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It has been interesting and worthwhile to me to have the opportunity to sift through NextBillion’s multitude of resources in search of projects to add to the activity database. The projects I have come across never cease to inspire. Some are new twists on old ideas combining traditional methods with modern systems…some are partnerships forged in the name of innovation. Some focus on cultural and artistic traditions and still others address more urgent needs such as disease prevention and nutrition. Acknowledging and sharing each project’s success and significance is just as important as the activities themselves.

Banco do Nordeste's CrediAmigo: Microfinance Banking
In November 1996 at a meeting in Fortaleza, the World Bank and Banco do Nordeste, a development bank formed to support growth in northeastern Brazil, decided to initiate a collaborative process to jointly implement a local development program based on the idea of micro-credit. Motivated by the fact that small informal companies – family owned and small properties - were not being served by the Bank's financing activities due to the restrictive regulation of Brazil's Banking Systems, Banco do Nordeste and the World Bank decided to develop and launch a pilot low-income bank, targeting micro-entrepreneurs from informal sectors.

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Three quarters of India's population lives in rural areas. Individual households in these communities tend to spend about $50 per year on primary healthcare. This is hardly enough to pay for private coverage, yet many of these underserved consumers are not reached by government programs. While the annual expenditures households in the countryside make toward health services may not amount to much individually, they collectively represent the kind of impressive purchasing power we often refer to in discussion of BOP-oriented business models.

Gram Mooligai, a recent addition to the New Ventures portfolio, recognized that the gap between poor, rural dwellers and basic healthcare could be profitably filled by a company willing to meet the specific needs of these consumers. Gram Mooligai's innovative solution is successful because it is tailored to this BOP market. The company relies on India's wealth of biological diversity to sustainably harvest traditional herbal remedies that it sells under the Village Herbs label. The herbs form part of the Ayurvedic system of healing, one with a strong heritage in India and that has a great deal of influence in many rural areas. These medicines have been provided to over 30,000 households by a network of 300 women health practitioners with prior experience in non-profit work.

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Oxfam International has just published a report, "In the Public Interest: Health, Education and Water and Sanitation For All." One can hardly dispute some its assumptions - it's a scandal that people go without basic services, the money is theoretically there to solve problems, aid policies are often misguided, local governments have often proven incapable, incompetent, corrupt and uncommitted to their own citizens' welfare.  But one can argue with their solution set...it's like going back to the future.   

As I read this report, the private sector is seen as the enemy at worst and a wild beast to be caged at best, the profit motive as antithetical to welfare, and more aid as the solution.  The past and current failures of the public sector in the developing world to make headway in solving these problems for billions of people across all regions are acknowledged but then largely ignored.  The Oxfam doctor's prescription is to throw more money at these self-same entities - but more consistently and in larger amounts.  

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"It's a moment to balance the global with the local." - Dr. Abhay Bang, director of SEARCH

NextBillion’s news section contains 4 new items, all of which pertain to “risk” in relation to the BOP community. But this risk I am referring to is two-fold. These news items address the wrongly perceived notion by commercial banks and insurance companies that the poor are 'high risk.' But the flip side, the newsworthy aspect, is that now these companies are seeing opportunity instead of risk. In fact, they are making it their job to reduce the risk to the poor using multiple approaches.

Micro Health Insurance
For years, the poor were considered uninsurable, both for the barrage of risks they face and for being either unwilling or unable to pay for disasters in advance. Micro health insurance plans, such as the one provided by UpLift India Association, aim to provide quality healthcare at low premiums on a community-level scale. Undertaken with creative planning, this initiative can provide the same protection against risk for the poor that it does for the rich. In countries such as India (the world leader in this emerging field, with 5 to 10 million people enrolled in micro health insurance nationwide) where the poor usually work in informal jobs or are self-employed, they are highly unlikely to be included in employment-related plans. In addition, about one-fourth of hospitalized Indians fall below the poverty line as a direct result of their hospital expenses, according to a 2002 World Bank report. Many people take out steep loans or sell their homes in order to pay. And for the poor, losing even a day's wages while waiting in the hospital can be devastating. According to an article by The Christian Science Monitor...

Nandakumar Rajeshirke, a stone carver in India, bought coverage for his whole family at 50 rupees ($1.10) per person annually and renewed the plan for several years in a row. In 2005, his gamble paid off. Rajeshirke's wife needed a hysterectomy, a procedure that would normally cost 20,000 rupees ($446), one-third of his yearly salary. "Without insurance," he says, "I would have had to sell some things from my house or get a loan from someone at high rates." Instead of facing financial ruin, he paid 6,000 rupees ($134) total and had help navigating the long process through diagnosis, surgery, and medication.

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It is a familiar story: post-college volunteer (Peace Corps, etc.) returns from the developing world with a desire to help the community in which he or she has been staying. The subsequent projects are also familiar – they often involve selling local handicrafts to first-world markets, or aggregating donations of used computers and cell phones to send back to the community. I don't question the motivation behind such initiatives, and I applaud some of them for attempting to bolster the local economy or jump-start development with first-world technology. More often than not, however, these small projects operate much like typical top-down development projects; that is, they depend on human and physical capital that only the donor/benefactor can provide. In order for such projects to become truly sustainable, they must be able to stand on their own.

Peter Haas knows this story well, having spent years traveling to and volunteering in low-income communities, where well-intentioned development projects often failed without constant donor intervention. With his first-hand knowledge of the problem, Haas set off to find a solution, founding the Appropriate Infrastructure Development Group (AIDG) in 2004. The AIDG web site describes exactly what it is they do:

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So much to read, so little time…but these activities are definitely worth a look-over.

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The Ashden Awards reward outstanding and innovative projects which tackle climate change and improve quality of life through the generation of sustainable energy at a local level. As you can imagine, the winners had some amazing ideas with the potential to drastically change the lives of the communities they are reaching out to.

Four awards were given in recognition of the way in which sustainable energy has been used to improve access to Light, to Food, to promote Enterprise and to improve Health and Welfare. An Africa Award was given in recognition of the urgent need to address the combined challenges of environmental degradation and lack of access to resources in the region. More general information on the awards can be found in the press release.

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I've recently been reading through some past blogs, keeping a keen and curious eye out for activities to add to NextBillion's activity database...care to see what I found? Some very interesting, and of course worthwhile projects...

ZENUFA Laboratories - Tanzania

Zenufa, a pharmaceutical company, is settting up one of the first Tanzanian pharmaceutical plants complying with the WHO Current Good Manufacturing Standards. The project is being supported by BIO (Belgian Investment Company for Developing Countries)

Zenufa has a long-range plan to produce more innovative drugs, not yet manufactured in Tanzania, such as ARV drugs for aids patients. Zenufa will sell most of its products in Tanzania but will also target other neighbourhood countries. In addition, this plant will improve the access to essential drugs, will help reduce prices and will offer opportunities to launch more sophisticated drugs. Zenufa will create about 150 new jobs, most of them for women.

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Over a month ago, we covered a New York Times article on Billiton and its six year effort fighting malaria in Mozambique.  Now it has come to my attention that The World Economic Forum, in collaboration with Harvard’s School of Public Health, has released a paper, Business and Malaria: A Neglected Threat? which documents the danger that malaria poses to business.  The paper reaffirms the urgency of the situation and suggests that businesses need to step up where inept and corrupt governments have failed and help support the fight against malaria.  Check out the World Bank’s PSD Blog for more information.