction standpoint, the tiny percentage of value-added goods being exported, the minimal technology transfer, and the lack of skill development does not bode well for the hope of sustainable change. And while U.S. and European companies certainly do not have a clean history in Africa, they are now under much greater social and environmental scrutiny, while Chinese firms appear to be operating with little or no oversight. One of the most comprehensive journalistic pieces on this topic that I came across was the May 2008 Fast Company Series Special Report: China in Africa. Author Richard Behar traveled to Mozambique, Zambia, The Democratic Republic of the Congo, and Equatorial Guinea in the six-part special. After all of his travels, he came to the conclusion (primarily through visiting extractive resource sites) that Africa is bearing the brunt of China’s massive energy and resource needs that are fueling the established Western and newfound hyperactive Eastern consumer economies. He compared China to a parasite infesting the Sub-Sahara, saying that the Chinese are, “there to get what they need to feed the machine.” What Behar found was that, “while flat-footed Western governments largely watch from the sidelines, cash-flush Chinese firms—many with state-directed financing—are cutting deals at a dizzying pace, securing supplies of oil, copper, timber, natural gas, zinc, cobalt, iron, you name it.” China needs Africa, and it has offered much in return for the resources that are driving its booming economy. However, the questions that we need to consider are, what does this means for those living at the BoP and, what role will the civil sector take in this changing landscape of south-south development relations? Should we point a finger at Chinese companies for potentially stripping Africa of its natural resources, or should we instead encourage this much-needed investment and potential job opportunity? Or, in this case, should we step aside and suppress our White Man’s impulses to apply what Easterly would call the “intellectual hubris at the top that disdains the messy realities at the bottom?” According to some Africans, they welcome the partnership with China because China “treats them like a peer.” * For a more in depth version of this article please visit NextBillion.net
Posted by Kelsey Walker
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| August 27, 2008 08:33 AM |
Chinese Activity in Africa, Part 2: The Path of Least ResistanceThis post is the second in a two part series exploring China’s role in Africa’s development. Part 1 focused on the breakdown and impact of African exports to China, and Part 2 focuses on the role of China’s investment and imports into Africa. Investment It is no surprise that most Africans are welcoming Chinese investment and products. The history of traditional Western aid and investment in Africa is one of a nagging “I correct you because I want what’s best for you” parental-like stronghold over the continent. Tired of “the politically motivated, finger-wagging approach of western governments,” numerous sources quote the lack of political motivation, as well as societal or environmental demands, as one of the primary reasons that Africa is welcoming the Chinese investment. Sahr Johnny, the Sierra Leonean ambassador in Beijing, was quoted as saying the following regarding China’s projects in Africa: “The Chinese are doing more than the G8 to make poverty history. If a G8 country proposes a project for Sierra Leone, there is an environmental assessment and evaluation of the human rights and governance situation. The Chinese just come and do it.” Despite the claims of poverty reduction, the reality is that the aid flowing from China is not designed to alleviate poverty, as opposed to aid from the World Bank and the IMF, which falls under the category of “office of development assistance.” Therefore, it is not subject to social and environmental assessment. The assistance from China is purely aimed at promoting trade and development for China. Therefore, when an issue like the Darfur crisis in Sudan arises, China slyly steps aside and claims that its role is not to police other countries. While this lack of social and environmental benchmarks may worry some, others praise the fact that much-needed investment has been able to flow freely into Africa. Some of the key areas of Chinese investment, which align with improving the efficiency of resource extraction, are telecommunications, energy, and physical infrastructure. These areas have traditionally been ignored by donors in Africa, who have instead favored social development programs such as education and health. Although the money is flowing in, Africans have expressed concern regarding whether or not these investments will add long-term value in the sense of technology transfer, education, and opportunities for Africans. At the amazing blog Global Voices, a young Malawian girl questioned, “Am I being idealistic in hoping that they will teach us their unique skills in building and pass the construction mantle back soon after?” Products and Services for the African Market Not only has China offered investment in infrastructure, but there has also been an influx of Chinese products in Africa, which has rallied critics from both ends of the spectrum. According to the article “The Strategic Entry of China’s Emerging Multinationals into Africa,” “…the Chinese multinationals have become adept at identifying so-called ‘market blind spots’, market areas that have essentially been neglected and under-capitalised. These are typically cheaper product lines that may not seem to be money spinners, but which would actually stimulate demand once available.” Examples of these are Haier’s smaller refrigerators and Lenovo’s C100 laptop, targeting small and medium enterprises. Huawei provided the international market with low-end routers that were 40 per cent cheaper than other products, capturing 3 percent of the global market by 2002. From that, it sounds as if the Chinese products are giving African people more