Local-level accountability in Ghana

Ishac Diwan reflects

"Everyone agreed that silent corruption was endemic, but they rejected our call to organize parents and beneficiaries to push back on the state and try make it accountable. They thought that this was unrealistic. When school spots are limited, people are nice to the school master to have a chance to get their kids admitted. The poor need to fight for themselves and do not have the luxury of fighting on behalf of the whole community, especially when that comes at a cost"

This might be a big dampener for projects that aim to say, strengthen School Management Committees or Parent Teacher Associations to reform public schools. Social audits for public works might be slightly different since they usually affect, directly or indirectly, a large swathe of the population in any given community. Is it that for any project that entails individual-level benefits, competing for (perceived) scarce resources among potential clients trumps mutual cooperation for greater collective benefit? All is not lost, though - 

"After initially feeling disappointed, I found this sentiment profound. What I learned from our discussion is that our much touted civil-society-driven accountability model can only work if we put equal effort into getting the state to agree to an internal system of vertical accountability – vertical and horizontal accountability need to act as complements not substitutes" 

The state needs to promote horizontal accountability systems within it various arms that act as checks and balances to each other. But at the same time, as Ishac points out, there is no substitute for vertical accountability along the chain of command within the state. Civil society alone cannot win every battle.

Development in a Coke bottle

David, at "Find What Works" blogs about Melinda Gates' recent TED talk, where she lauds Coca Cola for its success in taking Coke to the remotest corners of the world. Gates underlines three core reasons for Coke's success - Use of real-time data in the feedback loop; Leveraging local entrepreneurial talent; and Going local in developing aspirational marketing campaigns.


David concludes with -

What disappoints me is how thin the analysis usually is. As with most similar commentary, Gates fails to discuss the unique constraints facing social causes. These include the difficulty of determining impact when your goal is not measured in dollars (as it is for a business) and the range of stakeholders you must be accountable to when the money comes from one place (donors) and the services/products go someplace else (beneficiaries). The challenges actually are unique. Business principles are useful and the development sector can learn from multinational corporations, but simply mimicking them is not enough. The principles have to be translated. That’s the hard part.

I share David's angst about the casual swipes people take in equating private sector strategies with the development sector's objectives and point to the former's successes in the face of the latter's trials and tribulations. Is "good change" in the lives of people as easy as having them drink coke? 


First of all, I am a little surprised by the choice of the product. Why coke? Why not beedi or gutkha which too, are "ubiquitous" (at least in India)? After all, beedis and gutkha are at least much more reasonably priced than a bottle of Coke and offer greater 'satisfaction'. I get it...we are not sitting on judgement of whether the product is intrinsically good or bad. We are also not implying that 'popular demand' equals 'good'. But this popular demand and the resultant far-reaching supply chain have anything to do with the nature of these products (cheap temptation goods, bordering on being addictive)? Probably does... 


Lets leave all of that aside. Does merely their availability make them the models for the development industry to imitate? In a community with layers of obvious and not-so-obvious power relations, I am more likely to care if my neighbour gets assistance to build a toilet or gets a farm loan from a bank, than if I see him drinking  more Coke than I do. In a society where women hesitate from talking to men and cover their heads whenever outside their home, is buying a bottle of coke the same as them getting condoms from the nearby clinic/pharmacy (and convincing their partners to use them)? 


Marketing and the resultant availability of certain products and services is critical - vaccines and other medicines (for TB, diarrhea etc) are great examples. But if ever there is a day when rumours spread that Coke is making young men and boys sterile, I will be interested in seeing how it fares in these remote pockets where it reaches. 


Coke is also a good example of a one-size fits all product. If many members of a community decide they prefer to Pepsi to Coke, Pepsi will probably follow suit and set up shop. But what if the Pepsi-loyalists decide that they are a superior group and therefore Coke should be booted out of their village (and threaten to vandalize Coke outlets, suppliers and customers if they do not voluntarily leave), will Coke stay on in the village and fight for the rights of the minority that still prefers Coke? They probably will cut their losses and escape so more 'stable' markets, where they can go about their business without having to deal with local politics.


There are of course key lessons about appropriate incentives for the actors at different stages of the supply chain. Waiting for altruistic supply agents is unlikely to work. They too live in a competitive market economy and need to make their ends meet. Even so, the dream of delivering development in a Coke bottle will remain just that - a dream.


Disclaimer: I have nothing for or against Coke, Pepsi, beedis or gutkhas. All names used are merely for illustrative purposes

Interesting experiments in microfinance

Laura Starita blogs about a J-PAL - CMF study that tested an innovative flexible repayment micro-credit product in West Bengal (an earlier working paper is here); where the implementing MFI, VWS has decided for now, not to adopt the innovation, due to the threat of higher defaults.

