Social Networking Websites: A Way Out of Poverty

Social networking websites also known as, Web 2.0 – the name given to the new wave of internet businesses and websites such as YouTube and MySpace that are transforming the way people interact with the Web – has been dubbed the social web for its power to bring people together. The label has been derided as a marketing gimmick by some, but many argue there are a number of characteristics to Web 2.0 that make it something different and a valuable tool for entrepreneurs seeking ways out of poverty.

The new Web 2.0 applications offer many free software tools stored online, from accounting and business related tools, to new multimedia ways to communicate for free. Unlike Web 1.0 sites, which offered information to passive users, Web 2.0 sites allow interaction and comment. These qualities have meant Web 2.0 can be used to build communities and social and business networks. By being able to store vast quantities of information online, it becomes faster to work and reduces the painful delays brought on by slow connections.

All these new tools are making it easier and easier for entrepreneurs to work from home, in internet centres, or anywhere there is a wireless connection, and is slashing the costs of managing a business. All the applications are online so there is no need to be hidebound by one operating system or hardware capability. The number of internet centres has increased significantly all over Asia and Africa, bringing the power of Web 2.0 to millions more people.

Linking mobile phones and the internet is also remarkable. It is becoming more and more possible in Africa to send messages to weblogs via text messaging, to post photos and videos, or to stay connected with a community, advocacy or business group via messaging to its website.

“Web 2.0 is a pre-occupation of ours that can be beneficial in fighting poverty,” said Tobias Eigan, founder and co-executive director of Kabissa.org, a web portal dedicated to promoting Web 2.0 in Africa. “It is really relevant for Africa. It makes the internet a read and write function, it is more user-friendly – that dynamic is going to make a big difference. It is so much easier to upload content with Web 2.0. It will build the capacity of local institutions and society and that will improve the lives of people – it will be much easier to fight poverty with this connectivity.”

Two other champions of the Web 2.0 way out of poverty are Waleed al-Shobakky, science and technology reporter for alJazeera.net, and Jack Imsdahl, a consultant and technology commentator. While they admit subsistence farmers and the illiterate will not directly benefit, those who are students or are working in proximity to computers will definitely benefit. They point out how rapidly mobile phones have been taken up by the poor and that this is being driven by the new services they offer.

There are still profound obstacles to more rapid take-up, however. Internet connection speeds will have to get better and more will need to be invested in this area. Web 2.0 tools will also need to be adapted to local languages if they hope to get past those who speak major web languages like English.

Entrepreneurs in the global South can now easily sign up to a vast array of e-newsletters that are sent to email accounts and keep on top of trends and innovations in their field. The relative anonymity of these email lists mean subscribers are less likely to be judged on their physical circumstances.

By David South, Development Challenges, South-South Solutions

Published: March 2007

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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Dynamic Growth in African ICT is Unlocking Secrets of SME Treasure Trove

A newly released survey of 14 African countries in 2006 has documented the impact of Information and Communication Technology (ICT) on private sector development and how it is contributing to developing a vibrant Small Medium Enterprise (SME) sector in Africa. It discovered how dynamic the SME sector is, how it has rapidly adopted mobile phone technology (96 percent have it), and how if used properly in concert with this new technology, extraordinary economic growth is possible.

The survey – Towards An African e-Index: SME e-Access and Usage in 14 African Countries – covered only businesses employing fewer than 50 people and took in the vast informal sector in the countries. It investigated if they had access to ICTs, how they are using them and if it was making them more productive. SMEs were especially interesting because they do not waste money (most people are just trying to survive) and they only use what is really useful to them to increase income. In the informal sector this has become the mobile phone.

The countries surveyed included Botswana, Cameroon, Ethiopia, Ghana, Kenya, Mozambique, Namibia, Nigeria, Rwanda, South Africa, Tanzania, Uganda, Zambia and Zimbabwe. With most of the continent’s poor working in the SME sector, little was actually known about the impact of ICT and its link to profitability and labour productivity. And surveying only formal businesses would be telling half the story since about two-thirds of non-resource driven GDP generation is derived from SMEs, and a large share of that from informal ones.

“This is a sector that has no access to formal finance,” said Dr. Christopher Stork, a senior researcher at the Witwatersrand University in South Africa. “The mobile phones present an opportunity to tap into this market and offer finance, banking services, cash transfers – we see this already in Kenya – without the risks of other services. These informal businesses can build up a history, learn how to better control their businesses, and receive loans. Where the financial system is dysfunctional or overpriced, airtime credits can be the new cash form.”

