USAID Impact Photo Credit: USAID and Partners

Archives for Economic Growth

Celebrating the 150th Anniversary of the Morrill Act

Dr. Rajiv Shah serves as the 16th Administrator of USAID and leads the efforts of more than 8,000 professionals in 80 missions around the world.

Dr. Rajiv Shah serves as the 16th Administrator of USAID and leads the efforts of more than 8,000 professionals in 80 missions around the world.

Today we celebrate the visionary leadership of President Abraham Lincoln in signing the Morrill Act 150 years ago.  Even as our nation prepared to enter one of the most brutal and challenging periods of its existence, President Lincoln demonstrated a powerful understanding that America’s success would depend on investment in the agricultural development of its new frontier. His foresight led to the creation of the most productive science- and engineering-based agricultural economy the world has ever seen. The new U.S. land-grant system democratized American access to education, graduating young scientists and engineers who have continued to transform the American economy through generations as no other single investment has.

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Video of the Week: A Visit to Candlenut Farmers

This week’s video comes from our USAID Mission in Timor-Leste. USAID works with candlenut farmers and their communities to teach them how to increase yields and reach new markets.

Powering Energy to Face the Challenges of World Hunger

Feeding the world’s hungry and access to energy are typically viewed as separate development goals. But it is becoming abundantly clear to those of us here in Rio de Janiero at the UN Conference on Sustainable Development (RIO+20) that they are intertwined. The facts speak for themselves:

  • An estimated 850 million people go to bed each night hungry;
  • The world population grows by 77 million people each year, and by 2050 the population will be an estimated nine billion;
  • To meet this demand, global food production must increase by 70 percent by 2050.

PoweringAg, USAID’s new Grand Challenge, invites ideas and innovation on powering up energy in developing countries. The effort is expected to help women with 43 percent of the world’s farmers estimated to be female.

To feed nine billion people, we will need to increase food production on the land already growing today’s food supply, and access to sustainable energy is key.

The magnitude of the challenge is illustrated in Sub-Sahara Africa (SSA) where only fourteen percent of people in rural areas have access to electricity.  Post-harvest losses have risen as high as fifty percent in SSA, but with the introduction of cold storage, refrigerated transport, and business models to store produce could dramatically reduce levels of hunger. 

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Pressures on the Plundered Planet

Director, Centre for the Study of African Economies, Oxford University

Director, Centre for the Study of African Economies, Oxford University

Paul Collier, Professor of Economics at Oxford University, spoke earlier today at USAID’s Frontiers in Development Forum, and will speak again tomorrow morning. Below is an excerpt from his contribution to the Frontiers in Development essays.

As the world economy grows, it increasingly faces natural constraints. These provide both new opportunities and new risks for the poorest countries; managing them well will be central to their exit from poverty. These were the themes of The Plundered Planet. Here I bring out some of the key current issues. Industry needs natural resources, for energy and material inputs, but many of the natural resources we use for these purposes have a fixed endowment, which we are depleting. A growing global population needs food, and food needs land, but land suitable for agriculture is finite.

Both industry and agriculture emit carbon dioxide into the atmosphere, but the stock that can be safely absorbed by the atmosphere is finite, and as it builds up it gradually changes the climate. How concerned should we be about these constraints, and what do they imply for development?

I think that the concerns about industrialization grinding to a halt because of shortages of vital natural-resource inputs are misplaced. As any particular resource becomes depleted, its price rises. In turn, this induces fresh investment in prospecting and so furthers discoveries, and ultimately research into innovation. This has happened so many times across such a wide range of activities that we can be fully confident of it. The past decade of rising prices for natural resources has already triggered these waves of investment. Currently, by far the highest-valued natural resource is carbon-based energy, from oil, coal, and gas. The high prices of the past decade have triggered an astonishing wave of new technologies that enable us to tap into endowments that were previously inaccessible: The United States has already discovered enough additional resources through these new technologies to be self-sufficient for several decades. Beyond technology-based discoveries are technology-based
substitutes: For example, in the 19th century, nitrates were considered vital and finite; then we discovered modern fertilizers.

Similarly, the global population will not face hunger because of land shortages. There are still huge areas of grossly underutilized fertile land; beyond that are drip-feed and greenhouse technologies that open up lands that are currently too dry or cold. Nor will we face a stark choice between energy shortage and overheating. Although global supplies of carbon-based energy are finite, there are many non-carbon sources of energy waiting to be developed. Indeed, modern physics tells us that the endowment of other forms of energy is infinite: The challenge of permanently sustained energy supply is entirely technological, and we can be confident that innovations will be forthcoming. But although we are not facing a natureimposed Armageddon, natural resources, climate, and food are interconnected in ways that pose new opportunities and new risks for the poorest developing countries.

