USAID Impact Photo Credit: USAID and Partners

Archives for Economic Growth

Taking PRIDE in Putting Local Wealth to Work

On a crowded street in the Kariakoo District of Dar es Salaam it is easy to overlook the unassuming building that houses PRIDE Tanzania’s local branch. Nestled among endless shops and lost amongst the excitement of the day’s activity, the largest of PRIDE’s 58 branches is modest and nondescript. It isn’t until you step inside the orange stucco walls that you are able to understand what makes this building more remarkable then the rest.

In the branch’s waiting area, you are immediately hit with an atmosphere of activity. Hundreds of Tanzanian entrepreneurs have come for their weekly check-in with one of the country’s most effective and innovative microfinance institutions, PRIDE Tanzania. PRIDE, which stands for Promotion of Rural Initiatives and Development Enterprises Limited, also happens to be supported by a USAID credit guarantee which has helped it maintain and increase microcredit activities.

This particular branch services over 2,000 clients a day, some of whom travel for hours to meet with their lending groups and pay back the next installment of their loans.

Gertrude used a local microfinance loan, made possible thanks to a USAID guarantee, to open a second clothing and shoe store in Tanzania. Photo credit: Mike Muldoon, USAID

As someone lucky enough to engage with these entrepreneurs, I was immediately struck by the drive and charisma with which they approach their businesses (in addition of course to the charm that all Tanzanians naturally possess). While intrigued by their visitor and more than willing to share their stories, they are clearly anxious to complete their meeting and get back to what brought them here in the first place – their businesses.

Just a short distance down the road I was able to visit some of these businesses firsthand, starting at Fatema’s print shop. A client of PRIDE for over six years, Fatema started her business as a one-person operation with a $3,000 loan. Fatema now has four employees, was able to buy a plot of land for her home and can afford to send her children to school. Recently becoming an agent for the popular M-PESA mobile banking service, Fatema’s business continues to grow, as evidenced by the $11,400 loan she recently received.

Deeper into the Kariakoo market, I met Gertrude, the owner of two local clothing and shoe stores. Formerly on her own, Gertrude recently opened her second store, employs four employees and is able to source her products from suppliers throughout the region – greatly reducing her input costs and boosting her profits.

This trend continues for the rest of the afternoon, for Fatema and Gertrude are just two of the thousands of entrepreneurs that PRIDE supports through its micro-loan products.

One of the things that makes PRIDE special is its relationship with USAID’s Development Credit Authority (DCA). DCA uses risk-sharing agreements known as credit guarantees to mobilize local financing in developing countries.

In 2010, PRIDE utilized a guarantee from DCA to support a bond offering, the first of its kind for a microfinance institution in Tanzania. The guaranteed bond enabled PRIDE to raise $10,000,000 from local capital markets. As a result, PRIDE vastly expanded its portfolio and the number of borrowers it supports. This activity is part of a much wider effort by the U.S. Government to stimulate local capital markets in Tanzania.

Meeting these individuals firsthand, both the borrowers and the staff of PRIDE, reinvigorated my drive to provide them with the local capital they desperately need to grow their businesses, provide for their families and develop an economy that is supported entirely by the local community.

Fly-Tying Deals Bring Sweet Success

I grew up along the swampy shores of Lake Victoria in Western Kenya, where fish is our favorite meal.

When I travel home to my village, over 300 miles from Nairobi, I enjoy watching rural family members hook worms or other insects to a fishing line before casting it out into a local stream and reeling in tilapia, trout, catfish, mudfish, and more.

But around Lake Victoria, villagers fish for food and income—not for fun. It amuses them to think that people might fish as a hobby.

At a recent USAID event though, I met an entrepreneur named Carol Mbutura who showed me that some Kenyans also make a good living from this hobby—supplying lures to the leisure-fishing industry. Carol was showing off a large display of dainty, hand-tied fishing flies created in Kenya and destined for overseas markets.

I knew there was a story here: Fly-tying is not a traditional Kenyan craft.  How on earth did Carol get into the fly-tying business?

