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.



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, China Have Dueling Definitions of Cybersecurity

Analysts say attribution or or proving that a particular individual or government is responsible for a hack, is a daunting task More

Snowden: I'd Go to Prison to Return to US

Former NSA contractor says he has not received a formal plea-deal offer from US officials, who consider him to be a traitor More

Goodbye Pocahontas: Photos Reveal Today's Real Native Americans

Weary of stereotypes, photographer Matika Wilbur is determined to reshape the public's perception of her people More

This forum has been closed.
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.
Russia’s Syria Involvement Raising Concerns in Europei
Luis Ramirez
October 02, 2015 4:45 PM
European nations are joining the United States in demanding that Russia stop targeting opposition groups other than the Islamic State militants as Russian warplanes continue to conduct raids in Syria. The demand came in a statement from Britain, France, Germany, Qatar, Saudi Arabia, Turkey and the United States Friday. VOA Europe correspondent Luis Ramirez reports.

Video Russia’s Syria Involvement Raising Concerns in Europe

European nations are joining the United States in demanding that Russia stop targeting opposition groups other than the Islamic State militants as Russian warplanes continue to conduct raids in Syria. The demand came in a statement from Britain, France, Germany, Qatar, Saudi Arabia, Turkey and the United States Friday. VOA Europe correspondent Luis Ramirez reports.

Video First Self-Driving Truck Debuts on European Highways

The first automated semi-trailer truck started its maiden voyage Friday, Oct. 2, on a European highway. The Daimler truck called 'Actros' is the first potentially mass-produced truck whose driver will be required only to monitor the situation, similar to the role of an airline captain while the plane is in autopilot mode. VOA’s George Putic reports.

Video Nano-tech Filter Cleans Dirty Water

Access to clean water is a problem for hundreds of millions of people around the world. Now, a scientist and chemical engineer in Tanzania (in East Africa) is working to change that by creating an innovative water filter that makes dirty water safe. VOA’s Deborah Block has the story.

Video Demand Rising for Organic Produce in Cambodia

In Cambodia, where rice has long been the main cash crop, farmers are being encouraged to turn to vegetables to satisfy the growing demand for locally produced organic farm products. Daniel de Carteret has more from Phnom Penh.

Video Migrant Influx Costs Europe, But Economy Could Benefit

The influx of hundreds of thousands of refugees and migrants is testing Europe’s ability to respond – especially in the poorer Balkan states. But some analysts argue that Europe will benefit by welcoming the huge numbers of young people – many of them well educated and willing to work. Henry Ridgwell reports from London.

Video Botanists Grow Furniture, with Pruning Shears

For something a bit out of the ordinary to furnish your home, why not consider wooden chairs, crafted by nature, with a little help from some British botanists with an eye for design. VOA’s Jessica Berman reports.

Video New Fabric Helps Fight Dust-Related Allergies

Many people around the world suffer from dust-related allergies, caused mainly by tiny mites that live in bed linen. Polish scientists report they have successfully tested a fabric that is impenetrable to the microscopic creatures. VOA’s George Putic has more.

Video Burkina Faso's Economy Deeply Affected by Political Turmoil

Political turmoil in Burkina Faso over the past year has taken a toll on the economy. The transitional government is reporting nearly $70 million in losses in the ten days that followed a short-lived coup by members of the presidential guard earlier this month. The crisis shut businesses and workers went on strike. With elections on the horizon, Emilie Iob reports on what a return to political stability can do for the country's economic recovery.

Video Fleeing Violence, Some Syrians Find Refuge in Irbil

As Syrians continue to flee their country’s unrest to seek new lives in safer places, VOA Persian Service reporter Shepol Abbassi visited Irbil, where a number Syrians have taken refuge. During the religious holidy of Eid al-Adha, the city largely shut down, as temperatures soared. Amy Katz narrates his report.

Video Nigeria’s Wecyclers Work for Reusable Future in Lagos

The streets and lagoons of Africa's largest city - Lagos, Nigeria - are often clogged with trash, almost none of which gets recycled. One company is trying to change that. Chris Stein reports for VOA from Lagos.

Video Sketch Artist Helps Catch Criminals, Gives a Face to Deceased

Police often face the problem of trying to find a crime suspect based on general descriptions that could fit hundreds of people in the vicinity of the crime. In these cases, an artist can use information from witnesses to sketch a likeness that police can show the public via newspapers and television. But, as VOA’s Greg Flakus reports from Houston, such sketches can also help bring back faces of the dead.

Video Thailand Set to Build China-like Internet Firewall

Thai authorities are planning to tighten control over the Internet, creating a single international access point so they can better monitor content. VOA Correspondent Steve Herman reports from Bangkok on what is being called Thailand’s own "Great Firewall."

Video Croatian Town’s War History Evokes Empathy for Migrants

As thousands of Afghanistan, Iraqi and Syrian migrants pass through Croatia, locals are reminded of their own experiences with war and refugees in the 1990s. VOA's Daniel Schearf reports from the town of Vukovar, where wartime scars still are visible today.

Video Long Drought Affecting California’s Sequoias

California is suffering under a historic four-year drought and scientists say even the state's famed sequoia trees are feeling the pain. The National Park Service has started detailed research to see how it can help the oldest living things on earth survive. VOA’s George Putic reports.

VOA Blogs