Demystifying Africa’s Risk Perception Premium

With a growing middle class, early-stage frontier markets, enormous demographic advantages, and its ongoing digital transformation, Africa continues to grow in both economic and geopolitical importance. In “Demystifying Africa’s Risk Perception Premium,” Paul Clyde and co-authors make the case for a stronger U.S.- Africa trade and investment relationship, one that changes the narrative around doing business on the continent.

This primer provides a comprehensive but non-technical overview of the distinct health information systems (HIS) that all together support health care delivery in low-resource settings. It opens with a historical account and landscape assessment and describes the urgent need to build a lean rigorous HIS that integrates these different components. Subsequent sections describe the individual systems that: i) track individual patient and health care provider information; ii) directly document care delivery; iii) provide public and population health data; iv) support facilities’ and community health workers’ administrative and financial functions; and v) coordinate logistics and health commodities supply chains. A separate section describes imported data, including “master data” and manufactured (e.g., “meta”) data. The primer closes with recommendations for principled HIS stewardship.

This white paper is a modest contribution to the existing body of knowledge on potential revenue benefits from taxation of “bads” in low- and middle-income countries (LMICs).  We seek to provide orders-of-magnitude responses to the questions, “For 16 LMICs, what amount of additional government revenue could have been generated in 2016 if higher excise tax rates had been imposed on tobacco, alcohol, and sugar-sweetened beverages?”, and “How does this additional government revenue compare to select national economic indicators?”.

WDI’s Michael Krautmann (left), Ben Davis (center) and manager of a medical commodities warehouse in Zanzibar.

 

The Global Health Supply Chain Technical Assistance (GHSC TA-TZ) project, funded by the U.S. Agency for International Development (USAID), aims to strengthen Tanzania’s health supply chain systems across different disease programs.

Two research managers from WDI’s Healthcare focus area, Michael Krautmann and Ben Davis, conducted a midterm review of this project to assess whether it is on track to meet its objectives, and also to make recommendations for any necessary course-correcting actions.

GHSC TA-TZ marks a fundamental shift in USAID’s approach to health supply chain technical assistance in Tanzania.  Previous projects, such as Supply Chain Management System (SCMS) and USAID | DELIVER Project, focused significant resources on strengthening the health supply chain by providing detailed and direct operational support to the government for key supply chain functions. GHSC TA-TZ seeks to move U.S. government-funded technical assistance away from this type of operational role and toward a more strategic, advisory role.  Thus, the first two years of GHSC TA-TZ have focused heavily on transitioning certain supply chain management activities to government ownership.

After completing a thorough desk review of relevant documents and developing an overall methodology, Krautmann and Davis traveled to Tanzania to gather information from health supply chain stakeholders. They conducted more than 35 interviews with more than 60 individuals – from government ministry officials to internal project staff and implementing partner representatives. The interviews, which took place in the cities of Dar es Salaam and Dodoma as well as the nearby island of Zanzibar, provided the type of qualitative information not available in existing documents.

“During interviews, we focused on understanding what the project is doing well and what could be improved,” Krautmann said. “And we solicited interviewee expectations for the project’s remaining years. Between the desk review and interviews, we were able to get a holistic picture of the project.”

GHSC TA-TZ operates in a challenging environment. Tanzania is a large, populous country with major infrastructure challenges at the health facility level. Three separate government entities are involved in managing key health supply chain activities, making effective coordination and accountability more difficult and complex to achieve.

“One of the challenges is how to transition health supply chain functions effectively to the government, especially when these functions are split between ministries,” Krautmann said.

Davis and Krautmann with Zanzibar Ministry of Health’s Supply Chain Management Unit.

Despite these challenges, the GHSC TA-TZ has already made significant contributions to key health supply chain performance metrics such as forecast accuracy, facility reporting rates and, most importantly, product availability at health facilities.

As part of the review, Krautmann and Davis provided GHSC TA-TZ project leadership with a list of actionable recommendations for addressing current risks to project success while also facilitating the project’s transition toward a strategic advisor role. The recommendations drew upon the types of business principles that are the foundation of WDI’s approach. Whether the application of lean thinking, developing mutually-reinforcing organizational capabilities, or analyzing the incentive structures within performance-based contracts, their recommendations sought to leverage private-sector and academic knowledge to benefit Tanzania’s public-sector health supply chain.

