NextBillion.net - Development Through Enterprise - Base of the Pyramid Market Building in Disaster Areas - Comments

NGOs and economic sustainability

Paul Rigterink — Sat, 24 May 2008 17:17:03 -0400

Thanks Manuel. I believe it is a lot easier for anyone to ask for money for people in need and then give away the money to these needy people. Developing profit making businesses is hard. I suggest that a micro-finance NGO borrow one acre in the rural area in which they are working and show what they can do with a machete, a sharpstick, and approximately two months of income of a BOP farmer (to buy seeds, fertilizer, pesticides, or small animals). The micro-finance NGO would better understand what the BOP farmer faces and could make better loans. In the US one can make about $4000 dollars an acre using the techniques of Dr. Booker T Whatley.

Re: NGOs should purchase BOP micro-irrigation equipment

Manuel Bueno — Fri, 23 May 2008 10:54:04 -0400

Hi Paul,

I totally agree with you. Although I am by no means an expert on this issue, it seems to me that NGOs sometimes have a biased anti-capitalist approach which hinders the sustainability of the work they do and the economic sustainability of the communities they work with. NGO personnel do have a lot of expertise in many different areas, but unfortunately, they often lack economics or business majors in their staff.

Since you probably are more knowledgeable about this issue than me, why would you think this is? It feels to me that it might be that NGOs still carry in many ways the ideological weight of their origins. What do you think?

NGOs should purchase BOP micro-irrigation equipment

Paul Rigterink — Wed, 21 May 2008 20:55:46 -0400

Thanks for your comment Manuel. I am a strong believer that the growing of high value food commodities and producing crops outside of the normal growing season can dramatically increase the standard of living of personnel at the BOP especially after a disaster. This is only possible if personnel at the BOP have the proper supplies (including micro-irrigation equipment), training, and understanding of the local market. I am not convinced that NGO personnel are experts in market relations but I hope that I am wrong. I would like to see NGO personnel create demonstration farms with the equipment that is available locally and show BOP personnel how to earn additional money. Many NGO personnel do not know how to run a backyard poultry farm, raise small animals, run a fruit tree nursery or orchard, etc. This lack of knowledge, in my opinion, affects the NGOs ability to make good decisions on how to respond to a disaster in very poor areas where there is a lot of crime, bad government, and a lack of natural resources.

Re: NGOs should purchase BOP micro-irrigation equipment

Manuel Bueno — Wed, 21 May 2008 10:19:54 -0400

Hi Paul,

Thanks for your comments. Actually I had in mind a different scenario. The people living in disaster areas tend to be totally cut off from their social networks and lifestyle. My opinion is that maybe actors which have some BoP background, apart from providing relief, could help them rebuild those social networks through market relations, while helping them get back on their feet. You see, for example, in the case that you put forward, I was thinking not as much as getting garden sets or Family Nutrition Kits, as about creating a market that would help them exchange their produce with each other, a market that would give them pricing signals about what would be most profitable things to plant. These markets would enable them to reconnect with each other in the first place and later hopefully with bigger markets. In such scenarios, the creation of BoP markets would not really be a force for growth, but rather a stabilizer after the extreme shock of a disaster.
What do you think?

NGOs should purchase BOP micro-irrigation equipment

Paul Rigterink — Tue, 20 May 2008 15:29:52 -0400

NGOs could become BOP customers during disaster recovery efforts. After a disaster NGOs may need 100,000 IDEI micro-irrigation “Family Nutrition Kits”, 100,000 garden sets (garden forks, garden rakes, garden hoes, appropriate seeds, fertilizer, chemicals for disease control, and pesticides for the region) 10,000 pesticide applicators, as well as wire mesh fencing so that the disaster victims can start major gardens to increase their food security. Some of this equipment could be bought from businesses supporting BOP personnel. The equipment would need to be purchased and stored in advance so that it is ready to go after the disaster.

Base of the Pyramid Market Building in Disaster Areas

Manuel Bueno — Tue, 13 May 2008 12:25:30 -0400

We live in a world obsessed with growth. According to the National Bureau of Economic of Research (NBER), there have been only four recessions in the US since 1980. Between March 1991 and March 2001, the US experienced the longest economic expansion in its history. It comes, therefore, as no surprise that BoP experts seem to be concerned only with applying BoP lessons toward stimulating growth. In this post, I would like to suggest the possibility of using BoP knowledge as a palliative action in places that are experiencing extreme hardship and as a first step towards returning to normalcy.

One of the defining characteristics of BoP markets is the lack of connections with global markets. This lack of connections results in smaller markets with fewer competitors and higher prices. Furthermore, BoP markets suffer from a lack of infrastructure, efficient bureaucracy and the legal, political and economic certainties that are normally provided by public actors. Now, what happens in an area afflicted by disaster or violence where some or all of these variables are totally non-existent? Would BoP lessons be applicable in these cases?

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