3 minute read

Paths to the Pyramid
BoP Spending
(on Flickr by Merkur*)
Last Wednesday, Al Hammond of NextBillion.net fame (who now hangs his hat at Ashoka), presented to the Washington, DC ICT4D Practitioners on two of his initiatives working with the private sector to achieve sustainable positive change. He discussed two great projects -- a low cost rural connectivity pilot in Vietnam getting moving in its first deployments, and the other on base of the pyramid-focused healthcare -- mostly at a conceptual phase but building off existing proven models.

It was a fascinating discussion. I'm a strong supporter of sustainability (otherwise, why bother?) and Al Hammond gives a passionate and convincing argument for the central role of business in creating sustainable solutions. Talking with him beforehand, he mentioned (paraphrasing heavily) comparing the measurable benefits of the past five decades of foreign aid versus the last decade of private sector mobile phone rollouts -- the long-term benefits greatly favor the mobile phones.

I can only imagine that once mBanking really gets rolling, all doubt will be erased that the cell phone has helped the Next Four Billion more than 2.3 trillion dollars in aid. My mind quickly out-paces itself when I begin to ponder mBanking benefits for everyone from rural artisania workers able to take and receive payments for commissioned artwork to p2p payment systems to direct-to-market agricultural benefits...

Now, I have a few outstanding doubts about some parts of these two plans - some scalability and malicious-user problems with the Vietnam model, and some privacy and franchise-enforcement questions with the healthcare idea. Now, I have fewer doubts on both of these concepts, combined, than, say, the OLPC Project (though I strongly believe that a base-of-the-pyramid approach to the OLPC could work well). The huge difference between a BoP, market-driven approach and traditional development is that investors bear the brunt of failed projects, a pleasant change from the recipient country being in deeper debt regardless of the outcomes of debt-financed aid projects. I think traditional development will forever have a role in humanitarian and post-conflict aid, but in infrastructure and service creation, the BoP, private-sector approach will prove long-term much stronger than pure-play foreign aid programs, for the simple reason that it applies reasonable risk management to development projects. What a concept!

Without further ado, my full meeting notes after the jump...