Here’s your Daily Brief for December 9th:

Women at the BoP: what does it mean when your money belongs to you? (via Perspective 2.0) – Ownership is a critical step toward empowerment at the bottom of the pyramid. Advances in technologies, in this case biometric ID cards, will be the future of solving this problem.

The ever-growing business case for CSR/sustainability (via Business Fights Poverty) – Ian Berry takes a look at a recent survey of 250 global business leaders on CSR/Sustainability initiatives. Of those surveyed, 68% are using CSR as a platform for growth and differentiation to create new revenue streams. And 54% believe their CSR activities are giving them an advantage of their top competitors. (Full Report Here)

Rallying the World against “Blood Oil” (via Africa Business Source) – I posted earlier on the topic of conflict minerals in the DRC (with Appfrica’s wonderful use of Ushahidi data to visualize the correlation between conflict and mining). Today, this post from Africa Business Source shares the problem of “Blood Oil” in Nigeria — the “use of proceeds from stolen crude oil in financing international terror groups and domestic insurgents in Nigeria.” What is amazing is the magnitude of stolen crude oil — ranging from 100,000 to 300,000 barrels per day! Outside of the criminal uses of stolen money, there is an enormous lost opportunity cost to the people of Nigeria.

Nigeria’s Brain Gain – It seems that the rising unemployment rates in the US and the UK are driving native Nigerians to take up job opportunities available in their home country. We talk so much about brain-drain in the developing world, it’s interesting to see that the current economic climate is driving quite the opposite effect: brain-gain! (HT: Annansi Chronicles)

Here’s your Daily Brief for December 8th through December 9th:

Conspicuous Correlation: Coltan and Crisis Reports (via Appfrica) – One of the major factors feeding genocide and violent crimes against humanity is that ruling regimes have established business relations with foreign companies, earning them an political ally and a source of revenue to fuel local conflict. The foreign companies often get exclusive access to local resources in exchange for their unwavering political support and usually a cut off the top. We have seen this in South Sudan with Chinese oil companies, and also in DRC with Coltan mining. This excellent report by Appfrica takes Ushahidi (conflict mapping) data and mashes it with mining data to illustrate the “conspicuous correlation” between the two. Coltan can be found in the capacitors used in your hearing aids, pacemakers, airbags, GPS units, laptops, mobile phones, video games, and the list goes on. 60% of it can be found in the DRC, where conflicts since 1998 have killed an estimated 5.4 million people.

A business plan competition for entrepreneurs that deliver access to clean energy Africa – If you’re an entreprneur working on clean energy solutions for Africa (in particular Ethiopia, Ghana, Kenya, Mali, Morocco, Mozambique, Rwanda, Senegal, South Africa, Tanzania, Gambia, Uganda, or Zambia), there is a business plan competition for you! Awards include mentorship, expert advice, consideration for up to $100k in financing, and access to over 100 prospective investors!

The Dragon in Africa: How Chinese Investment Changes The Game (via Triple Pundit) – Interesting question posed: Does China’s appetite for risky investments in some of the most unstable parts of the world (and the investment benefits that come along with it) outweigh its questionable tactics of investment?

Al Jazeera Looks At Investment in Equatorial Guinea

Image Credit: Appfrica Labs

Here’s your Daily Brief for December 7th:

The Next Generation of Microfinance: Microfranchising (via Allyu and BeyondProfit) – One of the challenges for microfinance institutions is covering their overhead expenses. I’ve written about my friend Ben Lyon’s approach to integrating mobile platforms that deliver microfinance services at much lower cost (See FrontlineSMS: Credit). Melissa Richer, Founder of Allyu, has created a strategy of “microfranchising” that could offer additional means for adding value to MFI’s distribution networks while deploying more wealth creating opportunites to the world’s “bottom billion”.

Can Obama Deliver American Investment in Africa? (via Africa Business Source) – As many of us await concrete steps by Obama Administration on its foreign policy strategy toward Africa, this article lays out the foundation on which the Administration will be expected to build as well as the forces it will be working with. One of the best overviews I’ve seen in quite a while!