Read the full article in USAID’s Frontiers in Development publication.

If Development Were Soccer

Rakesh Rajani is the founder and head of Twaweza and a civil society leader in Tanzania.

Rakesh Rajani is the founder and head of Twaweza and a civil society leader in Tanzania.

Rakesh Rajani spoke at the Frontiers in Development Forum. Below is his contribution to the Frontiers in Development essays.

If there were a prize for global organizations  most tainted with corruption, FIFA, the International Federation of Football (Soccer) Associations, would be a strong contender.

For years, its board members are said to have demanded, received, and dished out bribes for purposes such as vote buying and selling rights to host the World Cup. The “crony culture” inside  FIFA has reportedly caused huge losses—about  $100 million in one instance alone when an exclusive deal with a marketing company went belly-up. These acts have spawned investigations, books, and blogs seeking to expose the organization, but FIFA appears to have warded off serious reform. Its current boss has been in charge for 14 years and part of FIFA for 38. He ran unopposed in the last election, in part because his two rivals were disqualified for foul play. His predecessor had been at the helm for 24 years.

Several boys play on a soccer field at Tabarre Issa Emergency Relocation Camp on June 7, 2010.  Photo Credit: Kendra Helmer/USAID

Several boys play on a soccer field at Tabarre Issa Emergency Relocation Camp on June 7, 2010. / Kendra Helmer, USAID

Precise numbers are difficult to establish, but soccer has well over a billion supporters worldwide. Many of these tune in every week on radio, TV, and, increasingly, the Internet. More than 700 million are estimated to have watched the final games of the World Cup in 2006 and 2010, across all six continents. It is easily the world’s biggest sport.

While growing up in Mwanza, Tanzania, listening to commentary of English league games on a crackly BBC shortwave transmission was the highlight of my week. Today, walk through East Africa’s bustling neighborhoods or rural communities on weekends, and you will likely see animated men and (increasingly) women listening to a duel between national rivals or watching Chelsea play Arsenal or Barcelona take on Real Madrid. You will see much of the same across large parts of Africa, Latin America, and Asia. In many cases, these are communities that have no electricity and low incomes, but some entrepreneur will have rigged up a generator and an improvised satellite dish, and be turning a tidy profit charging entrance fees.

It’s not only about relaxing in front of the TV. Soccer is among the most common topics on social media, radio call-in shows, and street corners. Crotchety pundits, hip pre-teens, and nerdy economists alike pore over team statistics to discern patterns, debate choices, and predict outcomes. It is public engagement interspersed with politics, business, and local drama, but soccer remains at the core. And soccer evokes great emotion. When there is a crucial goal or save, observe the poetry of celebration rituals or the slow-motion implosions of defeat among both players
and fans. It’s quite an experience.

Why does soccer work? Why, unlike so many badly governed public agencies, NGOs, and projects, is soccer so powerful, lively, and engaging? Could it be that soccer has got something so  right, that it doesn’t much matter that its state of supra governance is somewhat shambolic? And if that is indeed the case, might it provide useful insights for how we think about development in countries where the intractable problems of supra governance will not be sorted out soon?

Children First.  An orphan herself, Fortune helps other children learn about HIV through the Grassroot Soccer program. Photographer: Heather Quinn

An orphan herself, Fortune helps other children learn about HIV through the Grassroot Soccer program. / Heather Quinn


Soccer and development, while very different, have several features in common. I’ll highlight four. Both have purposes or goals to score. Both  have rules and conventions of how things are to  be done. Both have someone deciding whether  conduct is right, imposing sanctions for foul behavior, and judging the final outcome. And  both have actors who need to be motivated and focused to deliver. But each handles these features very differently.

In Soccer, Success Is Clear and Simple

Soccer isn’t called the “beautiful game” for nothing. Players display enormous skill when dribbling, passing, and making daring dives and gravity-defying turns. Fans love these moves, and TV screens replay some of the best ones over and over, so that viewers can study the skill and savor the moment. Papers speak of the teams that play the most entertaining football. But all this skill is aligned toward a very simple and very clear purpose: to score more goals than the other team. Sure, a lot of other statistics are collected, such as the number of passes, number of fouls, percentage of possession, ages of the players, and so forth. The artistry is fun and appreciated, but what matters is how it contributes toward the purpose. What counts is the final score.

