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Venezuela’s Currencies Promote Cooperation Not Competition

By David SouthDevelopment Challenges, South-South Solutions

SOUTH-SOUTH CASE STUDY

The global economic crisis has spread around the world and is bringing many problems in its wake.  As global currency markets gyrate wildly, and people find they can go from having wealth to being poor almost overnight, the question is being asked: “is there another way?”

The global economy is slowing rapidly. Even Iceland – a country recently named as having the best quality of life in the world (Human Development Index) (HDI) – has gone broke, and many other nations around the world will face serious economic crises. People will need to protect themselves from the worst effects of the fallout from various economic bubbles bursting.

Runaway inflation, as is occurring in Zimbabwe – reaching 231 million percent in October, 2008 according to official sources – shows faith in a country’s currency can be sorely tested. But do people and the poor in particular, need to be prisoners of the economy managed by a national currency?

The ‘prosumer’ movement (http://en.wikipedia.org/wiki/Prosumer), where consumers take an active role in re-shaping markets and economies to their benefit, around the world is looking for ways to bypass national currencies and make food, goods and services more affordable and stable, improving the lives of the poor. One way this is done is through alternative currencies (http://en.wikipedia.org/wiki/Alternative_currency).

Cimarrones, or the Cimarron, joins 10 other alternative currencies currently in operation across Venezuela. They are circular cardboard tokens with a picture of a runaway slave on them.

Supported by Hugo Chavez, the country’s president, the new currencies are aimed at tackling poverty and establishing new economies. The currencies can’t be exchanged for the Venezuelan currency, the bolivar.

It works like this: to be a prosumer, you must first bring something to sell before you can buy anything. The range of products for sale at prosumer markets is not vast, but that isn’t the point.

“It’s magic,” Pablo Mayayo, an Argentinian advising Venezuela on prosumer schemes, told The Economist. “ When you take away money, which is the cause of almost all the great evils in the world, people relate to each other in a different way, by cooperating, not competing.”

Argentina pioneered so-called “barter markets” in response to its economic crises, helping people avoid starvation, looting and perhaps a revolution. By the end of 2002, there were 4,500 barter markets being used by half a million people producing 600 million credits.

“They were organized geographically around church halls, car parks and baseball courts,” recalled Peter North, a Liverpool University geographer. “They offered a wide range of products and services, supplied by professionals, trades people and farmers, as well as housewives and the unemployed. Stalls attracted ‘prosumers’ in their thousands, who paid with credit coupons issued by one or more barter markets. Everyone involved was both a prosumer and a producer, since you couldn’t purchase credits or exchange them for pesos.”

In Rio Chico, a small town in the Venezuelan coastal region of Barlovento, the prosumer currency market has people happy with the prices.

“I grow coconuts,” said Angenia Hernandez. “In the shops they cost 3.5 bolivares each (US $1.63) at the official exchange rate), but we we’re going to sell them at [the equivalent of] 1.5.” She calls it an end to “commercial fascism.”

Because of global currency speculation and investment flows, national currencies are not entirely at the control of national governments. High inflation seriously hurts the poor and low-waged, and national currencies can hurt the rural poor, who become prisoners to high interest rates charged by urban lenders.

Turning to a local, alternative currency has many advantages: it stops currency speculation, stops the flow of wealth to urban areas, preserves purchasing power, keeps trading local. Avoiding the draining away of wealth to middlemen, it addresses currency scarcity, and fosters greater awareness of how economies function and the mechanisms of trade

Criticism of these schemes say it is just a re-run of regressive company currencies and feudal tokens that were used in the past to control people and force them to only buy products from the landowner or boss.

In Papua New Guinea , shells are used for money and are called Tabu.  It is an ancient currency system used by the Tolai people of East New Britain Island . Stephen Demeulenaere (www.network-economies.com), who has worked on alternative currencies around the world and helped with the re-introduction of the Tabu in Papua New Guinea , sees it playing a key role in the local economy.

“Tabu was very effective at addressing poverty,” he said, “because anything could be purchased with it, from a handful of peanuts up to a piece of land or even a car, without needing national currency.  Tabu is produced traditionally by women, so theoretically nobody would suffer from a lack of it.  The advantage over the national currency is that it has a very long history of use, and people trust it more than the national currency.

