South-South Trade Helping Countries During Economic Crisis

Weathering the global economic crisis is testing the stability of countries across the global South. But many countries are finding South-South trade and catering to their domestic middle classes can lift incomes and maintain growth rates despite the global turmoil.

A decade of boom in global markets as they became more integrated has brought rising incomes and created growing economies in the so-called emerging markets of the global South. Finance and investment from developed countries flowed into the global South and helped bolster growing economies, boosting incomes and bringing millions of people into the middle classes. But since the start of the global economic crisis in 2008, more and more countries in the global South have experienced turmoil, chaos and crisis.

The export-driven model that had served many Asian countries well – creating products for developed Western markets – is being tested by high unemployment in developed economies and declining purchasing power for the Western middle classes. Two trends that have grown in the past 10 years may offer a solution to this economic crisis. One is to build on the growth in South-South trade, and the other is to tap the growing middle classes of the global South by expanding the products and services available to them and further improving their quality of life.

It is well established that one of the key elements to securing sustainable prosperity is a thriving middle class. Middle classes in many countries in the global South are still classified as vulnerable – at risk of returning to poverty if the economy experiences a short-term crisis. Their resilience to an economic downturn needs to be strengthened, and this can be done by improving the quality of products and services available to them.

Building this market can also strengthen domestic job growth and help reduce a country’s dependence on imports.

One country facing up to this challenge is Indonesia. The New York Times recently reported that ports in Indonesia and other resource-exporting countries are quiet, as China’s demand for resources slows.

But while export markets are experiencing a slowdown, investment is going into Indonesia’s agricultural food-processing industry. Agricultural multinational Cargill (cargill.com) is building a cocoa-bean processing plant in the country, and the PT. Suprama (suprama.co.id/en/) instant-noodle factory is running at full capacity to meet the needs of the country’s growing middle class.

Many countries have experienced significant inflows of investment money as a result of stimulus measures led by the United States Federal Reserve (http://www.federalreserve.gov/faqs/about_12594.htm) to counter the economic contraction caused by the global economic crisis. This money, however, is uncertain and can just as easily disappear as it leaves to chase the next opportunity. Wise countries take measures to avoid being dependent on this fickle and fast investment funding.

Unlike in the Asian Crisis of 1997-1998 (http://en.wikipedia.org/wiki/1997_Asian_financial_crisis), many emerging-market countries now have large foreign currency reserves and robust stock markets. They have also built up their middle classes and increased consumption. Trade links with other countries in the global South have grown enormously since the late 1990s. For example, the trade between China and Africa, as announced by Chinese President Xi Jinping (http://en.wikipedia.org/wiki/Xi_Jinping) in early 2014, has surpassed US $200 billion for the first time, turning China into Africa’s largest trading partner

Despite a raging global crisis, in many emerging economies domestic spending is holding up and, in some cases, has never been stronger.

China now plays a key role in maintaining global economic demand. According to the global bank HSBC, Chinese growth adds “twice as many dollars to annual global demand as growth in the United States economy and far more than the economies of the European Union.”

An article in The New York Times (http://www.nytimes.com/2014/02/13/business/emerging-markets-in-asia-in-a-delicate-limbo.html?_r=0) suggested that global South countries can benefit from these trends by becoming an alternative to China’s “own increasingly high-cost producers of coal, aluminum, and other minerals” – as well as of clothing, shoes and electronics.

China is also in the process of altering its economy, from being the low-wage workshop of the world to an increasingly high-tech, high-value economy with growing science, technology and innovation sectors buoyed by heavy investment in research and development, for example China’s Xi’an Hi-tech Industries Development Zone (xdz.com). As China changes, other countries can step in and replace the industries that no longer find China an affordable place to manufacture their goods.

As an example, the Indonesian vice minister of trade, Bayu Krisnamurthi, announced that the Foxconn Technology Group of Taiwan (foxconn.com), which makes components and assembles devices for the popular Apple (apple.com) computer brand, is looking to set up a large factory in Indonesia.

“The other brands will come in their footsteps,” Krisnamurthi told The New York Times.

Other countries are bucking the crisis trend and using greater freedom to boost economic growth.

