MALAWI NOW HUNGRY!

By CHRISTINE MUNGAI The EastAfrican

Malawi was touted as a success story in Africa’s agriculture narrative.

An intensive farm subsidy starting in 2004 made fertiliser and seed available to farmers at a third of the normal cost, and the results were nearly instantaneous.

In 2005, Malawi harvested a maize surplus of 500,000 tonnes, and soon began exporting food to other countries in the region.

It seemed a “green revolution” was in the making.

But the scheme was opposed by donors who argued that a subsidy programme was against the principles of free markets and was unsustainable; they also criticised the increasing corruption associated with the scheme. Donors withdrew their funding, and by 2011, a sustained forex shortage led to street protests and political instability.

What went wrong?

Today, Malawi has gone from being a food-surplus country to a food-deficit one. What went wrong? Masimba Tarifenyika, editor-in-chief at Africa Renewal, a UN online magazine focusing on Africa, writes that autocracy and dependency on aid killed the scheme, and that “while foreign aid is critical in feeding the hungry and reviving agriculture in Africa, food security is too important to be left to the generosity of external partners.”

Ephraim Mukisira, director of the Kenya Agricultural Research Institute, argues that Malawi’s problem was “piecemeal” solutions to the agriculture sector. “If we can have a well-integrated and holistic approach to the challenges facing Kenya’s agriculture sector, then we can avoid going the Malawi way.”

WORLD BANK, JAPAN SCALING UP ON DRR

Over the last few decades, natural disasters have cost aid donors serious amounts of money that could have been earmarked to fund other development programs — which the World Bank and the Japanese government plan to address by focusing on a new (and better) way to conduct disaster risk management.

This week, the Washington D.C.-based institution and Japan launched a program to mainstream disaster risk management in the most vulnerable developing countries. It aims to produce a streamlined protocol in global disaster risk management and climate-proof development programs moving forward, according to a disaster risk management expert from the World Bank.

“Support to vulnerable countries for effective DRM mainstreaming in all development planning and investments … will be delivered through technical assistance, capacity building and pilot projects on … risk identification, risk reduction, preparedness and financial protection,” Prashant, member of the Global Facility for Disaster Reduction and Recovery, told Devex.

The severe effects of disaster-related incidents, especially in developing nations, have been devastating. According to a World Bank report, disaster losses have cost the world over $3.8 trillion from 1980 to 2012, a huge amount that could have been spent in eradicating global poverty several times over.

Cross-cutting framework

The launch of the DRM program complements another initiative under the same partnership called Code for Resilience, harnessing expertise of innovators, technologists and disaster management experts to create digital and hardware disaster solutions. This holistic and comprehensive approach, the expert said, will prove to be essential and timely.

“A comprehensive and cross-cutting [DRM] framework is the most urgent development imperative for high-risk countries as it will amount to protecting all development investments, outcomes and gains,” Prashant explained. “[Without DRM], it runs the risk of decades of development gains being wiped out in a moment.”

If these proactive steps are not taken seriously, the poorest and the most vulnerable will suffer the most, according to a spokesperson from the Japanese finance ministry.

“Natural disasters take a heavy toll on the lives of the people. They … significantly damage years of development efforts in moments,” the spokesperson noted. “The poor and vulnerable are most exposed. It is thus vital to provide appropriate support for actions in advance to prepare for future disasters.”

The program will be managed by the World Bank’s GFDRR, with $100 million in funding provided by Japan over the next five years.

Challenges

Despite the merits of the proposed disaster risk management program, both donors admitted that several challenges will have to be addressed before the initiative can have full positive effects.

For the Japanese official, the program will be in its strongest if synergy between different institutions including their own development agency JICA and multilateral organizations like the Asian Development Bank are forged and strengthened.

Prashant, on the other hand, listed several challenges that need to be addressed including the need to scale up international support, meet growing demand for technical assistance and capacity building for effective DRM, as well as sustaining ties and commitment with the initiatives various stakeholders.

“The challenge is to maintain sustained counterpart interest in recipient governments and communities in order to maximize cross-cutting integration of DRM and climate adaptation in all development planning and investments,” he said. “It is often observed that governments accord high priority to DRM after being hit by disasters, and unfortunately over time, other more immediate concerns start pre-occupying the governments as DRM tends to take a lower priority over time.”

