There’s a great chapter in ‘The Undercover Economist‘ by Tim Harford titled ‘Why Poor Countries Are Poor’. He talks about his visit to Douala, Cameroon, ‘the Armpit of Africa’ at the end of 2001, which in 1999 was listed by Transparency International as one of the most corrupt countries in the world. He also talks about why development projects implemented by aid agencies can often fail, using Elinor Ostrom’s study of irrigation in Nepal as an example.
He explains why relying on business to pull countries like this out of poverty is of little use when corruption penetrates to the government level:
“There’s no point investing in a business because the government will not protect you against thieves. (So, you might as well become a thief.) There’s no point in paying your phone bill because nobody can successfully take you to court (so there’s no point being a phone company). There’s no point getting an education because jobs are handed out on merit (and in any case, you can’t borrow money for school fees because the bank cannot collect on the loan, and the government doesn’t provide good schools). There’s no point setting up an import business because customs officers will be the ones to benefit (and so there is little trade, and so the customs office is under-funded and looks even harder for bribes).”
Where businesses can function though, dealing with them as a business and providing them with a way that they can afford to invest in their own success and tap a new market seems like a far more effective approach for generating social change than simply instigating isolated donor funded projects. This doesn’t mean giving them handouts, but an opportunity to enter the marketplace and purchase services. It means that cash-rich countries are tasked with innovating new ways to do business with cash-poor countries. An interesting article was written in the Guardian last week titled ‘Brain Food: Forget the Harvard MBA – learn from Africa‘. In it Indian entrepreneur C.K. Prahalad is quoted as saying:
“If we stop thinking of the poor as victims and start recognising them as creative entrepreneurs and value-conscious consumers, a whole new world of opportunity will open up.”
I think this is an interesting approach, and is in fact one that WHL Consulting has recently taken with its latest tourism development initiative named Project:Exposure. Designed for small and medium sized tourism enterprises, the project takes room nights in exchange for services.
Small tourism business can afford to invest in their success
Overcoming obstacles / Photo by Stephen Chapman
Every participant gets a complete audit of their existing tourism products, professionally written content, photographs, marketing material, a completely spherical 360° immersive tour of the area and a website that has full online booking functionality. Participants are also given the opportunity to view first hand the benefits and effects of these services through seminars conducted by WHL Consulting on the dynamics and significance of the Internet and e-commerce.
The idea is to work with a local sponsor so that Project:Exposure can deliver essential e-commerce tools and training to the small and medium sized tourism enterprises with little knowledge, experience or presence in this area. The services are all offered to businesses at a significantly subsidized rate by working with a local sponsor or donor agency. Participants are not asked to pay cash for the services, but instead a newly developed Tourism Development Bank has been created to take their payment in room nights, which will be sold through the WHL Group network.
The WHL Group made its first transition from development work into the social enterprise field way back in 2006 when whl.travel was transformed from a World Bank project to a private company by a visionary CEO, Len Cordiner; and more recently it has continued along that path with its ongoing tourism development work conducted by WHL Consulting, led by CEO Zachary Rozga.
Supporting the World Heritage Site of Tequila, Mexico
Project:Exposure has already been rolled out in 4 destinations in South Africa with the support of the South African Business Trust, and is now being made available to small businesses in the World Heritage Site of Tequila, Mexico through the support of the Multilateral Investment Fund (MIF), a fund administered by the Inter-American Development Bank.
The recent rise of social enterprise is all about stimulating fresh thinking, new ideas and solutions to the world’s problems from anyone dynamic, creative and highly motivated enough to make something happen. There have been some incredible success stories and Project:Exposure looks set to be another one.
Our Contributing Editor Michelle Rodrigues will be in Tequila, Mexico to help with the roll out of this project. We look forward to receiving some updates from the field as things progress.
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