Cuba has been able to bounce back with free-market reforms. The Caribbean island has had its ups and downs economically since its revolution in the late 1950s. After the revolution, the country had several decades of impressive human development gains and built up enviable education and health care systems. But with the collapse of the Soviet Union in the early 1990s, the country lost its trade relationships and subsidies and was pitched into a major economic crisis.

During the Cold War, the USSR hoovered up almost all of Cuba’s exports of sugar, nickel and citrus fruit, and sold Cuba two-thirds of its food and 98 per cent of its fuel.

What was termed the “special period” after the collapse of the Soviet Union saw petrol become scarce. Many had to turn to cycling and walking to get around. Factories closed and food production declined.

One estimate by Hal Klepak of the Royal Military College of Canada, reported in The Observer newspaper, found the economy collapsed by 50 per cent in the five years to 1993.

Since then, Cuba has endured significant austerity and has struggled to regain its trade relationships and restore economic growth. Tourism has played a key role in keeping the country going.

And since 2008, various economic reforms have started to shift the economy away from over-dependence on the state and towards a more mixed market model.

Its capital, Havana, is a UNESCO world heritage site and is a popular tourist destination with one of the best-preserved former Spanish colonial architecture in the Caribbean.

When President Raul Castro took over from his brother Fidel, he began to slowly experiment with reforms to test how much market freedom could boost the economy and increase incomes. This has included allowing paladares, or privately-run restaurants, which are now flourishing and benefiting from the steady flow of tourists to the island.

The state now allows people to set up as independent traders in 200 occupations. Some have established entertainment businesses such as paint balling, others are running bars, or bookshops. It is now possible to easily change money in Havana and to find accommodation in private homes. Cash machines are spreading throughout the capital and more and more businesses will accept credit cards.

Registered businesspeople rose from 157,000 in October 2011 to more than 442,000 in 2013.

By being flexible, it is possible to discover new ways to grow economies and increase incomes, even in hard times. And increasing South-South trade is the way to go.

By David South, Development Challenges, South-South Solutions

Published: June 2014

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

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India 2.0: Can the Country Make the Move to the Next Level?

With the global economic crisis threatening to cause turmoil in the emerging markets of the global South, it is becoming clear that what worked for the past two decades may not work for the next two.

For India, the legacy issues of poverty still need to be addressed, and the country’s impressive information technology (IT) industry – which has driven so much of India’s growth – will face stiff competition from other countries in the global South. Some argue that if the IT industry hopes to keep growing and contributing to India’s wealth, things will need to change.

Unlike China, where heavy investment in infrastructure and a strong link between government and the private sector has driven the impressive manufacturing boom in the country, in India the government has de-regulated and taken a back seat, leaving the private sector and entrepreneurs to drive the change and do the innovation.

Many believe various areas need urgent attention if India is to continue to enjoy good growth rates in the coming years. Areas in need of attention include infrastructure, healthcare and education (thesmartceo.in), in particular the knowledge to work in the information technology industry of the 21st century.

One of the founders of Indian outsourcing success Infosys (infosys.com), executive co-chairman Senapathy Gopalakrishnan, told Britain’s Telegraph newspaper, “So many people’s lives have been changed by IT in India.

“People from the middle class and lower middle class have become global employees and have the opportunity to work with some of the best companies in the world. But the challenge for India is that this industry can only create so many jobs. IT is not going to solve the unemployment problem in India.”

But the coming next wave of change in information technology is an opportunity to be seized to reduce unemployment if enough people are educated to handle it.

According to Gopalakrishnan: “I strongly believe, and it’s backed up by data, that there is a shortage of computer professionals everywhere in the world, including India. The application of computers is growing dramatically and will continue to grow dramatically over the next 20 to 30 years. We have to train and create the workforce necessary to grow this industry.”

Various media stories have called this next phase India 2.0. If India 1.0 was the highly successful information technology outsourcing industry developed in the late 1980s, through the 1990s and 2000s, then India 2.0 is the next wave of IT innovation being driven by Big Data, automation, robotics, smart technologies and the so-called “Internet of things.”

Big Data is defined as the large amounts of digital data continually generated by the global population. The speed and frequency with which data is produced and collected – by an increasing number of sources – is responsible for today’s data deluge (UN Global Pulse). It is estimated that available digital data will increase by 40 per cent every year. Just think of all those mobile phones people have, constantly gathering data.