Is Social Enterprise Ethical? Or Even Legal?  (via SocialEarth) - Several posts on this blog have been centered on the legal and moral foundations on which social enterprises find themselves. In particular, does the corporate framework in America support social entrepreneurship? Mike Shoemaker addresses these concerns in this very well laid out post.

I fell behind on posting Daily Briefs this last week – I was focusing most all of my attention on great Thanksgiving food and company, as well as working hard on completing my Echoing Green Fellowship Application! Here’s a compilation of some of the coolest articles and blog posts that have come across my desk in the last week, hopefully you will find a gem you haven’t yet seen!

B Corps Win Healthy Tax Break in Landmark Law (via Triple Pundit) – Awesome and exciting news on the social entrepreneurship front: B Corps will be privy to a tax break in Philadelphia — and the vote was UNANIMOUS!

Africa and the Crisis: What’s Next? (via PSDblog) – A very interesting look at Africa’s trade portfolio, and what it means particularly in the current economic downturn. While Africa’s growth is largely tied to commodity exports, it is increasingly being integrated into the global economy which will provide it more leverage and economic options during tough times. Interesting point: China’s increased engagement on the continent is noted as driving prices up and increasing value of exported commodities.

Start-up Visas Can Jump-Start the Economy – WSJ.com – This WSJ article makes the argument for “Start-Up Visas” that would allow immigrant entrepreneurs preferenital access to the US so that they may help jumpstart our economy! Thoughts?

Interviewing Good Capital’s Investment Manager (via UnreasonableInstitute) – Teju continues his series of interviews with social innovation leaders with this segment featuring GOOD Capital’s Investment Manager – Wes Selke.

Europe’s $774 billion African desert solar power project launches (via Annansi Chronicles) – A very interesting project designed to build solar power plants across North Africa and the Middle East to provide 15% of Europe’s electricity by the year 2050. What are your thoughts on this?

East Africa Common Market Coming Alive with Business and Investment Opportunities (via Afribiz) – The East Africa Community (EAC) has been in limbo for many years, suffering from a bit of an identity crisis. A recent agreement among the countries of Kenya, Tanzania, Rwanda, Uganda and Burundi will hopefully advance the purpose of the EAC towards a “common market” — allowing for a common external tariff and unhamperd movement of resources (goods, services, labor) within the region. This article takes a look at what this means for investors and businessess, and the EAC region as a whole!

Where Are the Exits for Social Enterprise? (via Change.org) - I’ve always been confused about the concept of building an “exit strategy” into a startup company — especially with social enterprises. Nathaniel raises the point that the concept of “exit strategy” has changed with both an evolving economy and especially in the infancy of the social capital marketplace. He asks, “Where should social enterprises (and their investors ) look for financially and socially rewarding exits?”

The Big Picture: Eid al-Adha and the Hajj, 2009 – This page takes a little time to load, but it’s well worth the wait! An awesome collection of photos from Eid al-Adha and the Hajj 2009!

Coconut + Zippers = Handbags (via AfriGadget) – Creative little product being sold in Lamu…

How Can We Help the World’s Poor? (via NYT) – Nicholas Kristof wrote this great overview article in the New York Times about the aid debate defined by the two camps: Sachs v. Easterly.

Here’s your Daily Brief for August 20th:

AGOA Nations Frustrated By Administration’s Adherence To Status Quo (via The Whitaker Group) – I wrote a post a few weeks ago about the African Growth and Opportunity Act that was being promoted at the AGOA Forum by several high ranking US officials including Secretary Clinton. This excellent post from Whitaker Group outlines the disappointment of the private sector and African governments in the Obama Administration’s lack AGOA reform, despite its very public “commitment” to promote trade and investment in Africa.

In my previous post, I wrote about some of these concerns — a major one being the number of products covered under AGOA. Another being the US possible extending AGOA benefits to non-African countries like Cambodia or Bangladesh (two countries that would easily out-compete and drown out African markets).

