|From: Glenn Petersen||8/7/2017 10:35:22 PM|
|A GiveDirectly update from NPR:|
How To Fix Poverty: Why Not Just Give People Money?
(GP: NPR podcast at link below)
August 7, 20172:42 PM ET
Heard on All Things Considered
Denis Otieno is one of the villagers getting $22 each month from the charity GiveDirectly. He and his wife have used some of the money to buy cypress saplings. They hope to sell the trees for lumber in a few years to pay for their children's education. Nichole Sobecki for NPR
Young guys in dusty polo shirts. New moms holding their babies. Grandmas in bright head wraps. They've all gathered in a clearing for one of the village meetings when something remarkable happens. Practically every person's cellphone starts tinkling.
In this series, NPR explores an emerging idea in the fight against global poverty. Instead of offering poor people traditional aid — seeds or goats or job training — what if you just give cash? Join the conversation with the hashtag #NoStringsCash or tweet us @NPRGoatsAndSoda
It's a text alert from an American charity called GiveDirectly. Last fall, GiveDirectly announced that it will give every adult in this impoverished village in Kenya an extra $22 each month for the next 12 years — with no strings attached. The money is wired to bank accounts linked to each villager's phone. The alert is the signal that the latest payment has posted. Everyone starts cheering. Some of the younger women break into song.
The payouts are part of a grand and unprecedented experiment that is motivated by an equally sweeping question: What if our entire approach to helping the world's poorest people is fundamentally flawed?
Otieno withdraws money from his M-PESA account, a widely used banking system linked to people's phones. GiveDirectly wires its monthly payouts to the villagers through M-PESA. Nichole Sobecki for NPR
Dancan Odero checks his phone to confirm that the GiveDirectly transfer has been made. Nichole Sobecki for NPR
Today practically all aid is given as "in-kind" donations — whether that's food, an asset like a cow, job training or schoolbooks. And this means that, in effect, it's the providers of aid — governments, donor organizations, even private individuals donating to a charity — who decide what poor people need most. But what if you just gave poor people cash with no strings attached? Let them decide how best to use it?
GiveDirectly has actually been advocating for this kind of cash aid for the past decade. Founded by four grad students in economics who wanted to challenge traditional aid, the charity has already given $65 million to people across Kenya, Rwanda and Uganda, provided by a mix of Silicon Valley foundations and ordinary citizens who contribute through GiveDirectly's website. And GiveDirectly has shown through rigorous, independent study that people don't waste the money.
Still, those cash grants were relatively modest one-time payouts. With this experiment, GiveDirectly wants to see what happens when you give extremely poor people a much longer runway — a guaranteed "basic income" they can count on for years. Michael Faye, the chairman of GiveDirectly, says they've chosen to set the payment at $22 because in Kenya $22 per person per month is "the food poverty line — the amount of money it would take to afford a basic basket of food for yourself."
This hamlet, near Lake Victoria, is the first to participate in the cash distribution experiment. GiveDirectly plans to expand the payouts to 200 villages and compare them to 100 other villages that don't get the cash. Nichole Sobecki for NPR
This hamlet near Lake Victoria — about 400 residents living on less than $2 a day in mud-brick huts with no running water — is just the beginning. (GiveDirectly has asked that NPR not disclose the name of the village to protect residents' privacy.) This coming fall, GiveDirectly wants to extend the monthly payments to every adult in 200 similar villages across Kenya, then compare them to 100 "control" villages that don't get the cash. To do this they need $30 million, of which they've raised $25 million.
Some of the world's foremost researchers of anti-poverty strategies will be doing an independent study of the data that emerges — including Alan Krueger, professor of economics at Princeton University, and Abhijit Banerjee, a professor of economics at MIT and director of the Abdul Latif Jameel Poverty Action Lab.
It will take more than a decade to determine the impact. But just a few months in you can get a hint from two cousins at the village meeting, who are grinning and clapping as the women finish their song
All his life, Denis Otieno has been striving to climb out of poverty only to find himself blocked by a lack of funds. Nichole Sobecki for NPR
Denis Otieno is a father of four in his late 30s. He holds up his phone to show his new balance. "I got it!" he exults.
Standing next to him is 30-year-old Dancan Odero, who is single and more soft-spoken, but looking just as pleased as he clicks through his phone.
"I'm more happy," he mumbles. "I'm more happy. I'm more happy."
For each of them the money has already proved life-changing but — and this is the key — in totally different ways.
Otieno: "I'm thinking of putting up a forest"We'll start with Otieno. I meet up with him one morning in a field by his house as he slashes off tree branches with a machete. He's going to burn the wood to make charcoal.
What you need to know about Otieno is that he's an entrepreneurial sort of guy who all his life has been striving to climb out of poverty — only to find himself blocked by a lack of funds.
Despite a tough start in life — he was orphaned at age 16 — straight out of high school he got himself into a training program for mechanics. He managed to land a job repairing cars, thanks to a relative who worked at the same company in one of Kenya's cities. Then that company closed. Since then, Otieno says, he has found it impossible to find another position. "I've applied! I've applied so many times and it doesn't work," he sighs.
Part of the problem, he explains, is that the person doing the hiring at a company often requests a bribe. "They'll say, 'OK, I want half your salary, before you start.' " Otieno doesn't have that kind of money.
Otieno and two waitresses go over the accounts at his lakeside bar. To start the business he had to take out a loan. Now the payments are crushing him. Nichole Sobecki for NPR
He has also tried starting various small businesses — including a kind of bar, selling drinks to fishermen out of a gazebo on the shore of Lake Victoria. The trouble: To get the bar off the ground, Otieno had to take out a loan of about a thousand dollars at an interest rate of nearly 25 percent. Now the payments are crushing him. "Each day, whatever sales I make I just send to the bank," Otieno says. "You end up working for the bank."
Then there's this charcoal making. Ideally, Otieno says, he would buy the rights to harvest one of the tall, thick trees that grow on some people's property, then rent a chainsaw to cut it up. But that would require money up front, which, again, he doesn't have. Instead, he has to make do with the thinner shrubs on his own land, hacking off each limb by hand.
