Pending Changes in the Development Funding Environment with the Trump Administration.

The total U.S. federal budget is 3,800,000,000,000 (12 zero’s). Of that amount America’s foreign aid is less than one percent. Before the inauguration of the 45th President of the United States, Donald J. Trump, many were speculating what the vast changes in development assistance that would be ushered in under the new Administration.  Everything from infrastructure plans to education, health, and economic development programs are rumored to be impacted by the administration’s support for the “America First” initiative.

These U.S. Government development priorities have garnered a high level of interest by senior government officials, business leaders, and other stakeholders in the lead up to the election.  As seen during the Obama Administration U.S. shareholders, small businesses and large corporate interests with Fortune 500 CEO’s attending the U.S. Africa Business Leaders Summit and the following Business Forum, Power Africa and the continuation of the Africa Growth and Opportunity Act were significant and comprehensively augmented. While others looked to the past republican administration’s initiatives often guided by Christian values and do-good morality especially highlighted by programs such as PEPFAR supporting HIV/AIDS treatment, education and agriculture, it appears as though within the first few weeks of the new Trump Administration there are other ideas for a more narrow engagement of the relationship between the U.S. and the nations of Africa.

Over the last 30 years, development assistance has given us the greatest opportunity to close a basic equity gap and spread prosperity and freedom within the U.S. and throughout the global community.  The returns on the one percent investment the U.S. spends on Official International Development Assistance Funds, includes global successes such as PEPFAR that supports life-saving antiretroviral treatment for 7.7 million men, women and children, nutrition programs reaching 12 million children, and access to clean water and sanitation for 50 million people and counting. The successes are not just humanitarian in nature, the African Growth and Opportunity Act has generated $37 billion in total two-way traded goods with Sub-Saharan Africa and according to the U.S. Department of Commerce, U.S. exports of goods to sub-Saharan African countries supported an estimated 121,000 workers in the U.S., that is, American jobs in 2014.

But let’s not get confused, our international development funds have also created an incredible contractor industry in the U.S. worth billions of dollars that employs thousands of American workers.  The likelihood that you know a person working for an U.S. Government Contractor in receiving international development contracts is one in five.  The top five largest U.S. contractors for Official International Development Assistance received contracts worth over $2.3 billion in 2015.   According to the U.S. Government, total obligations for total overseas development assistance to sub-Saharan Africa in 2005 was $4.9 billion, in 2015 assistance increased to $12 billion.  The largest sectors of funding were Population Policies, Programs and reproductive health, emergency response, and basic health. So while Trump is attempting to cut and slash a less than 1% budget of aid to Africa that also aids and employs American workers and American jobs his administration and knee-jerking supporters are all focused on putting “America First”; it will in reality put “America Last” with increasing strong South-South partnerships, and a wide-eyed Putin laying in wait to pick up the slack.

Please take note, prosperity in Africa and around the world is in the best interest of the United States, it always has been and always will be.

 

 

 

 

Food

At this moment, more than 900 million people worldwide are experiencing hunger. Among the hardest hit regions Southern and Eastern Africa as well as India are experiencing crimpling drought and rising temperatures. Leaving over 400 million threatened with starvation.

According to the United Nations Global Early Warning System people in the Southern African Development Community (SADC) and those living along the North-South African corridor are experiencing one of the worst droughts brought on in the last 25 years.

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Food insecurity is threatening to slow the economic progress of countries in the SADC region and those in the larger Common Market for Eastern and Southern Africa (COMESA). Drought, poverty, and food insecurity that threaten large populations around the world are disconcerting challenges that keep us, at 1847 Philanthropic, up at night. While it may be tempting to separate these issues into smaller and more “manageable” problem sets that bite sized approach limits the ability of these countries to mobilize on a grander scale the necessary resources to holistically tackle this dilemma comprehensively. Achieving optimal nutrition[1] depends on the complex movement of multiple factors within the health and food systems of a particular country. Many factors contribute to this delicate nutrition enabling environment. While we can’t completely militate against natural disasters such as drought, through genuine partnership and collaboration, we can work toward local preparedness and increased resiliency for those most at risk and vulnerable to the plights of malnutrition and starvation in developing countries.
In the short and medium-term, three things can be done to help us achieve the sustainable development goals of no hunger and good health:

  • Source food stuffs for immediate emergency relief from the local region versus importing international food aid; this will do less harm to local economies and will assist with regional integration and increased investments in the transportation and local production of food.
  • Ramp up investments in cold storage and processing facilities and enhance the use of successful methods of irrigation for locally available nutritious foods such as sweet potatoes and legumes
  • Support local organizations already providing assistance throughout the lean slow seasons and unforeseen disasters. Far too often critical local factors are left out of the discussion pertaining to overseas development assistance (ODA) with direct food support when clearly they are the closest responders. While ODA is often structured as bilateral agreements between two countries, they lack the flexibility of bringing additional development and private sector partners to the table threatening all well-intended efforts.

Governments within the COMESA and SADC regional blocks need to compromise for the sake of an estimated 30 million people who lack the daily dietary intake needed to live a healthy life (United Nations). The pattern of food insecurity and malnutrition in Africa has been well-researched and documented. Whether it is man-made via policies or by natural disasters and climate change, we have to do more in moments that are non-emergency to prepare societies for fluctuations that may develop into emergencies.

Organizations such as Farm Capital Africa, MFarm. One Acre Fund and others are African organizations emerging entirely as agribusiness markets. The organizations create demand, use capital access for growth, and support farmers and cooperatives. All of these factors point to what we know will work in the long run. Dr. Akinwumi Adesina, the President of the African Development Bank has committed $24 billion in funding for agriculture for the next ten years. The donor community needs to get on board and support these initiatives. This action will require some shifting in attitudes and funding objectives but in the long run will bring a great deal of success to a systemic impasse. As Dr. Adesina said at the Seventh African Agriculture Science Week in Kigali, “It is high time that Africa feeds Africa.”[2]

[1] UNICEF, 2013 Black et al., 2013

[2] Africa Wants to Stop Importing Food by Dan Ngabonziza, KT Press, published June 13, 2016

Sustaining Economic Growth with Investments in Education

HiResThe discussion around economic growth during the IMF and World Bank Spring meetings, the World Economic Forum Africa meetings in Kigali, and the G20 meetings in China quickly turns to the bulging inactive youth population presence in most developing countries. Not limited to but particularly in sub-Saharan Africa the conference discussion moves to why such startling numbers of adolescents are unemployed. In fact, while sitting at the library writing this blog post one glance around makes it apparent that the surrounding chairs, desks, and hallways are full of idle and economically unproductive young males between the ages of 18-30, languishing away in the middle of the day. Surely they can’t all be working from home using the library as a change of location hoping the walk will accomplish the practice of “hitting two birds with one stone” by getting in from the outing some much needed exercise. Most of these young men are using the library as a place to charge their cell phones or to gain momentary relief from the extreme temperatures of cold and heat. Some may be applying for jobs and others lingering around waiting to use the less than plentiful computers in the libraries’ media/technology center.   Because so many young men in their most productive years are not drawing a paycheck, globally this lack of productivity has led to both a fiscal and education collapse. While this library is a world away from the places where most of 1847 Philanthropic’s work is focused, what has become very clear is that there is a worldwide education and unemployment crisis.

In fact, a few weeks into the spring session, the African American Institute sponsored Conversations on Africa, with a session on “Reflections: The Obama Administration’s Approach to Promoting Education in Africa” held April 21, 2016 on Capitol Hill. This forum provided an opportunity to discuss the similarities and differences in global education systems. The findings reveal that 250 million children around the world are failing to learn basic skills in reading, writing and mathematics is a sobering statistic. According to USAID (The United States Agency for International Development), 124 million children and adolescents are out of school and 62 million girls are not in school universally. The expectation that young people can thrive in an environment without skillful training and preparation is absurd.   Coupled with the increase in gender-based violence, that is physically restraining girls from going to school, directly lowers academic performance on the whole. Surely our children, mankind’s future, deserve better than this! Donors are shifting their focus to education programs both in the US and overseas. Leading the way in international funding is USAID with additional funding for the New Education Strategy, which covers education programs in 20 countries across the African continent. Between 2011 and 2014, USAID reading programs have reached more than 30 million learners. In the US, Foundations are trying to fill the disparities with innovations in the delivery of improved high-quality education to deprived populations. With the Ford Foundation, the William and Melinda Gates Foundation and others leading the way, strategic financial investment in early education establishes comprehensive solutions that create an enabling environment where youth can learn to succeed and become productive. We are all part of one world, whether we are Youth Lead! in Sri Lanka, YETA in Uganda or Opportunity Youth in New Orleans our children deserve and require a chance to prosper.