The results showed that clients with the two-month grace period on average enjoyed 25 percent higher profits than clients in the control group. They invested 10 percent more of the loan in the business, and increased inventories and outputs by two thirds. Household income also seemed to increase in the period 

Those numbers imply that increasing flexibility in loan terms has positive effects for some micro-credit recipients. Yet the study showed some important nuances. Most relevantly is that the results varied widely—a group of recipients with grace periods did dramatically better, but some did dramatically worse (that 25 percent increase in profits is only the average). In addition, defaults for the bank increased, reaching 12 percent of the “grace period” group, compared with slightly more than 4 percent for the control

I was out in the field for a brief period of the said study and remember discussing with potential clients their impressions about such flexible repayment systems. They themselves were wary of the risk of higher defaults if they did not start repayments immediately. They also mentioned that in the plain vanilla micro-credit loans, having to repay from Week 1 usually meant that they had to keep a certain portion of the loan aside for the first few week's repayments. 


The study reports a significant distinction in the nature of investments made by the different groups. The variability in repayments poses an increased risk to MFIs, some of which may be covered by offering loans at higher interest rates. Given the present political climate though, may be not!


Takes me back to my favourite theme about microfinance: MFIs should help clients graduate to becoming bank clients. I am not sure how much of that is happening, but I would love to see an MFI report on how many of their clients have gone on to becoming clients of formal banks in their areas of operation, accessing the complete range of financial services on offer.

World Press Freedom Index 2010

M.F. Hussain might just have made the right choice, if one were to believe the latest rankings. Qatar ranks 121, to India's 122nd place. Northern European countries dominate and Ghana ranks 26th. The rankings are here and here. 


Sure, the ranking has the usual problems that arise when attempting to conjure a single number to represent an entire country.

The survey found that only 16 percent of the world’s inhabitants live in countries with a Free press, while 44 percent have a Partly Free press and 40 percent live in Not Free environments. The population figures are significantly affected by two countries—China, with a Not Free status, and India, with a Partly Free status—that together account for more than two billion of the world’s roughly six billion people. The percentage of those enjoying Free media in 2009 declined to the lowest level since 1996, when Freedom House began incorporating population data into the findings of the survey.

Also, interestingly (but not surprising), best friends USA and Israel are each ranked twice for press freedom - once domestically (20 & 86 respectively) and another, extra-territorially (99 & 132).

Vox populi

A snapshot of how the media works in India -

Reporter: “Can we please have you say a few words on the things you dont like about Delhi?”

Junta: “Nothing – there isnt anything that I like about Delhi! The problem that Delhi faces, all cities do. I can crib, but that doesnt mean anything.”

R: “No, I mean there must be something. Like the CWG or the Ayodhya Verdict!”

J: “I liked the CWG…really…and exactly how is the Ayodhya verdict related to not liking stuff in Delhi”

R: “No, just say anything that comes to your mind. Just 2 mins…please, please please!”

J: “Ok alright! (camera rolling, silence and ACTION). The thing I dont like about Delhi is that inspite of being the capital, it doesnt have anything to offer beyond malls and food! Very little in the name of nice parks, or a theater culture, or monuments. There is a lot but its shadowed by these glass buildings”

R: “ummmm…(whatever)…ok..so whats the first word that comes to your mind when you think of bureaucrats?”

J: “(WTF, what!!??) Nothing specific. What do you want me to say, corruption?”

R: “Corruption? So how do you think we can deal with corruption. Will these bureaucrats ever be brought to justice?” 

(I added the labels in bold)
And, Ankur says

And thats how journalism is done nowadays. A pretty 21 yr old wearing red nail polish, a cameraman whose creative talent is considered 1/10th infront of the verbal power that the lady has, and a citizen that is driven to say what the media wants, not want he wants to say!

Sadly, this is no breaking news...

One man's terrorist is another man's...

Via Chris Blattman and Eric Green, here is Osama:

"What governments spend on relief work is secondary to what it spends on its armies,” bin Laden says on the 11-minute tape called, Reflections on the Method of Relief Work…

“Merchants are the knights who will save this region from famine and must avoid investing in worthless projects,” 

This one is for the IPCC website

“The number of victims caused by climate change is very big” — “bigger than the victims of wars,”

Also from NYT - 

He recalled his own experience with farming in Sudan, called for creating a “unique relief agency,” and described watching a father in Pakistan holding his two young children above chest-high flood water, according to a translation by the private SITE Intelligence Group in Washington.

In Saturday’s release, Mr. bin Laden, who trained as an engineer, mused about the cost and materials for embankments to control flooding and chastised wealthy Muslim countries for not doing more to help Pakistanis.