Despite African countries being quite vocal in local media outlets about what THEY wanted from AGOA, it appears that the Obama Administration intends to maintain the “status quo”

Nuclear Power for Energy Security in Africa (via The Whitaker Group) – Another gem from the Whitaker Group, this time on Energy Security in Africa. Reliable electricity throughout Africa has always been a problem – and a serious one when you consider the income lost by businesses during blackout. It is an all to common occurrence, and that combined with the high costs of electricity have been a major impediment to investment.

With SEACOM and TEAMS coming online in the months to come — dramatically decreasing the costs on internet and connectivity — African governments need to focus on the next big infrastructure challenge: electricity.

African countries are looking to nuclear power as the solution. The coolest part about this is detailed at the end of the post and includes seriously import research benefits that could come about and help across multiple sectors. Also nuclear power creates and maintains high-paying and high-skilled jobs that cannot be offshored.

Patient capital, markets that work and ending the endless emergency of poverty (via Seth Godin) – Here’s a nice post from Seth Godin explaining in very concise terms the importance of “patient capital”.

The Microfinance Debate:

As Muhammad Yunus, founder of microfinance and Grameen Bank, was awarded the Presidential Medal of Freedom, critics assailed the very institution he was being awarded for. Microfinance has revolutionized development and blazed the path for social entrepreneurship. But the model has its flaws — including high overhead costs barely covered by interest payments, that it’s largely subsidized credit, and the lack of a long-term financing option. Here are a few articles to help you follow the debate:

• The backlash against microfinance (via Duncan Green) – A good breakdown of the arguments at hand over microfinance
• A $9 Trillion Question: Did the World Get Muhammad Yunus Wrong? (via Foreign Policy) – Peter Schaefer argues in this Foreign Policy article that the work of de Soto (integrating the poor into formal markets) and Yunnus (delivering micro-loans to the poor) must be built upon and combined “in order to develop a more viable way to realize their [the poor's] inherent promise.”
• Economics focus: A partial marvel (via The Economist) – The Economist weighs-in to the discussion

And here are posts I’ve already included in previous briefs:

• A Global Surge in Tiny Loans Spurs Credit Bubble in a Slum (via WSJ Subscription Req.)
• A Response to the WSJ Micro-Credit Crisis Article
• Is There a Mortgage Boom in Sub-Saharan Africa?

An article in todays Business Daily newspaper caught my eye and has inspired me to begin my discussion on the role of China in Africa. This is a wildly important discussion and I promise there is more to come on this topic.

Anyways, this article suggests that the rise in US trade-related engagement with Africa is in direct response to China’s threatening stake-hold on the continent. I don’t entirely agree with the suggestion, but it raises a critical point: the US needs to take a serious look at the role of China in Africa and throughout the developing world, and then reevaluate our approach to these undervalued and underestimated developing regions of the world. Historically, the United States has taken a very ethnocentric and paternalistic stance when dealing with Africa — an approach that, from the receiving end, tends to be condescending and demoralizing. America’s long tradition of attaching conditionalities to all forms of foreign assistance (for better or for worse) further exacerbated nationalistic sentiments and resentment towards the US within the aid-receiving countries. So it was no surprise that when China invited 35 African Heads of State to Beijing in 2006, providing celebrations and red carpet treatment, to discuss China-Africa relations, Africans were thrilled to have a new partner in the world — one that treated them as equals.

Now there is a stark contrast between US and Chinese engagement with Africa. While the US does come off as paternalistic and restrictive (particularly with the large number of conditionalities attached to aid), it is trying to uphold certain standards of human rights and morality. Additionally, many conditions (particularly economic) on aid are intended to protect the investment and maximize its impact. But the US has, for the most part, dismissed Africa as a mutually beneficial trading partner. US engagement with Africa is out of a “moral imperative”.

China, on the other hand, has approached Africa as an “equal” and as an alternative to the US and the West. China’s investment in Africa has been less humanitarian and more economic. When an African country want to get a certain project complete an they are looking at two bids: one from the US government and one from the Chinese government, the Chinese offer a blank check with no political or economic conditions whatsoever. However the Chinese have a high propensity of making unfulfilled promises at the outset of a deal, importing their own labor to carry out a project, and mostly extracting natural resources. And the Chinese are ruthless business people, doing business with countries under the backdrop of genocide and dictatorship. They are adept to protecting corrupt leaders in exchange for access to local resources.

