News / Africa

Businesses Look for Profit in US Development Aid

Obama encourages private companies to help spur economic growth

A partnership including the U.S. government, TechnoServe, and Cargill helped transform the poultry industry in Mozambique.
A partnership including the U.S. government, TechnoServe, and Cargill helped transform the poultry industry in Mozambique.

Multimedia

Audio

Private businesses are being encouraged to assume a greater role in development efforts as part of the Obama administration's agricultural development initiative.

Food prices are at record highs, and experts are sounding alarms about the potential for civil unrest. The Obama administration has made improving developing world food security an important foreign policy goal.

But rather than relying solely on governments and civil society groups as in the past, the administration is highlighting the role the profit motive can play in economic development.

Mozambique's poultry boom

At a recent congressional briefing, the growth of Mozambique's poultry industry was cited as one example.

Until recently, domestic poultry farmers were unable to compete with imports.

Mozambican poultry farmer Derek Xavier says part of the reason was the way farmers raised their birds.

"We just used to have them at home," he says. "We had no medication, no vaccination. And obviously, with no good treatment, the chickens are always thin, and no good meat."

It did not help that foreign producers were using Mozambique as a market of last resort to dump nearly spoiled chicken.

Industry overhaul

That all started to change in 2005. An industry transformation began with help from the U.S. government, the business-focused development group TechnoServe, and the U.S. agribusiness giant, Cargill.  

Mozambican farmers were organized. Vaccination, education, and disease monitoring programs were developed. Trade regulations were changed to prevent import dumping.

The overhaus brought about dramatic changes, according to Florencia Cipriano, chief veterinarian for the Mozambique government. She told the briefing that in 2005, domestic producers raised only a third of the broiler chickens sold.

"Today," she said, "Mozambique broilers outnumber imports three to one."

Feeding all those chickens has also spurred a roughly four-fold growth in the domestic feed grain industry, she says. Cipriano credits the chicken boom with creating about 90,000 jobs, and helping tens of thousands of small farmers improve their incomes.

Business meets development aid

"We want to work more with the private sector than we have in the past," said Gregory Gottlieb, head of the food security bureau at the U.S. Agency for International Development. "This time around, I think we want to look more at economic growth. Real economic growth."

Gottlieb told the briefing that real economic growth comes from focusing on the profit motive for everyone from farmers and their suppliers to retailers who sell their products, and the partnership with Cargill and TechnoServe is a good example.

Profit is the reason Cargill gets involved in development, says the company's director of international business relations, Devry Boughner.

"That's not a bad thing in our mind," she says. "Because as we make profits in these countries and invest overseas, we're able to re-invest and re-partner and re-up our commitment to global food security."

Aid budget cuts loom

But the Obama administration's commitment to global food security faces a challenge as lawmakers consider the next federal budget. The administration dramatically increased funding for agricultural development with a three-point-five billion dollar initiative known as "Feed the Future."

But with U.S. unemployment at 9 percent and a $14 trillion national debt, Republicans took over the House of Representatives this fall pledging to cut federal spending.

"Moral arguments aside, we must stop sending hundreds of billions of dollars to foreign governments when our own economy is in shambles," says Texas Congressman Ron Paul.

Paul is widely considered to be outside the political mainstream on most issues.  But a recent Gallup poll found nearly 60 percent of Americans favor cutting foreign aid.

Business case for aid

At the congressional briefing, Cargill's Devry Boughner  made the business case that aid is in the company's and the country's long-term interest. Look at South Korea, she said. It took time, but development aid turned that country into an economic powerhouse and a market for U.S. goods.

"We're now looking to take this relationship to stronger commercial ties, which will translate to stronger economic growth here in the United States," she added.

A big free trade agreement with South Korea is currently before the Senate that backers say will create jobs in the U.S. In the long run, Boughner says, when private businesses can help transform industries, as Cargill helped to do in Mozambique, aid can become trade and provide a valuable return on investments.

You May Like

US Imposes Sanctions on Alleged Honduran Drug Gang

Treasury department alleges Los Valles group is responsible for smuggling tens of thousands of kilograms of cocaine into US each month More

At 91, Marvel Creator Stan Lee Continues to Expand his Universe

Company's chief emeritus hopes to interest new generation of children in superheroes of all shapes and sizes by publishing content across multiple media platforms More

Photogallery New Drug Protects Against Virus in Ebola Family

Study by researchers at University of Texas Medical Branch, Tekmira Pharmaceuticals is first looking at drug's effectiveness after onset of symptoms More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
African Media Tries to Educate Public About Ebolai
X
George Putic
August 20, 2014 8:57 PM
While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.
Video

Video African Media Tries to Educate Public About Ebola

While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.
Video

Video Ferguson Calls For Justice as Anger, Violence Grips Community

Violence, anger and frustration continue to grip the small St. Louis suburb of Ferguson, Missouri. Protests broke out after a white police officer fatally shot an unarmed black teenager on August 9. The case has sparked outrage around the nation and prompted the White House to send U.S. Attorney Eric Holder to the small community of just over 20,000 people. VOA’s Mary Alice Salinas has more from Ferguson.
Video

Video Beheading Of US Journalist Breeds Outrage

U.S. and British authorities have launched an investigation into an Islamic State video showing the beheading of kidnapped American journalist James Foley by a militant with a British accent. The extremist group, which posted the video on the Internet Tuesday, said the murder was revenge for U.S. airstrikes on militant positions in Iraq - and has threatened to execute another American journalist it is holding. Henry Ridgwell has more from London.
Video

Video Family Robots - The Next Big Thing?

Robots that can help us with daily chores like cooking and cleaning are a long way off, but automatons that serve as family companions may be much closer. Researchers in the United States, France, Japan and other countries are racing to build robots that can entertain and perform some simpler tasks for us. VOA’s George Putic reports.
Video

Video In Ukraine, Fear and Distrust Remain Where Fighting has Stopped

As the Ukrainian military reclaims control of eastern cities from pro-Russian separatists, residents are getting a chance to rebuild their lives. VOA's Gabe Joselow reports from the town of Kramatorsk in Donetsk province, where a sense of fear is still in the air, and distrust of the government in Kyiv still runs deep.
Video

Video Five Patients Given Experimental Ebola Drug Said to Be Improving

The World Health Organization has approved the use of experimental treatments for Ebola patients in West Africa. The Ebola outbreak there is unprecedented, the disease deadly. The number of people who have died from Ebola has surpassed 1,200. VOA's Carol Pearson reports on the ethical considerations of allowing experimental drugs to be used.
Video

Video China Targets Overseas Assets of Corrupt Officials

As China presses forward with its anti-graft effort, authorities are targeting corrupt officials who have sent family members and assets overseas. The efforts have stirred up a debate at home on exactly how many officials take that route and how likely it is they will be caught. Rebecca Valli has this report.
Video

Video Leading The Fight Against Islamic State, Kurds Question Iraqi Future

Western countries including the United States have begun arming the Kurdish Peshmerga forces in northern Iraq to aid their battle against extremist Sunni militants from the Islamic State. But there are concerns that a heavily-armed Kurdistan Regional Government, or KRG, might seek to declare independence and cause the break-up of the Iraqi state. As Henry Ridgwell reports from London, the KRG says it will only seek greater autonomy from Baghdad.
Video

Video In Rural Kenya, Pressure Builds Against Female Circumcision

In some Kenyan communities, female genital mutilation remains a rite of passage. But activists are pushing back, with education for girls and with threats of punishment those who perform the circumcision. Mohammed Yusuf looks at the practice in the rural eastern community of Tharaka-Nithi.

AppleAndroid