Source: Nichole Sobecki for NPR. Otieno prepares the ground to burn wood for charcoal.
Sweat pours off him as he hoists the pieces onto his shoulder and lugs them over to the burn pile. It will take hours to chop the wood. Then he has to cut leaves to cover the pile. Light a fire at the bottom. Shovel dirt on top. The process will take two days — after which he'll have enough charcoal to sell for, at best, $5.
So the combined $44 a month Otieno and his wife have been getting from GiveDirectly is boosting their income by as much as 50 percent many months.
The benefits are already visible, most notably in the case of Otieno's 2-year-old daughter Gloria, who is looking healthy and full of pep as she toddles behind him. "My Daddy's girl," he calls her, because she follows him everywhere. She picks up a stick and pretends it's a machete, thwacking at branches alongside her dad.
Otieno's 2-year-old daughter, Gloria, follows him everywhere. "She's my Daddy's girl," he says. Nichole Sobecki for NPR
Gloria used to cry all the time, Otieno says, because she was hungry. Before the GiveDirectly payments started there were many days each month when he couldn't afford to buy his children breakfast or lunch. Sometimes there wasn't even dinner apart from what Otieno calls "porridge" — water mixed with flour and sugar, "just to fill the stomach." On those nights, he recalled, "you feel so ashamed as a father."
Otieno and his wife, Bentah, laugh as Gloria munches on some bread. Gloria used to cry all the time because she was hungry. Now Otieno can guarantee her solid food every day. Nichole Sobecki for NPR
He still wishes he could feed his children more meat and fish. But with the extra charity money, now he can at least guarantee them solid food for both lunch and dinner. And for breakfast they're getting milk from several goats that are chomping on shrubbery nearby. The family used to own just two. With the charity money they've bought three more. They hope to breed them — then sell the offspring. Maybe upgrade to a cow.
Otieno and his oldest daughter plant one of the cypress saplings. He says he'll designate a different section of the grove for each child to help him tend. "It's going to be like their bank account." Nichole Sobecki for NPR
Longer term Otieno has an even more ambitious plan: "I'm thinking of putting up a forest," he says. Specifically, a grove of eucalyptus and cypress trees. They're used as lumber in construction. Every month Otieno has been setting aside $10 of the charity money to save up for saplings. They should be tall enough to sell in five years. He wants to use the money to put all four of his children through high school. He'll designate a different section of the grove for each child to help him tend. "It's going to be like their bank account," he says, laughing.
Otieno is hoping that his tree venture will be the one that finally boosts his family out of poverty. Nichole Sobecki for NPR
And maybe something more. Otieno is hoping this venture will be the one that finally boosts his family out of poverty. Because this time, for the first time, Otieno doesn't just have an idea. He has the capital to make a proper go of it. So that 12 years from now when the money from GiveDirectly stops flowing, he won't need it.
Odero: The power of a sofa set
Now to Otieno's cousin, Dancan Odero — the 30-year-old single guy. He's had a different experience.
Odero lives just a 10-minute walk away from his cousin's house along a red dirt path. When I catch up with him he's also hacking at branches. The field belongs to his elderly aunt. He's clearing underbrush while he chats with her.
Dancan Odero at his family's compound. He has epilepsy, which makes it hard for him to work. His family says he's constantly trying to prove he can be useful. Nichole Sobecki for NPR
She looks worried. Odero has epilepsy. Working in this sun is risky. "I'm scared he could have a seizure right here," she confides in a low voice. She's seen it happen before, she adds. "Many times." But Odero insisted on helping.
His family says he's constantly trying to prove he can be useful — be independent. But people hesitate to hire him for even odd jobs. He'll go out with the other young guys to look for work. Then watch as everyone gets picked but him. Back at his house he says that when that happens, "it makes me so frustrated I start shaking and I feel like crying. But I just keep it inside."
What makes it all worse, he adds, is that he didn't used to be this way. Back in elementary school he was a top student. One of his cousins, Isaac Oguti, remembers how Odero even used to get a little cheeky with teachers, bombarding them with questions. But Oguti says they'd let it slide because "he was so bright, the teachers loved him."
Then, when Odero was in the eighth grade, the seizures started. By the end of the year he had to drop out. He's clearly still intelligent. He loves to read. And he speaks English at a remarkably high level for someone who had to stop studying in middle school. But his family says over the years the attacks seem to have taken a toll on his brain. His speech has become slow and halting. And he often falls into a sort of fog, becoming confused about what's going on around him.
With no real income, he's had to rely on his mother and siblings to pay for practically everything, including food and medicine. His oldest sister Betty says he so hates having to keep asking for money that there were times he wouldn't even tell them he was out of epilepsy drugs. They would just notice that his seizures were becoming more frequent. "Then we'd realize, 'Argh! he's got no medicine.' "
Odero with his mother, Pamela. With no income of his own, he's had to rely on her and other relatives. Nichole Sobecki for NPR
But these days, Odero says, he can use the new GiveDirectly money to buy his meds. He takes them out, handling them very carefully. They eat up a third of his monthly payment.
Still, he's had enough cash left over to save up for something just as precious to him: a sofa and two armchairs. He explains that in the village, when a guy reaches adulthood, it's traditional for him to build himself a house on his parents' land — a mud hut with a living area and sleeping nook. But Odero never had the money. It wasn't until a year ago that his brothers built a hut for him. Even then he had no furniture. Buying that sofa set was so important he says, "so that when guests came to visit I wouldn't be ashamed."
Source: Nichole Sobecki for NPR. Odero lives in this hut, which his family built for him.
His mother, Pamela, remembers the afternoon when a little white taxi with the new sofa set strapped on top pulled up to Odero's hut. He carried in one of the armchairs and just sank into it, she says, laughing. Then, she says, he started calling over all his friends, saying "Come! Come have a seat!"
"Yes," he agrees. "I couldn't stop smiling."\
Odero's pride and joy is his new sofa set. He bought it using money from the payouts "so when guests came to visit I wouldn't be ashamed." Nichole Sobecki for NPR
There was a hitch, though: It turned out the set only consisted of the wood frame. Cushions for the seat and backrest must be purchased separately, and there wasn't enough money to cover that. So since then, Odero has been carefully husbanding his GiveDirectly payouts to complete the set, buying one or two cushions each month.