That being said, I don’t believe that America’s increase in trade-related engagement with Africa is a direct response to China’s growing stake over the continent — otherwise we would see a decline in conditions and political stipulations attached to trade policy like AGOA. Rather, I believe that this shift is a direct response to a rapidly changing global landscape whereby African markets are becoming more stable both politically and economically. Additionally, I see a dramatic shift coming in the future toward increased investment in Africa driven both by a moral imperative and an economic understanding. This, I believe, will grow as the younger generations begin to assume control of US policy and business.

For now, I’ll leave you with some video for the weekend! This is Riz Khan’s “China in Africa” series:
Part 1/2:

Part 2/2:

In Other News:

Standard Charter shocks rivals with 43 per cent profit growth (via Business Daily) – The banking sector in Kenya is one of the largest recipients of FDI, despite the fact that only about 10% of Kenyans potentially eligible for a bank account actually hold one. Despite the post-election violence in 2008, three out of four of Kenya’s major banks still experienced growth. It seems that still today the banking sector in Kenya continues to surprise!

Chinese and Indian Growth in Latin America: New Business Opportunities (via NextBillion.net) – This is a nice piece on the current and possibly future role of China in the Latin America / Caribbean (LAC) region. I disagree with the zero-sum suggestion in the second paragraph, but the rest of the article is great!

Here’s your Daily Brief for August 6th:

There has been a lot of buzz surrounding AGOA for the last week or so, and I’ve included a few articles in my daily briefs the last couple of days. I figured today I would dedicate the entire DB to AGOA and flush out some of the concerns and issues on all sides.

First of all, I’m very disappointed in the US Media for completely ignoring this story all together. I was watching NBC Nightly News the other night and Brian Williams cut to a reporter traveling with Hillary Clinton, they were in Nairobi, and all they talked about was North Korea! A cursory Google News query for “AGOA” yields nominal US reports. But some wildly important issues are being raised!

So, I hereby take it upon myself to be your guide through AGOA 2009:

Brief Background on AGOA

The African Growth and Opportunity Act (AGOA) was initially passed by Congress and signed into law by President Clinton in May 2000. Four years later, President Bush signed the AGOA Acceleration Act of 2004. AGOA expands on the Generalized System of Preferences (GSP) and gives eligible African Countries trade preferences for quota and duty-free entry into the US on certain goods.

But what would US Trade Policy be without political stipulations? AGOA allows the President to determine a country’s annual eligibility (of course, this responsibility lies more in the hands of the USTR). To date, there are about 41 countries eligible for AGOA preferences.

While AGOA acknowledged the need for eased integration of African economies into the core global economy, it has had some significant shortcomings. It is these shortcomings that have dominated the discussion among scholars and the African media the last couple of weeks.

The theme of this year’s AGOA Forum was “Realizing the Full Potential of AGOA Through Expansion of Trade and Investment”. It’s interesting this comes a year after the original legislation was set to expire (the 2004 Acceleration Act extended it through 2015). But given this theme, it makes these shortcomings essential to address and discuss.

AGOA Shortcomings

The first of the major shortcomings is the political stipulations mentioned above, whereby the US reserves the right to pick and choose eligible recipients. Bill Easterly wrote a great post yesterday on this (linked below), so I’ll keep my remarks short here. Whenever politics and economics come together, the outcome is rarely/never good. And when we’re speaking about developing nations, sometimes the stick/carrot game really hurts us more politically. (This could lead into an entire discussion on the role of China in Africa!)

The second major shortcoming is the US’ still-burdensome import standards, regulations, and policies. From Kenyan exporters to the US that I’ve spoken with, this is a big non-tariff barrier in itself. If we want AGOA to succeed we need to work on assisting African exporters in meeting US-Import Standards.