Krautmann said WDI was well equipped to handle this project.

“Through our prior work we have a broad, strategic view of the global health supply chain landscape, and we also have on-the-ground experience that allows us to operate effectively with government ministry officials,” he said. “Moreover, we have enough experience working with clinic staff on supply chain issues to be able to predict how things will play out when these national-level policies filter down to the clinic level.”

 

WDI developed an approach and toolkit to help governments and donor agencies manage complex data and conflicting priorities when evaluating supply chain designs, and an approach for quantifying the priorities of individual stakeholders and then using those priorities to weight the observed performance of a supply chain model. Drawing upon academic and industry research in multi-criteria decision analysis, this approach resulted in a simplified, composite performance metric that enabled easy comparison across different supply chain models and stakeholders. By applying this approach retrospectively to health supply chain pilot analyses in Zimbabwe, Tanzania, Nigeria and Togo, WDI increased government and donor awareness of the true diversity of real-world stakeholder priorities and highlighted the importance of addressing such priorities in the performance management process. This project was funded by the Bill & Melinda Gates Foundation.

Kristin Babbie, a senior project administrator at WDI’s Grants Management team, recently attended the Global Youth Economic Opportunities Summit and authored the following post for NextBillion.net. NextBillion, a WDI affiliated site, originally published the article on Oct. 12, 2016.

In 2013, I interviewed a group of young people at a youth empowerment center in Kenya about their perceptions of agriculture as a livelihood. The interviews were part of a study driven by concerns about Kenya’s youth bulge, coupled with anecdotal evidence that the country’s youth had negative attitudes about working in the agricultural sector. The attitudes of the youth I interviewed were shaped primarily by the significant barriers they faced in accessing the capital needed to develop agriculture-based enterprises. Indeed, my findings pointed to the conclusion that the youth and agriculture problem runs deeper than the “youth are not interested” narrative.

Fast forward to 2016 and the Global Youth Economic Opportunities Summit hosted by Making Cents International, where the youth and agriculture problem was highlighted and the simplified assumptions underpinning it – such as “youth just are not interested” – were challenged.

So why is the youth and agriculture problem a concern to international development practitioners?

For one, agriculture is the “backbone” of many sub-Saharan countries. For instance, agriculture accounts for about 70 percent of the total labor force and 30 percent of Gross Domestic Product in Kenya. Second, rural households in Kenya rely heavily on subsistence agriculture for food consumption. And third, the country’s labor market lacks the ability to meet the demand of young job seekers. The highest unemployment rates in Kenya are for 20-year-olds, at 35 percent, followed by 25-year-olds, at 25 percent.

At the Global Youth Economic Opportunities Summit’s plenary titled “Seeding the Future: Land Tenure, Technology, and Opportunities in the Rural Economy,” panelist Thomas Jayne, a professor in the Department of Agricultural, Food and Resource Economics at Michigan State University, emphasized that agriculture is not a “declining sector” in sub-Saharan Africa. Over the next 20 years in sub-Saharan Africa, he said 350 million youth will pursue employment, but even under the most favorable conditions only 25 percent will find wage-paying jobs in the formal economy. Agriculture offers a potential solution.

USAID’s Feed the Future Initiative cites the World Bank’s “Agriculture for Development” report, which makes the investment case for agriculture in developing countries. Perhaps the most compelling finding is that for people with the lowest incomes, “GDP growth originating in agriculture is about four times more effective in reducing poverty than GDP growth originating outside the sector.” Jayne presented the argument that multiplier effects offer the most significant benefit for investments in agriculture. Given the sheer size of the agricultural sector in sub-Saharan Africa in terms of number of producers, a slight increase in per capita income would have an overall positive economic impact.

“Since 2013, farmers’ sales of Feed the Future-supported crops increased 30 percent, on average. For poor farming families, this means more income to: buy more food, access healthcare, pay for school, save for & invest in the future. Economic empowerment is good for rural families, their communities and countries, and the world. It all adds up.” 