As for any planning beyond that? There's not much, he admits. Unlike his cousin Denis Otieno, Odero has no scheme for how to use the charity income to make more money. No strategy for the day the money will stop coming.
I ask him, "Do you worry that at that point you will be back to where you were before?"
"Yes," he says, casting his eyes downward. "I think I might."
Odero has no long-term strategy for how to use the charity income to make more money. But the money has clearly changed his life for the better. Nichole Sobecki for NPR
Dignity and a rekindled love
So would this make GiveDirectly's grand experiment a failure?
Faye, the charity's chairman, says not necessarily. "There's a lot of talk about this magic bullet that you can apply once and people will no longer be poor," he says. "I think we all hope that to be true. We would obviously hope cash has the long-term impact."
But he points out that this is an unfair standard. Every month that GiveDirectly provides the villagers with $22 the charity is, by definition, lifting them out of extreme poverty. So on some level, it's just a different version of the billions in relief aid that the world currently spends annually to provide desperately poor people with food and other forms of in-kind help. No one expects that type of aid to permanently lift people out of poverty. So it would be enough for this experiment to show that just giving poor people cash is more efficient and effective.
"Let them make the choices," says Faye. "Because the poor are pretty good at making them."
Only they can know the damage that poverty does to each individual. And it's not just the tangible deprivations.
For Odero, what poverty really stole from him was his dignity. And the couch set is what has given it back. He no longer feels like the village invalid, the guy who always has to depend on everyone else, who can't ever be the host. Now he can invite people over — and offer them a place to sit.
"I feel like now I can be counted as a person," he says.
And even practical, go-getter Otieno says the most profound benefits go beyond the material. It's late afternoon. Otieno and his wife, Bentah, are sitting in their hut — heads bent over a notepad as they calculate their budget for the month. Otieno tallies some figures with a pencil, then looks up and says, "I was thinking that since last time we weren't able to give your mother any grain, we should get her some this time."
Otieno and his wife, Bentah, calculate their budget for the month. They never used to talk about money. It was too stressful. Nichole Sobecki for NPR
Bentah purses her lips. "Hmm, how much do we have?"
Both of them say a conversation like this would have been out of the question before the GiveDirectly payments started. Otieno worried Bentah wouldn't agree with how he was spending their earnings. As the eldest of four siblings, and with his parents long dead, he felt a duty to help his younger brothers and sister with a little cash during tough times, even when he and Bentah were just as hard up. And Otieno felt all the more awkward about it because he has yet to pay Bentah's parents the traditional dowry a groom owes his in-laws — generally two or three cows, a goat and some cash. The in-laws let the marriage go forward on the understanding that Otieno was good for the dowry down the line. But as the years have passed it's become an unspoken point of contention.
For her part, Bentah says she would often put unrealistic demands on Otieno. "We would have our needs as a family, and honestly he wouldn't have enough for it. But I would sometimes fail to understand that and that would bring friction."
So Otieno kept the family finances to himself — doling out pocket money to Bentah so she could buy the groceries but keeping her in the dark about the bigger picture. "I would be like, 'OK wife, do your work. I'm the man. Let me do my part. I'll just bring the money and here's what you should do with it.' "
And the silence over money seeped into the rest of their relationship, says Otieno. "I would come home. If there was a meal, I'd eat the meal. Then go to bed. No talk."
Figuring out how to spend the charity windfall has become a hopeful, joint project for Otieno and his wife, Bentah. And it's brought the fun back into their marriage, says Otieno. "It's like we're married the other day." Nichole Sobecki for NPR
Yes, agrees Bentah. "It was a little bit gloomy."
But now, figuring out how to spend the charity windfall has become a hopeful, joint project. Adding up their budget has become a monthly ritual. And it's got them doing other fun stuff together. Going on shopping excursions to the market. And, says Otieno, strolling around the village, hand-in-hand.
"It's not normal in our village for couples to walk this way," he adds, grinning a little sheepishly. "But it's like we're married the other day."
"You mean like newlyweds?" I ask.
"Yes," he says, laughing. "You're right."
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|From: Glenn Petersen||9/13/2017 8:31:29 PM|
|Africa’s Delivery Drones Are Zipping Past the US|
Author: Jeremy Hsu Jeremy Hsu
A Zipline drone releases a blood package in southern Rwanda.
CYRIL NDEGEYA/AFP/GETTY IMAGES
Tech visionaries may tantalize us with visions of instant gratification via drone delivery, but Silicon Valley has yet to deliver on such promises. Meanwhile, halfway around the globe in an African country barely the size of Maryland, drone deliveries have already taken flight—with more serious cargo than burritos.
In October 2016, Rwandan crowds cheered the launch and landing of delivery drones developed and operated by Zipline, a San Francisco-based startup. The locals call the Zipline drones “sky ambulances” as they soar overhead and swoop in low to drop off lifesaving blood supplies by parachute to remote hospitals and clinics located hours outside the Rwandan capital of Kigali. That may sound very different from the PR circus surrounding Google drones testing delivery of Chipotle fare to Virginia Tech college students—and it is. But Zipline and similar delivery drone pioneers have also learned some valuable lessons about what a large-scale delivery drone operation can look like—and whether Silicon Valley can ever realize the dream of drone delivery to your doorstep.
“Countries like Rwanda can make decisions fast and can implement new technologies in concert with new regulations fast, so we’re now in a position where the US is trying to follow Rwanda,” says Keller Rinaudo, CEO and co-founder of Zipline. “They’re not trying to catch up to US infrastructure. They’re just leapfrogging roads and trucks and motorcycles and going to a new type of infrastructure.”
In early 2018, Zipline will officially kick off the world’s largest delivery drone service in Tanzania, Rwanda’s much larger neighbor. The Tanzanian government aims to use Zipline’s delivery drones to make up to 2,000 deliveries of medical supplies per day. Those deliveries of supplies such as blood products, medicines, and snake antivenom will go to more than 1,000 hospitals and clinics serving 10 million people. An operation at this scale will dwarf anything previously attempted in the drone-delivery universe.