SHOULD THE UK GOVERNMENT PROMOTE UK BUSINESSES IN DEVELOPING COUNTRIES?

U.K. Secretary of State for International Development Justine Greening

Justine Greening’s speech at the London Stock Exchange on Monday highlights the growing emphasis on how business contributes to economic growth, and on how growth is the way out of absolute poverty. There are two interrelated objectives here: reduce poverty in developing countries through economic growth (i.e. by creating new jobs and raising incomes) and promote market development as a pathway to growth. Given the U.K.’s desire to improve its trade links by targeting emerging and pre-emerging markets and DfID’s desire to make it easier to do business in developing countries, is this a clear opportunity to promote stronger partnerships and collaborations between British enterprises and innovative enterprises in developing countries?

Are business partnership programs a good thing?

Business partnership programs (BPPs) link businesses in developing countries — those that have the potential to grow (mainly SMEs), but are constrained by limited access to finance, limited market access or insufficient technical know-how — with businesses in developed countries. From the perspective of the developing country, they can bring in new technologies, and help provide new goods, services and jobs whilst linking development and commercial objectives. For developed countries, benefits include promoting country exports, accessing new clients and creating stronger trade links with emerging markets. Some good examples include DANIDA’s ”Vanilla Trade with Responsibility” program which links farmers with Danish importers (securing supplies), supporting 6,500 farmers in Uganda; or a GIZ programme that links German and Brazilian chemical manufacturers to produce bioplastics from sugar processing waste. These programs have the potential to help create knowledge platforms that shed light onto these markets, provide information to potential UK investors and spur them to take their first steps in what would otherwise be considered as “risky” investment environments, all of which can catalyse further investments. They can also be a good way to promote more rigorous environmental, social and governance standards: international labor regulations, fair wages, more energy- and resource-efficient production processes and more rigorous and efficient business-management systems. On the other hand, there is the risk of crowding out local companies or “resource grabbing” by less ethically inclined enterprises. However, with good regulations, clear conditions on profit allocations, tax payments and employment distribution (in favor of the host country) and good donor screening processes, the opportunities and benefits of such partnerships have the potential to promote local company growth where it might have not otherwise have occurred.

Weighing the positives and negatives of BPPs is difficult

Weighing the positives and negatives of BPPs is difficult. Worldwide, only ten or so programs link high-income country enterprises with developing country companies, of which only four — Finnpartnership, USAID’s GDA, NORAD’s Matchmaking Programme and the Dutch PSI Programme (which has now ceased to operate) — have been evaluated. The major issue applies to all private-sector development programmes: the fact that there is no clear counterfactual that can be assessed since there is no simple system to determine which positive effects can be attributed to BPPs and which would have occurred anyway. The varied nature of these projects means that it is difficult to assess such issues for individual companies, and close to impossible to measure or isolate macro- or national-level impacts satisfactorily. Even well-established development finance institutes such as the International Finance Corporation are having a hard time assessing indirect impacts, let alone outcomes — beyond job creation.

Triple wins for donors: enhanced growth, increased private investment and development

These programs take on a lot of the risks that companies may otherwise not be prepared to face when investing in what are seen to be “new” or “risky” markets. BPPs tend to target national SMEs, which may not otherwise have the financial capacity to invest in emerging markets and usually provide up to 50 percent of funds for any investment project. Donors see triple wins: they are enhancing growth in developing countries, leveraging private-sector partners to invest in low-income countries and encouraging them to take social concerns into consideration as part of their operations. In a period where leveraging private funds is seen as a way to bolster aid budgets and as an alternative to public aid financing, such approaches are gaining traction.

Beyond tied aid

The U.K.’s DfID is currently not allowed to promote U.K. enterprises in countries where they work, but donors in Germany, Sweden and Norway have no such issues. Simply allowing donors to promote their national enterprises through these partnerships is essentially a form of “tied” aid, promoting donor country goods, regardless of job creation, innovation and market-efficiency effects in the countries where they operate. However, Germany’s DeveloPPP or Sweden’s Public-Private Development Partnerships — as well as other Scandinavian programs — must link developmental objectives together with commercial returns for partners in both their home country and in countries where they are operating. Conversely, the U.K.’s Business Innovation Facility’s remit is to promote inclusive business practices — but not offer commercial advantages for U.K. companies in developing countries. What this means is that German or Scandinavian companies have an additional incentive to take part in BPPs compared to British companies.