                                                                                                                                     Ending Hunger and Poverty: A Snapshot of Progress

 

Following Jayne’s talk, Odenda Lumumba, CEO of the Kenya Land Alliance, described a rural-to-urban migration trend he has observed in Kenya. Young people move to urban areas to attend school, he said, and once they are there, it is not uncommon for them to move to slums due to lack of opportunities. He implied that in many cases greater opportunity awaits youth in rural areas than in urban areas. The World Bank’s Agriculture for Development report points out that while agriculture is a driver of sub-Saharan African economies, only 4 percent of public spending is allocated to the sector. Lumumba called on governments, donors and the private sector to invest in agriculture where it can have a significant multiplier effect: “Today agriculture has the biggest opportunity to end hunger and eventually end poverty. But how do you do that? That is the challenge.”

Prior to the plenary, Beth Dunford, assistant to the administrator in USAID’s Bureau for Food Security, said that it is not that youth in sub-Saharan Africa are simply not interested in agriculture; it is that they are not interested in pursuing the agriculture of their parents. Dunford said, “Young people bring the kind of innovation, energy and enthusiasm that we need to tap into (for) transformative solutions to many of our biggest problems. Youth are interested in that, and that is what we need for agriculture.” Her message resonated with the research I did in 2013, in which youth frequently reflected on their experiences witnessing their parents’ hard manual labor. Dunford described Feed the Future’s approach to development, focused on creating enabling environments with youth – not for youth – to grow and expand their agricultural enterprises. A key takeaway message was that “there is money in the soil,” an expression Dunford heard while in Zambia.

The panel included two youth who both provided on-the-ground perspectives of how they had pursued agriculture in their home countries of Tanzania and the Philippines. First, 22-year-old Sirjeff Dennis of Jefran Agrifriend Solutions (JAS), based in Tanzania, shared his experience of growing up in a slum where finding a meal was difficult. When he saw a woman in his neighborhood lose her baby to malnutrition, it gave him the passion to end hunger through agriculture. Despite earning his degree in petroleum engineering, Dennis decided to become an agricultural entrepreneur, or “agripreneur.” Five years ago he started his company with $50 USD. He purchased 50 chickens and eventually expanded his enterprise to include maize, rice, tomatoes, Chinese cabbage, okra, eggplant and onion. On one hand, he explained, there is a common stereotype among Tanzanian youth that agriculture is something that should be done by poor people with a low level of education; on the other hand, people throughout his country really love it.

Dennis’ comments suggest that there is a cultural value to agriculture; however, there is a perception that those who pursue careers in the sector are minimally educated and are destined to be poor due to the difficulty in generating sustained incomes. To assist in debunking this attitude, Dennis created a youth and agriculture initiative within JAS, recruiting and training young people to start their own agricultural enterprises. He had hoped for 30 applicants but received 300, demonstrating the interest of youth in agriculture.

Today, Dennis’ business employs 37 people, with 80 percent of them 23 or younger – and 20 percent are women. Despite the success, he points to key challenges that threaten the sustainability of his enterprise. For one, access to finance is a significant problem for Dennis. For example, despite the exposure he gained through winning a MasterCard Foundation award, the local bank was still not willing to provide him with a loan. The reason? Because he is 22 and doing agriculture. Another challenge, he said, is access to equipment. He had to import equipment through Alibaba, an online marketplace, to scale his business, which was very expensive. Dennis recommended that the government in his country lower taxes for young farmers, provide assistance to youth to form farming cooperatives, and provide financial assistance. He stated that development practitioners must create awareness among banks and governments about the unique challenges agri-preneurs face, so that investments in agriculture make sense.