Processing this data and finding innovative ways to use it will create many of the new IT jobs of the future.

“We are living in a world which is boundary-less when it comes to information, and where there is nowhere to hide,” continues Gopalakrishnan, “If you have a cellphone, somebody can find out exactly where you are. Through social networks you’re sharing everything about yourself. You are leaving trails every single moment of your life. Theoretically, in the future you’ll only have to walk through the door at Infosys and we’ll know who you are and everything about you.”

Unlike in the late 1980s, when India was the pioneer in IT outsourcing for large multinational companies and governments, competition is fierce across the global South. The mobile-phone revolution and the spread of the Internet have exponentially increased the number of well-educated people in the global South who could potentially work in IT. China, the Philippines, Kenya, Nigeria and Ghana are just some of the countries heavily involved in this area.

If India fails to meet the India 2.0 challenge, it risks seeing its successful companies and entrepreneurs leaving to work their magic elsewhere in Asia and the new frontiers of Africa, just as many of its best and brightest of the recent past became pioneers and innovators in California’s Silicon Valley.

India’s IT sector contributed 1.2 per cent to the country’s gross domestic product (GDP) in 1998; by 2012, this was 7.5 per cent (Telegraph). The IT industry employs 2.5 million people in India, and a further 6.5 million people indirectly. IT makes up 20 per cent of India’s exports and, according to the National Association of Software and Services Companies (nasscom.in), the industry has revenue of US $100 billion.

India is now the IT and outsourcing hub for more than 120 of the Fortune 500 companies in the United States.

Out of India’s 3.5 million graduates every year, 500,000 are in engineering – a large pool of educated potential IT workers. India produces the world’s third largest group of engineers and scientists, and the second largest group of doctors.

IT has become a route that catapults bright Indian youth into 21st-century businesses and science parks and to the corporations of the world.

One visible example of the prosperity brought by IT services in India is the booming technology sector based in the city of Bangalore (also called Bengaluru) (http://en.wikipedia.org/wiki/Bangalore).

Reflective of the contradictions of India, Bangalore has 10 per cent of its workforce now working in IT, but also 20 per cent of its population living in urban slums.

The nearby Electronics City (elcia.in) is considered “India’s own silicon valley and home to some of the best known global companies.”

To date, aspects of India 2.0 are already taking shape.

One company is called Crayon Data (crayondata.com). It uses Big Data and analytics to help companies better understand their customers and increase sales and deliver more personal choices.
Edubridge (http://acumen.org/investment/edubridge/) is helping to bridge the gap for rural youth with varied education backgrounds and long-term jobs. Edubridge trains youth for the real needs of employers to increase the chances they will get a job. This includes jobs in the IT business process outsourcing sector and banking and financial services.

Infosys is working on innovations for the so-called “Internet of things,” in which smart technologies connect everyday items to the grid and allow for intelligent management of resources and energy use. Infosys is developing sophisticated software using something called semantic analytics – which analyses web content (http://en.wikipedia.org/wiki/Semantic_analytics) – to sort through social media and the Internet to track customer responses to products.

Elsewhere, former Infosys Chief Executive Nanden Nilekani is involved in a Big Data innovation to address the problem of social and economic exclusion of India’s poor. Called Aadhaar (http://uidai.gov.in/), the government-run scheme is gathering biometric data on every Indian to build the world’s largest biometric database. After being enrolled and having fingerprints and iris scans taken, each individual is given a 12-digit identification number. So far 340 million people have been registered with the scheme, and it is hoped 600 million will be registered by the end of 2014.

The idea is to use a combination of access to mobile phones and these unique ID numbers to widen access to all sorts of products and services to poor Indians, including bank accounts for the millions who do not have one. Many people, lacking any identity or official acknowledgment they exist, were prevented from engaging with the formal economy and formal institutions. Being able to save money is a crucial first step for getting out of poverty and it is hoped information technology will play an important role in achieving this.