choice, and filling market gaps. However, there are worries about the safety of the extremely cheap Chinese goods. If an exporter can’t pass FDA inspections, it may still be able to slip its products into African markets. China as a Model for Development Lastly, if you look beyond the investments and new products, and consider China a model of development that may provide a tutorial for Africa, it is both exciting and worrisome. A working paper issued by the World Bank in February of this year, titled “Lessons from China for Africa” is focused on the fact that “other developing countries struggling to grow and reduce poverty are naturally interested in what has been the source of this impressive growth and what, if any, lessons other developing countries can take from China.” For those who are looking solely at economic indicators, China has lifted 300 million people out of poverty with unimaginable speed. China certainly did not achieve this success through a dependence on Western aid and structural adjustments. Could China do the same for Africa? The situation that has emerged in China, albeit economically prosperous, may not be the pathway that most would like to imagine for Africa. China may have tackled poverty, but what about inequality? While China has started to embrace the market philosophy from the West, the adoption of the freedoms that are usually associated with a democratic system is another story. You could trip over the number of examples of human rights violations in China, from incarcerated activists to the infamous “great firewall.” What is happening in Africa right now clearly demonstrates a seemingly simple distinction that we may all sometimes forget to make; poverty and inequality are not one in the same. And, if poverty is addressed, will inequality then follow suit? * For a more in depth version of this article please visit NextBillion.net
Posted by Kelsey Walker
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| January 26, 2009 10:30 AM |
From Blue to GreenI just finished reading an advance copy of The Blue Sweater: Bridging the Gap Between Rich and Poor in an Interconnected World, Jacqueline Novogratz’s book on social enterprise due out in March—and it’s terrific, an unusually candid and highly personal memoir about the deep and often painful complexities of trying to make lasting change in the world. Novogratz, the CEO and founder of The Acumen Fund, which invests money in companies run by and for the developing world, is also generous with her storytelling: Early in the book, she shares the memory of first landing in Africa some 22 years ago, at the Abidjan airport on a sweaty Ivory Coast morning. She had just left Wall Street, had cut her hair (“to the point of resembling Margaret Mead,” she told Cause Global) and gave away most everything she’d owned, arriving with “all the essentials, from poetry to new clothes to, of course, a guitar. I was 25 and I was going to save the world—and I thought I would just start with the African continent.” Yet within days of arriving, she was told—and in no uncertain terms by a group of West African women—that “‘Africans didn’t want saving, thank you very much’—and least of all, not by me.” Recalls Novogratz: “I was too young, unmarried, had no children, didn’t really know Africa and my French was pitiful. It was an incredibly painful time of my life and yet it gave me enough humility to start listening.” And learning: To this day, Novogratz—cited last fall by Portfolio magazine as one of the “73-Biggest Brains in Business”—has let her experiences as a pioneer in the still-evolving field of social enterprise continuously shape and check her unique blend of idealism and flat-out pragmatism; her Acumen Fund, founded in 2001, remains passionately focused on “changing the way the world sees the poor” by alleviating poverty in ways that make the poor the customers of—and workers at—self-sustaining businesses seeded by donors but run locally, over time, without hand-outs. From her experiences running a bakery in Rwanda in 1986 with 20 unwed mothers to starting the first microfinance institution in Kenya, Novogratz has seen first-hand “the power of markets to end poverty, the discipline that running a business provides, and the pride that results from ownership”—in other words, an end to charity. She has also seen what doesn’t work, and retells the story of revisiting Rwanda a few months after the 1994 genocide there. Of all the inspiring stories in her memoir—[the blue sweater in the title comes from Novogratz’ experience of seeing her favorite childhood sweater, which her family had given 11 years earlier to Goodwill, being worn by a child she met on a hilly street in Kigali—her name, written on the collar, still intact]—one of my favorites is her hard-won lesson in the importance of listening, closely, to those in need. “...I could have listened better,” she says about the women she met in and around the markets of Kigali while helping them to create a “blue bakery” to sell samosas and doughnuts as a local enterprise, even painting the walls blue until one of the women dared to speak the truth to their enthusiastic benefactor. [“Our color,” one of them finally told Novogratz, “really is green.”] “...Listening is not just having the patience to wait,” Novogratz writes, “but is also about learning how to better ask the questions.” Her efforts eventually transformed the bakery, which had been run as a charity when she got there, into an enterprise that earned $2 a day for each of the women. “When you’ve lived on charity and been dependent your whole life long, it’s really hard to say what you mean,” Novogratz says. “The poor often think no one really wants to hear the truth.” But perhaps the biggest lesson, both from the book and the life it profiles, is that investing in businesses run by and for the people they’re intended to serve can actually work, grow, and create change across a neighborhood or a region or a country. For those looking for the “ROI” of social enterprise, it doesn’t get much better than that.