The Tanzania launch will fulfill the dream that led Rinaudo to found Zipline in the first place. In 2014, he met a graduate student named Zac Mtema while visiting the Ifakara Health Institute in Tanzania. Mtema had created a mobile alert system that could help doctors and nurses text emergency requests for medicines and vaccines to the government. There was just one problem: The government had no way of quickly delivering those medicines and vaccines via the country’s existing roads and distribution networks.
Today, Mtema is helping the Ifakara Health Institute evaluate how Zipline’s service affects health outcomes in Tanzania. Quantifying lives saved and medical conditions treated could go a long way toward convincing Zipline’s deep-pocketed backers in the international aid and development community—such as the Bill & Melinda Gates Foundation—that delivery drones can become a global force for humanitarian good. The for-profit startup has already raised at least $41 million in funding from investors.
By focusing on carrying critical medical supplies, Zipline has gotten off the ground faster and in a bigger way than other, more mundane delivery pioneers. It’s a lot easier to convince regulators to tolerate the potential safety risks of delivery drones falling out of the sky when those aircraft are making lifesaving deliveries to hospitals rather than carrying shoes or pizza.
Zipline isn’t the only delivery drone startup to latch onto the idea of carrying high-value packages in difficult terrain. Matternet, a startup in North Fair Oaks, CA, plans to launch a partnership with the Swiss Post before the end of 2017, carrying healthcare supplies between hospitals and labs in Switzerland. “In healthcare we’re targeting over 1,000 hospital groups with three or more facilities in our target markets, which include the main European Union markets, the United States, and Japan,” says Andreas Raptopoulos, Matternet’s CEO. “For the applications we’re pursuing in health care, [delivery drones] are clearly profitable for us while giving a 50 percent saving to hospital systems over the on-demand ground delivery methods they use currently.”
These drone pioneers have learned that if you’re going to provide reliable service delivering essential, life-saving goods, you may end up with technology that looks very different from the familiar demo videos of consumer delivery by air. All drones must contend with limited battery life or fuel tanks. But many early experiments with delivery drone services used quadcopters or other multi-rotor drone models similar to those available online or on retail store shelves. These designs usually have limited delivery range and speed; their less-than-aerodynamic shapes and vertical lift rotors limit the efficiency of forward flight.
For example, Amazon and Google have been testing delivery drones that usually top out at ranges of 15 miles or less. Shorter delivery ranges limit the number of customers drones can reach, and may also limit the profitability of future delivery drone services. Still, these short-ranged multi-rotor drones are by far the most common choice for drone-delivery innovators, even as some companies have tried creating hybrid drones with both vertical and horizontal rotors to improve flight efficiency. Most delivery drone prototypes still tend to hover like helicopters as they lower a package by cable or take the time to actually land.
A Zipline technician installs a small cardboard box with a paper parachute in a drone prior to its launch in October 2016.
STEPHANIE AGLIETTI/AFP/Getty Images
That may work for the big city or suburbia. But Zipline needed to provide timely delivery of medical supplies across dozens of miles in Rwanda and Tanzania. So the company’s San Francisco team of engineers—drawn from organizations such as SpaceX, Google, Boeing, and NASA—decided to create the equivalent of small drone airplanes with wings. The current “Zips” in Rwanda can fly at speeds of up to 62 miles per hour and reach destinations within a 46-mile delivery radius.
Zipline’s airplane-style drones don’t waste time or battery power landing at their destinations. Instead, they simply swoop in low to drop off supplies by parachute before winging their way home. That’s easier done in the open grassy areas near remote Rwandan clinics and hospitals than in densely populated city blocks. Still, Amazon alone has several patent ideas around the concept of midair package drops or even folding parachutes within package shipping labels. Both Amazon and rival Walmart have even envisioned the possibility of someday using giant airships as flying warehouses that could deploy glider drones with packages.
It’s easy for almost anyone to create a slick video showing a drone perfectly delivering snacks or tech gadgets for a smiling customer on a sunny day. But when lives hang in the balance, drone deliverers must meet a higher service standard—one more like the US Post Office’s: “Neither snow nor rain nor heat nor gloom of night stays these couriers from the swift completion of their appointed rounds.” Mostly, quadcopter-style drones won’t cut it here. Matternet’s Raptopoulos says that a “key challenge is designing a platform that can handle dynamic wind loads during take-off and landing.” The Amazon Prime Air website currently states: “We are currently permitted to operate during daylight hours when there are low winds and good visibility, but not in rain, snow, or icy conditions.”
By comparison, Zipline’s rugged, fixed-wing drones have already made over 1,400 flights and delivered 2,600 units of blood, even during bad weather conditions involving heavy rain or wind in Rwanda. “Everybody and their grandma has bought an off-the-shelf quadcopter and in perfect weather flown three to four kilometers to deliver something under ideal test conditions,” Rinaudo says. “It’s hard to distinguish between that and a national-scale operation that can fly in any weather.”
An additional challenge is limiting the human staff needed to oversee the drone swarm. After all, every human engineer or drone operator on staff is another person on salary, points out Gerald Van Hoy, senior research analyst at Gartner. And the promise of delivery drones hinges in large part upon delivering packages more cheaply than today’s hordes of human bike messengers and delivery van drivers. “With delivery drones, if you’re not flying them automated, then it’s probably costing too much,” Van Hoy says.
The most obvious solution is for drones to mostly fly themselves instead of relying upon a human operator. But automation gets complicated quickly when you’re aiming to deliver to the doorsteps of individual home and business addresses. That could require a drone’s computer brain to track other flying objects in order to avoid midair collisions, fly to a random drop-off point where a given customer lives, and avoid getting entangled in tree branches or power lines when landing or lowering a package for delivery.
It’s possible that better artificial intelligence and the growing trend of edge computing could eventually make for smart drones capable of delivering anywhere without human supervision. But until then, delivery drone services will likely have the best luck sticking with pre-planned flight paths and deliveries to set locations. For example, Flytrex, a startup focused on cloud solutions for drone operations, recently started a delivery drone service involving one or two drones making up to 20 flights per day between two set points separated by a large bay in Reykjavik, Iceland. But Yariv Bash, Flytrex’s co-founder and CEO, says his company is working with the Icelandic Ministry Transportation on a next phase that could involve drone deliveries to Reykjavik street corners before the end of the year.
