Author Archive
Meet a Micro-Debt Collector
Alioune Badara Thioune has a confident stride. In the mornings he comes into the office sporting stylish sunglasses, a leather briefcase and a newspaper carefully tucked under his arm. After making the obligatory “good morning” rounds, he chooses a chair in the hallway and opens his newspaper until he is called into the office of the regional head. For some reason he always reminded me of a Senegalese Chili Palmer – John Travolta’s character in Get Shorty. And this was before I knew exactly what he did. (more…)
“Does Microcredit Really Help Poor People?” Yes, but…
KF9 Ilmari Soininen UIMCEC, Thies, Senegal
Over the last four months working in microfinance in urban Senegal, I have come across many clients who report increased income thanks to their loans. Fishmongers, clothing salesman, taxi drivers, you name it. Indeed, this has come to be expected – put the capital into the entrepreneur’s hands and he will surely put it to the most efficient use, and help bring his family out of poverty.
Makes sense. But trying to tease out exactly by how much the client’s income has increased is not as straight forward. Clients rarely keep good track of revenues and expenses, so the bottom line at the end of the month can be pretty hard to decipher. Often I wonder after the interest payments, did the client really increase his income or was it a mirage simply reflecting more money coming in and out?
My experience is consistent with the broader lack of evidence to link microfinance with increased incomes and reduced levels of poverty. In “Does Microcredit Really Help Poor People?”, an excellent recent report for CGAP, Richard Rosenberg examines recent research and looks to answer this question.
Senegal’s Answer to the Golden Arches?
By Ilmari Soininen, KF9 Thies, Senegal
Of the forty-eight countries in Sub-Saharan Africa, how many would you guess have a Mcdonald’s? Why would one care?
Thomas Friedman, the columnist and author, posited “No two countries that both had McDonald’s had fought a war against each other since each got its McDonald’s”. If one had missed the lesson on causation versus correlation back in statistics class, the answer to ending conflict in Africa would be simple. Step one:open a Mcdonalds in every country on the continent. Step two: award Ronald Mcdonald the Nobel Peace Prize (“I’d like to thank God, the Hamburgler…”).
Friedman’s point was that globalization ties countries closer economically, increasing the opportunity cost of waging war. A dubious theory on conflict prevention, especially as much of the residual conflict is internal, not countries fighting other countries. But perhaps the lack of Mcdonald’s in Africa can tell us something. Oh, and the answer to the initial question: as of 2009, only three of forty-eight countries in SSA have Mcdonald’s. – one of them being (a bit cryptically) Zimbabwe.
The idea of chains and franchises popped into my head a couple of weeks back, when I visited a client, Fatou Binetou Dieng. According to the profile, she had used her loan to purchase traditional West African fabrics to sell in her neighborhood. Indeed she had. But this was a year ago. (more…)
Reading the Economic Chicken Bones
By Ilmari Soininen, KF9 in Thies, Senegal
Christmas kicks off a serious week of celebration for Senegal’s Christian minority. Dispersed families unite, meaning a series of sept-place, clando and bus rides from the capital. Like in many parts of the world, roasted chicken (or turkey) is an important part of the Christmas menu here. The bird is carefully prepared, and cooked to tender perfection. Chicken is not an everyday treat for most of Senegal. Indeed, it is quite a luxury item. But why is this so? And can this tell us something about the country’s future?
A Holiday luxury - but hopefully not forever
Global Slowdown: Senegal
Ilmari Soininen
KF9 UIMCEC Senegal
Many developing countries were just beginning to recover from the havoc caused by sky-rocketing food and fuel prices, when the last F-bomb hit – the financial crisis. A year in, what are the effects on Kiva’s borrowers, partner MFIs and the diverse array of countries we work in? Is there reason for optimism for the future?
Credit institutions issuing loans to local clients and then shuffling the risk to investors in the four corners of the world – hmmmm sounds oddly familiar. Fret not, Kiva is not responsible for the global financial crisis – even Premal knows Kiva’s not that huge…yet.
Senegal: car rapide or economy flaccid?
Phonecards and Peanuts: Looking at Micro-finance through the Macro Lens
Ilmari Soininen
KF9 UIMCEC Dakar, Senegal
Topping up one’s phone credit is never a problem in Dakar – on every street corner you will find one, or usually three or four young men hawking the same exact Orange Telecom cards. They offer the exact same cards, in the exact same spot, at the exact same time. Peanut vendors are equally ubiquitous, often stationed only a feet away from each other, selling the same peanuts, in the same 50 Franc increments.
These vendors often rarely have many other avenues for generating income. Many come from the countryside, where subsistence farming is usually the one and only option. They prefer the hustle and bustle of the city. They prefer the 500, 1000 or even 2000 CFCA (between US$ 1-4) they can make a day. Who can blame them.
But when you add up all of the thousands of phonecard, peanut (cigarette, tissue, fruit …) vendors, you begin to see why this country, and indeed many of its neighbors, are still so poor. (more…)
Geopolitics and giant goats: thoughts from a week in Dakar
By Ilmari Soininen, KF9 UIMCEC Dakar, Senegal“Africa lite” is how a retired career diplomat once described Senegal to me. Glancing at a map of West Africa he may have a point. Bloody diamond-fuelled conflicts in Sierra Leone and Liberia, violent Islamic extremism in Mali and Mauritania and the recent military coup in Guinea make Senegal look like a bastion of stability, even in light of the resurgence of a separatist movement in the southern region of Casamance (recent news).
Further, despite relatively weak institutions and inescapable corruption, Senegal has had a rich history of democratic elections. The transition of power in 2000 to the current president, Abdoulaye Wade, was smooth and peaceful despite fiery campaigning. Looking back to the previous change of guard is perhaps even more telling: in 1980, President Senghor became the first African head of state to ever step down voluntarily. Pretty amazing.
But enough geopolitics, let’s get to the giant goats. (more…)