IRS changes to tax code could spell trouble for many non-profits

Many non-profits provide critical social services to some of the most vulnerable and disadvantaged populations.  Whether the targeted population is in the United States or abroad non-profits registered as 501-c 3 tax–exempted through the Internal Revenue Service (IRS).  This classification also benefits donors by providing them with a contemporaneous written acknowledgement provided by the donee organization, which provides proof of a charitable contribution and allows the donor tax-deductible self reporting forms.   Based on the Federal Register notice dated September 17, 2015[1], the IRS proposed to add additional requirements to the current Income Tax regulations under code 170 (f)(8) governing the substantiation of charitable contributions of $250 or more.   The checks and balances is assured to the IRS given that the donor would self-report for a tax deduction and the donee organization files a 990, “Return of Organization Exempt From Income Tax”.  Now the IRS would like to change this requiring donee organizations to collect additional personal information from donors including social security numbers to keep tax exemption status for donations over $250 dollars.

Let it sink in.  This means that the organization that asks you to contribute to those Thanksgiving dinners to the homeless, the healthcare or HIV treatment to those who can’t afford to pay, the after-school program, or your University that is raising money for capital improvements.  The IRS is proposing they collect your personal identification information to file for all donations over $250.  The implications of new addition to the disclosure code are severe and will be immediate if these regulations are approved, particularly for small non-profits.  In an ever increasing environment of identify theft will donors be willing to add another layer of risk to “do good”.  In the mail just last week I received notice from the Office of Personnel Management stating that my personal information including my social security number could have been compromised in a breach and offering identify monitoring.  If our own government can’t keep our personal information safe is it reasonable to expect that non-profits can take on that task?

After months of comments and feedback from non-profits and organizations like the Association of Fundraising Professionals that mobilized thousands of individual and organization-linked fundraising professionals around the country, the IRS has backed down and withdrawn the substantiation requirements.
[1] Federal Register/Vol. 80 No. 180/ Thursday, September 17, 2015/ Internal Revenue Service: Substantiation Requirement for Certain Contributions. Notice of  proposed rulemaking.

BUT WHAT ABOUT TODAY AND THE OTHER 364 DAYS OF THE YEAR?

Last week we celebrated International Youth Day on Wednesday, August 12. The creation of this day by the United Nations in 2000 was meant as recognition of the need “to draw attention to a given set of cultural and legal issues surrounding youth.” [1] This year the UN released a statement encouraging member states to make young people “drivers of change”. While in theory elevating the current state of affairs of young people for one day each year as a tool to drive awareness is a useful exercise.   Many of us who work with youth and promote full youth participation know that more than a day is needed to address the systemic marginalization of young people in many countries but particularly in the developing world.

In many cases what is stated policy “to engage youth as assets”, and the “largest and most rich untapped resource” is mostly rhetoric that manifests itself in programs mostly designed to “fix” the youth problem. What does it mean to make youth “drivers of change”? What happens the days and weeks after International Youth Day? In order to find out I spoke with four of the youth organizations that I had the pleasure to meet while in East Africa supporting the design of a youth in agriculture program.

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When we tried to come to the table we were told it was full

What I found was young, motivated, and energetic community based organizations (CBOs) that were struggling with challenges so daunting and yet fairly simple to solve if in fact there was a will to truly partner with youth-run groups.

So I called and Skyped and asked how was your International Youth Day? In Uganda, one organization was asked by local officials to bring out their youth members for a demonstration event on International Youth Day, when asked if they could follow up and meet to discuss the mission and projects of the group, they were told, “ There is already one youth group representative we work with”

In my conversation with the executive director of a program in rural Mbeya, Tanzania, I asked if the organization participated in any International Youth Day events? “ Yes, we were able to make provisions for one of our farmers to attend the event.”   As a follow up questions I asked was the organization able to follow up on any of the contacts that were interested in engaging youth? The Executive Director had followed up and had received a no from each of the proposals that the organization submitted. When I asked if he knew why he went on to tell me, “We are considered too young an organization and we did not have audited financials.”