The point-to-point delivery drone system is also being used by JD.com, a Chinese e-commerce and logistics giant that is already living Amazon’s dream of owning its last-mile delivery. Beyond operating an online marketplace, JD.com has more than 70,000 delivery people getting those packages to paying customers in China. Since 2016, the Chinese company has also operated a fleet of 40 drones that have made “thousands of runs that have packages going to customers,” says Josh Gartner, vice president of international corporate affairs at JD.com.
JD.com currently uses delivery drones in the rural areas of four Chinese provinces. Those drones are “fully automated” and fly “fixed routes” between warehouses or to the backyards of certain “village promoters” employed by JD.com in each country village, Gartner explains. The village promoters then distribute the packages on foot to customers within each village.
A Zipline technician launches a drone in Muhanga, 31 miles west of Rwanda’s capital, Kigali.
STEPHANIE AGLIETTI/AFP/Getty Images
Zipline employs a similar logic of using automated drones to boost the productivity of individual human workers. Zipline’s Rwandan distribution center can operate with just three to four human flight operators potentially handling hundreds of drone flights per day. The flight operators spend their days loading packages onto the Zips, placing the drones in the launch catapult, and then recovering the returning drones that land by using a tailhook to snag onto a line so that they can plop safely onto a giant cushion. (Rinaudo proudly points out that the Rwandan operation runs entirely on Rwandan engineers and flight operators rather than outsourced foreign labor.)
The predictability of automated delivery drones’ flight paths also helps them pass muster with safety regulators. For example, Zipline has provided air traffic controllers at Kigali International Airport with heads-up displays that allow them to track each Zipline drone with centimeter-level accuracy using advanced GPS. That has ensured smooth daily operations, even as the number of flights increases. In fact, Zipline’s Rwandan delivery drone operation is on track to become one of the busiest “airports” in the world based on flight volume by the end of 2018, Rinaudo says.
Still, the upcoming Zipline launch in Tanzania will push the company’s current model to its limits. Tanzania’s sprawling land area—including geographic highlights such as Mount Kilimanjaro and the Serengeti National Park—is 36 times larger than Rwanda’s. That means Zipline will need both more distribution centers and more capable delivery drones to cover a country that is bigger than any US state except for Alaska.
For Tanzania, Zipline eventually plans to roll out four distribution centers each equipped with fleets of up to 30 drones capable of making up to 500 deliveries per day from each center. The startup’s engineers have also been developing an upgraded drone that can carry up to 4.4 pounds, fly at 68 miles per hour, and deliver within a 99-mile radius. That system would enable healthcare workers to simply place orders by text message and receive their packages within half an hour.
Don’t expect to see a Rwanda- or Tanzania-style national-scale delivery drone service coming to the US anytime soon. For one thing, the US Federal Aviation Administration has suggested regulations for delivery drones will not be ready until 2020 at the earliest. By that time, delivery drone operations may only account for one percent of the global commercial drone market, according to a report by Gartner.
Another factor is that the economics of delivery drones make less sense in cities already crowded with many competing delivery services and where safety concerns are more abundant, says Josh Gartner of JD.com (no relation to the Gartner research firm). Indeed, the Chinese company is considering ground-based delivery robots for Chinese cities instead of delivery drones. Similar delivery robots have already been rolling around certain cities in the US and European countries, where delivery drone services mostly remain grounded.
Some companies may seek a middle ground in suburban or rural areas by testing delivery drones as robotic partners for delivery van drivers. In February 2017, UPS—the world’s largest package delivery company—joined forces with the Ohio-based company Workhorse Group to conduct a much-publicized test of a delivery drone deployment from the top of a “Big Brown” van. “Our HorseFly delivery drone can handle packages of 10 pounds and under,” says Mike Dektas, a representative for Workhorse Group. “With the truck and drone delivery system this is a good weight limit, and the 30-mile [drone] range works as well.”
Similarly, Matternet has teamed up with Mercedes-Benz to try out the combination of delivery drones and vans. Matternet’s CEO Raptopoulos also envisions solo delivery drones as becoming profitable for both his startup and logistics companies such as FedEx or UPS, with a price point of around $5 for delivery within an hour. He adds that a company such as Amazon could make the delivery drone service even cheaper or potentially free for customers who have already signed up for the $99 Amazon Prime subscription.
Silicon Valley’s magical vision of delivery drones—Harry Potter-style owl messengers for each of us Muggles—remains seductive as ever. But it’s worth paying attention to what has already been accomplished in the more remote parts of the world—lessons likely to be applied as delivery drone services slowly take off in developed countries. By the time 2018 rolls around, Zipline will surely have more insights to offer would-be winners in the game of drones.
“The vast majority of people thought this was crazy and stupid and there was no chance it would happen in Africa,” says Zipline’s CEO Rinaudo. “Now our entire distribution center is run by a totally driven and brilliant team of Rwandan operators and engineers who are not only working 12 hours a day and 7 days a week, but [also] doing things that the richest tech companies in the world haven’t figured out how to do yet.”
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|From: Glenn Petersen||10/11/2017 7:03:57 AM|
|Start-Up Bets on Tech Talent Pipeline From Africa|
By STEVE LOHR
New York Times
OCT. 10, 2017
Seni Sulyman, Andela’s country director in Nigeria, joining colleagues for a video call in Lagos. He said the company “is a platform for giving people who want to learn and succeed access and opportunity.” Credit Tom Saater for The New York Times
When Tolulope Komolafe first heard the pitch, she was skeptical. A fledgling company in Lagos, Nigeria, would pay her to learn how to write modern computer code and then offer her a good job in the high-tech economy.
“I thought it was a con,” she recalled. “Too good to be true.”
After inquiring, Ms. Komolafe found the offer was real. Today, she is a software developer, working remotely from Lagos for a start-up in New York, and she dreams of starting her own tech company someday.
