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Archive for the ‘Global Poverty’ Category

Why big dams and big ag are good for the poor

Sunday, August 1st, 2010

Katse Dam, Lesotho

Recently, I interviewed John Briscoe, a Harvard professor and development expert who has spent decades thinking about how poor countries get richer, with a particular focus on water. He has come to believe that large-scale dams and genetically-engineered foods can be good for poor countries.

These are controversial views. See, for example, the website of a nonprofit group called International Rivers, which says:

Africa’s dams have done considerable social, environmental and economic damage, often with complete disregard for the human rights of dam-affected communities, and have left a trail of “development-induced poverty” in their wake.

Friends of the Earth, meanwhile, says that it “opposes the introduction of GMOs as it will constitute a threat to African biodiversity and the continent’s food sovereignty, and will make nothing to help Africa tackling poverty and hunger.”

For his part, John, who was trained as a civil and environmental engineer, has worked as an engineer in the water agencies of South Africa and Mozambique; as an epidemiologist at the Cholera Research Laboratory in Bangladesh; as a professor of water resources at the University of North Carolina; and, for the past 20 years in a variety of policy and operational positions in the World Bank. Most recently he has served as the Bank’s Senior Water Advisor and the Country Director for Brazil. John now a professor of environmental engineering at Harvard.

Here’s an edited version of our interview:

Marc Gunther: John, let’s begin by talking about water. You’ve called water scarcity “a massive and growing problem in the developing world.” What do you mean by that? Are you talking about drinking water and sanitation? Or water more generally? And if it’s the latter, why is it that we are experiencing scarcity since there is, essentially, a finite amount of water in the world? We don’t deplete our supply of water like we do, say, our supply of oil.

John Briscoe: I think it’s useful to think about water as you suggest: There’s the resource itself and then the services that are derived from that resource. So, when it comes to drinking water and sanitation as a service, in my view, there is a large but not a growing problem. In fact, the number of people who do not have adequate water and sanitation services is shrinking. Lots of people who never had services are getting services, because of economic growth in the developing world in general and China and India in particular. Of course, one person without these services is one person too many, but the situation is improving. You see this improvement reflected in the rapid decline of infant mortality rates in many countries.  There are important financing and institutional issues for delivering these services, but for societies at large, I do not consider that a huge, massive, existential challenge.

The greater challenge in countries like India, Pakistan and China is that the resource itself, as you said, is finite, and the demands on it are ever-increasing. We need more agriculture to grow our food. We need more energy. We need more industry. We need more water and sanitation. It’s essentially a Malthusian problem of a limited resource and the ever-growing demands on it. And that is a massive problem.

MG: For the west, or just for the developing world? (more…)

Gouda cheese, wienerschnitzel and the Amazon

Monday, July 26th, 2010

Consider this thought experiment: Given the importance of the Amazon rainforest to the effort to curb climate change, and the potential value of the thousands of species that live only in the Amazon, and the vastness of the place (See Just how big is the Amazon?), what benefit, if any, can justify destroying a few trees, or a few thousand trees, or even a few thousand square miles of trees? Feeding a hungry family? Providing energy, at a lower cost to a nearby city? Making meat or cheese cheaper in the U.S. or Europe?

These are obviously not theoretical questions. They’re the kinds of questions facing the Brazilian government, and they are relevant to the rest of us because decision we make—about the government leaders we elect or about what to eat for dinner—can have an impact on the Amazon. These are also the kinds of questions that arose frequently during my six-day tour of Brazil last week. The government-organized trip for international reporters focused on the Amazon.

The good news is that the rate of deforestation of the Amazon is decreasing, and dramatically. Six years ago, 27.7 square kilometers of trees were cut down—that’s about 10,700 square miles, an area bigger than the state of Massachusetts. Last year, about 7,000 sq. km. were cut down, and this year the pace is slowing further, satellite photos show.

Americo Ribeiro Tunes, who’s in charge of protecting the forest for IBAMA, Brazil’s equivalent of the EPA, told us: “Brazil is on the verge of a major victory over deforestation.”