Posted by Kelsey Walker
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| June 26, 2009 12:09 PM |
Now MediaThese past days have been a fascinating time for those studying social media. Even as Iranian authorities continue to prevent most mainstream journalists from reporting on citizen protests, Twittering citizen reporters have been able to bypass government censorship to share events on the ground as they unfold. Many of their rapid-fire, 140-character dispatches are uncommonly empathetic, hyper-personal, and unforgiving, prompting even some of the more sober and astute observers of the Net’s impact on society to recently wax hyperbolic. “That a new information technology—[so-called “now media” such as Twitter, cellphones, mobile vlogs]—could be improvised for this purpose so swiftly is a sign of the times,” blogger Andrew Sullivan gushed in a post titled, “The Revolution Will be Twittered.” “ …You cannot stop people any longer. You cannot control them any longer. They can bypass your established media; they can broadcast to one another; they can organize as never before.” Meanwhile, political blogger Maegan Carberry told last week’s 140 characters conference in Manhattan, the nation’s first all-things-Twitter thoughtfest, that “social media are pushing us into an era of post-partisanship,” where political parties become far less important as wider and more personal communication among groups start to blur the political distinctions that authoritarian institutions of government have previously used to divide us and mute our penchant for dissent. That statement followed remarks by NYU new media scholar Clay Shirky to TED interviewers earlier in the week that “we are living through the the largest increase in expressive capability in human history” and that the surge of Twitterized news reporting out of Iran has made the Iranian uprising historically unprecedented. “This is it. The big one,” he told TED. “This is the first revolution that has been catapulted onto a global stage and transformed by social media.” Iran, of course, isn’t the first world hotspot where social media have played an abrupt and interventionist role in focusing the world’s attention to urgent social causes and events happening on the ground. Text-messaging and vlogging (video-blogging) was instrumental in revealing government corruption around foreign aid to victims of Cyclone Nargis in Burma last year. Social media also helped to leak word out to the world about the pro-democracy uprising by Burmese monks, hardline censorship by Chinese authorities during last summer’s Beijing Olympics, and the extent of the devastation of the Chinese earthquake —details of which, says Shirky, would have otherwise taken months to go public. But whoa, Nellie. Indeed, while Twitter with its velocity to spit out information can expose the undercurrents of dissent and the underbelly of corruption, hunger, and the abuse of power in often shocking detail, social media haven’t been able to drive those undercurrents of dissent, nor bring about widespread reforms—at least not yet. For every successful social media-fueled protest, such as the Facebook-fueled protests last year to destabilize FARC in Colombia, there are at least a dozen more digitized uprisings that end when authorities shut down the Net or, as in the case of the as-yet unmutable Twitter in Iran, track down the people whose tweets have been most prominent and revealing and “disappear” them, creating a chilling climate of self-censorship that all but cedes power to those abusing it. More significant, perhaps, is how Twitter and other forms of social media are accelerating the rate at which events play out, regardless of outcome, and how that speed can be potentially destabilizing, in and of itself. Jason Calacanis, a social media entrepreneur and cofounder and CEO of mahalo.com, speaking on a panel I convened and moderated for the recent Milken Global Conference 2009 on social media and politics, said: “The good news is that the Internet is an accelerator, probably the greatest accelerator since the advent of the written word. Truth gets wrestled away from the rumors more rapidly now; if you’re on the wrong side of society, you get outed in hyperspeed.” Further, he says, activists are better at the conversations spawned by social media because “those on the right side of society are the most willing to engage in conversation; when you’re on the wrong side of an issue, it’s very hard to be involved in a discourse because if you are involved in one, the quicker you get to the inevitability of being wrong.” Just how much power, ultimately, social media can have will be debated again widely at next week’s Personal Democracy Forum in Manhattan, which opens Monday with a late-addition workshop entitled “Social Media and Iran.” Such debates are likely to go on for months, if not years. As Twitter co-founder Jack Dorsey queried the a standing-room-only crowd of Twitterati at the 140 characters conference: “We have this brand new tool to help us in this experiment in democracy but where are we taking this? What are we doing with this technology and how are we sustaining these concepts of immediacy, approachability and transparency to open up the process of every social community from families to the largest governments in the world?”