Ms. Komolafe, a 27-year-old Nigerian, is one of hundreds of young Africans who have joined Andela, a fast-growing start-up based in New York that has attracted the attention and money of people like the Facebook founder Mark Zuckerberg and works with blue-chip companies like Mastercard.
The company’s ambitious agenda spans education, economic development and moneymaking. It is betting on its ability to build out a talent pipeline of African software developers to the United States and elsewhere, tapping into a continent eager to connect to the global digital economy.
Jeremy Johnson, Andela’s chief executive, says the company offers “a very different model for unlocking human potential.”
Olufunmilade Oshodi, left, and Tolulope Komolafe are among hundreds of Africans working for Andela as software developers. Credit Axel Dupeux for The New York Times
The animating idea behind Andela, founded in 2014, is that Africa has plenty of smart people, but that they too often lack the preparation for and pathways to gainful jobs — the missing ingredients that Andela can provide in the field of software development.
Not only does Andela instruct people in person, but 20,000 aspiring programmers across Africa have used its free online learning and training tools. By 2024, Andela hopes to have helped prepare 100,000 software developers in Africa for jobs, including thousands working for Andela.
After six months of paid training, the Andela employees become remote members of software development teams at companies. The current roster of 112 customers includes Viacom, Mastercard Labs, GitHub and SeatGeek in the United States, and clients in 10 other countries.
“This is a platform for giving people who want to learn and succeed access and opportunity,” said Seni Sulyman, a 32-year-old graduate of Harvard Business School, who is the country director for Andela in Nigeria.
The challenge for Andela will be expanding its model to meet its lofty growth targets. “Andela has delivered on its promise so far, but can it keep finding high-quality talent and finding relevant employment for them as it gets bigger?” asked Aniedi Udo-Obong, a Google program manager who works with software developers in Africa.
Andela’s growth plans got an enthusiastic endorsement this week from its financial backers, with a $40 million round of venture funding that lifts the total the company has raised to $80 million. The new investment was announced on Tuesday.
The start-up has attracted a group of top investors that find both its business model and its mission appealing, including GV (formerly Google Ventures) and Spark Capital.
It was also the first lead investment for the Chan Zuckerberg Initiative, which Mr. Zuckerberg and his wife, Priscilla Chan, set up in 2015 to eventually invest most of their Facebook wealth to “advance human potential and promote equality.”
During a tour of Africa last year, Mr. Zuckerberg visited Andela’s Lagos office and told the employees, “You are all part of something that’s really important.”
Andela’s offices in Lagos. Ninety percent of its workers are in Africa, with other sites in Nairobi, Kenya, and Kampala, Uganda. Credit Tom Saater for The New York Times Photo
Sayo Alagbe, an Andela coordinator, briefing software developers for a trip to the United States. Credit Tom Saater for The New York Times
Spark Capital and the Chan Zuckerberg Initiative were the lead investors in two earlier rounds of funding for Andela. CRE Venture Capital, based in Cape Town, South Africa, is the lead investor in the new $40 million round, the largest venture round led by an African firm, said Pule Taukobong, a founding partner of CRE Venture Capital.
Andela began with a founding team of six — three Africans, two Americans and a Canadian — and an initial test class of four students. It now employs 800 people, and it expects to double that number in the next year. While it has its headquarters in New York and a small office in San Francisco, 90 percent of its workers are in Africa, with offices in Lagos; Nairobi, Kenya; and Kampala, Uganda.
Though growing fast, Andela has been highly selective. Applicants undergo dozens of online drills to assess everything from technical ability to personality type. About 3 percent of the applicants are invited to a two-week boot camp, and a final cut takes the acceptance rate below 1 percent.
The new hires get a MacBook computer, subsidized housing and two meals a day during their six-month training program. In that time, Andela invests $15,000 in each developer. Starting salaries are low, but after the developers begin working as billable contractors for companies, their pay rises, up to $30,000 or so, comparable to salaries for young professionals in Africa’s urban centers.
Andela makes money much like consulting or law firms. It charges clients per worker, with part passed on to the worker as salary and Andela collecting the remainder. The company declined to detail its billing practices.
Andela’s recruits sign contracts for two years, but are expected to stay for four years. That longevity is part of the business model, since the work of developers on contract to customers helps pay to recruit and train new hires. So far, the retention rate is 98 percent.
None of the developers have hit the four-year threshold yet. Andela would be happy to have them stay beyond that, but it is also encouraging them to go work for other companies or start their own. It is setting up an Andela accelerator to nurture alumni start-ups.
“We want them to go out to become leading entrepreneurs and leading technologists in Africa,” Mr. Johnson said.
The Andela developers are young — the average age is under 25 — and 70 percent have computer science or engineering degrees. But university curriculums in Africa, technologists say, tend to emphasize theory rather than modern programming tools and the techniques of fast-paced software development in teams.
Jolomi Otumara, left, Andela’s director of apprenticeship products, speaking with Kamdi Uko, a product manager, in Lagos. Credit Tom Saater for The New York Times
Olufunmilade Oshodi, a computer engineering major in college, had done some programming before, but his practical skills have been acquired since he joined Andela two years ago. Today Mr. Oshodi, 25, leads a group of eight Andela developers working for the Zebra, a car insurance comparison website based in Austin, Tex.
Last year, the company needed more engineering talent to expand. But with Google and Facebook hiring in Austin, the company did not want to compete in the escalating bidding war for local talent, said Meetesh Karia, Zebra’s chief technology officer.
Instead, it gave Andela a try.
The developers, Mr. Karia said, have worked out well — aided in part by Andela’s customized approach to outsourcing.
Andela sends its developers to customer sites to meet people and learn about the client’s business. Mr. Oshodi spent a month in Austin last year, and recently finished another three-week visit. He and the other Adela programmers have been invited to backyard barbecues and nights out in downtown Austin.
“They know my family. They know my kids,” Mr. Karia said. “They are really part of the team.”
The Andela developers are on the same corporate mailing lists and chat channels as Zebra employees. When back in Africa, the Andela members of the team participate in the daily “stand-up meeting,” where developers talk about their work and plans, usually via a video link.