Well, maybe, but, along with stepped-up law enforcement, a big reason for the decline in deforestation is the global recession, which drove prices down timber, soy and beef, easing pressures on the Amazon. A strong global economy recovery will likely renew the pressure to destroy forest land to raise cattle or harvest timber, no matter what the laws say.

Besides, there’s plenty of opportunity for legal deforestation of the Amazon. Today, landowners are permitted to cut down up to 20% of their land under Brazil’s Forest Code;  proposed revisions would raise that to 50%. Government-approved plans for industrial development include the controversial Belo Monte Dam, which would be the world’s third largest dame, and the potential expansion of the Urucu Oil Province, which we visited (See Deep in the Amazon, learning to like fossil fuels) also pose a threat. Revenues from Amazon development can be used to promote social and education programs in Brazil, the government says.

This may—may—justify drilling for more oil and gas at Urucu. The Petrobras project has done minimal damage to the rainforest, while providing tax benefits to the region, as well as cleaner energy and cheaper electricity to Manaus, where 2 million people live.

Similar arguments can be made for hydroelectric projects like the Belo Monte Dam, which has been in the works for years. The environmental costs are significant, Reuters reports:

The 6 kilometre-long (3.75 miles) dam will displace 30,000 river dwellers, partially dry up a 100-kilometer (62.5 mile) stretch of the Xingu, and flood a 190-square-mile (500-sq-km) area three times the size of Washington D.C.

And the benefits? According to Amazon Watch, which opposes the project,

The electricity may be exported in large part to eight industrial mining and construction companies: Alcoa, ArcelorMittal, Camargo Corrêa, CSN, Gerdau, Samarco, Vale, and Votorantim.

Without knowing more about what these companies do, how much they pay in taxes and how many people they employ, it’s hard to whether the dam will be worth building. In an interview last week, Brazil’s energy minister, Marcio Zimmerman, said the dam is valuable because it’s a source of carbon-free electricity.

As an outsider, and someone just starting to learn about Brazil, I’m not prepared to offer an opinion about these big infrastructure projects. It turns out, though, that while they attract a lot of controversy–movie director James Cameron of Avatar fame last spring joined a protest against Belo Monte–they aren’t the major cause of deforestation. Cattle ranching is, by far, No. 1:

Which brings us to gouda cheese and weinerschnitzel. The oil and gas from Urucu are necessities, so long as we drive cars and fly in airplanes. Likewise electricity–energy is a driver of economic growth, jobs and wealth. But the soy plantations and cattle ranches? They occupy a great deal of land, employ relatively few people and produce animal feed and meat, much of which is shipped to Europe at the U.S.  Ocean-going ships filled with soy, for example, travel from the Amazon port of Santerem to Amsterdam, to feed Dutch and German cows. Meat’s a luxury–millions of people can, and do, live without it.

Destroying rainforests to make cheese, veal and burgers seems like a bad trade-off. At the very least, it’s another reason to eat less meat–not that we really need one. (Among them: Meat is an inefficient and expensive way of getting calories, it contributes to heart disease and obesity, causes of animal suffering, pollutes waterways, etc.) Now that I’ve seen the Amazon, and come to understand the connection between deforestation, cattle and soy, I’m going to curb my own consumption of meat. It’s easy, and it seems like the very least we can do.

Disclosure: My week-long trip to Brazil, with a focus on the environment in the Amazon, was organized by Apex-Brasil, a government-backed agency that promotes trade and investment. It’s sponsored by Electrobras, Petrobras and Banco do Brasil.

Brazil’s climate guy is green but blue

Thursday, July 22nd, 2010

Sergio Serra

A cell phone rings. It belongs to Sergio B. Serra, Brazil’s ambassador for climate change, a longtime diplomat with a professorial manner. Actually, it doesn’t ring. It croaks. Sounds like something in the rainforest.

“It’s a frog,” Serra says, laughing, during a meeting today with a group of visiting reporters. “Very politically correct.”

Serra is a green. But he’s also blue.

Green? Brazil will commit to reducing its greenhouse gas emissions, even as a developing country, in the next round of climate negotiations. Brazil gets nearly half of its energy from renewable sources, mostly hydropower and sugar cane ethanol. Brazil is even winning the battle against deforestation in the Amazon.