Osama's focus is limited to the "Islamic world" - understandable, I guess, given his day job...

Portraying Ghana: The World Bank responds

From Peace FM  The Country Director of the World Bank, Ishac Diwan, explained that the Bank’s photo library was linked to a website that was available to delegates attending the conference and the reporter saw the photos because of that linkage. He commended the Daily Guide reporter for his observation and “for alerting us that such photos were on our website.” He said some of the pictures were 20 to 30 years old, indecent and should not have been displayed on the Bank’s website. “We completely agree that they are offensive, and they prolong the kind of stereotypes that are really far from the reality and very much at odds with the image of Ghana that we want to project at the World Bank,” he said. “I want to offer our apologies to Ghanaians and we very much regret any harm that has been done to Ghana’s image,” Mr Diwan stated

Are MFIs refusing to learn from past mistakes?

MFIs in Andra Pradesh keep hurtling from one crisis to another. The latest is the Andhra Pradesh government's ordinance that seeks to regulate microfinance operations in the state. It is still not clear if the ordinance covers NBFCs, regulated by the RBI, or restricts itself to MFIs that are sought to be brought under NBARD's control in the impending Microfinance bill. While the ordinance seems loaded against private commercial microfinance players (and favours the state-led SHG model), as N. Srinivasan points out, MFIs cannot escape the blame entirely. He faults MFIs on the following fronts - 

Multiple lending and associated problems faced in Kolar were not seriously internalised.

High interest rates even in the face of declining operating costs and the resultant high return on assets have been criticised over the last two years.  The proposition that high growth rates and accelerated expansion of outreach require high profitability has been questioned. The need for patience in recovering investments and the nature of equity (patient capital) that would best fit institutions in the sector have been time and again debated. 

Regardless of the ability of customers to pay high interest rates, the underlying political economy issues of doing business with vulnerable customers have been consistently ignored by some MFIs.  Even with the code of conduct in place from two networks, deviant behaviour was in evidence.  While suicides might not be related to loans at all (and not MFI loans either), by the kind of market behaviour exhibited by some MFIs, the sector added grist to the cynics’ mill.

These criticisms of the MFIs seem quite fair. Lessons from the 2009 Kolar crisis were either not taken seriously, or were forgotten in the heat of the battle, in the race for profits and unrealistic returns on investments. Earlier this year, the Association of Karnataka Microfinance Institutions (AKMI) brought out their assessment of the Kolar microfinance crisis of 2009. The report roundly criticised coercive repayment collection practices -     

MFI staff required invariably to collect on time put various types of pressure on clients to repay.  A common practice is to undertake a vigil outside the homes of defaulting clients until payments due are made good. This is usually a matter of 1-2 hours but, nevertheless, causes tension in the family and community.

The spark that ignited the tinderbox of Kolar was the alleged verbal abuse of a client by an MFI loan officer. While the principle of zero delinquency was meant to ensure good collections, its rigid application in practice became a proximate cause of the crisis.

The report also suggested that the joint-liability principle may not be working as well at higher loan amounts since the risks were too high, especially when more than one member in the group was vulnerable to default.   

In Kolar, a group (which had borrowings from 4 MFIs) said that one of their members had run away and they did not want to pay for her. Another group of clients had faced repayment problems in the past but had pooled funds to repay for their group members. They said they did not like having to call fellow members from their homes, or to humiliate them by demanding payment in public. When, however, 5 members of the group defaulted it became impossible for the rest to repay. At this stage their family members had begun to complain about the system.

The other important point Srinivasan makes is that MFIs might have failed to take into account the political economy of doing lucrative business with the poor. This rings even more true since a part of the title of the AKMI report is "the role of external agents" and the report itself dwells on how other organisations in the region capitalised on the situation and "lit the tinderbox". One would expect that MFIs would self-regulate their operations at least as a politically expedient step in a potentially inflammable situation. Instead, 'Political interference' was actually ranked a lesser risk in the 2009 Banana Skins report than in the preceding 2008 report. 


So, have MFIs played their cards wrong in southern India? With the latest ordinance in Andhra Pradesh, looks like MFIs will have to play catch-up. They have been painted as villains in the mainstream media through numerous newspaper reports attributing suicides and extortions to them, as opposed to success stories (anecdotal or otherwise) that have largely remained on MFI websites and institutional/academic circles. As India's apex microfinance associations prepare to respond to the AP ordinance, at least one thing that's clear is that difficulties for MFIs will continue to arise unless MFIs pro-actively take steps to learn from their past mistakes.