By David South, Development Challenges, South-South Solutions

Published: March 2014

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

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China Sets Sights on Dominating Global Smartphone Market

The rise of smartphones – mobile phones capable of Internet access and able to run ‘apps’ or applications – is the latest wave of the global connectivity revolution. Mobile phones rapidly made their way around the world to become almost ubiquitous – the most successful take-up of a piece of communications technology in history – and now smartphones are set to do the same. The number of mobile phone subscriptions in the world surpassed 6 billion in 2012 (out of a population of 7 billion) and, according to the International Telecommunications Union (ITU), the number of mobile phones will exceed the world’s population by 2014.

Over the last five years, with the increasing popularity of smartphones, the focus of the mobile industry has shifted from voice and messaging to apps and data services.

Smartphones are complex pieces of technology and any country that can develop the capability to make them and innovate is set to make a lot of money.

The high export value potential of designing and making “computer equipment, office equipment, telecommunication equipment, electric circuit equipment, and valves and transistors” was flagged up as a priority for developing nations back in 2005 at a UN meeting looking for “New and Dynamic Sectors of World Trade” (UNCTAD).

At present, smartphones have a long way to go to surpass old-style mobile phones: by the end of 2016, according to Portio Research (portioresearch.com), the number of non-smartphones in the Asia-Pacific region alone will still be bigger than the entire worldwide number of all smartphones. Even so, it’s predicted that by 2016, there will be 555 million active smartphones in China alone, as well as half a billion smartphones in Europe by the end of 2014. By 2013, North America’s smartphones will make up 50 per cent of all mobile phones. All in all, a lucrative market.

The main factor holding back the rise of smartphones is price. Smartphones tend to cost more than a basic mobile phone. But as China gets more heavily involved in the smartphone marketplace with its own smartphone and mobile phone brands, low income consumers will find themselves with a wider choice of affordable and powerful smartphones, each one a mini-computer.

Out of the 10 largest global manufacturers of smartphones, four are Chinese: Lenovo, Yulong, Huawei and ZTE (Gartner).

Huawei (http://www.huawei.com/en/), the world’s biggest smartphone seller (according to research firm Canalys) (canalys.com), has started to move some of its design team to London in the United Kingdom, to better tailor its products for foreign markets. It has revenues each year of US $35 billion.

China’s mobile phone market is vast, accounting for a third of all smartphones sold in the world. Getting a foothold in this marketplace places a company in a very strong position to build the expertise and capital to push into the wider global marketplace. And that is what Chinese brands are starting to do. So far, Chinese exports of branded smartphones make up a fifth of those sold around the world (Canalys).

The big global competitors to date have been South Korea’s Samsung (samsung.com) and the American Apple brand (apple.com). Other large competitors are Canada’s troubled Blackberry and Finland’s Nokia.

To compete with them, popular and successful Chinese brands include Xiaomi (xiaomi.cn), which sells more mobile phones in China than does the American Apple brand, and ZTE (http://wwwen.zte.com.cn/en/).

For years, many of the top global brands have had their phones and the components manufactured in China. This meant Chinese manufacturers were assembling the phones but not benefiting from the high value that can be extracted from being the owner of the brand name and the originator of the innovation and holder of the copyrights and trademarks.

But now China’s Lenovo brand (http://www.lenovo.com/uk/en/), for example, has successfully pulled past U.S. electronics maker Hewlett-Packard (www.hp.com) to become the largest seller of personal computers in the world. It is also selling more mobile phones and tablet computers than personal computers.

Lenovo Chief Executive Yang Yuanqing espouses a two-part strategy to defend market share at home in China while going hard at overseas markets. Lenovo started with so-called emerging markets in Russia, India and Indonesia.

“We have very aggressive plans to explore overseas markets,” Lenovo’s mobile phone division head Liu Jun told China Daily. “We hope the overseas market will contribute more than half of Lenovo’s total smartphone revenue in the long run.”

Xiaomi founder Lei Jun is considered part of a new generation of dynamic Chinese technology leaders. His casual clothing and charismatic public presentations have had some equate him to the late Apple founder Steve Jobs. But Jun is not happy with selling smartphones and instead sees the company’s future in software and that the phones are just a tool to access the software. Xiaomi hopes to make even more money from selling games, running online marketplaces and offering social media.

The Chinese-made smartphone brand Coolpad (http://coolpadamericas.com/) – made by Yulong Computer Telecommunication Scientific Co. – is the third best-selling in the Chinese marketplace, surpassing Huawei and Apple and has global annual revenue of US $1.8 billion, according to Forbes magazine. Sino Market Research found 10.2 per cent of China’s smartphone users own a Coolpad, behind Korean brand Samsung and China’s Lenovo.