Posted by Jason Chua
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| July 24, 2007 09:43 AM |
Getting Everyone on the Bus
In an influential Foreign Affairs article last year, former Vice Chairman of the Federal Reserve Alan Blinder argued that the impending offshoring of tens of millions of jobs is a “Third Industrial Revolution.” It will spread beyond manufacturing jobs to high-skill professional services that were previously insulated, such as accounting, law, and virtually any kind of data analysis. (X-rays, for example, can now be read by specialists in India.) Although this disruption will be massive, it can be managed, according to Blinder, so long as we recognize that the critical divide is no longer between “skilled” and “unskilled” labor, but between work that can be done at a distance (“impersonal services”) and work that must be done interpersonally (“personal services”). Here in Los Angeles, we haven’t adapted quickly enough to globalization, but there are signs that our leaders are increasingly acting as Blinder’s theory would predict. Labor unions are prioritizing industries that are not subject to offshoring, such as home health care, hotel, and restaurant workers. Similarly, government and civic leaders are placing great stock in the economic potential of ports, airports, and the entire logistics industry, as well as green technology. Blinder thinks the key may be thinking differently about education. Our current system is geared to push the lucky and talented into college—which may no longer result in a stable professional career—and provide a basic education that was adequate for the manufacturing jobs of the past but is woefully short on the verbal and tech skills required for blue collar jobs of the present. (Have you seen the electronic gear your UPS delivery person lugs around?) In the nonprofit sector, thoughtful leaders are acting in accord with Blinder’s theory. For example, the Kellogg Foundation’s New Options Initiative aims to create a credential alternative to high school diplomas and associate degrees that will land youth in good careers. The James Irvine Foundation’s emphasis on technical education and academies in which young people can learn real world skills is helping young people better prepare for the global job market. Against this backdrop, the social sector’s developing emphasis on family interventions—a recurrent theme in the interviews my colleagues and I have been conducting with civic leaders and public officials this summer—may foretell a trend. We aren’t doing nearly enough to help parents ready their kids for these new realities. We have all known this for decades, of course. The preschool and child care movements are longstanding, and fairly successful—but not enough. To hear leaders from business, government, labor, academia, and politics all hit the same note on this subject is striking. The impacts of globalization may make nonprofit work even more central to our society. Alhough nonprofits are not immune to offshoring, most of the services they provide, such as teaching, health services, counseling, and advocacy, cannot be delivered over a wire. Furthermore, these services are precisely the areas that will require greater investment to make American workers competitive, meaning that the sector is likely to grow. Now, what could professional sports possibly have to do with all this? We’re all familiar with the extraordinary measures college and professional teams will take to find top talent. Scouts begin tracking basketball players when they are in the third grade. What if we took a similar approach to finding other talents in young people? We should be looking in those same neighborhoods for kids who might grow into good programmers, mathematicians, analysts, social workers, and peacemakers. Google is one company that goes hunting for talent (a friend once told me about a co-worker who had been invited to work for them four separate times), but if Google and its competitors could just start earlier, and if we could just provide better early childhood environments, we’d really be on to something. The irony of global competition is that the pressures for quarterly profits push us to recruit from overseas. For the same amount of effort and expense it takes to get highly educated workers H-1B visas, couldn’t we develop two or three times as many capable young people in this country? The problem is that no company wants to wait 12 to15 years when they need someone today. That leaves us with a workforce that is somewhat like major league baseball before Jackie Robinson: There’s a world of talent out there that’s not being realized.