Another young agri-preneur, Cherrie Atilano, shared her perspective as it relates to a social enterprise she founded called AGREA, based on the island of Marinduque in the Philippines. AGREA leads a youth movement in support of agriculture, offers a variety of trainings and events, promotes sustainable agricultural technologies, and bridges the gap between farmers and consumers. AGREA is known for its tagline, “Making farming cool, smart, sexy, and humane.” Atilano starting farming when she was 12 years old and 18 years later, she is still involved. She said a lot of young people in the Philippines, especially professionals, are going back into the sector. There are thriving high-value markets for organic and artisan foods in Southeast Asia, she said, and the Filipino government has begun to recognize the value of agriculture. For example, a new law mandates all public and private schools visit a farm once per year as a field trip. Finance, Cherrie noted, remains the most significant barrier to young farmers working to start their own agricultural enterprises in her country.

Speakers at the summit made a strong argument for the potential of agriculture and why the development community should continue to challenge the assumptions behind the notion that youth are not interested in it. However, the transformation of structures (including government and the private sector) and processes (such as laws, policies, culture and institutions), which in turn influence ability to respond to shocks, trends and seasonality, must be addressed within the local context. These macro factors have an ultimate influence on the ability of youth to access key capital to develop, sustain and scale their agri-enterprises.

Photo by Neil Palmer (CIAT) via Flickr

From a spinning scarecrow that sends animal intruders scurrying off the crops to an eco-friendly shelter that helps grow spores into mushrooms, there is no shortage of innovation in Tanzania’s agricultural sector. But what has traditionally been lacking is the business knowledge to nurture these creative products and help them blossom into sustainable businesses.

This is where the Innovations in Gender Equality to Promote Household Food Security (IGE) program comes in. A joint venture between USAID and Land O’Lakes International Development launched in 2012, IGE’s mission is to identify, test and then scale innovations that enable female farmers to more efficiently produce agricultural products and bring them to market. Over half of the agricultural workers in Tanzania are women. Not only do women carry out some of the most labor-intensive work, but they also have insufficient access to financial credit and face discrimination in land ownership. The IGE project seeks to address these hurdles and help women spend less time in the field and more time in higher-value added activities.

Thousands of miles from Dar es Salaam, at IGE project headquarters, Diana Callaghan, an MBA student at the University of Michigan’s Ross School of Business, was in the market for a summer internship. Deeply interested in the potential business has for making change in the world, Callaghan did not want a traditional MBA internship experience – she was seeking an innovative alternative. When she heard about the IGE project in early 2015, she thought it would be an ideal opportunity to apply her studies in entrepreneurship and social impact as well as her previous work experience in consulting. WDI was sponsoring the internship. Callaghan’s work focused on equipping both male and female entrepreneurs in agriculture with the business skills needed to professionalize and scale their businesses. IGE has an effective process for finding the entrepreneurs with the highest potential to participate in the program. They organize business expos during which the entrepreneurs showcase their products. Selected entrepreneurs then advance to the next phase and pitch their ideas before a panel of judges that includes seasoned entrepreneurs and investors. The top performers in each pitch competition are then eligible for an IGE grant and training program.

Callaghan got to know the participants and their business challenges. She traveled to their places of business with IGE staff to familiarize herself with their operations and challenges firsthand. She was impressed by the great ideas and innovations, but quickly realized the need for cultural understanding in designing a locally viable business model. She met Judith Muro, a member of the Dar es Salaam Mushroom Growers Association (DMGA), who designed innovative mushroom-growing technologies utilizing years of academic and professional experience she accrued traveling the globe and learning about mushroom cultivation. As part of her business, Muro created and built her own structures for growing mushrooms from spores. The eco-friendly shelters struck Callaghan as a real innovation, but rather than selling them, Muro taught others how to construct the structures. The mushroom seller told Callaghan that there was no point in trying to sell them, as others would just steal the design of her product. Intellectual property is not easily secured in Tanzania.

Through her visits with other entrepreneurs, Callaghan was able to identify gaps in their business knowledge. For example, some of the entrepreneurs had no accounting systems and little understanding about their cost structures. As a result, they had set their prices much too low to run a sustainable business. Callaghan also noticed that while many of the entrepreneurs had innovative technologies, their revenue models prevented them from scaling successfully. For example, certain entrepreneurs were marketing high-cost innovations to customers who could not afford them. Callaghan suggested alternative revenue approaches such as subscription-based, rental and community shared models that could allow customers easier access.