A third shortcoming is that of little capacity building and technical assistance. While a provision for this was written into the original legislation, it remains a significant issue. This is discussed further below in the “African Countries Call on US Reform” section.

The final shortcoming, and probably most important, is the disproportionate consistency of US-Africa trade under AGOA. While last year’s trade numbers reached $67.5 billion, about a 30% increase year-on-year, 97.2% of that went to oil producers in only six countries. This means that all other countries only brought in $1.9 billion total. And that number is predominantly textile and apparel exports. (Download US-African Trade Profile 2009)

US Calls on African Reform

Aside from calls for political reform throughout Africa (notably in Madagascar, Liberia, and Kenya), the US Trade Representative to Kenya Ron Kirk offered his suggestions for economic reform in an Op/Ed piece for the Business Daily newspaper.

He called for a diversification of trade in order to generate and sustain economic growth. Furthermore, he suggested African Countries improve their local business environments and foster entrepreneurial initiative.

Secretary Hillary Clinton notably announced, “Today, Africa counts for two percent of global trade. If Sub-Saharan Africa were to increase that share by only one percent, it would generate additional export revenues each year greater than the total amount of annual assistance that African currently receives.” Hopefully this signals a shift is State Department / USAID thinking away from the traditional aid model and more toward a business/trade approach to Africa. (Her full remarks are embedded below)

African Countries Look Inwards

African ministers have acknowledged the role they play internally in making AGOA work. They have called on regional economic blocs like the EAC, SADC, ECOWAS to lead the way in increasing global competitiveness.

African Countries Call on US Reform

President Kibaki called on the US to assist in removing obstacles to trade such as those mentioned above. “The US should help Africa build trade capacity because some of the set quality standards demand that we import specialized equipment, materials and parts from the developed world,” he said.

Other African ministers called on the US to enhance the goals of AGOA through the transfer of skills and technology to improve the quality of exports.

One request include the establishment of a low-cost credit facility for start-up businesses in Africa willing to participate in AGOA, coupled with US-provided technical training and assistance.

African entrepreneurs have requested that product inspection be done in the country of origin, helping lower costs and other technical barriers to trade.

Concluding Remarks

Overall, the discussion is an important one. Integrating Africa into the global economic core is an essential task, but a task of which responsibility does not solely lie on the shoulders of the United States. There is a lot to be done in African Countries with respect to capacity building that does not require US assistance. Additionally, there needs to be a discussion among business leaders, both American and African, to lead toward greater cooperation and increased access to mutually beneficial opportunities.

Here’s Secretary Clinton’s Keynote Remarks at the AGOA Forum in Kenya:

And Here is a Joint Press Conference with Kenya’s Foreign Minister:

And As a Little Treat, Here’s a Sneak Peak Into The Night’s Activities @ Carnivore:

Note: It’s not like the nights at Carnivore I remember!

Here’s the Bill Easterly article I mentioned above:

Hilary offers trade opportunities to Africa – except when we don’t feel like it (via Bill Easterly) – Bill Easterly expresses concern in this blog post over the USTR’s ability to revoke AGOA status from any country for “political” reasons like poor governance. He points to Madagascar, an exemplar country for the success AGOA has had in promoting its textile industry; but political unease in the country has led to the USTR threatening to revoke AGOA eligibility (effectively destroying the local textile industry comprising 6.5-8% of GDP and 50,000 jobs).

Updated:

Here’s some good articles on AGOA:

The New Global Reality: Africans Lead the Way at the AGOA Forum

Will Global Recession Damage US-Africa Trade Ties? (via Paul Collier and Rosa Whitaker)

Here’s your Daily Brief for August 5th:

Paul Farmer out for USAID? (via Foreign Policy) – It appears as if Paul Farmer, the man recently rumored to be appointed head of USAID, is no longer in the running. The culprit seems to be the daunting vetting process itself, including a form requiring the candidate to list every foreign national he/she has come into contact with of the past several years.

How is AID-reform supposed to take place if nobody can get in to reform it???