Coolpad has succeeded by investing heavily in research and development (R&D) and innovation to make the phones cheap but also powerful.

Innovations include technology that lets users have more than one phone number for the same phone by being able to connect to two different network technologies. The phones also include security and privacy protections that make them popular with businesspeople and government officials.

The Coolpad brand has also been frenetic in launching different models of the phones to appeal to its customers. In 2012, it launched 48 different models, selling for between US $50 and US $500.

Coolpad was launched in 2012 in the US as part of the company’s global expansion plans.

China has placed innovation at the core of its economic development policies. China increased its R&D spending in 2009 to US $25.7 billion, a 25.6 per cent rise over 2008, according to Du Zhanyuan, vice minister of the Ministry of Science and Technology. In 2011, China surpassed South Korea and Europe in total patents filed and was in a neck-and-neck race with Japan and the United States.

China now boasts twice as many Internet users as the United States, and is the main global maker of computers and consumer electronics, from toys to games consoles to digital everything.

China is also on course to become the world’s largest market for Internet commerce and computing.

The drive to change and transform China’s global economic role was promoted in 2011’s Beijing International Design Week (http://www.bjdw.org/en/), with its theme of transforming “Made in China to Designed in China.”

By David South, Development Challenges, South-South Solutions

Published: September 2013

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

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Update: Huawei Loses Millions Of Users As Serious New Threat From China Gets Real

"Make no mistake—Xiaomi intends to entice Huawei consumers with upgraded phones such as the recent Mi 10 Pro, better able to compete with Huawei’s flagships in overseas markets. The company is also making a feature of its “easy access to Google,” as its marketing goes head to head with its larger Chinese rival. Right now, Xiaomi has a unique opportunity to strip away market share with Huawei helpless on the Google front. And it seems that millions of Huawei users outside China who want to maintain Google on their phones are already voting with their wallets."

Mobile Phone Microscopes to Revolutionize Health Diagnostics

 

Mobile phone usage has increased hugely across the global South in the past five years. In Africa, the number of mobile phone subscribers reached 545 million in 2013, while there are 3.5 billion mobile phone users in Asia and the Pacific (ITU). Some 93 million people in Africa and 895 million in Asia and the Pacific have mobile phone Internet access (ITU).

“Every day we are moving closer to having almost as many mobile-cellular subscriptions as people on earth,” Brahima Sanou, Director of the ITU Telecommunication Development Bureau, wrote in its latest report on their growth.

The number of mobile phone subscriptions in the developing world has surpassed 5 billion and the number in the world as a whole reached 6.8 billion in 2013 (ITU), out of a world population of more than 7.1 billion. This compares to considerably lower numbers of people with access to the Internet: 2.7 billion in the world (ITU).

While many people in poorer countries have basic versions of mobile phones, the next generation of smartphones has been growing in number as prices come down (http://en.wikipedia.org/wiki/Smartphone). Examples of these smart phones include the BlackBerry, Apple’s iPhone, the Samsung Galaxy, and the Nokia Lumia. Smartphones tend to have enormous computing power and an ability to run complex ‘apps’ or applications – including public transport options, maps, restaurant and store locators, banking services and market information and resources. They can also access the Internet through Wi-Fi, and have camera and video capability.

What people can do with these feature-packed phones is limited by little other than human imagination. With the ability to store large amounts of data and images, using apps that perform a limitless range of services and tasks, smartphones can be deployed as powerful tools to tackle problems.

Science fiction sagas have long fantasized about people being able to walk around with small electronic devices that can do immensely powerful tasks, including being a medical diagnostic tool. But this science fiction dream is rapidly becoming reality in the global South.

Various initiatives and innovators are using mobile phones and smartphones to conduct medical diagnosis and gather data for medical studies in real time.

Some innovations are even turning smartphones into mobile microscopes.

Developed by the University of California, Berkeley in the lab of Professor Daniel Fletcher (http://cellscope.berkeley.edu/), the CellScope (cellscope.com) is capable of turning the camera on a cell (mobile) phone into a diagnostic microscope with a magnification of 5x to 60x. Fletcher’s lab has also pioneered work on needle-free injection technology.