To further assess the skills the entrepreneurs were lacking, Callaghan created a needs assessment. Entrepreneurs answered such questions as: What need does your innovation address? What is your profit per unit? What problems are you facing in your business? It also asked the entrepreneurs to rate their knowledge across the various business functions.

How did Callaghan know how to create this comprehensive assessment? At the Ross School of Business, she also is the director of investments for the Social Venture Fund, the first student-led impact investing fund. An aspiring entrepreneur herself, Callaghan had also been through the Zell Lurie Institute’s (ZLI) Dare to Dream entrepreneurship competition and has been actively involved with the institute. ZLI is part of the Ross School and focuses on entrepreneurship, offering business plan competitions for students. She borrowed questions from the program’s educational materials and expanded on them based on her field research.

Now familiar with the business culture and needs of the entrepreneurs, Callaghan turned to designing the entrepreneurship training workshop. The project included a program designed by a WDI intern from the previous year. Callaghan used that as a starting point, applied what she learned from her travels and the needs assessment, and took input from the IGE staff to redesign it. The staff gave her many insights, including a suggestion to include more visual components so that the training could be understood by illiterate students and those with limited knowledge of English. Callaghan added graphics as well as a set of engaging videos on business model development from YouTube. Callaghan combed through the training material she had received as a participant in the Dare to Dream competition and added some of that content to her curriculum. It included introduction to the business model canvas, a strategic tool that enables the description and design of a business model. She also provided training to local staff on how to deliver the workshops.

Callaghan is currently back in Ann Arbor as a second-year MBA, student but the training workshops she designed are still being delivered. (Read Callaghan’s blog about her work in Tanzania here.)

“Spending a summer traveling across Tanzania and working with entrepreneurs on the development of impactful technologies was a once-in-a-lifetime experience. I am grateful to have had the opportunity to share insight from my professional experience and my academic experiences at Ross with many of these great entrepreneurs. I hope that the business trainings and workshops will continue to support entrepreneurs as they develop sustainable, impactful innovations that improve the lives of women,” she told me.

“I loved working with a wide variety of change agents in such a creative role,” she added.

FIVE TIPS FOR ENTREPRENEURSHIP TRAINING DEVELOPMENT FROM DIANA CALLAGHAN:

  • Conduct a thorough needs assessment. While training companies and instructors often believe they know what the programs should look like, they should listen to real needs on the ground and then design programs accordingly.
  • Understand the entrepreneurs themselves before starting the design. For example, if you have a group that includes those who are illiterate, more hands-on instruction will be necessary.
  • Understand cultural differences. Partner with local organizations that know the surrounding community and can connect the entrepreneur with the appropriate local resources such as funding sources and accounting services.
  • Teach business fundamentals in a way that is easily accessible to entrepreneurs. Easy-to-follow visuals can help with this, as can short videos.
  • Start with sufficient funding to conduct a program for at least three years. It takes a long time to both kick off a new training project and to wrap it up. Given that, try to ensure you have the resources you need to achieve your project goals.

This post originally appeared on NextBillion.net, a WDI affiliate. It was written by Amy Gillett, vice president of WDI’s Education initiative.

The Gender Equality to Promote Household Food Security (IGE) program aims to help women agricultural workers in Tanzania spend less time in the field and more time in higher-value added activities. WDI Intern Diana Callaghan spent her summer here, and Amy Gillett reports her findings on entrepreneurship training development.

Case study on the impact of SunnyMoney on alleviating poverty on children age eight years and younger. SunnyMoney sells a wide range of solar products to BoP communities with limited access to electricity in Tanzania, Malawi, Kenya, and Zambia and markets the lamps through schools and existing entrepreneur networks.

Assessment of the role BoP ventures can play in alleviating poverty on children age eight years and younger. This article aggregates impact findings across the six ventures including businesses that sell a product to the BoP, businesses that sell a service to the BoP, and businesses that source from the BoP. The ventures analyzed, work across a range of sectors including housing, renewable energy, sanitation, health care, as well as export-based and locally-based agribusinesses. It compares and contrasts the types of impact experienced by children across different stakeholders, both within the venture and across the six ventures.

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