Africa has a high proportion of entrepreneurs because people have next to no social supports to fall back on and need to do business to survive. Most fall into the informal sector where they can avoid paying tax, pay low wages, and keep overheads down. According to Stork, if governments are serious about dealing with poverty, then the best approach is to acknowledge this sector, and rather than crush it, draw it in to become more sophisticated and efficient. He sees the mobile phones as key to this strategy.

“Innovative technology can help these entrepreneurs to acquire the tools they need to do business better. There is a lack of skills in all areas, a lack of accounting skills, a lack of basic financial management. This is where ICT can overcome this. SMEs can get a monthly statement with all their business transactions, making it easier to manage things. This would be a great way to distribute micro-finance. Savings clubs could store cash on the phones.”

The e-Index also noted the trend for mobile phone providers to consolidate and offer common regional services. This could fuel an explosion in cross-border trade as it becomes cheaper and easier to communicate via mobile phone for business. The e-Index also found the ever-growing importance of internet cafes remains. They continue to evolve into multi-purpose business centres offering a wide range of services, from post to word processing. At present they still remain the main means of accessing the internet. And with broadband still minimal and very expensive, it falls on mobile phones to offer internet access, though this will remain mainly in the continent’s capitals.

The survey’s sponsor, Research ICT Africa! (RIA!) network, seeks to build an African knowledge base in support of ICT policy and regulatory design. The network emerged out of a growing need for hard data and analysis to help the continent join the information age. Throughout 2007 it is conducting household surveys on e-access and e-usage and will present the findings in 2008.

By David South, Development Challenges, South-South Solutions

Published: February 2007

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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African Tourism Leads the World and Brings New Opportunities

Tourism around the world is growing rapidly again after the setbacks caused by the September 11, 2001 terrorist attacks. Tourism is also finally acknowledging Africa – home to 888 million people (2005, UN) – and where 46 percent of sub-Saharan Africa’s people live on less than US$1 a day. Led by Kenya and South Africa, the continent has come out on top in world tourism growth according to the United Nations World Tourism Organisation (UNWTO) (http://www.unwto.org/). While global tourism is forecast to grow by four percent in 2007, Africa as a whole enjoyed growth of 10.6 percent in 2006.

Tourism, because it is a labour intensive industry, is seen as a great way to both reduce poverty and meet all the Millennium Development Goals. It favours small scale businesses, it is decentralized and can diversify regional economies, it is relatively non-polluting and can contribute to the conservation and promotion of natural and cultural heritage, and most importantly it can act as a catalyst for kick-starting other sectors of the economy.

Tourism is now generally recognized to be one of the largest industries-if not the largest-in the world. It has grown rapidly and almost continuously over the past 20 years, and is now one of the world’s most significant sources of employment and of Gross Domestic Product (GDP). Tourism particularly benefits the economies of developing countries, where most of the sector’s new tourism jobs and businesses are being created. This rapid growth has encouraged many developing nations to view tourism as key to promoting economic growth, and global development assistance agencies see it as having real potential to help achieve many of their own development goals.

Tourism provides opportunities for diversifying local economies and promoting formation of micro and small enterprises, many of them women-owned. These enterprises promote better lives for poor entrepreneurs, especially in rural areas where there may be few other livelihood options. Tourism is generally labor-intensive and it tends to employ relatively higher proportions of women and young people than most other sectors. Tourism introduces technology and basic infrastructure, and strengthens linkages with the outside world. Well-planned and -implemented tourism projects can improve local governance, natural resources management, biodiversity conservation and other important development goals.

Within Africa, sub-Saharan Africa led the way with 12.6 percent growth. The countries benefiting the most included Kenya, South Africa, Mozambique, Swaziland and the Seychelles. Kenya received almost a million tourists in 2006, and earned US $857 million in revenue.

Kenya’s success rests on the fact it set aside 10 percent of the country for wildlife and biodiversity conservation. The majority of its tourists come to see the ‘big five’ – elephant, rhino, lion, buffalo, and leopard. Tourism currently employs 11 percent of the country’s workforce.

In October 2004 the World Tourism Organization released the Washington Declaration on Tourism as a Sustainable Development Strategy. Governments, international aid agencies, and the world’s leading universities agreed to make sustainable tourism development a top priority in their strategies to reduce poverty and meet other MDGs.

