Trickle Out, Africa

Posted by editor 18/09/2012 0 Comment 1845 views

trickleoutafrica

Can small businesses help avoid Africa’s poverty traps? A project by a University in Belfast aims to find out in the most adventurous way. Development through enterprise in Southern and Eastern Africa – the Trickle Out Africa project.

Many suggest that for Africa to develop sustainably ‘Trade not Aid’ is the way forward. Yet whilst development through enterprise is an attractive proposition there are still huge gaps in our knowledge and understanding of the vibrant business models that might be emerging in Africa. A recent project funded by the UK’s Economic and Social Research Council from Queen’s University Management School aims to shed light on what is happening by showcasing and exploring the kinds of social and environmental enterprises emerging across Southern and Eastern Africa.

The project is called Trickle Out Africa, recognising the need to look at and promote the trickle out benefits that might emerge from such businesses. The project is run Diane Holt and David Littlewood from Queen’s University Belfast. Both are very familiar with parts of Africa. Diane hitchhiked across Zambia, Zimbabwe and Malawi in the early 90s, before working for Middlesex University where she was involved in activities in Kenya, Uganda, Mauritius and the Seychelles. David recently completed his PhD work on corporate social responsibility in the Namibian mining industry, including a year in the field. Both are just back from the first stage of the fieldwork in Kenya, South Africa and Zambia. They recently launched the project in Nairobi where Alison Coutts, Director of the British Council Kenya, officiated as the honour guest and stated that:

“Putting together a directory of all the social and environmental enterprises, or at least as many as they can find, will be an enormously valuable exercise and should build up innovation and enterprise, not just within Kenya and other countries but across them too”

Trickle Out Africa has developed a free, searchable database of social and environmental enterprises across the 19 countries of Southern and Eastern Africa, as well as the support agencies and bodies that help such organisations. Currently there are over 2000 organisations detailed, with a further 1000 due to be added in the next few months. For each organisation listed there are contact details and where possible a brief of the nature of the organisation.

In her launch speech Diane stated that

“We hope that in some small way our project will help showcase the innovative, home- grown, truly transformative business models that form the bedrock of modern Kenya and other countries in Eastern and Southern Africa. We hope that Trickle Out helps us understand more about the potential benefits of these businesses and the relationships they form. In addition we also hope that it offers a way for customers, potential partners, potential donors and civil society to find, and learn more, about these organisations”.

Whist the first step is to identify such enterprises and help make them visible to the outside world through this integrated Directory, the next step is trying to figure out the kinds of impacts they might have. Diane and David are visiting a number of case studies across Zambia, South Africa, Kenya and Mozambique over the next four months. Here they hope to map the potential benefits that are emerging from these enterprises in terms of poverty alleviation and sustainable development. They will be profiling social enterprises like the Mumwa Craft Association of Western Zambia which has 3500 members making crafts that the Association is trying to sell across Zambia and worldwide. Or Proudly Macassar Pottery, a social enterprise based in the town of Macassar in the Western Cape. which uses the production of clay drums and flutes as a means to connect with youths from the surrounding community. It works with young people providing pottery skills training, and business opportunities, advice and support. It also provides wider educational and personal development guidance and mentoring, with the aim of empowering young people in the community and helping them to build more sustainable lifestyles. Macassar is a small town close to Cape Town with an approximate population of 40,000 where unemployment, substance abuse and gang related violence and criminality are significant problems for the community, particularly amongst young people.

Trickle Out is also exploring for-profit businesses and hybrid organisations who are addressing environmental and social needs, such as Cookswell who make energy efficient stoves in Kenya and solar firms such as Tough Stuff Solar who work with organisations like Christian Aid to empower individual entrepreneurs who sell solar products to rural communities. The kinds of ‘needs’ being addressed by many African social enterprises, and hybrid organisations with a strong social dimension, are most often about providing access to the fundamental needs of food, shelter, education, and medical care. These kinds of needs are also addressed by social enterprises in developed countries, but the key difference in Africa is that there are no other safety nets available from the State. Leaving people reliant on outside agencies like Aid Agencies and Churches.

In parts of Africa entrepreneurship generally, especially amongst smaller enterprises, is much more closely linked to the informal economy than many might think. In addition many entrepreneurs, and equally those in the social/environmental space, are often very risk adverse. It is important to consider that most entrepreneurs in the developing world, especially in the informal economy, have little if any financial safety net. If their enterprise fails it threatens their livelihood and that of the extended family linked to them. There are few State benefits for most, and they risk homelessness and starvation if their business fails or is lost. They have no insurance, typically no rights to where they are located, and no social security to support them if they lose everything. Adopting a ‘short-termism’ focus on preserving the income stream they have, and continuing to do what is familiar, is much more likely than risking everything by adopting a growth perspective.

The fragility of even successful businesses is illustrated by the story of another Kenyan called Barack, a tailor now based in Western Kenya. Originally from a town in the Rift Valley, he spent 20 years there working for an Indian businessman who ran a blanket factory. Working as a cutter for the machinist he learnt to sew, eventually rising to assistant supervisor. When the owner retired he set up his own business, helped by the ‘gift’ of a sewing machine from the founder (for which he paid a discounted amount). His five year old business was doing well, growing to four sewing machines and an overlock machine, when the post election violence broke out in early 2008. His shop, all his stock, the material customers had left with him and his machines were all lost in the fire that gutted his shop. He fled to Western Kenya where he now lives, trying to earn a living to support his 10 dependents. His wife is still based in his original home town and she supports herself by doing laundry. He rents a sewing machine, and now each day he strings his canvas shade from a tree where he has set up a makeshift stall along one of the main routes into town, trying to start his business again.

The Trickle Out team believes that it is crucial that we do not just import business models and preconceptions from a western, developed world context into Africa. Work so far has shown that the social enterprises emerging in Africa are perhaps very different to what we call a social enterprise in the UK, in particular the differences in the nature and role of funding, the generation of income through trading, and the relationship of the enterprise with, and within, the informal economy. How many of those organisations who designate themselves as social enterprises in Africa would be eligible for a social enterprise mark? Many of the social enterprises Trickle Out is finding are at a much more informal stage but they are potentially impacting thousands. So visit the Directory and see what the team has found from Angola to Zimbabwe. If you are looking for organisations with a social or environmental mission to support, purchase from, donate to, or to reach out to generally then visit the Directory and see some of the exciting social and environmental enterprises across these 19 countries. You can also find more information on the case studies and emerging findings from the study which will last for 26 months. But that’s not the end of the story – the Directory will remain as a free resource where any relevant organisation can register themselves. Over time the team hope to build this into a platform for disseminating entrepreneurial support and dialogue between enterprises.

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