Foreign Aid is broken. Can giving cash directly to the poor help fix it?
Just give money to the poor: That’s the essence of GiveDirectly’s strategy for global good. It sounds way too simple to work. What about trainings and empowerment and oversight?
But initial studies suggest it works very well indeed — and that GiveDirectly could jumpstart an entirely new way of easing global poverty.
In western Kenya, GiveDirectly grants recipient families about $1,000 over the six to nine months, more than doubling their annual incomes, on average. Recipients can spend the money however they want. So far, it seems, they’re making investments with long-term returns: sturdy tin roofs that, unlike thatched ones, don’t require constant repairs; school fees for their children; and livestock and land.
One internal study of the cash transfers found that families saw their personal assets increase an average of 58 percent over a year, while monthly incomes rose an average of 28 percent, thanks to returns on investments made with GiveDirectly cash. (The study was conducted by a researcher at MIT’s Poverty Action Lab and a co-founder of GiveDirectly.) Just across Kenya’s western border in Uganda, a three-year government cash-transfer program had similar success.
Could the GiveDirectly approach rescue development?
Kenya’s counterterrorism approach following the Westgate Mall attack is crude — and may actually be spawning more violence.
NAIROBI, Kenya — At around 7:30 p.m. on March 31, three blasts went off in Nairobi’s Eastleigh neighborhood. The explosions, which police say were caused by grenades, killed six and injured around a dozen civilians congregating at two local cafes in the suburban area, which is dominated by ethnic Somalis.
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The bombings were only the latest in a spat of terror attacks following the September 2013 siege of Westgate Mall by Somali gunmen, which left 67 people dead. In December, a grenade blast killed four people in Eastleigh. In late March, unidentified gunmen entered a church near the coastal city of Mombasa, killing six. In all, nearly a dozen attacks that bear the marks of al-Shabab, a jihadist group based in Somalia that was responsible for the Westgate attack, have rattled Kenya since last fall.
Police are taking a high-profile approach as they respond to these attacks, detaining thousands of Somalis and Kenyan citizens of Somali heritage. But stops and arrests are not based on intelligence. Rather, police officers simply scour ethnic-Somali neighborhoods, sweeping up civilians from the streets.
Terrorism analysts say this sort of policing may actually be making Kenya less safe. As indiscriminate profiling becomes the fabric of security procedures, hundreds of thousands of Kenyan-Somali Muslims — a group from which al-Shabab affiliates are actively attempting torecruit — have something to be angry about. The government’s ethnic-focused, and often brutal, anti-terror tactics thus may be fueling the very attacks they are meant to suppress.
Read the full story at Foreign Policy Magazine.
Instead of handing over billions of dollars to bureaucrats to devise ways to help the world’s poor − and make aid vulnerable to ‘leakage’ in the process − why not just send one-time disbursements of cash directly to recipients so that they could lift themselves out of poverty?
Last month, I travelled to western Kenya to interview some of the recipients of cash transfers in those communities. (My research was funded by GiveWell, a non-profit organisation that vets the work of international charities).
“People used the money in different ways, to pay their children’s school fees, to buy a motorbike, to build a new house like you see my neighbour has done here,” one recipient explained. “I think everybody has used it well according to their own needs.”
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This is precisely what makes cash transfers different, and superior, to traditional forms of aid, proponents say. In an article for the Cato Institute Journal, former Lead Economist in the World Bank’s research group, Branko Milanovic, wrote: “By delivering aid in cash, we do not tell poor people what they should do…and how they should spend their money. We just allow them to decide, without paternalism, on their own. And we improve, ever slightly, their condition.”
The million Chinese who’ve landed in Africa are plucky, hugely ambitious and have an eye for opportunity. They’re also helping make China a big player on a continent once dominated by the West.
You’ve seen the headlines: China is taking over Africa, and the United States and Africa’s former colonizers in Europe have lost sway.
Mostly, it’s true. Throughout Angola, Ghana and the Congo, some of China’s largest companies are building roads and railways. They’re backed by Chinese banks, and they’ll pay off their loans in kind through mining and oil deals. All the while, small-scale Chinese entrepreneurs are moving to Africa, opening pharmacies, trading furniture or buying land to farm, much as earlier generations did in Southeast Asia and North America. African governments are welcoming them with open arms, and for the most part, so are Africans themselves.
Earlier literature on China’s rise in Africa pushed us past the easy — and flawed — paradigm of China as Africa’s latest ”colonizer.” But in his forthcoming book, China’s Second Continent, Howard French argues the Chinese who migrate to Africa do so as individuals motivated by simple, familiar dreams of opportunity.
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A former China bureau chief for The New York Times and veteran Africa correspondent, French traveled the African continent, speaking Mandarin with Chinese men and women who had grown weary of the daily grind in their homeland. The characters French encounters are risk-takers: sometimes foulmouthed, often lucky and universally ambitious.
Read the full Q&A: Howard French on ‘China’s Second Continent’ | C-Notes | OZY
China isn’t the only one raising its stake on the African continent.
