The Wild West of Aid
Good Paper attended a Conference on “Social Enterprise: Developing the social economy and generating sustainable and creative solutions to poverty and social exclusion” which was held in Phnom Penh, Cambodia, on 19 and 20 August 2011. This inaugural conference was organised by Royal University of Phnom Penh, University of Bradford and Friends International and supported by the British Council under their DelPHE project.
The speakers and the conference attendees represented a wide range of Cambodian based nongovernmental organisations (NGOs), social enterprises and capacity building organisations.
A key focus of the conference was about creating self-sustaining enterprises to support NGOs. Much attention was paid to the fundamentals of businesses, measuring impact and remaining financially viable. Many speakers showcased their business solutions that catered to the needy; soy milk with essential vitamins to help alleviate blindness and infant mortality, cheap ceramic water filters that filtered out contaminated water to prevent tuberculosis (TB) and dysentery and franchise businesses that sold toilets or technical farming knowledge.
There are many social businesses that provide capacity building services to NGOs in areas such as website development, micro financing and operations management. While some organisations are still being funded by international donors, they aim to be self-sustaining by charging NGOs for their services. On one hand, this will encourage organisations to be self-sustaining. On the other hand, is charging NGOs who are serving beneficiaries competing with the poor for existing donated resources?
With more than 30% of the population under the poverty line and average annual salary less than USD$2,000, many businesses that employ locals or provide services to locals, who on the whole are poor. Is this what the term “Bottom of the Pyramid” (BOP) refers to? In affluent societies, such businesses would be called social enterprises. Does operating in a national environment where most people are poor allow a business to call itself a social enterprise?
Annually nearly a billion US dollars of investment money from the West comes to Cambodia, usually through aid organisations. Such NGOs often shine a spotlight at citizen’s rights issues, so they have often reported troubled relationships with the Government. A NGO registration law is coming into effect later this year will clean up the image of NGOs in Cambodia or it could be seen as a move to close vocal organisations down. By contrast, there a lot of money from China being invested in Cambodia through government contracts. Is it better to work with the government in the hope that sufficient money will elevate the living standards of the general population?
For Cambodia, will NGOs be a permanent part of the national landscape for many years into the future?
Below are two organisations with sustainable and creative solutions to poverty and social exclusion in Cambodia:
Since 1997, CEDAC has worked with Cambodia’s farmers and rural youths to create greater prosperity. With more than 60% of Cambodia’s population involved in rice farming, CEDAC’s centrepiece initiative is to introduce the System of Rice Intensification (SRI) across the country. This is done by training of farmers and by supporting farmer-to-farmer learning on SRI methods, and by developing physical and marketing facilities to support rice farming.
Profits from sales of CEDAC rice are used to support the training of farmers in organic SRI. CEDAC is supported by the German Development Cooperation (GIZ) to build up the organic rice value-chain from production to organic certification, then from processing and finally to national and international customers.
To empower farmers and mobilise capital for the rural areas, CEDAC and GIZ support the formation of associations of farmers. Alongside organic rice farmers, there are also associations of pig producers, chicken producers, and vegetable producers getting organised. Based on such associations, communities can form savings banks that individuals can use to take out loans. The associations also build community cohesion among the people whose lives have been impacted by rule of Khmer Rouge from 1975-1978.
Information Technology (IT) is a developing business in Cambodia and several companies are giving opportunities to the rural poor in this area. Perfexcom is one such organisation has business units that offer services in mobile, publishing, sales, temporary staff and data digitisation.
High performance staff will be given a scholarship and other staff can enjoy a study loan for University, regularly paid back by salary deductions. After graduation, Perfexcom links up with other partners such as Microsoft and Cisco so that graduates can obtain professional certification in Accounting and IT. Eventually the eminently qualified and experienced graduates will be able to get high paying jobs at other companies.