That’s green.

Blue? Well, even though Serra is spending virtually all his time promoting a global climate treaty—this weekend, for instance, Brazil is hosting a meeting of the so-called BASIC countries (Brazil, South Africa, India and China) to talk about climate change—he has modest expectations for COP16 in December in Cancun, the next big UN meeting on climate. Nor does he have much hope that a global climate treaty with binding caps on carbon emissions, the kind of deal that will likely be needed to deal with the climate crisis, can be negotiated in the immediate future.

No wonder he’s blue.

The biggest obstacle to a global deal is the U.S. Congress, which has yet to pass a law capping climate pollution in the U.S. and, even if it does, may resist a UN-administered treat. Other counties won’t go forward without a commitment from the U.S., the world’s No. 2 emitter of greenhouse gases, behind China.

The U.S. is pivotal, Serra said: “Just as pivotal as the U.S. thinks China is pivotal.”

Serra, who speaks near-perfect English, spent about 90 minutes chatting with the visiting reporters, and provided an insider’s view of the thorny politics of climate action. He was in the room, representing Brazil, when President Obama personally tried to broker a deal last December in Copenhagen, and he moves easily between the western powers and the poor countries of the global south, no surprise since Brazil is somewhere in between.

Climate is the biggest and most complex collective action problem ever. No action by an individual, a company or even a country to curb its greenhouse gas emissions will solve the climate crisis until most everyone agrees to do so. Each country’s circumstances and history differ, leading to arguments about who is obligated to do what. And the climate crisis creates risks for politicians because the costs of action are short-term and significant, while the benefits are long-term and uncertain.

Unlike some enviros in the U.S., Serra acknowledges the cost issue in a straightforward way.  “There’s a price for being responsible in terms of climate,” he says. “Especially because much of the evolution towards a green economy depends on technology.” Developing countries can’t be expected to foot the bill, he said, because, one, they’re poor and two, they didn’t make the climate mess; the rich countries did.

He explained:

This is the concept of historical responsibility, and it’s not that complicated. The situation we are in regarding global warming is due mostly to the burning of fossil fuels since the beginning of the industrial revolution. So the countries whose industries which industrialized later are much less responsible for global warming.

China is now the world’s No. 1 emitter but “they have much less of a historical responsibility than the U.S.,” he said.

Post-Copenhagen disappointment, if not dismay, led some critics to suggest that the UN process itself, which seeks to reach a global consensus, is to blame. Why not let the world’s 20 biggest countries work on a deal, I asked Serra.

“We will get nowhere if we don’t try to make the negotations as transparent and inclusive as possible,” he replied. He said “consensus is not exactly unanimity” because some countries can express their consensus with their silence. Besides, he said, poor countries in Africa, Asia and Latin America “that are more vulnerable, that are most affected” are not part of the 20 major economies, and they need to help shape a  global deal.

Serra expressed two hopes for Cancun. First, that an agreement could emerge around REDD (Reducing Emissions From Deforestation and Forest Degradation) that would provide financing to developing countries, like Brazil, that protect vital forests. Second, that rich countries could work out details of a $30-billion financing commitment they made at Cancun to help poor countries adapt to climate change and develop new technologies. The financing deal is ridiculously complicated, with disagreements about who should administer the fund, how spending should be monitored and where the money would come from.

As if that weren’t enough, the global economic crisis has left rich countries feeling  less rich, although my travels in Brazil, where you can see people living in conditions that would not be tolerated in the U.S., made clear that even in these tough times, most Americans are very, very well off by global standards.

When our discussion ended, I checked my email and learned that Senate Democrats have given up on a climate bill this summer.

Barring a stunning performance by Democrats in this fall’s midterm elections, that means no climate legislation until 2013, if then.

Now I’m blue.

Disclosure: My six-day trip to Brazil was organized by Apex-Brasil, a government-backed agency that promotes trade and investment, and sponsored by Petrobras, Electrobras and Banco do Brasil.