African leaders are happy to look beyond Western aid and investments that come tied to pesky political conditions, like asking for free elections or letting the opposition out of jail. As a result, China, India and other Asian firms willing to look the other way are making major inroads across the continent.
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Now, Turkey is joining the crowd and forging a route into Africa, setting its sights on Uganda, an East African nation with untapped reserves of oil and minerals. It could be the start of a beautiful friendship.
Read more: Turkey’s Rise in Africa | Fast forward | OZY
By the books, it’s rising. Africa had six of the world’s 10 fastest-growing economies in the 2000s. Minerals, metals and oil are nourishing long-starved government coffers. In January, Kenya’s Revenue Authority said it had collected too much money in taxes over the previous six months — 24 percent more than during the same period the year before.
But don’t go telling your friends Africa is no longer poor. The raw numbers are misleading, and “much of Africa’s celebrated growth is vulnerable,” according to the first Africa Transformation Report, published last month by the African Council on Economic Transformation (ACET). According to ACET, African economies have failed to transform in ways that would ensure long-term gains.
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In that argument, ACET joins a burgeoning subfield of economists trying to explain the discrepancy between fast economic growth and slow human progress in some African countries. Their ranks include Dani Rodrik and other development economists, but ACET’s report may be the most prominent. They hope their ideas change how we think about national success.
Read the full story at OZY.com
A push by Kenya’s president and male-dominated parliament to overhaul marriage bodes ill for the nation’s wives, socially and economically
NAIROBI, Kenya – President Uhuru Kenyatta signed a new marriage law this week that drastically restricts the rights of women in wedlock.
Human rights advocates here and abroad are condemning the law, which grants men the right to marry a second, third or even fourth wife without the previous wives’ permission. Currently, certain traditions allow men to take multiple wives, but only if he first gains their approval. There is no law that allows women to take multiple husbands.
“Parliament has discovered it has this ability to formulate laws that serve its interest,” said Tom Odhiambo, professor of cultural studies at the University of Nairobi. “Because many (members of parliament) are married to women whose social status and education level is below theirs, they can always go home and say “the Constitution allows me to marry a second wife.”
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After parliament passed the regulation, Kenyans waited for nearly one month to see whether President Kenyatta — who stands accused before the International Criminal Court of committing crimes against humanity during Kenya’s violent 2007-2008 Presidential election — would risk further soiling his human rights image by signing it into law. Christian and Hindu leaders joined human rights advocates in calling on Kenyatta to veto the Act, saying polygamy violates their religious edicts.
Read the full article at GlobalPost.
Turkey, which already straddles both Europe and Asia, is now making inroads into a third continent: Africa. East Africa is poised to become the new frontier market for Turkish construction, textiles and hospitality firms as they position themselves to become major stakeholders in the region’s rapidly growing industries.
Meanwhile, the Turkish government is forging ties with its African counterparts to negotiate tax agreements, regional security cooperation and foreign aid packages.
“The total value of projects undertaken by Turkish contractors in African countries exceeded $47bn dollars” in 2011, according to the most recent available figures from Turkey’s Ministry of Economy. At the same time, Turkey’s exports to Africa reached $13.3bn that year – a fivefold increase since 2003.
For service workers at the Nairobi Railway, breakdowns and delays limit time-off, and there’s no overtime pay
MOMBASA, Kenya – In its heyday, the Nairobi railway employed some 24,000 people. Day and night, they worked to keep freight and passenger trains running between what is now Kenya’s capital city, Nairobi, and the Indian Ocean at the port of Mombasa.
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Today, the Rift Valley Railways Consortium employs only 3,000 people. The railway itself has changed little in more than a century since it was built by the British imperial power. Trains still bobble up and down, side to side as they roll along outdated, narrow tracks. Train traffic, derailment and other delays strand cars for hours in the middle of a national park.
In April, the China Road and Bridge Corporation announced plans to replace the historic railway with a new, modern line. Workers will lay a set of standard-width tracks that will allow freight trains to traverse them at much higher speeds. Most workers seem hopeful the new line will attract more tourists and other passengers, and that the influx of customers will translate into higher wages and benefits for the workers, too.
Read the full story and watch the video at GlobalPost
Nairobi’s first cupcake shop demonstrates the power of a rising consumer class — and teaches a lesson about labor in emerging economies, too.
If anyone needed more evidence that Kenya’s economy is on the rise, a sort of confirmation arrived recently — in buttercream and a half dozen flavors that change daily.
Sugarpie Cupcakes in Nairobi has won plenty of fans and local press, attesting to this city’s changing tastes. The expats tend to favor Belgian chocolate, while the Kenyans prefer chai or red velvet, but overall sales have grown fast since the business launched late last year.
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Running the business is no cakewalk — but its vagaries and workarounds reveal a lot about Nairobi’s consumerist aspirations, and the economics that underlie them. A rising number of middle-upper-income Kenyans sees cupcakes as one of many small luxuries they can afford. And some among Kenya’s large, (non)working class see that as something to aspire to.
Read the full story at OZY.com