Author Archives for Grant Montgomery

China transforming Africa

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Zambian economist Dambisa Moyo, and author of “Dead Aid: Why Aid is Not Working and How There is a Better Way for Africa”,  is an outspoken critic of international aid, arguing for years that foreign handouts stifle Africa’s development, perpetuate corruption and hinder the continent’s growth.

In a new interview with CNN, Moyo explains why she’s optimistic about the future of Africa. She looks at the positive impact that China can have on the continent and details the key drivers that will spur Africa’s economic growth. Some briefs:

CNN: The Chinese story has been thrown into the mix, has that changed the landscape?

DM: Yes, absolutely, but in a strange way it’s exactly what we need in terms of delivering economic growth and meaningfully reducing poverty. We need jobs, we need investment, we need trade, we need foreign direct investment, whether investment domestically but also from the outside. It’s not some magic pill, everybody knows that this is the formula, and finally the Chinese are showing up, again, not just in Africa, but around the world with that elixir, that mix of opportunities to really transform these countries.

CNN: A lot of people are critical of Chinese “neo-colonialism” but you argue that’s not the case.

DM: Well, it’s not, because China has so many economic problems in itself. You know, this is a population of 1.3 billion people with 300 million people that live at the level of Western living style. So they’ve got a billion people to move out of poverty. The notion that they would be spending their time trying to colonize other places is just, frankly, absurd.

I’m not saying that China should be given a red carpet, carte blanche, to come into Africa or, indeed, anywhere in the world, and do what they like. We do need the investment, we need job creation and we do need actual trade in these places. But I think what’s really essential is to focus on what China can do for Africa, as well as what Africa can do for China. And I think that discussion is not had as objectively as it should be.

Afghans worry about International Aid

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The impending withdrawal of U.S. and other foreign combat forces from Afghanistan means more than a loss of firepower. International aid is also on the decline because of donor fatigue and fears of deteriorating security after nearly 12 years of war.

Worried about losing hard-won gains, many Afghan and international aid organizations are racing to finish projects or find new sources of funding to provide basic services such as health care, education and electricity that the weak central government has been unable to deliver.

The money that has flowed into Afghanistan since the 2001 U.S. invasion that ousted the Taliban and their al-Qaida allies has led to drastic improvements, with nearly 8 million children, some 40 percent of them girls, enrolled in school — up from just over 1 million when girls were banned from school under the Taliban.

Afghan street children are packed into classrooms, raising their hands to answer math questions and bending their heads over art projects as part of a program funded by the European Union. But the money is about to disappear after a four-year grant expires next month, and the Afghan government isn’t ready to fill the gap. That leaves thousands of poor children who spend most of their days hawking goods on the street poised to lose their only access to an education.

The U.S. Agency for International Development in Afghanistan has built or refurbished more than 680 schools, and child mortality has been halved with improved health facilities and other services.

A short history of US foreign aid

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Following World War II, US leaders realized that America’s security and prosperity are interconnected with the rest of the world, and that they had a duty to help people in Europe with their recovery from war.

In 1961, Congress passed the Foreign Assistance Act in response to President John F. Kennedy’s request to unify all economic aid efforts under the jurisdiction of a single agency, the US Agency for International Development (USAID).

President George W. Bush began a process of rebuilding US foreign aid and introduced several notable reforms: He created the Millennium Challenge Corporation (MCC) to better enable countries to meet the needs of their own citizens; he developed the President’s Emergency Plan for AIDS Relief (PEPFAR), which paved the way for the Global Health Initiative (GHI); and he began to restore staffing levels at USAID through the Development Leadership Initiative (DLI).

Efforts to ensure that foreign aid works to reduce global poverty and human suffering have accelerated under President Barack Obama. In 2010, President Obama announced a new US Global Development Policy, recognizing that governments and citizens in poor countries shouldn’t be merely recipients of aid, but full partners in the process. The policy also outlines new tools for measuring programs to make sure they meet their goals, so both American taxpayers and poor people affected by US policies abroad can see where aid dollars are going and for what purposes.