Sustainable livelihoods in the Amazon

Wednesday, July 21st, 2010

Inside the Tapajos National Forest, where 228 people have joined in a cooperative known as Coomflona, workers display sandals and wallets made of latex from rubber trees, necklaces and earrings made from the seeds of plants and tiny bottles of plant oils:

More important, they talk about how they are harvesting timber from the rainforest with extreme care, strictly limiting the number of trees that are cut, preserving younger specimens and removing the older ones with minimum impact.

These activities and others like them—harvesting acai or Brazil nuts, ecotourism, or developing oils for medicinal or cosmetic use–are absolutely vital to protecting the Amazon because they generate the income needed by the people who live there.

They’re often called sustainable livelihoods, meaning that they are ways to make a living that preserve or restore the environment.

Without them, people would resort to cattle ranching—small-scale agriculture, soy farming or illegal logging—the very activities that already have deforested nearby areas, as shown here:

Yesterday (July 21), I visited  Coomflona with a small group of reporters from the U.S., UK, France and Brazil. Before the visit, we took a charter flight from the small city of Santarem over the Tapajos forest to see the contrast between protected zones and denuded areas. Below is an image of the forest and another of deforestation, taken from the plane:

After the flight, we drove an hour from Santerem to the coop– a potential solution to the problem of deforestation, albeit at a small scale. Coomflona, which began in 2005 with lots of Brazilian government and international support, has organized people from nearby communities to exploit the rainforest in sustainable ways. (more…)

Deep in the Amazon, learning to like fossil fuels

Monday, July 19th, 2010

Deep in the Amazon rainforest, many miles from anywhere, the Brazilian energy giant Petrobras is producing oil and natural gas from an industrial development carved out of the landscape that includes 70 working oil wells, five drilling rigs, an airport, two river ports and lodging for 1,800 workers.

This remote outpost is known as the Urucu Oil Province, and, believe it or not, state-controlled Petrobras says it’s an example of  “sustainable development.”

Flaring gas: Is this sustainable development?

Flaring gas at Urucu: Is this sustainable development?

This is sustainable only if you believe that the oil and gas will last forever, that climate change isn’t a worry, and that drilling for fossil fuels in one of the world’s most unspoiled and biodiverse regions makes sense.

Here’s the surprise, though: Petrobras’s Urucu project may not be sustainable in the strictest sense,  but it is about as environmentally benign as an oil-drilling project in a rainforest can be. That may be damning with faint praise, but I have to confess that I came to like Urucu after visiting today with a group of reporters on an six-day tour of Brazil.

Urucu has issues, to be sure, but it is generating thousands of jobs, contributing considerable wealth to a developing nation in the form of taxes and royalties, and generating electricity in ways that are cleaner and cheaper than the current alternative. (more…)

Modern-day slavery: Here, there and everywhere

Sunday, June 27th, 2010

57470512SH007_migrantsModern-day slavery is not just about sex workers or poor people in faraway places.

Some farmworkers in the U.S., for all practical purposes, work as slaves.  Laborers  with few or no rights, working under inhumane conditions, typically far home, have produced such products as  blueberries, organic milk, personal computers or cell phones and garments imported from India, a new report says.

Consider:

An estimated 12 to 27 million people are victims of slavery, and other forms of forced labor around the world. In the United States alone, 10,000 or more people are being forced to work at any given time.

The report, called Help Wanted: Hiring, Human Trafficking and Modern-Day Slavery in the Global Economy (PDF for download, here),  was published by Verite, a non-profit based in Amherst, Mass., that monitors and reports on  labor rights abuses around the world. (It was funded by Humanity United, a nonprofit focused on peace and human rights started and chaired by Pam Omidyar.) Over the years, Verite has helped identify and clean up the supply chains of such global brands as Timberland, Gap, Levi Strauss, Apple, Disney and HP. I met with Verite’s executive director, Dan Viederman, last week in Washington to talk about the report, and what can be done to deal with slavery. (more…)

A dramatic story behind a soccer shirt

Thursday, June 3rd, 2010

Devoted fans of Ghana will wear this soccer jersey, designed by Puma, when they cheer on their team this month during 2010 World Cup in South Africa.

Puma-Ghana-AwayJersey-10-12-1

Fans of Cameroon, meanwhile, will don their team’s green World Cup jersey.