The CellScope can be used for ocular imaging (technologies for visualizing and assessing a range of diseases of the eye) and for detecting tuberculosis, blood-borne diseases and parasitic worms.

Fletcher is a bioengineer and was impressed with how much mobile phone technology has proliferated across the global South.

“You don’t have to put in these copper wires (for phone lines) anymore; you have the (cell) towers. It’s big business,” Fletcher told The Scientist Magazine.

“It’s leaping over the need for infrastructure.”

Fletcher and his colleagues experimented by attaching extra lenses to smartphones. They then used the phone to image cells that had been stained with fluorescent dyes to make them easier to see. The quality of the image was so good, they were able to diagnose malaria from blood samples and tuberculosis from sputum (spit) samples.

With the addition of image analyzing software, the phone was able to automatically count the number of Mycobacterium tuberculosis bacilli. They were trying to prove you did not need conventional microscopes to do this sort of diagnostic work.

Fletcher and his colleagues are currently trialling the technology in Vietnam, India, Cameroon and Thailand.

“Technology alone doesn’t create effective health care,” Fletcher emphasizes. “It’s got to be part of a context in which the information is captured and validated and is analyzed in the right way, and treatments are then available in response to information.”

Another group from Toronto General Hospital in Canada (http://www.uhn.ca/corporate/AboutUHN/OurHospitals/Pages/TGH.aspx) has ‘hacked’ an iPhone smartphone by placing a 1 millimeter ball lens on the phone’s camera. Isaac Bogoch, an infectious disease specialist, had been investigating parasitic worm infections in children on Pemba Island off the coast of Tanzania. Along with Jason Andrews of Massachusetts General Hospital, they had been inspired by a report about how a team of researchers from the University of California, Davis had created a simple microscope out of an iPhone with a 1 millimeter lens. This makeshift microscope was used to take pictures of blood smears at a 350 times magnification and giving a 1.5 micron resolution.

“We thought that was a great idea,” Bogoch told The Scientist Magazine. Bogoch regularly works as part of an international team around the world, often in remote locations.

“We thought … we could take it to the field and see if it accurately works in a more real-world setting.”

Inspired, Bogoch got together with his colleagues and created a similar microscope with a 3 millimeter ball lens and then got to work using it to identify soil-transmitted helminth eggs in stool samples in Tanzania. When examining the stool samples of 199 children in a clinical trial using the makeshift microscope, they were able to accurately identify helminth infections in 70 per cent of the cases. They also found the iPhone microscope did very well at spotting eggs of particular parasites, such as 80 per cent of Ascaris lumbricoides infections (http://en.wikipedia.org/wiki/Ascaris_lumbricoides). The success rate dropped significantly, however, when trying to detect whipworm parasites (just over half) and hookworm infections (14 per cent).

But this is early days and an experiment: “Obviously the results aren’t perfect and there’s definitely room for improvement,” Bogoch admits.

What stands out is the potential to completely revolutionize health care by continuing to develop the capability of smartphones. With their portability and low cost, they also have the advantage of not needing a trained physician to operate them, according to David Walker, president of the American Society of Tropical Medicine and Hygiene, in The Scientist Magazine.

One of the many advantages of combining a microscope with a digital smartphone is the ability to take a picture and send it straight away to someone to make a diagnosis.

Even more exciting, Sebastian Wachsmann-Hogiu at the University of California, Davis (http://cbst.ucdavis.edu/people/sebastian/) is adapting mobile phones to undertake spectroscopy (http://en.wikipedia.org/wiki/Spectroscopy), using diagnostic test software to analyze samples on the spot. This, when successful, would be akin to the capabilities first mooted in the science fiction television and film series Star Trek (startrek.com). In Star Trek, the doctor is able to use a small handheld digital device to quickly diagnose what ails somebody.

The potential for this technology in the global South is significant. Aydogan Ozcan at the University of California, Los Angeles, who is also working on mobile phone microscopes, believes this is as significant as the dawn of the personal computer: “If you look at the early computers, they were bulky, they were extremely expensive,” he says.

But now computers “are portable … and almost anyone can afford them. The same thing is going on today (with microscopy). We are miniaturizing our micro- and nano-analysis tools. We’re making them more affordable; we’re making them more powerful.”