In the works: Major social enterprise rating and reporting systems – It looks like some big changes to the social capital markets world may be in the works. The first is the “Impact Reporting and Investment Standards” — an initiative toward creating a common language for assessing social and environmental impact. The second is the “Global Impact Investment Rating System”, a B-Lab-like system for rating global private equity and investment portfolios. I could see the latter being a huge success — leading to increased private investment in such funds/portfolios.

Interview with Marie Konaté, CEO of a leading producer of fortified infant cereal products in Côte d’Ivoire – Protein Kisèe-La is a company delivering cereal-based foods designed to fight malnutrition while promoting the production of local food crops.

Quote of the Day:

Clinton Re-Affirms US Commitment to Africa Partnership (via VOA) – “Today, Africa counts for two percent of global trade,” she said. “If Sub-Saharan Africa were to increase that share by only one percent, it would generate additional export revenues each year greater than the total amount of annual assistance that Africa currently receives.” – Hillary Clinton

What do you think about the Daily Brief? Let me know!

Here’s your Daily Brief for August 4th:

Investment Into Rwanda to Rise 10% in 2009 (via Reuters) – Hat tip to @whitakergroup for this gem: A more positive outlook than the NYT piece; This Reuters article reports a 10% increase in investment to Rwanda. The growth is attributed to an honest and disciplined government, though there is still red tape to be cut for investors.

Just When Africa’s Luck Was Changing (via NYT) – This article from the New York Times takes a look at the impact of the global credit crisis on investment in Africa. Just as major investment projects were on the rise throughout the continent, companies have had to scale back due to the current economic climate. What I like about this article is that it makes the argument FOR business in Africa. Quoted in the article is M Nathaniel Barnes, Liberia’s ambassador to the United States and the country’s former finance minister:

““Instead of talking to Usaid, I’d rather be talking to a company like Nike,” Mr. Barnes said. “Having a partner like that means jobs and economic growth, and you just don’t get that from aid.”

The article further illustrates examples of business investments throughout the African continent. This is something that is rare and much needed in the US Media – painting a more accurate picture of Africa and its numerous investment opportunities.

Trade a powerful development tool (via Business Daily Africa) – Ron Kirk, a US Trade Representative in Kenya, wrote this Op/Ed piece in the Business Daily Africa. He stresses the need for African countries to expand and diversify trade in order to achieve sustained economic growth. Additionally, he calls on African Countries to improve their own business environments by nurturing entrepreneurial initiative and simplifying/modernizing border procedures.

Diary of a Social Venture Start-up (via GOOD) – This is a series of blog posts over on the GOOD Magazine website that looks pretty intriguing

Here’s your Daily Brief for August 3rd:

US Africa Trade on Exhibition at 8th Annual AGOA Forum (via Africa Business Source) – A nice overview of this weeks AGOA forum. Makes the good point that the issue needing MOST focus is no longer market access, but rather building up the competitiveness of African Countries by addressing infrastructure, information sharing, and capacity building.

Coca-Cola Enterprises Joins Carbon Footprint-Cutting Race (via Triple Pundit) – Coca-Cola, one of my favorite companies, has pledged to reduce its carbon footprint by 15% by 2020.

What Western Executives Should Learn About Design Thinking in Emerging Markets – This is an article from back in March by John Hagel and John Seely Brown, both from the Center for Edge Innovation at Deloitte. They look at the case of Tata Motors, which released a car called the Nano which was a “disruptive innovation” in the developing world car market. It’s a great piece, and at the end they list four key points (or “broader lessons”) to be learnt.

Maker Faire Africa in 2 Weeks (via WhiteAfrican) – Erik Hersman posted a preview of what to expect at the upcoming Maker Faire Africa – “a celebration of African ingenuity, innovation and invention” – in Accra. Check it out!

Kiva.org: July: 2nd biggest month of lending ever! – Despite (or maybe IN spite of) the global economic recession, Kiva announced today that July posted the second highest lending numbers EVER through their site! The highest month EVER you ask? JUNE! This comes off the back of five (5) very strong months of lending ranging from $3.8 Million in February 2009 to June’s record $4.9 Million. This is awesome, congrats KIVA!