PUM_40085_A_big

Ivory Coast

Ivory Coast

Algeria

Algeria

Puma also sells replicas of the World Cup jerseys for Algeria and the Ivory Coast.

What all these shirts have in common is that they are manufactured  by Impahla Clothing, a supplier to Puma based in South Africa that was started a few years ago by a man named William Hughes.

Surely there will be drama when play begins in the World Cup, but it will have to be exciting to compare with  the drama in the life of William Hughes. He has known first-hand the joy of victory and the agony of the defeat.

Born in Kenya, Hughes, who is now 47, moved at a young age with his family to Zimbabwe. (more…)

My $100 solar power deal…in Ghana

Tuesday, May 11th, 2010

298x231Meet Georgina Teye. She sells plastic housewares–baskets, bowls, mugs and the like–at an outdoor market in Somanya, Ghana. She’d like to install solar-powered lanterns at her shop, which is also her home, so that she can remain open later and so that her three children can study at night.

I’m loaning her $100.

I made the loan through a startup nonprofit called Energy in Common.

I did so mostly to make a point–that the problems of energy, climate change and poverty are all tied together. Getting clean energy to poor people is one of the best ways to help them to escape poverty, to combat global warming and to deal with food and water shortages and poor health as well.

This isn’t easy for those of us in rich countries to grasp. We live in a world of cheap, abundant energy. Sure, you may nag your spouse or your kids to turn off the lights or turn down the thermostat. But when was the last time you thought about the energy needed to power your laptop, your TV, your stove or even your car? Probably the last time your power went out during a storm.

In the global south, and particularly in Africa and south Asia, energy is a daily worry for the more than 1.5 billion people who don’t have access to electricity. Without safe and reliable energy, people can’t grow crops beyond subsistence levels, operate a factory, get water to where it is needed, refrigerate food or drugs, or study  at night.

Worse, some of the alternatives to clean energy for the poor–cooking or heating by burning wood, dung, agricultural residues or coal, or using expensive, dirty kerosene lamps–are not only bad for the planet, they’re terrible for human health.

This set of problems led Hugh Whalan, a 26-year-old Australian, to start Energy in Common.

“Energy, he said, is at the base of just about any development outcome you’d want,” he said. “Yet it isn’t a Millenium Development Goal. We’d like to give energy a higher profile.”

Hughprofile1Hugh traveled widely in the global south–he volunteered at refugee camp on the Sudanese border, helped victims of land mines in Cambodia, and taught English in Uganda–before coming to the United States where he landed a job at a carbon finance company called Environmental Credit Corp. There, he met Scott Tudman, with whom he co-founded Energy In Common. They wanted to combine their knowledge of energy and carbon finance with their desire to bring clean energy to the poor.

“I wanted to make an impact in Africa,” Hugh told me. “I was torn between development work and business.”

Think of Energy in Common as a green Kiva. Entrepreneurs, most of them women, are featured on the website. Donors decide how much money they want to lend. Local microfinance institutions deliver the funds to the borrowers, who are expected to repay. Of course, there are no guarantees.

For borrowers, there’s an added bonus–carbon credits. Here’s how Energy in Common explains that:

A little team of brainy people here at EIC analyze the carbon data over the period of your loan and add up the amount of emission reductions created by the entrepreneur. These emission reductions are then sold to lenders (like you) as carbon offsets, which means you can buy the very carbon offsets that you helped to create allowing you to reduce your carbon footprint too. That tax-deductible purchase then goes straight back into finding and helping even more entrepreneurs – and so the cycle begins again.

If Georgina Teye succeeds with her solar lanterns, replacing electricity from the grid, she will save 0.8 metric tons of CO2 per year, which is the equivalent of a U.S. family not using electricity for 49 days. And I’ll get my loan repaid, and be able to lend the money to someone else. Nice.

Which raises a question: Why have markets and aid groups failed, so far, to deliver energy to the poor. “Part of the reason,” Whalan told me,  “is that for many years, investment was channeled into large-scale projects.” Only recently, and in large part because the work of the late C.K. Prahalad and Stu Hart, have entrepreneurs look at the billions of people at the bottom of the pyramid as consumers and entrepreneurs and not charity cases. Technologies like solar power and LED lights are also relatively new.