U.K. business partnership programmes must consider their positive contribution first

If the U.K., through Justine Greening and DfID, wants to implement its own BPP, then it faces the challenge of making sure that any such program does not slip into the tied-aid mould. BPPs are not a form of aid, and it is essential that this is clear; furthermore participating businesses need to commit to a sustainable growth plan after donor participation has ceased. This means more involvement from the Department for Business Innovation and Skills as well as the Foreign and Commonwealth Office, who could work together with DfID to identify high-impact sectors in developing countries (potentially using the CDC Group’s employment-related impact grid as a starting point), and to link up U.K. and emerging market businesses that could work together.

Considering where U.K. enterprises would be a positive contribution to emerging markets (rather than a new set of competitors) will be the critical difference between a simple export strategy or a growth programme that can really represent and promote DfID’s new drive towards economic development.

Devex 

IN US: HOW WILL SECURITY REFORMS AFFECT FOREIGN AID WORKERS?

Security clearance reform is climbing up the agenda again in Washington, where high-profile

A security camera.

leaks and violent incidents involving cleared personnel have shaken the government system that conducts — and outsources — 2 million background investigations a year and determines whether or not to grant individuals access to confidential information and government facilities.

Experts are considering new options, like gathering information from social media, automating tasks that are currently conducted by staff, and moving to a system of continuous review, instead of the current five- and 10-year review requirements.

An interagency group led by the Office of Management and Budget is currently wrapping up a 120-day review of security clearance procedures to identify changes that can be made to ensure higher-quality information is used in clearance decisions and to find smarter ways to re-evaluate individuals during the course of their employment.

Earlier this week a panel of experts and two congressmen convened on Capitol Hill to weigh in on the importance of the effort, which is the first comprehensive security clearance reform since a post-9/11 push to overcome the huge backlog of unprocessed clearances that existed at that time.

Now officials are trying to maintain, or even enhance, the efficiencies created in the Intelligence Reform and Terrorism Prevention Act of 2004, while also ensuring the quality of the decision-making process leaves less room for the kinds of high-profile incidents, such as Edward Snowden’s release of troves of national security data, which have brought scrutiny of the agencies and U.S. contracting firms that investigate and adjudicate clearance applications.

The outcomes of this reform effort could affect thousands of U.S. aid workers and contractors who disclose personal information when they apply for and seek to maintain security clearance.

The world of personal information has changed dramatically in the last decade, and the U.S. government’s security clearance experts are wondering what they can do — and should do — to catch up. Social media presents a world of potential hints about applicant’s past conduct, especially those who are not cautious enough to closely monitor their online presence.

And with so many personal files like employment, ownership, criminal records, and credit scores available online, much of the investigative work currently carried out by people could be more quickly — and perhaps even more reliably — undertaken by automated information technology.

Both of those proposals raise concerns.

“There’s good information, and then there’s what’s on the internet,” said Alan Chvotkin, executive vice president and counsel of the Professional Services Council, at the congressional panel discussion.

And even accurate information can be misleading when it lacks the context surrounding it. An individual’s criminal file might show that they were arrested; but if they weren’t charged, it may not disclose details surrounding the arrest, explained Joseph Jordan, president of public sector at FedBid and former administrator for the Office of Federal Procurement Policy. Since ultimately the decision to grant clearance is based on a holistic assessment by a U.S. official of the individual applicant, those kinds of details not easily captured through automated systems can be valuable.

Some of the proposals stemming from recent security breaches — like whether background investigations should draw on mental health records — carry weighty ethical implications. If applicants think their mental health records might compromise their ability to receive a security clearance they could be less likely to access important mental health services.

And if those records were available to investigators, “what would we do if we knew it?” asked Jordan.

Other reform measures could affect the clearance review process. Currently, “secret” level clearances are valid for 10 years and “top secret” clearances for five. Some experts suggest the system could move toward a continuous review process, which would intake information periodically throughout the course of an individual’s employment and make note of any red flags as information comes in.

Still, officials will have to determine how often it is useful to know something and what sort of information technology architecture will provide and catalogue that kind of useful information.

The panel raised another potential solution to reducing the burdens placed on a more risk-averse system. Agencies could review their policies for determining who needs access to confidential information and which information needs to be classified and try to scale back the nearly 5 million individuals currently in the system.

Devex