“Tabu builds wealth by facilitating the exchange of locally-produced goods and services which may not circulate in a ‘national-currency only’ economy, and values activities that may not be considered to be economically viable if the use of national currency was the only option.  In the west we see this where ‘mother’s work’, hobbies, mutual-aid and other traditional under-valued but economically important activities are not valued monetarily.

“By encouraging the exchange of locally-produced goods and services, wealth is built in the community from the ground up.”

Over 75,000 people now use the shells, usually traded in great rings.

Getting the introduction of an alternative currency right is critical. In Argentina, such currencies were criticised for being manipulated by criminal gangs and political forces.

“The main advice I have is to study the community closely, and our website at http://www.complementarycurrency.org, provides free resources for people wishing to start their system,” Demeulenaere said.

“The system must be transparent so that people trust it and participate in maintaining its health and stability; democratic, so that it can not be abused by those in power; appropriate, so that it achieves general social and economic goals and aspirations of the community; and to be complementary to the regular economy so that the system helps its members to improve their lives economically.”

At the Jai Marketplace in Thailand , all of the goods in the market can be bought entirely in the local currency called “Jai’. Jai is convertible to Thai Baht or to organic, locally made cow fertilizer, and is designed to improve the local economy and the climate for micro, small and medium enterprises through the local exchange network.

Published: January 2009

Resources

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP’s South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South’s innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator.

Creative Commons License

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2022

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Southern Innovator Magazine | 2010 – 2014 

By David South

“I think you [David South] and the designer [Solveig Rolfsdottir] do great work and I enjoy Southern Innovator very much!” 

Ines Tofalo, Programme Specialist, United Nations Office for South-South Cooperation
Southern Innovator in Tianjin, China.
Issue 5 of Southern Innovator at the Global South-South Development Expo (GSSD Expo) 2014 held in Washington, D.C.
Volunteers in Nairobi, Kenya pose with Southern Innovator Issue 4 at the Global South-South Development Expo (GSSD Expo) in 2013.
Southern Innovator Editor and Writer David South in Australia.
Southern Innovator Graphic Designer and Illustrator Sólveig Rolfsdóttir in Iceland.

Some comments that have come in so far about SI’s first issue:

“What a tremendous magazine your team has produced! It’s a terrific tour de force of what is interesting, cutting edge and relevant in the global mobile/ICT space… Really looking forward to what you produce in issues #2 and #3. This is great, engaging, relevant and topical stuff.”, to “Looks great. Congratulations. It’s Brill’s Content for the 21st century!”

What they are saying about SI on Twitter: From @CapacityPlus Nice job RT @ActevisCGroup: RT @UNDP: Great looking informative @SouthSouth1 mag on South-South Innovation; @UNDP Great looking informative @SouthSouth1 mag on South-South Innovation; @JeannineLemaireGraphically beautiful & informative @UNDP Southern Innovator mag on South-South Innov. 

And on Pinterest:

Peggy Lee • 1 year ago 

“Beautiful, inspiring magazine from UNDP on South-South innovation. Heart is pumping adrenaline and admiration just reading it”

Southern Innovator Magazine can be found in libraries around the world.

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP’s South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South’s innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator. 

Creative Commons License

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2022

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Making Bamboo Houses Easier to Build

By David SouthDevelopment Challenges, South-South Solutions

SOUTH-SOUTH CASE STUDY

More than 1 billion people around the world lack decent shelter. Of these, the majority live in urban areas, usually in slums and informal settlements (UN-HABITAT). Latin America has a serious shortage of adequate housing: in Colombia, 43 percent of the population needs decent housing; in Brazil, 45 percent; Peru, 53 percent.

The challenge is to provide good quality homes without significantly harming the environment – and with constrained budgets. Bamboo – cheap, strong, quickly renewable and beautiful to look at (http://en.wikipedia.org/wiki/Bamboo) – is an ideal solution to replace traditional wood lumber. In Bolivia, pioneering work is underway to improve the quality of homes and buildings made with bamboo.