The incentives are well aligned too, in the short and long term. You win the game, you celebrate, your team gets three points. Everyone involved—the players, the managers, the owners, the spectators—understand this. In the long term, those points and goals add up, and you move up the league table or on to the next round of the competition, until you win the cup. The better you perform, the more likely you are to earn a better salary.

Read the complete essay on page 18 of USAID’s Frontiers in Development publication.

ABOUT THE AUTHOR

Rakesh Rajani is the Head of Twaweza (meaning ‘we can make it happen’ in Swahili), a 10-year initiative to enhance access to information, citizen agency, and public accountability in East Africa.

Broadband Partnership of the Americas

Eric Postel is the Assistant Administrator for USAID’s Economic Growth, Agriculture, and Trade Bureau. 

President Obama, while attending the Summit of the Americas in Colombia, announced a new Broadband Partnership of the Americas (BPA), with a focus on expanding access to the Internet.  This Partnership is the first region-wide extension of the Global Broadband and Innovations (GBI) program, originally launched by USAID in the fall of 2010.

Within the international development community there is growing recognition of the value of information and communication technologies (ICTs) in advancing economic growth, and in enhancing the delivery of health, education, agriculture, and other services.  For that reason, ICTs are essential to achieving several of the Millennium Development Goals (MDGs) and MDG Goal 8: Develop a Global Partnership for Development has a target of making available new technologies, especially information and communications. In 2005, the United Nations World Summit on Information Services (WSIS) established ten priority ICT-related targets.  Of these ten targets, “connect villages” is the first.  2010 data show progress against this target with mobile subscriptions reaching just under 70 percent of the population in developing countries, and the Internet reaching just over 20 percent.  Clearly there is more work to be done, however.

A key component for leveraging ICTs within USAID’s development portfolio is expanding access of both mobile and broadband networks.  While much progress has been made, three constraints remain.  First, there is still a rural population of more than one billion people who do not have mobile coverage.  Second, most of the mobile networks put into place during the last decade are capable only of voice and text, but do not support full Internet access.  And third, there is the issue of affordability. Even where networks are available, pricing is often beyond the reach of the lower-income populations that are often the focus of USAID’s programs, especially in rural areas where connection costs are high.

The GBI program is addressing these constraints by providing technical assistance to universal service funds (USFs).  USFs are created from taxes placed on telecommunication carriers for the purpose of supporting rural build-outs.  In addition, the GBI is working with private sector equipment manufacturers and carriers to deploy innovative, affordable and scalable solutions appropriate for small, rural communities.

The most exciting aspect of the new Broadband Partnership of the Americas announced by the President, from my perspective, is the fact that it focuses on the Americas — that is, on countries in our own hemisphere.  It builds on earlier successes and melds the expansion of telecommunications with clean-energy solutions.  BPA also pulls together a rich partnership of local and international public and private sector entities with a specific focus.  This approach, especially in our hemisphere, underscores once again that working together we can make a difference.

We must do better than cash

Cash can stifle economic development.  That might seem counterintuitive.  Aid is critical to ameliorating the plight of poor people living on far less a day than we spend on a latte.  But physical cash can undercut many development objectives the U.S. government works to achieve.  From improving aid effectiveness to shining a light on corruption to unleashing the private sector, cash gets in the way.   If you care about reducing poverty, then you must also care about reducing the reliance on physical cash.

USAID is helping Haiti increase financial inclusion through the advance of mobile money. Photo Credit: USAID

We begin a movement to do just that.  USAID Administrator Rajiv Shah is announcing a broad set of reforms to use USAID’s $22 billion financial footprint as a force for good—as a way to reduce the development industry’s dependence on cash.  This includes integrating new language into USAID contracts and grants to encourage the use of electronic and mobile payments and launching new programs in 10 countries designed to catalyze the scale of innovative payments platforms.  Based on examples in Kenya, Haiti, Mexico and Brazil, we believe that our implementing partners will generate at least 15% efficiency gains in their operations by 2016.

This movement would not have been possible 5 or 10 years ago.  The infrastructure did not exist.  But the rapid rise of the mobile phone—there are now nearly 4.5 billion mobile phones in the developing world—in tandem with electronic cards makes it possible today.   We cannot afford to let this opportunity pass—this movement cannot be a movement of one.  Indeed, USAID’s assistance is a big drop but still a drop in the development bucket.   This must be a movement that crosses sectors and borders—private companies with extensive supply chains and governments with large disbursements must join together to leverage electronic payments platforms.  Here’s why we must do better than cash.

First, cash costs money.  It is ironic, but paying teacher salaries or issuing social transfers is expensive.  You need money to hire couriers to lug big bags of cash around—and leakages are inevitable.  Think of electronic or mobile payments as the functional equivalent of epoxy paste—they seal the cracks in the payment edifice and prevent leakages.