It looks like this science fiction dream will soon become today’s reality.

By David South, Development Challenges, South-South Solutions

Published: July 2013

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

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Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

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Kenya Reaches Mobile Phone Banking Landmark

 

Financial transactions and banking with mobile phones have been a Kenyan success story.

Now, one service, M-Shwari, has reached a significant milestone in the history of m-banking (mobile phone banking): it was able to record a billion Kenyan shillings (US $11,926,100) in savings deposits in a month after its launch in November 2012 and reached deposits of Kenyan shillings 2.8 billion (US $33 million) by February of 2013. This outstripped the Kenyan shillings 378 million (US $4 million) in loans lent by the service, reports Daily Nation.

M-Shwari is a mobile phone banking product that allows people to save and borrow money by phone and earn some interest too. The service offers small emergency loans to customers, offering a financial lifeline to people who would have been frozen out of financial services in the past.

There is no need to have any contact with a bank or bother with paperwork. And loans are instant because they are small.

Safaricom Chief Executive Officer Bob Collymore told the Daily Nation “Trends show that it has become more of a savings service than a lending service. This is what we intended since the beginning.”

As of February 1.6 million customers had used the service.

On top of this success, the pioneering M-PESA (http://www.safaricom.co.ke/personal/m-pesa/m-pesa-services-tariffs/relax-you-have-got-m-pesa) mobile phone banking platform developed in Kenya by Safaricom is set to roll out across India and help bring banking services to the country’s 700 million “unbanked.”

Both these developments are solid proof that innovation aimed at drawing in the poor into the mainstream economy not only works, it is profitable and exportable.

M-Shwari (http://www.safaricom.co.ke/personal/m-pesa/m-shwari/m-shwari-faqs) works like this: a customer can save as little as one Kenyan shilling to receive an interest rate of up to 5 per cent. If they want a loan, then they can borrow from 100 Kenyan shillings (US $1.19) to a maximum of 20,000 Kenyan shillings (US $238) for a processing fee of 7.5 per cent which will need to be paid back after 30 days.

By offering greater access to loans, M-Shwari s increasing competition in the banking sector and giving customers a choice.

It joins an ongoing revolution in access to credit for the poor. Powerful mobile phones enable individual depositors and businesspeople to organize their financial affairs and business needs on the phone. This is a revolutionary development in many places where people previously had to contend with poor access to financial services – or no access at all.

M-Shwari and products like it allow people to borrow, save and conduct transactions with family, friends, business partners and customers over their mobile phones.

M-Shwari is a collaboration between Kenyan telecoms company Safaricom and the Commercial Bank of Africa. It is being hailed as an example of how banks and telecommunications companies can cooperate to offer innovative financial products to the country.

For the unbanked in India, the initiative between Vodafone India (https://www.vodafone.in/pages/index.aspx) and ICICI Bank, India’s largest private bank, has started to roll out the Kenyan M-PESA mobile phone banking platform in India as of April 2013. They are hoping to open up access to banking to 700 million Indians who currently do not have bank accounts or access to banking facilities. The rollout starts in the country’s eastern regions of Kolkata and West Bengal (CNN).

It looks like access to banking services for the poor in the global South will soon undergo radical change with these large-scale initiatives.

By David South, Development Challenges, South-South Solutions

Published: May 2013

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP's South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South's innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.  

Follow @SouthSouth1

Google Books: https://books.google.co.uk/books?id=RfdcAwAAQBAJ&dq=development+challenges+may+2013&source=gbs_navlinks_s

Slideshare: http://www.slideshare.net/DavidSouth1/development-challenges-may-2013-issue

Southern Innovator Issue 1: https://books.google.co.uk/books?id=Q1O54YSE2BgC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 2: https://books.google.co.uk/books?id=Ty0N969dcssC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 3: https://books.google.co.uk/books?id=AQNt4YmhZagC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 4: https://books.google.co.uk/books?id=9T_n2tA7l4EC&dq=southern+innovator&source=gbs_navlinks_s

Southern Innovator Issue 5: https://books.google.co.uk/books?id=6ILdAgAAQBAJ&dq=southern+innovator&source=gbs_navlinks_s

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.