Bamboo is the fastest growing woody plant in the world, sometimes growing over 1 metre a day. Bolivia (http://en.wikipedia.org/wiki/Bolivia) has about 17 identified bamboo species, of which five have a significant economic value. Around the world, there are 1,000 species of bamboo. They grow in a wide variety of climates, from cold mountains to hot tropical regions.

Once called the “poor man’s timber” – a temporary building material to replace once there is more money – bamboo is now getting the respect it deserves. Bamboo for housing has a long history in Latin America, stretching back 4,500 years to ancient civilizations. In Asia, it has long been a traditional construction material. But most of the existing bamboo dwellings in Latin America are 50 to 100 years old.

The most popular species of bamboo used in South America is Guadua, which is known for being large, straight and attractive.

“In Bolivia, there is no other building material more competitive in costs,” said Jose Luis Reque Campero, coordinator of the Bolbambu Programme of the Architectural Research Institute, Universidad Mayor de San Simon, Bolivia (http://www.umss.edu.bo/).

“Bamboo is the material that requires less energy, followed by wood and concrete, with steel in last place, needing energy necessary for its production 50 times greater than that required by bamboo.”

Campero also says bamboo is much less expensive than traditional building materials.

“But the biggest advantage is certainly the possibility of planting bamboo, and then reaping houses,” he said.

Campero has focused his efforts on a key component of bamboo housing: the joints that bind the bamboo poles together. Driven by the desire to find ways to improve the ease of building bamboo homes and their strength, Campero came up with the Bamboo Bolivia Space Structures, Structural System: EVO (BBSS-EVO) (named after Bolivia’s president, Evo Morales – http://en.wikipedia.org/wiki/Evo_Morales).

Traditional joints took a long time to make and required power tools and complex instruction manuals. Simplifying the building techniques necessary for bamboo construction was important because, while bamboo was cheap, the labour costs were high.

The joint looks like a giant two-headed Q-Tip. Each end is made of four pieces of bamboo, connected by a long screw with bolts on each end taken from old cars. The joint is inserted inside the bamboo poles and snaps shut, joining poles tightly together and, as each piece is assembled, looking like a child’s building toy as the structure of the bamboo home takes shape.

The new joint was easier to assemble and was quickly adopted by local builders. It also allows for a vast range of structures and shapes to be built, limited only by imagination and physics.

Devising joints made from bamboo has the advantage of avoiding the weight and cost of bringing in concrete, especially to remote areas.

“The manufacturing process is fully in the workshop and indoors,” said Campero, “which in addition to allowing a degree of quality control in production, improves working conditions for staff and protects the material.”

The whole building process adheres to “the principles of the famous phrase: ‘do-it-yourself’.”

The Evo joint allows for flexibility and easy assembly and disassembly, enabling the builder to move around parts of the structure and not be wedded to the original structural plan. This has the advantage of customizing the building to its physical location.

Working in the tropical forests of Cochabamba (http://en.wikipedia.org/wiki/Cochabamba), Campero has been testing his designs with the local people, who were looking to improve the tourist infrastructure in the resort town of Cristal Mayu.

Costa Rica in Central America – ironically a country without indigenous bamboo plants – has used its National Bamboo Project of Costa Rica (http://www.unesco.org/most/centram1.htm) to prove it is possible to both cultivate bamboo and use it to provide housing for the poor, confirming the wisdom of millions of people: bamboo is economical, convenient, safe and looks great.

Campero has received a great deal of interest in his innovations and is looking for funding partners in 2009 to take his work further.

He has this advice for other builders and designers: “Stick to developing local technologies, use what you have and innovate, use native materials and the local environment for the development of elements, components and construction systems. Don’t rely on advanced technology tools for manufacture, and stay in harmony with the human need for creativity.”

Published: December 2008

Resources

  • UNEP, the UN’s Environment Programme, has produced a report on bamboo biodiversity and how it can be preserved. Website: http://www.unep-wcmc.org
  • The Asian Development Bank is using its Markets for Poor programme to link bamboo products to marketplaces, helping poor communities. Website:http://www.markets4poor.org/
  • The United Nations Human Settlements Programme, UN-HABITAT, is the United Nations agency for human settlements. It is mandated by the UN General Assembly to promote socially and environmentally sustainable towns and cities with the goal of providing adequate shelter for all. Website: www.unhabitat.org

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP’s South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South’s innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator. 