Posted by SSIR Editor
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| August 25, 2008 09:39 AM |
Chinese Activity in Africa, Part 2: The Path of Least ResistanceThis post is the second in a two part series exploring China’s role in Africa’s development. Part 1 focused on the breakdown and impact of African exports to China, and Part 2 focuses on the role of China’s investment and imports into Africa. Investment It is no surprise that most Africans are welcoming Chinese investment and products. The history of traditional Western aid and investment in Africa is one of a nagging “I correct you because I want what’s best for you” parental-like stronghold over the continent. Tired of “the politically motivated, finger-wagging approach of western governments,” numerous sources quote the lack of political motivation, as well as societal or environmental demands, as one of the primary reasons that Africa is welcoming the Chinese investment. Sahr Johnny, the Sierra Leonean ambassador in Beijing, was quoted as saying the following regarding China’s projects in Africa: “The Chinese are doing more than the G8 to make poverty history. If a G8 country proposes a project for Sierra Leone, there is an environmental assessment and evaluation of the human rights and governance situation. The Chinese just come and do it.” Despite the claims of poverty reduction, the reality is that the aid flowing from China is not designed to alleviate poverty, as opposed to aid from the World Bank and the IMF, which falls under the category of “office of development assistance.” Therefore, it is not subject to social and environmental assessment. The assistance from China is purely aimed at promoting trade and development for China. Therefore, when an issue like the Darfur crisis in Sudan arises, China slyly steps aside and claims that its role is not to police other countries. While this lack of social and environmental benchmarks may worry some, others praise the fact that much-needed investment has been able to flow freely into Africa. Some of the key areas of Chinese investment, which align with improving the efficiency of resource extraction, are telecommunications, energy, and physical infrastructure. These areas have traditionally been ignored by donors in Africa, who have instead favored social development programs such as education and health. Although the money is flowing in, Africans have expressed concern regarding whether or not these investments will add long-term value in the sense of technology transfer, education, and opportunities for Africans. At the amazing blog Global Voices, a young Malawian girl questioned, “Am I being idealistic in hoping that they will teach us their unique skills in building and pass the construction mantle back soon after?” Products and Services for the African Market Not only has China offered investment in infrastructure, but there has also been an influx of Chinese products in Africa, which has rallied critics from both ends of the spectrum. According to the article “The Strategic Entry of China’s Emerging Multinationals into Africa,” “…the Chinese multinationals have become adept at identifying so-called ‘market blind spots’, market areas that have essentially been neglected and under-capitalised. These are typically cheaper product lines that may not seem to be money spinners, but which would actually stimulate demand once available.” Examples of these are Haier’s smaller refrigerators and Lenovo’s C100 laptop, targeting small and medium enterprises. Huawei provided the international market with low-end routers that were 40 per cent cheaper than other products, capturing 3 percent of the global market by 2002. From that, it sounds as if the Chinese products are giving African people more choice, and filling market gaps. However, there are worries about the safety of the extremely cheap Chinese goods. If an exporter can’t pass FDA inspections, it may still be able to slip its products into African markets. China as a Model for Development Lastly, if you look beyond the investments and new products, and consider China a model of development that may provide a tutorial for Africa, it is both exciting and worrisome. A working paper issued by the World Bank in February of this year, titled “Lessons from China for Africa” is focused on the fact that “other developing countries struggling to grow and reduce poverty are naturally interested in what has been the source of this impressive growth and what, if any, lessons other developing countries can take from China.” For those who are looking solely at economic indicators, China has lifted 300 million people out of poverty with unimaginable speed. China certainly did not achieve this success through a dependence on Western aid and structural adjustments. Could China do the same for Africa? The situation that has emerged in China, albeit economically prosperous, may not be the pathway that most would like to imagine for Africa. China may have tackled poverty, but what about inequality? While China has started to embrace the market philosophy from the West, the adoption of the freedoms that are usually associated with a democratic system is another story. You could trip over the number of examples of human rights violations in China, from incarcerated activists to the infamous “great firewall.” What is happening in Africa right now clearly demonstrates a seemingly simple distinction that we may all sometimes forget to make; poverty and inequality are not one in the same. And, if poverty is addressed, will inequality then follow suit? * For a more in depth version of this article please visit Grace Augustine is a research associate with the William Davidson Institute, an educational institute focused on researching and supporting organizations in emerging markets. She writes for the NextBillion blog and has an interest in economic development and clean technology for the world’s poorest citizens.
Posted by Kelsey Walker
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