The total budget for this particular CBO in Mbeya was $1,900 last year. This was how much they were able to raise on their own with some assistance from a larger international NGO.   Local audits are between $1,000 and $2,000 based on a quick comparison shopping with local accounting providers. While the need to have coherent financial accounting of donor funds is critical to effective management of funds the chicken and egg scenario we discussed was quite discouraging even for me. If only the organization had more experience and money to meet the criteria and yet if they had the money and experience they would likely not need the help they do to qualify. All of the conversations I had with each entity in different stages of maturity and sectors showed me that youth were organized and trying to gain access to the formal civil society sector.

Concrete Steps to Support Youth CBOs

My number one recommendation for development agencies that want to have real engagement with youth run CBOs is support these organizations and help them grow. There is no sense in encouraging youth participation if they are not going to be welcomed at the table because they are too young in experience or don’t have the past performance to compete with other development actors. Young run organizations need support to get started. After my statistically invalid survey of youth-run CBOs in East Africa, I learned there are some things that could be useful for these organizations during the other 364 days of the year, including:

  • Structure mentoring programs with access to financial incentives. Mentoring takes time for both the mentee and the mentor, while these relationships have proven to show dividends it would be helpful to have access to some financial resources such as grants, competitive awards for organizations in this type of NGO leadership mentoring program to offset the costs of spending this time away from fundraising.
  • Establish Youth-Run CBO Funds, similar to Youth Funds that have been established to assist young entrepreneurs, not everyone is going to start a business. There should be funds available for youth CBOs in the priority areas identified in the countries development strategy. Such as the successful Youth Bunge Model supported by USAID Kenya has more than 15,000 village-level democratic groups or “bunges” registered with the Government of Kenya.[2]
  • Provide extra points in program evaluations for large NGOs collaborating with budding youth organizations. This will help alleviate some of the perceived credibility concerns of some of these CBOs and will allow them to get on their feet and prove performance.
  • Support Universities with student run CBOs that prove successful and potentially scalable. Support at the University level could serve as a sort of incubator for CBOs.

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With over 200 million persons (aged between 15 and 24, the youth bracket)[3] in sub-Saharan Africa under the age of 25, more needs to be to include young people trying to support their communities in all sectors of the economy. The idea that young people need to be occupied in activities until they have enough money, age and experience to fully participate or be useful is not particularly helpful.  Youth see through this fakeness and begin to waiver in their convictions as institutions erode their confidence.

Long-term engagement programs such as 4-H and others that promote positive youth development have been shown to triple the likelihood of youth contributions within their communities. All that is needed is true desire for partnership, trust and commitment for youth to be encouraged to find their path as leaders not just for the future but also as drivers of change and innovation, today.

[1] http://undesadspd.org/Youth/OurWork.aspx

[2] https://www.usaid.gov/news-information/frontlines/youth-mobile-technology/community-‘parliaments’-kenya’s-youth-find-voice

[3] www.un.org/africarenewal/…/africa’s-youth-“ticking-time

Your Mission Inspired Our Launch

Since 1990, extreme poverty has been cut in half in developing countries. The story of development is one of promise, advancement and growth but we still have to aim higher. The role civil society and local non-governmental organizations (NGOs) play in the growth of economies and providing social safety nets is significant.

In Africa, many community-based indigenous NGOs are on the front lines assisting where they live and work, but often these local heroes do not have the resources to sustain transformational development.

We hope to change that.

At 1847 Philanthropic, we strive to enhance the long-term viability and financial stability of indigenous organizations in Africa. We provide this assistance by engaging both the donors, looking to support local causes and local NGOs on-the-ground.

True support of local organizations includes developing program management skills, structuring processes to absorb the funding, and communicating impact through an established reporting progress. Once we are assured of the local organization’s capacity, we use existing grants from the donor as leverage to raise additional funds for meaningful projects.

These services provided together produce a clear path for African non-profits to create financial stability, increase impact and efficiency. Allowing these local heroes to tackle the other half of the world’s population still in poverty with efficient and effective AID.

This blog will focus on strengthening the case for international funding of African NGOs. We will publish tips on developing small local fundraising campaigns as well as highlight case studies of successful engagements by donors with local African NGOs.

Your comments and feedback are always welcome.

–Rashida