Creative Commons License

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2022

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Safe Healthcare is Good Business and Good Health

By David SouthDevelopment Challenges, South-South Solutions

SOUTH-SOUTH CASE STUDY

Many people have been shocked by recent stories about the proliferation of counterfeit drugs and the rate at which they are killing and harming people in Nigeria. The International Narcotics Control Board found that up to 50 percent of medicines in developing countries are counterfeit. This has driven home the point that without the presence of legitimate players in the African drug market, the illegal sharks will step in to make large profits – and a literal killing.

To counter this negative trend, what is most needed is support for reliable Africa-based companies: businesses that are long-term, sustainable and not living from one grant to the next. But as experience has shown around the world, nurturing businesses requires certain fundamentals: they must work to be profitable, they must find a market and exploit it, and they need cash infusions that are timed to the company’s growth, not to the cycle of international donors. This role, often served in developed countries by venture capitalists, who want a fast return of 35 percent – is too onerous a burden for most African businesses. What African companies need is a more conservative, long-term approach; one that expects returns of between five and 10 percent.

Kenyan company Advanced Bio-Extracts (ABE) is one good example. Only 18 months old and based in Nairobi, the company produces one of a new generation of low-cost anti-malarials known as artemisinin-based combination therapies (ACTs). The drug is produced from the green leafy plant Artemisia, or sweet wormwood. The company is the first in Africa to make this drug, and employs 7,000 local farmers in Kenya, Tanzania and Uganda, as well as scientists.

ABE has received two infusions of cash from non-profit social venture capitalists Acumen, as well as investment from Swiss drug giant Novartis. Acumen has so far invested US $9.6 million in 11 active investments focused on a diverse set of health challenges, including basic healthcare access in rural areas and treatment for malaria and HIV/AIDS.

“We are commercializing a product that had never been commercialized,” said ABE’s owner, Doug Henfrey, to the New York Times. “Those little windows of support make these things happen. We could not have done it otherwise.”

Acumen’s Kenya country director, Nthenya Mule, said “there are positive things happening in Africa, but they are not happening overnight, and some are happening quietly. ABE is exemplary. You will not see it as front-page news, but in 18 months they set up a factory with 160 people interfacing with 7,000 farmers and supplying one of the major pharma companies in the world.”

Stimulating private sector solutions to African healthcare problems is receiving an additional boost from a new fund established by the World Bank’s private sector arm, the International Finance Corporation. To be launched later in 2007, it will offer cash and loans totaling US $500 million to commercial healthcare projects in Africa. According to its own statistics, 60 percent of health expenditure in sub-Saharan Africa is privately funded, and the market, excluding South Africa, is worth US $19 billion.

Published: May 2007

Resources

  • Roll Back Malaria Partnership: Launched in 1998 by the World Health Organization. UNICEF, UNDP and the World Bank to coordinate the global campaign, to fight malaria.
  • Malaria Atlas Project (MAP): An online map showing up-to-date information on high-risk areas for malaria.
  • A paper on the global threat of counterfeit drugs: Click here

Development Challenges, South-South Solutions was launched as an e-newsletter in 2006 by UNDP’s South-South Cooperation Unit (now the United Nations Office for South-South Cooperation) based in New York, USA. It led on profiling the rise of the global South as an economic powerhouse and was one of the first regular publications to champion the global South’s innovators, entrepreneurs, and pioneers. It tracked the key trends that are now so profoundly reshaping how development is seen and done. This includes the rapid take-up of mobile phones and information technology in the global South (as profiled in the first issue of magazine Southern Innovator), the move to becoming a majority urban world, a growing global innovator culture, and the plethora of solutions being developed in the global South to tackle its problems and improve living conditions and boost human development. The success of the e-newsletter led to the launch of the magazine Southern Innovator. 

Creative Commons License

This work is licensed under a
Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2022