How not to portray Ghana

An article on the World Bank's portrayal of Ghana - starts rather dramatically, but makes a valid point, protesting a stereotypical portrayal of the country by the World Bank. Excerpts below - 

The World Bank, at the just-ended 2010 annual meeting in Washington DC, stabbed Ghana in the back. This was demonstrated by horrible pictures that the Bank displayed about the country on its computers...The computers, which had a picture of the Finance Minister of Ghana, Dr Kwabena Duffuor as well as the country’s flag, also had pictures portraying the country as a land of abject poverty...

The reputable organization has forgotten that even in Washington DC, the capital city of US, there are people who are still begging on the streets. However, the bank failed to photograph some of these people, let alone display them as the image of the US on its computers to the tens of thousands of delegates who attended the 2010 annual meeting...

...In the past, Africa has been portrayed by the western media as a continent of violence, poverty, starvation and corruption. The pictures displayed by the Bretton Woods institutions about Ghana seem to suggest that it supports the theory that when a dog bites a dog, it is no news but when a man bites a dog then it is news. In other word, bad news sells more than good news.

A Kenyan journalist, Kelly Mbani, asked: “Why couldn’t the country office of the World Bank in Ghana show pictures of interesting and attractive places such as Trassacco Valley, East Legon, the Accra Shopping Mall, Boti Falls, and Kakum National Park?”...

Why not, indeed? Sure, this may not be the considered view of a majority of Ghanaians; but it is a valid rejoinder and a sentiment that Binyavanga Wainaina might be proud of

What motivates research

Tyler Cowen suspects it might be - 

a) absence of jet lag from the U.S., b) relative ease of learning Spanish and Portuguese, and c) lower population densities than Asia, which in some ways make visits more pleasant, or d) income inequality, which means that life is quite good for visitors?

Global Hunger Index 2010

More here and here


India fares badly alright - but dare anyone criticise us anymore? We just got the CWG done in style and got on to the UNSC (non-permanent, so what?)! 


UK seems to have learnt its lesson - no mention of India in this piece by Andrew Mitchell on global malnutrition. 

An interesting view on Indian aid

Excerpts from a comment in response to a CGD blog on Indian aid:

“The major features of India’s development co-operation are the affirmation of mutual interest, rather than altruism or global citizenship, as the cornerstone for co-operation, and the rejection of conditionality as a modality for transacting development co-operation. The Indian approach treats recipients of its assistance as development partners and links development co-operation with the demonstration of solidarity at a political level. Development partners in turn share a common history of mutual co-operation grounded in political solidarity typically dating back to the Cold War period... 

...Given this, bean-counting financial resources that enter development co-operation is, logically, not a high priority for the emerging development actors. Equally for this reason, in my view, OECD-DAC is not “fit for purpose”to encompass the motivations underlying Brazilian Indian and Chinese development co-operation initiatives...

Counter 'audit culture': but be sure to get the message right

This was the theme of an event at IDS organised by the PPSC team recently. The participants were concerned about the increasing emphasis on measurable results, which they felt was sometimes at the cost of focusing on 'social transformation'. According to them, the problem is

Eyben says there are many reasons for the new funding environment which, she argues, fails to recognise the complexity of development and risks losing the voices and knowledge of local actors.

These include supporters' and taxpayers' lack of appetite for complex messages; increased pressure for quick 'wins' to demonstrate that aid works; and a belief that challenges such as high levels of maternal mortality in many developing countries are solely technical problems for which straight-forward technical solutions can be found.

The group identified the following as the way forward - 

·   Building 'counter-narratives' that emphasise accountability to those for whom international aid exists.

·   Developing innovative communication channels in order to better communicate with the public the complex nature of development.

·   Developing different methods of reporting, so that the requirement for aggregated numbers at Northern policy level captures the character of programming in complex development contexts.

·   Collaborating with people working for change inside donor agencies.

·   Re-claiming the term 'value for money'.

·   Enhancing organisational learning and reflective practice to nurture out-of-the-box thinking and approaches.

·   Scrutinising the role of big business in development aid and its impact on discourse, quality and accountability.

Working in the measurement industry, I can see how this can horribly go wrong. Is the PPSC advocating a return to the time when development interventions were primarily ideology-driven, with results being secondary? I do not think so. What they are pushing back against, is the tendency of aid agencies aiming for what is easily measurable and in turn, ignoring programs that cannot be measured as easily. Worse still, they may be ignoring sectors that don't lend themselves to easy evaluations, such as justice systems or taxation. 

I wonder if the challenge should not be upon us to come up with a more versatile tool-kit of evaluation methods? We cannot be method-driven, neither in research not in implementation - and  that itself is not a new idea. But with events such as this, that push back on measurement, one needs to be absolutely sure the message doesn't get muddled in the rhetoric.