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Harnessing Science, Technology, and Innovation To Promote Global Development

Originally posted on the White House blog

Today at the White House, senior Administration officials announced a series of new initiatives to promote game-changing innovations to solve long-standing development challenges.  Answering President Obama’s call to harness science technology, and innovation to spark global development, the Administration announced initiatives from across the government to generate new development solutions.  Announcements include new partnerships with universities; greater use of scientific breakthroughs through expedited technology transfer of federally-funded inventions; a program to reward inventors who use their patented technologies to address humanitarian needs; and initiatives to leverage advances in Internet and communications technologies to provide new development tools.

In an increasingly globalized world, the Obama Administration recognizes that global development is vital to national security and is a strategic, economic, and moral imperative.  One of the cornerstones of our global development policy is a commitment to investments in game-changing innovations with the potential to solve long-standing development challenges in health, food security, environmental sustainability, and broad-based economic growth.  Innovation can play a key role in building a stable, inclusive global economy with new sources of prosperity, advancing democracy and human rights, and helping us to increase the ranks of prosperous, capable, and democratic states that can be our partners in the decades to come.

Administrator Raj Shah announced that USAID is launching a new partnership with universities and research institutes to define and solve large development challenges.  USAID also announced new commitments to increased utilization of electronic and mobile payments to save on costs and increase financial access; a new effort to make assistance to other governments in telecommunications development more efficient; a new “app store” for development to spur humanitarian apps and software; and new commitments to mobile education technology as part of USAID’s All Children Reading grand challenge for development.

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Can Mobile Money Transform a Country?

Two years after the earthquake, Haiti is rebuilding not just brick by brick, but click by click.

A message confirms the deposit of a new customer who is signing up for Digicel’s Tcho Tcho mobile banking on March 3, 2011, in Port-au-Prince, Haiti. Photo Credit: Kendra Helmer/USAID

The earthquake left behind a government in rubble, an economy in shambles, and a people living in makeshift camps, coping with enormous loss.  Against this backdrop, the possibility of progress lives not just in the resilient spirit of the Haitian people, but also in the simple power of their mobile phones.

In June 2010, USAID and the Bill & Melinda Gates Foundation launched the Haiti Mobile Money Initiative (HMMI)(PDF, 163KB). This program leveraged the private sector and the ubiquity of mobile phones to bring financial services to Haitians, 90 percent of whom didn’t have access to a bank account before the earthquake destroyed nearly one-third of the country’s bank branches, ATMs, and money transfer stations.  Put simply, mobile money gives Haitians access to banking without building a single bank.

It worked.  In January 2011, one year after the earthquake, HMMI awarded Digicel and its partner bank, Scotiabank, a “First to Market” Award of $2.5 million for “Tcho Tcho Mobile.” Five months ago, HMMI awarded mobile operator Voila and their bank partner, Unibank, $1.5 million for “T-Cash.”  While verification is still underway, data reported by the industry indicate that there are nearly 800,000 registered users.  Moreover, there are over 800 agent locations now available to serve clients.  In a country where there are fewer than two bank branches per 100,000 people, this represents a near doubling of accessible financial services.

These numbers are significant, but what do they mean for the people of Haiti?  Why should we care about the growth of mobile money in Haiti and the rest of the developing world? 

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Women Combating Climate Change

Last week I was in Durban, South Africa where I attended the Seventeenth Session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP-17). Climate-resilient, low carbon development is sustainable development, so it’s no surprise that many of the issues addressed at COP-17 are crucially important to USAID’s development efforts and to our developing country partners such as adaptation, clean energy technologies, and REDD+ (Reduced Emissions from Deforestation and Forest Degradation).  USAID is emerging as a leader in gender and REDD+ and recently released a report which analyzes the barriers and opportunities for women’s participation in the REDD+ sector in Asia.

One of the issues I came to Durban to discuss is a key topic throughout climate change-related work – the critical role women play in combating climate change and the need to support gender equality across climate issues.

Last Monday, I hosted an event that covered the efforts of USAID’s Central African Regional Program for the Environment to engage civil society in forest conservation and REDD+ programs in the Congo River Basin.  USAID forestry specialists, partners, and local experts described how technology and community-based work are keys to sustainably conserving the second largest tropical rain forest in the world, and a significant carbon sink.  As efforts like Wangari Mathaai’s Greenbelt movement have demonstrated, women play a critical role in forest conservation and reforestation.  Involving local communities in the conservation efforts of course includes incorporating women into all aspects of the program – from design to implementation.

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