[Source: Oxfam]

Hunger and world poverty

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About 25,000 people die every day of hunger or hunger-related causes, according to the United Nations. This is one person every three and a half seconds. Unfortunately, it is children who die most often.

Yet there is plenty of food in the world for everyone.

The problem is that hungry people are trapped in severe poverty. They lack the money to buy enough food to nourish themselves. Being constantly malnourished, they become weaker and often sick. This makes them increasingly less able to work, which then makes them even poorer and hungrier. This downward spiral often continues until death for them and their families.

There are effective programs to break this spiral. For adults, there are “food for work” programs where the adults are paid with food to build schools, dig wells, make roads, and so on. This both nourishes them and builds infrastructure to end the poverty. For children, there are “food for education” programs where the children are provided with food when they attend school.

Learn more

150 Million desirous of immigrating to the US

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According to a Gallup survey, there are about 150 million adults living
in countries around the world who would migrate to the United States if
they could. And that does not count any children these 150 million
would-be immigrants might want to bring with them.

To arrive at this figure, Gallup interviewed 452,199 people at least 15
years or older in 151 countries around the world from 2009 and 2011.
Gallup asked: “Ideally, if you had the opportunity, would you like to
move permanently to another country, or would you prefer to continue
living in this country? To which country would you like to move?”

The 150 million people whom Gallup estimated would like to come to the
United States includes 22 million Chinese, 15 million Nigerians, 10
million Indians, 8 million Bangladeshis, 7 million Brazilians, 5 million
Filipinos, 5 million Japanese, 5 million Mexicans, and 3 million each
from Vietnam, Kenya and the United Kingdom.

In Liberia, 37 percent of all adults want to leave their homeland and
move permanently to the United States of America. In Sierra Leone, it’s
30 percent. In Dominican Republic, it’s 26 percent. In Haiti, it’s 24
percent. And in Cambodia, it’s 22 percent.

So by far, according to Gallup’s survey, America is still the No. 1 land
of dreams for would be immigrants.

Utilizing intermediaries to simplify international giving

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Few income tax treaties allow U.S. individuals to make deductible donations to foreign charities.

U.S. charitable organizations engaging in international philanthropy are subject to a number of restrictions on making grants to foreign organizations, some of these restrictions aimed at combating terrorism and increased enforcement of sanctions. Other challenges arise from the fact that the rules governing recognition of charities and the circumstances under which donors to charitable organizations may claim tax deductions or other benefits for their contributions is governed almost exclusively by the law of each separate jurisdiction.

A private foundation is subject to punitive excise taxes on grants to foreign organizations unless it either (i) obtains an equivalency determination that the recipient is the equivalent of a U.S. charity or (ii) exercises expenditure responsibility with respect to the grant. Obtaining an equivalency determination or exercising expenditure responsibility can be both costly and time consuming.

Hence, many U.S. private foundations, as well as individuals, choose to make grants to intermediaries that qualify as public charities rather than to foreign organizations directly.  A public charity is qualified as such because it raises its money from the general public and in turn donates funds and support to other organizations.

Next generation donors with international focus

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There is a cohort of the younger generations, particularly Generations Y and X, who stand to inherit an unprecedented amount of wealth — somewhere in the neighborhood of $40 trillion. So, what do they plan to do with it and which types of entities stand to be the recipients of their largesse?

“These generations … have the potential to be the most significant philanthropists in history and we really don’t know that much about them,” said report co-author and sociologist Michael Moody, who  also serves as the Frey Foundation chair for Family Foundations and Philanthropy at the Johnson Center.

This cohort, according to the survey, wants to get its hands dirty, prioritizing direct relationships with the entities they donate over merely writing checks. This rejection of “checkbook philanthropy” is one of two findings Moody found most surprising. “They want to get their hands dirty, to serve in meaningful ways, not just sit on boards or party planning committees,” said Moody during an e-mail exchange Thursday. “They want to be taken seriously — not only in the future but now — as talented partners with organizations, who bring skills and expertise to the table.”