Aid agencies like USAID have targeted women for micro-funding for tourism projects. They have been able to help women start businesses making crafts in Tanzania and Botswana. The UK’s DfID helped Toni Shina from the Cape Town-based The Backpack to become a fair trade business. “Fair Trade Tourism South Africa recognises our commitment to uplifting our staff and community, and our utilisation of local service providers,” she said. “As a business we also have a strong and positive attitude to working with and supporting staff who are affected by HIV and Aids and we abide strongly with required labour and legal standards.”

And the fair trade concept is getting greater recognition. In a recent survey of the local tourism industry in South Africa, half recognised the Fair Trade in Tourism South Africa brand.

On the other hand, the scale of missed opportunities is illuminated in Rwanda. A consultant on a tourism management plan for the Volcano National Park, Edwin Sabuhoro, is urging communities living nearby to embrace eco-tourism and cash in on the tourists visiting nearby gorillas.

“According to our research,” he told Kigali’s The New Times, “some tourists say they carry their money back to their countries because they can’t find what to spend on.” And he pointed out the fate of the gorillas were directly linked to the poverty of the community: poachers would not be stopped if the community remained poor and had no other source of income.

How popular Africa has become is exemplified by Ethiopia’s rise into the top ten travel destinations for 2007, according to travel guide specialist Frommer’s. According to the guide, “Ethiopia has finally emerged out of the shadows caused by years of political strife, economic hardship and famine. The improved infrastructure has made travelling in Ethiopia increasingly popular, especially among independent-minded travellers and those seeking adventure.”

Another country, Tanzania, is targeting tourism as a key growth area. The country is trumpeting its peaceful and stable status and low-crime to attract tourists.

By David South, Development Challenges, South-South Solutions

Published: February 2007

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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Ring Tones and Mobile Phone Downloads are Generating Income for Local Musicians in Africa

 

African musicians hoping to support themselves through their recordings have always had to contend with the added burden of poor copyright control over their work. While musicians in the West are supported by a highly regulated regime of copyright protection – ensuring some to become the richest people in their respective countries – most African musicians have had to stand back and watch their work being copied, sold and exchanged with little chance of seeing any royalties. Global audiences know of the success of artists like Fela Kuti, Youssou N’Dour, Manu Dibango and Miriam Makeba, but most African musicians can look forward to scant earnings from recording their music.

Anyone who has walked through the markets of Africa will know there are plenty of pirated CDs for sale, yet it is of no use to a musician who never sees the money. Poverty is endemic amongst African musicians as a result of this loss of income. While music is a global business worth US $40 billion according to the Recording Industry Association of America, pirated music in Africa is rampant – some estimates by the Recording Industry of South Africa put it at over 80 percent of available music. How much money is being lost can be judged from the estimated daily income of a pirate music vendor in Africa, ranging between Euro 762 and Euro 2,744.

But a solution to this problem is being pioneered in Botswana in southern Africa. A partnership between mobile phone provider Orange Botswana and Small House Records/Mud Hut Studios, ensures musicians get a slice of the profit pie. Managing director Solomon Monyame of Small House Records has signed a contract with Orange to share the profits from ring tone and song downloads to mobile phone subscribers. With more than 76.8 million people currently subscribing to mobile phone services in Africa, and the number growing by about 58 percent each year for the last five years, the potential royalties market for African musicians is vast if this initiative is replicated across the continent.

In the paper “Development Goes Wireless” to be published in the spring 2007 issue of the journal of the Institute of Economic Affairs, lead researcher Karol Boudreaux of George Mason University’s Mercatus Center and Enterprise Africa!, discovered mobile phones and mobile phone companies can give artists a new way to control royalties for their work. She found that in the absence of effective copyright control mechanisms – as is the case in many African countries – the mobile phone company can step in to save the day.

“When you walk through the markets there you see so much music available on the street, but there is little intellectual property rights protection,” she said.

“In other countries, like the UK, you have strong intellectual property rights protection, but this just isn’t the case in much of Africa. The mobile phones are a very good way to get around this problem as long as cell phone providers are willing to make the contracts. Botswana is very lucky in that they have a very good contract environment, but this isn’t necessarily the case in other countries. It is a win-win for music providers and mobile companies.”

The NetTel@Africa project started by USAID and the Center to Bridge the Digital Divide, in partnership with many African and US universities, is also championing copyright protection strategies.

How important creative industries are becoming to economic development is slowly being recognized. It is now seen as an important component of modern post-industrial, knowledge-based economies, but equally also a way for economically underdeveloped countries to generate wealth. Not only are they thought to account for higher than average growth and job creation, they are also vehicles of cultural identity and play an important role in fostering cultural diversity. Initiatives like UNESCO’s Global Alliance for Cultural Diversity attempt to document this phenomenon and back it up with hard numbers.