One of the initial group of developers, Mr. Karia said, did not work out. But Andela soon replaced that person. Now, Mr. Karia said, “I would love to hire all eight” when their four-year commitments to Andela are over.
Mr. Oshodi’s four-year clock runs out in 2019. Until then, he said, he wants to steadily enhance his product development and management skills. He has not decided what comes next, but he is optimistic.
“If you put yourself in a good place,” Mr. Oshodi said, “opportunity comes.”
A version of this article appears in print on October 11, 2017, on Page B1 of the New York edition with the headline: A Tech Talent Pipeline From Africa.
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|From: Glenn Petersen||11/13/2017 9:20:47 PM|
|The largest basic income experiment in history just launched in Kenya|
November 13, 2017
- GiveDirectly, a charity focused on direct cash transfers, has launched its 12-year experiment on basic income.
- The charity will test whether giving people money, no strings attached, will help people and communities or leave them worse off.
- Other basic income experiments are popping up across the globe.
GiveDirectly, a charity that has been financing direct cash transfers to poor villages in East Africa since 2008, announced Monday that it has officially launched the largest universal basic income (UBI) experiment in history.
Beginning November 13, 40 villages (roughly 6,000 people) will receive roughly $22.50 per month, no strings attached, for 12 years. At the same time, 80 different villages will get the same amount for just two years, another 80 will get a lump sum equal to the two-year amount, and 100 villages will get no money.
The study will produce some of the most comprehensive data yet about what happens when people are given money for nothing. It'll help answer questions such as: Do people stop working? Do they start businesses? Are they more likely to spend money on drugs and alcohol — or education?
The study will also collect community-wide data to learn if the added financial security reduces negative aspects of poverty like violence and theft.
"The past 19 months since we announced our plans to test UBI have been remarkable," GiveDirectly CFO Joe Huston wrote on the organization's blog. "The debate over basic income continues to rage, from skeptics who call it 'a senseless act of preemptive self-sabotage' to optimists calling it 'to the 21st century what civil and political rights were to the 20th.'"
Basic income is so new that researchers have yet to collect good data about the system in the developed world. Other experiments have sprang up to address that gap.
In Oakland, California, the startup accelerator Y Combinator recently wrapped a pilot study in which several people received $1,000 to $2,000 a month. Y Combinator is preparing to launch a larger trial across two states sometime in 2018.
"Now it's time for us to do our jobs, and wait to learn," Huston wrote. "We expect to get the first round of results in within the next year or two, and then more than a decade of learning to follow as we track these communities."
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|From: Glenn Petersen||12/5/2017 11:26:17 PM|
|The Promise of Kenya’s Experiment With Universal Basic Income|
World Politics Review
Tuesday, Dec. 5, 2017
Informal settlements in Nairobi, Kenya, November 24, 2016 (dpa photo by Miro May via AP images).
Makanga is a village like many others in rural Kenya. Farmsteads with walls made of clay and roofs of corrugated iron sit on plots separated by bush. Dusty footpaths cross fields that bear signs of the latest drought to hit East Africa—the effects of which are especially dire in a region cut off from the electricity and water grids. From time to time, one comes across a skinny cow.
Until recently, the village’s inhabitants were themselves quite typical of the region, struggling to make ends meet by farming. Phoebe Abagi still tended to her maize field each day, despite suffering from advancing arthritis at 84 years old. With no pension and no safety net, she had no respite from daily labor.
Makanga is dominated by women. While some of them, like Abagi, are elderly, many are younger mothers caring for their children and those of close relatives. Most of the village’s men, along with a fair number of its young women, have moved to one of Kenya’s cities to look for work; from time to time, they send money home to make up for harvests lost due to climate change. These remittances generally fail to keep pace with the area’s need. Of the 45 percent of Kenya’s population that lives below the national poverty line, the majority can be found in rural places like Makanga.
Since October 2016, however, Abagi and the other 94 adults living in Makanga have become the beneficiaries of a unique experiment: Their village is the only one in all of Africa known to be receiving a monthly universal basic income, or UBI, stipend, which is intended to cover their living costs.
According to the terms of the experiment, each adult resident receives the equivalent of $22 per month and will continue to do so for at least 12 years. The organization behind it is an international nonprofit, GiveDirectly, which promotes the use of cash transfers to combat poverty. Payments are made electronically through recipients’ mobile phones. GiveDirectly hopes the experiment will shed light on the economic and social effects of a UBI.
UBIs are not exactly a new idea. One of their earliest proponents was Thomas Paine, the American activist and philosopher, who wrote about them in his pamphlet “Agrarian Justice,” published in 1795. Yet the concept has become increasingly fashionable in recent years, especially in industrialized nations, as technological advances in automation and artificial intelligence threaten to usher in a new age of mass unemployment.
For its part, GiveDirectly is interested in the potential for a UBI to be a cost-effective and quick way to lift people out of absolute poverty. And while UBIs have been the subject of trials and studies before, GiveDirectly describes its Kenyan experiment as the largest and most rigorous methodologically.
Not everyone is convinced the results will yield the answers GiveDirectly seeks, or that a UBI system makes sense for a developing country like Kenya. But even if the notion of a nationwide, permanent program seems like a pipe dream, the organization hopes its experience in Makanga, and the data it generates, will encourage countries with high levels of poverty to rethink their approach to social welfare and safety nets.
How the Experiment Works
To qualify as a true UBI, according to GiveDirectly and many experts, the basic income payment has to be universal, meaning it must be paid to all members of a community without precondition. It also has to be paid over a long period of time and cover at least the basic cost of living. GiveDirectly claims to fulfill these criteria.
Its 12-year experiment will ultimately expand to 26,000 participants. Some 6,000 Kenyans will receive the full UBI over all 12 years, including the inhabitants of Makanga. In addition, 10,000 Kenyans will receive the payment for two years, while an additional 10,000 will receive the equivalent of two years’ worth of UBI in a single, lump-sum payment. Researchers will also follow several thousand people who won’t receive any benefits, establishing a baseline against which GiveDirectly can measure the effects of the three other interventions.