Moody was also surprised by the coming generation’s unwillingness to do away with past traditions. “They are certainly enthusiastic about innovation and willing to take risks and try non-traditional approaches to philanthropy,” said Moody, “But this doesn’t mean they want to discontinue all traditional forms of giving, that they give to radically different causes or for radically different reasons, or – most notably perhaps – that they care little for the family legacies they are inheriting.”

Asked why the report was initiated now, Moody said, “They hold the future of major philanthropy in their hands. As they start to engage more in that future, we need to know more about how they think about, learn, and practice philanthropy.”

They are more likely than their families to give to civil rights/advocacy and environment/animals causes, and international organizations, as the next generations are thought to be relatively more focused on global causes versus domestic.

[Washington Post]


Developing countries becoming developed countries

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Which countries are classified as developing nations?

Hans Rosling, a Swedish global health expert, suggests that people incorrectly divide the world into two –developed countries, such as the U.S., and developing countries, like Ethiopia – based on the number of children a woman has and how long the children live.

“In many people’s minds the world still looks like this – developed and developing,” Mr. Rosling says in a video designed to accompany Bill Gates’s annual talk, showing a cluster of countries separated in two distinct boxes.

“But it’s a myth because the world has improved immensely in the last 50 years.” He proceeds to demonstrate how, thanks to improvements in health care and other factors, child mortality has fallen rapidly in large swaths of the world since the 1960s.

Over time, more “developing countries” have moved into the box of “developed countries,” he shows.


Bill Gates on the Colbert Report

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Bill Gates appeared on the Colbert Report this past Wednesday night to talk about The Bill and Melinda Gates Foundation’s recent successes in global health. Not least of all, due to the critical role of the Bill and Melinda Gates Foundation, since 1990 the number of childhood deaths has been reduced by 5 million.

“It’s good news that you wouldn’t hear,” the founder of Microsoft said of the information he shared in his annual missive. “I share what I’ve been able to see in my travels to Africa and Asia.”

But after Gates shared his good news, Colbert in typical fashion commented that Gates is just not as “cool” as Steve Jobs was.

“People say ‘what a cool guy’ … Steve Jobs was. You’re out there saving the world, yet you don’t have the ‘cool factor,’” Colbert jabbed. “Did you ever want to be the cool guy?”

Gates didn’t seemed phased, responding, “He was brilliant. He had his own style. He had his own approach. Mine is, I guess…a little geekier than his was.”

Generation X and Y equals philanthropic power

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When it comes to philanthropy, Gen X and Gen Y/Millennial donors are keenly interested in personal values, measurable impact, and hands-on engagement, a new report from the Johnson Center for Philanthropy at Grand Valley State University and 21/64, a nonprofit consulting practice specializing in next-gen and multi-generational strategic philanthropy, finds.

Based on a national online survey of and interviews with young philanthropists, the report, Next Gen Donors: Respecting Legacy, Revolutionizing Philanthropy found that a relatively small group of Gen Xers (born between 1964 and 1980) and Gen Y/Millennials (born between 1981 and 2000) will inherit more than $40 trillion over the coming decades. And while they are not necessarily more charitably inclined than their parents or grandparents, the sheer volume of funds, foundations, and other types of giving by high-net-worth families is expanding to unprecedented levels, putting them in a position to wield more philanthropic power than any previous generation in American history.

The report also found that next-gen donors seem to be driven by values rather than “valuables”; that they see philanthropic “strategy” as the major distinguishing factor between themselves and previous generations and intend to change how philanthropic decisions and due diligence are conducted; that they want to develop close, hands-on relationships with the organizations or causes they support; and that, as engaged as they already are, they are still figuring out what kind of donors they want to be.

The report highlights the “practical wisdom” and insights of next-gen donors with respect to their hunger for engagement, new ways of learning, and making a difference sooner rather than later.

[Foundation Center]