UNESCO also has a project to establish musicians’ cooperatives across Africa. As such, the musicians are able to pool their production resources, which are individually insufficient to ensure the economic viability of a small or medium-sized business. In Burkina Faso, a co-operative is working with the International Labour Organisation. Click here for more information.

Festivals like Mali’s annual Festival in the Desert in the oasis of Essakane, 65 kilometers from Timbuktu, is an example of how African musicians are finding their own way to reach audiences. Targeted above all to promote African and Malian Music inside the continent, the Festival has also boosted international tourism to the region and almost 10 percent of last year’s 6,000 visitors came from outside of Africa.

Another initiative for African musicians is the DigiArts Africa network. It was founded by UNESCO and aims to increase communication between artists, industries and educators, make musicians self-sustainable, use the ICT industries to support and contribute to cultural activities, and better promote African musicians within and outside Africa. Click here for more information.

Well-known Senegalese musician Thione Seck is blunt about the economic effect of piracy on his income.

“Were there no piracy, I could have bought an island, seeing the number of songs that I composed in more than 30 years of my career”, he told a local newspaper.

According to Abdoul Aziz Dieng, president of the Senegal Music Works Association (AMS) and Chairman of the Board of the Senegalese Copyright Office (BSDA) (www.mali-music.com), out of 10 Senegalese artists’ CDs available on the local market, “only two are legal”. For audio cassettes, the ratio is three pirate copies out of every five sold.

Opportunities to combat piracy and generate income are also not limited to just musicians. Filmmakers in Africa are starting to learn how to exploit the opportunities thrown up by the fast-expanding mobile phone networks on the continent. Already a phenomenon in South Africa (www.filmmaker.co.za), director Aryan Kaganof is in the process of releasing SMS Sugar Man, a feature length movie shot entirely with mobile devices. The movie will be beamed to cell phones in three-minute clips over 30 days.

What are the effects of Piracy?

• Artist

  • No royalty payments, no money to live

• Record companies

  • No return on investments. Staff retrenchments

• Retailers

  • Cannot compete with low prices. Staff retrenchments

• Consumers

  • Many copies are of inferior quality. If tracks are missing or the sound quality is poor, no exchange or refunds

  • May be contributing to “organized crime” syndicates which are heavily involved in international music piracy

Source: Recording Industry of South Africa

By David South, Development Challenges, South-South Solutions

Published:  January 2007

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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Innovations in Green Economy: Top Three Agenda

By David South

southasiadiasters.net December 2013

The transition to a green economy has reached a crossroads: while multilateral global initiatives have been long-running and complex, the idea of a green economy still seems fragile and achieving it far from certain. In the face of the ravages of the global economic crisis that has raged since 2007/2008, countries are now trying to roll back their green pledges or slow the pace of transition.

This exposes a dilemma: a perception that a green economy is in conflict with economic growth, prosperity and the advance of human development, particularly in developing countries seeking to make rapid gains in reducing poverty and building a middle class, consumer society.

Three things need to be foremost in the minds of those who care about creating a global green economy in the 21st century: innovation in design, in market prices and in business models. I think these three factors will be the deciding elements in whether green technologies are taken up quickly and used by large numbers of people to improve their lives.

The green option needs to always be the more appealing, cheaper option that also improves living standards. Happily, many people are doing this all around the world - you just may not have heard of them yet (unless you are reading Southern Innovator magazine that is).

As editor of the magazine Southern Innovator since 2011, I have had the privilege to meet, interview and see first-hand green economy innovators across the global South and profile them in the magazine. What has stood out for me is this: the ones who have achieved sustainable success have put a great deal of effort into design - how the technology is made, what it looks like and how it is used, how efficiently it is made and distributed - while also thinking through the business case for their work and how to make it appealing to others.

We have tried to apply this thinking to the magazine as well, by using clear and modern design with bright, eye-pleasing colours, and by choosing to use 100 per cent renewable energy (much of it from geothermal sources) for the magazine’s design and layout and to have it printed on paper from sustainable forest sources.

The fourth issue of Southern Innovator (www.southerninnovator.org), on cities and urbanization, launched in October at the Global South-South Development Expo 2013 in Nairobi, Kenya. It profiles many practical initiatives and innovators that are currently building green homes, communities and even whole cities. The magazine’s fifth issue will focus on the theme of waste and recycling and hopes to be a one-stop source of inspiration to better use the finite resources of planet earth.

- David South, Editor, Southern Innovator
United Nations Office for South-South Cooperation (UNOSSC)

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