She told me the cottage industry dates from the 1930s when a young Englishman came to Kenya to recover from a broken back. Mad about fishing, he taught some local Kenyans to tie fishing lures. They then started selling to British settlers—for catching trout imported from Britain, which still inhabit highland streams today.

More recently, an American company called Flydeal began buying flies from Kenya.  Carol Mbutura had developed a shipping company based in Nairobi—and Flydeal hired her to send the products to the United States.

Keeping up quality and production numbers from 10,000 miles away, however, proved increasingly difficult. So four years ago, the Flydeal asked Carol to step in, manage production, and become a business partner.

USAID has helped Mbutura and other African entrepreneurs take advantage of the African Growth and Opportunity Act (AGOA), which allows duty-free imports of some African products to the United States. In 2011, training provided by USAID AGOA Resource Centers has sparked millions of dollars in new trade deals, which benefit both U.S. and African businesses and spur economic growth.

With Carol to supervise, sales have grown several times; Flydeal now provides jobs for approximately100 full-time and 50 part-time Kenyan workers in ten factories around Nairobi.  Together they produce 7,000-8,000 dozen of lures a month. The company sells mainly online and exports worldwide, though United States is the primary market.

The delicate but tough, hand-made lures resemble little creatures that fish might eat: flies of course, but also frogs, tiny fish, baby mice, cockroaches, grasshoppers, butterflies, mosquitos… Recently, the factories have begun making jewelry, too, from the feathers, beads, and wires used for lures.

Carol’s advice for other would-be entrepreneurs:  “With your own work you must have patience, perseverance and tolerance; don’t ever quit if someone lets you down, be it a customer or supplier.”

Next time I visit home, I’m going to bring some Flydeal flies with me. I want to see if Kenyan fish go for them—and what my cousins say about using these artsy artifacts instead of an old-fashioned worm.

Developers for Development: The Evolution of the Food Security Open Data Challenge

Geeks, Coders, Hackers, Developers, Computer Scientists, Technologists- whichever term you choose, people with technical acumen have proven to be some of the most prolific volunteers for social good.  It is not hyperbole to state that on any given weekend, in nearly every major city around the world, volunteers can be found gathering together to create products that benefit education, security, economic, and other social interests. Participants cobble together the vision, team, the code, and the experts over 48 hours, and present themselves for judging by Sunday evening.  These gatherings are dubbed “hackathons,” “codeathons” or “codesprints” and they have found success: out of the Disrupt Hackathon, which is hosted by TechCrunch and connects developers and entrepreneurs, the Docracy team formed to make legal and business documents more free and accessible, and went on to raise $650,000 over the next year to expand its operations.  StartupWeekend, a hackathon targeting entrepreneurs, claims hundreds of new startups including Reddit, a widely popular user-generated news aggregator.  In 2010, the State Department and iHub launched the Apps4Africa challenge  to connect local developers and global mentors to local NGOs to learn and solve local problems.  The winner, iCow,  is a successful mobile-phone application that tracks cows’ hormone cycles to inform better breeding, milk production, and nutrition information to Kenyan dairy farmers.

Indian woman arranges a display of grains and seeds at Millet Fest 2012, in Hyderabad on March 24, 2012. The three day event aims to promote use and increase knowledge of the nutritional benefits of millet seeds when used as part of a daily diet. Photo Credit: AFP

If you’re not familiar with the hackathon model, you’re not alone.  Government engagement with the tech community, though expanding, is limited.  And though hackathons bring together widely diverse communities to contribute their time and expertise to solve problems, they are not a flawless solution.  Rare is the startup that can convene and be commercially viable in 48 hours.  To increase the impact of the products of these hackathons, and ensure that those volunteering their time are doing so wisely, we have to improve on the existing model.

