by Austin Bay
November 20, 2002
NAIROBI, Kenya -- What kind of fire does $15 ignite in Paidha,Uganda, or Thika, Kenya?
What caliber of economic and entrepreneurial fire, that is.
For Mary Wanango, the bean lady in the Paidha town market (twocolorful acres of intense open-air sales action every Wednesday morning),the impact of a $15 loan has been enormous.
Mary, dressed in a cotton rainbow, is all business about beans.Her initial $15, provided by the woman's business coop at St. PetersAnglican Church in Paidha, turned her into an international trader.
"I now cross the border to the Congo town of Kudikoka," she toldme through a translator. "Because I have capital, the loan, I can now buyseveral kilos, 20 kilos in bulk, cheaper than I buy in Uganda."
Her business has boomed. "My customers here in Paidha buy moreat a lower price. I have repaid the first loan and sought another." Herimport cost at border customs, if the Congolese and Ugandan border copsdon't pump for a bribe? "1500 Uganda shillings."
That's roughly 80 cents. Don't sniff, that's steep governmenttaxation for Uganda's rural West Nile Province, where 1200 shillings is agood day's wage.
Exchange rates and local economics, however, only begin tosuggest the potential economic impact of small but highly directed loans, orin some cases, small-scale aid programs.
St. Peters Church in Paidha -- the town only appears on adetailed map -- is directly engaged in the hottest concept in internationaldevelopment and aid: micro-development.
From Bangladesh to Thailand, think small and do small has cachetamong governmental and non-governmental aid and development advocates. Thebest programs, however, really don't "think small," they think large in adifferent way. They seek to encourage and promote the productive dynamism ofhuman will and creativity empowered by experience, education and ethics.
I spent two weeks in Kenya and Uganda examining severalmicro-development and aid programs. Micro-development attracted me a decadeago as a means of slipping capital into developing nations beneath what Idubbed "the corruption horizon." Corruption savages economic development --ask investors in Global Crossing and Enron. Small, targeted programs areless likely to attract big thieves with Swiss bank accounts.
Since 1950, international agencies have spent a cool trillion inU.S. dollars on anti-poverty and economic programs in developing nations,with much of it wasted or pilfered. In too many cases, "spending large" hasnot produced large, or medium, or even small results. Big dams and bad debtaren't the crucial development issues -- they are building human economicexpertise and thwarting corruption.
East Africa has a growing number of people who are doingprecisely that. The majority of the programs I saw support their small-scalefinance activity with business advice, economic education and ethicalcounsel. The goals: building the economically savvy "human infrastructure"and civil society that undergird liberal capitalism.
That isn't thinking small, it's thinking long -- then proceedingto build the human spine of 21st century economies.
In Kenya, I visited Nairobi slums and outlying towns withFaulu-Kenya, a non-sectarian micro-finance corporation dedicated to buildingpeople who can build an economy. We spent one morning in Thika, whereFaulu-Kenya is advising a church organization on how local leaders cancreate, fund and operate a "village development bank" in a grass-rootseffort to fight unemployment.
One Kenyan businessman told me: "There are many in our nationalgovernment who support these efforts fully. But doing for yourself, forourselves -- with good advice and models, of course -- this empowers thepeople for building a stronger, expanding national economy."
Bishop Henry Orombi, of the Anglican diocese of Nebbi in Uganda,where Paidha is located, has set up 52 women's economic cooperatives.Through two lending cycles, only two groups defaulted on loans. "Theseprograms are a means for people in developing nations to move from aid, areceiving mentality, to doing," Orombi said.
Hope isn't a method. These programs are the slow but genuineroad to a better future.