Investing for Prosperity

Food Africa

Jack Isaacs

25 May 2021

Investing in local social enterprise is the best way to make progress towards the UN’s Sustainable Development Goals (SDGs).

It is easy to be overwhelmed by the SDGs. There is a lot of work to be done if we are to make progress in tackling 17 of the world’s biggest challenges in the space of a decade. Whilst we may agree on many of the fundamental issues, their relevance and potential solutions will differ greatly depending on the context in which they exist. “There is no single route to prosperity”, says Professor Henrietta Moore, Founder and Director of the Institute for Global Prosperity (IGP). International organisations pursuing more prosperous nations across the globe, regardless of whether they are classified as developed or developing countries, should be facilitating prosperity and not enforcing it. Investments in grassroots social enterprises, run by local people on the ground, will be a valuable tool as we look to work on achieving the goals more effectively.

Long term solutions at scale

$152.8 Billion of Official Development Assistance is estimated to have been sent to developing countries by members of the OECD Development Assistance Committee in 2019. This number was just over $70 Billion in 2000 (See Chart 1). Despite the humanitarian efforts of Euro-American democracies, the distinction between the developed and developing world remains as stark as it was twenty years ago. We are failing to meet the needs of those that we are inclined to support.

Chart 1: Components of DAC Countries Net ODA

I believe there are two things that should be considered when evaluating how these funds could be better spent: sustainability and scale. Investing in local social enterprise allows individuals within a given community to develop self-sustaining solutions that directly address the issues influencing their lives. These investments act as a mechanism for development institutions to create new markets, fuelled by private demand, that should ensure local development at a scale that would not previously have been possible with traditional one-off donations and aid programmes. Social enterprise acts as a solution to a lack of resource or capacity within any economy.

Who is leading the way?

Social enterprises are making a positive impact all over the world. For example, Kenarava Group uses their expertise in agriculture alongside cutting edge technology to support farming projects around Africa. They are creating sustainable agricultural solutions whilst creating employment, reducing poverty, generating wealth and empowering youth and women within the sector. It is a business that creates economic value for its owners and employees alongside huge positive externalities for the communities within which it operates. Businesses like these are the building blocks for thriving, self-sustaining economies.

What next?

The SDGs are global problems without global solutions. Luckily, whilst economic strength is not spread evenly around the world, the same does not apply to intelligence and creativity. The ideas needed to create solutions to social and environmental issues lie dormant in the communities where these challenges exist. The billions of dollars allocated to development programmes every year by national governments and international organisations would be better placed in the hands of those that know what it’s needed for.

Jack Isaacs is a postgraduate student at UCL’s Institute for Global Prosperity.

Bibliography

Kenarava Group Ltd (2020). Farmer Training Series. Available at: https://www.kenarava.com/portfolio/farmer-training-series/ (Accessed 5 November 2020).

Kenarava Group Ltd (2020). Kenarava Group Integrated Agricultural Techniques. Available at: https://www.kenarava.com/ (Accessed 5 November 2020).

Kenarava Group Ltd (2018). The Kenarava Group Limited. Available at: https://vimeo.com/298133039 (Accessed 5 November 2020).

Kim, D. and Lim, U. (2017). ‘Social Enterprise as a Catalyst for Sustainable Local and Regional Development’, Sustainability, 9 (8), pp.1-15.

Moore, H. (2015). ‘Global Prosperity and Sustainable Development Goals’, Journal of International Development, 27, pp.801-815.

OECD (2020). Aid by DAC members increases in 2019 with more aid to the poorest countries. Available at: https://www.oecd.org/dac/financing-sustainable-development/development-finance-data/ODA-2019-detailed-summary.pdf (Accessed 5 November 2020).

Picciotti, A. (2017). ‘Towards Sustainability: The Innovation Paths of Social Enterprise’, Annals of Public and Cooperative Economics, 88(2), pp.233-256.

United Nations (2020). The 17 Goals. Available at: https://sdgs.un.org/goals (Accessed 6 November 2020).

Image credit: Dan Meyers on Unsplash