Of course, Energy in Common is a very small group; so far, it has funded fewer than two dozen entrepreneurs.  Whalan says his goal is to deliver clean energy to 15 million people in the next five years. Even if Energy in Common succeeds, it will put only a small dent in the energy divide between rich and poor.

Fortunately, there are lots of other businesses and nonprofits working to bring clean energy or to the poor. Among them are Kiva, Global Giving, Kopernik (which I wrote about here) and Dissigno (which I blogged about last month). There’s plenty of room for all of them, and many more,

Fighting poverty and global warming in Africa

Thursday, April 22nd, 2010
Tree planting in Tanzania

Tree planting in Tanzania

Rarely do you find a business that attacks two big problems–global poverty and climate change–at the same time.

This week, I came across two such ventures. As it happens, they have a lot in common: Both operate in East Africa, both work with the very poor, both were started by executives who came out of the fossil-fuel industry and both are made possible by 21st century cutting-edge technology.

One is called TIST, which stands for The International Small Group and Tree Planting Program. (You can tell it wasn’t started by a marketing guy.) TIST organize small groups of farmers to plant trees, generate income from global carbon markets and reverse the devastating effects of deforestation in Tanzania, Kenya, Uganda and India. It’s been operating for less than a decade but has signed up a remarkable 65,000 farmers.

“It’s growing on its own by 50 to 100% a year,” says Ben Henneke, a veteran energy executive who started TIST after visiting Tanzania on a church mission back in 1998.

The other is Dissigno. A San Francisco-based startup, Dissigno operates a power and lighting project in Tanzania that provides villagers with battery-powered LED lights that are recharged with solar power. The company, which also has solar businesses in the U.S. and the Czech Republic, has big plans, hoping to expand its power and lighting business to Ethiopia, Botswana and South Africa.

“There are 1.6 million people around the world who don’t have power,” says Gary Zieff, a founder of Dissigno. “That’s a business opportunity for us.”

I met Henneke and Zieff at an energy and climate conference organized by Center for Sustainable Enterprise at the Kenan-Flagler business school at the University of North Carolina. Next week I’ll tell you about another entrepreneur who spoke at UNC about his plans to bring high-altitude wind power to the global south. Since I spend most of my time writing about big companies and the government, it’s great to connect with entrepreneurial energy.

TIST traces its origins to a service at an Episcopal church in northern Virginia where parishioners including Ben Henneke and his wife, Vannesa, were encourage by the rector join in a service mission. As Henneke recalls, Vannesa whispered to him: “Maybe we’re supposed to go to Africa this summer.” He replied: “I hope you have a nice time, dear.” Six months later, they found themselves in Tanzania, and they were astounded by what they saw. People were poor even by the standards of Tanzania, where annual per capita income [PDF] is about $440 a year. (more…)

Selling water to the global poor

Sunday, April 4th, 2010

twi-1Entrepreneur and lawyer Kevin McGovern has founded 15 companies. Some are household names, like Sobe Beverages, which he sold to PepsiCo for a reported $370 million in 2000. Others are quieter money-makers, like Tristrata, which owns 150 patents related to alpha hydroxy acids, a key ingredient in skin care products.

None, he predicts, will have the impact of his newest venture, a startup called The Water Initiative that aims to help solve the world’s water crisis by treating contaminated water at the point of use. It’s a simple idea–sell  equipment that will purify water to local distributors in poor communities around the world.

McGovern and his company are  operating in a couple of cities in Mexico, selling water purifiers for about $150 each to distributors who then lease them to families for about $3 a week. “It’s franchise model, a multi-level marketing approach,” he says. The Mexican government recently asked him to expand the business nationally.

While the company is small, McGovern has lined up some big-name supporters. Producer-musician Quincy Jones is honorary chairman of The Water Initiative. Indian business mogul Ranan Tata is an investor and adviser. So is Cornell University professor Stuart Hart, a pioneering thinker about business and sustainability and co-author, with C.K. Prahalad, of the 2002 article “The Fortune at the Bottom of the Pyramid,” which provided the first articulation of how business could profitably serve the needs of the four billion poor in the developing world. (more…)