Enter White House Chief Technology Officer Todd Park, and his bold concept for public sector improvement of the hackathon model to connect developers directly to the people who will ultimately use their product, and to incubate solutions to be attractive to investors.  Under his model, weekend sessions are stretched across at least ninety days and buttress the hackathon with brainstorming and planning session weeks prior and an incubation period of the successful products for weeks following.  He outlines this model as an endeavor of the White House’s “Open Data Initiative” and, following on the successful implementation at HHS, has taken it to various other agencies including the Department of Energy, Department of Veterans Affairs, Department of Education, and USAID. Through his leadership, each agency has taken up the mantle of instituting their own open data initiatives.

USAID is  building its first data initiative around food security, and I encourage anyone who is curious to get involved.  All backgrounds and interests are welcome; participants need not be an expert in food security nor in software, a willingness to contribute to the efforts of innovative solutions and commercially viable products is all that’s required.  Writers, designers, networkers, and creative thinkers from all walks are welcome.  As access to information increases globally, so does the potential for innovation and great ideas to be borne and fomented across borders.  USAID is convening a global community to engage more directly with those who are willing to volunteer their time and expertise to the cause of development, and who want to work together to “hack” new and creative solutions to long-standing development priorities.  Just yesterday, Secretary Clinton observed “Data not only measures progress, it inspires it.” At USAID we want to build and support the platform for those who are inspired to create and sustain lasting progress.

For more information and to participate, visit and contact OpenAgData@USAID.Gov

With a Little Help from the Crowd, USAID Increases Government Transparency

At USAID we’re fortunate to work on an incredible mission. But it’s an impossible one to achieve on our own. That’s why we’re always looking for creative ways to engage new problem solvers and develop new partnerships.

One of the best ways to engage the public is to open up our data. Set it free. Make it accessible. By opening up seemingly boring reams of spreadsheets to outside analysis, we have an opportunity to discover new trends, opportunities, and yes, inefficiencies.

In March, Administrator Shah wrote about how effective aid is transparent and accountable aid. This June, we took this commitment one step further when USAID’s GeoCenter and Development Credit Authority (DCA) hosted the Agency’s first-ever crowdsourcing event to open and map loan guarantee data.

Crowdsourcing is a distributed problem-solving process whereby tasks are outsourced to a network of people known as “the crowd.” Without the staff or resources to comb through 117,000 loan records on our own, we turned to the crowd for help in opening our data to the public.

The idea that the public would be willing to volunteer their time to geocode data – that is, to pinpoint the location of USAID loan guarantee activities – raised some eyebrows.  Yet what we anticipated would take an entire weekend sorting through 10,000 hard to identify data points, only took 16 hours thanks to an incredible outpouring of support from the online volunteer communities Standby Task Force and GIS Corps. Social media tools helped bring many more people to the virtual table.

Ultimately, volunteers wanted to meet like-minded people, plug into USAID, and make a difference. And they did. DCA utilizes partial credit guarantees to encourage private financial institutions in developing countries to lend their own money for local development. The released data represents an anonymized 117,000 loans made by these institutions thanks to risk-sharing agreements with the U.S. Government.   While this data was extremely valuable, we couldn’t map it until all of the location records were standardized.

With the release of DCA’s data and associated map, entrepreneurs in developing countries can discover existing lending facilities in the sectors in which they work, USAID Missions can analyze guaranteed loans across borders for a more complete picture of development impact, and  donors can overlay their guarantee data onto USAID’s to increase future opportunities for collaboration. These are just a few of the immediate impacts of opening up our data.

This event also marked the first time that was used as a crowdsourcing platform.  And thanks to partnerships with private companies like Socrata and Esri, we were able to customize the event at no additional cost to the Agency. By thinking outside of the box, we were able to put existing tools to use in new and innovative ways.

The complete dataset, associated map, and case study can all be accessed on USAID’s website.  These materials were presented at the Woodrow Wilson Center for International Scholars on June 28th and available via livestream.

We invite you to explore the data, draw your own conclusions and add your analysis.

We’ll continue to explore unique ways to engage the public in our work.  Development isn’t something that happens overnight. But with increased transparency, we can start working together to solve development challenges in a more efficient – and fun – way.

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.


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.

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