Past programs and studies have fallen short on at least one of the aspects covered by GiveDirectly. Some early trials in the U.S. and Canada in the 1960s and 1970s, for example, were neither universal nor long-term. Later studies in India and Namibia covered only a short span of time, while also lacking rigorous scientific evaluation and failing to provide sufficient funds to cover basic living costs.
Large-scale cash-transfer programs in medium-income countries—Brazil’s Bolsa Familia, Mexico’s PROSPERA and China’s Dibao—have proven to be effective at lifting people out of poverty. But these cash transfers are targeted at specific segments of society, thus falling short of the universality inherent to true UBIs.
Of course, the GiveDirectly trial makes some compromises as well. While having 6,000 participants makes for a large sample, it is only a fraction of Kenya’s population of almost 50 million. That said, it is still a much larger sample size than Finland’s ongoing two-year UBI trial, which is targeting 2,000 recipients. And in contrast to Finland, GiveDirectly is distributing payments to entire communities instead of randomly selected unemployed people, and it has multiple control groups along with a longer trial duration.
As automation and artificial intelligence threaten to usher in a new age of mass unemployment, the concept of a universal basic income is becoming increasingly fashionable.GiveDirectly is also focusing on rural communities. Participating villages are chosen at random, but the project is only implemented where the potential recipients and local authorities are in favor of the experiment. Makanga was chosen as a pilot because it fit the profile and is situated in a region where GiveDirectly already had field operations. (At GiveDirectly’s request, the name of the village has been changed in this article to protect the privacy of village residents and ensure the village won’t be targeted by criminals.)
In total, GiveDirectly plans to spend $30 million over the duration of the trial, with almost all that money raised from individual donors, mostly in the United States. The project is almost completely financed, with $27.2 million having been raised by the end of September.
Despite the steps taken to make the experiment as sound and informative as possible, there is ample skepticism that it will accomplish what GiveDirectly hopes it will.
“This is a well-thought-out and well-designed trial, using the most advanced technologies in order to avoid some of the pitfalls of previous UBI experiments” says Yannick Vanderborght, a political scientist at Saint-Louis University in Brussels who researches UBIs. “However, I am very doubtful that it can inform us about the impact of a real unconditional and universal basic income.”
According to Vanderborght, all trials, by definition, lack the capability to model the effects that would be produced by countrywide implementation of a UBI, which would need to be funded by tax increases. As with other experiments, GiveDirectly can only look at behavior changes among UBI beneficiaries, not taxpayers. Yet it stands to reason that taxpayers, faced with higher marginal rates under a UBI system, might choose to work less.
“This question is left unanswered: What happens with those who will have to finance the system in the real world?” Vanderborght says.
GiveDirectly readily concedes that its trial in Kenya won’t answer all outstanding questions about the impact of a UBI. But the organization argues that it will still provide important insights into the potential benefits and drawbacks for people like Abagi—effects that, at present, experts can only speculate about.
Specifically, GiveDirectly’s experiment is designed to answer five main questions: Will monthly cash payments improve recipients’ capability to plan their economic decisions? How does the UBI affect saving behavior? How will recipients’ ability and willingness to take risks be affected? What is the impact of a UBI on gender relations, in particular women’s empowerment and domestic violence? And, lastly, how might a UBI change recipients’ outlook on life?
To answer these questions, researchers will follow up with all recipients roughly every three months, collecting quantitative and qualitative information via individual questionnaires and focus groups. While the first conclusive results will take a few years to materialize, the pilot program in Makanga is already delivering some revealing insights.
Where Does the Money Go?
It should come as no surprise that, in Makanga, recipients eagerly welcome the payments. Who wouldn’t? “People are happier,” says Mary Abagi, an elderly resident of the village who is of no relation to Phoebe Abagi. “They are more energetic and are thinking of new ideas to develop.”
In conversations with her and other villagers, a few spending priorities become clear. Most of the UBI payments are spent on short-term consumable goods like food, school fees and medicine. At the same time, many recipients save at least part of the UBI for larger purchases. And in a few cases, local entrepreneurs have used UBI payments to invest in new or existing businesses.
A herder drives his animals away after watering them at one of the few watering holes near the
drought-affected village of Bandarero, Kenya, March 3, 2017 (AP photo by Ben Curtis).
Aswan Abagi, the village chief and a stepson of Mary Abagi, says he uses his UBI money to offset the effects of the ongoing drought, especially the rise in market prices for maize, the local staple food. “There has been a drought in this area for more than eight months now,” he says. “So most of the money has been used on foodstuffs.”
The potential impact of UBI payments on nutrition is of particular interest to GiveDirectly, in light of the fact that 2.6 million Kenyans are experiencing “crisis levels of food insecurity,” according to Oxfam. Caroline Teti, GiveDirectly’s external communications director, says anecdotal reports indicate that nutrition in Makanga has improved across the board since the UBI was introduced.
Aswan Abagi agrees. Even if a UBI isn’t enough to cover all food purchases, the experiment has made it easier for consumers to get credit, as shop owners know that people have a reliable stream of income.
It would be hard to overstate the beneficial impact of eradicating malnourishment in recipient communities. According to one calculation, malnourishment’s effect on the global economy amounts to $500 per capita—about double what GiveDirectly spends per UBI recipient.
Those who have money left after covering essential expenses tend to save it. Even before the UBI was introduced, Makanga was home to a small saving group of six members, although not all of them could always afford their monthly contributions.
Now there are six such groups, with 10 members each. Each member contributes about $10 per month; every month, one member receives all of the contributions, a system that allows members to plan for larger purchases.
Jael Abeta’s experience is a great example of how being able to save can improve residents’ quality of life. She used her savings from the UBI to finish a new house she had started building with remittances from her children, who have moved to Kenya’s urban areas in search of work.
Her husband, Andrew, plans to buy two bulls once he has saved enough. “With the bulls, I will be saving money because I don’t have to rent a tractor to plow my fields” he says. “I can even plow for others and boost my income.”
A Job Creator
Like the Abetas, Samson Wandolo Adera also invests his UBI. The former government worker is considered the most affluent citizen of Makanga, though he insists this is merely a reflection of the poor local economic situation. “I’m leading an average life” he says, “not poor, not rich.”
Before the UBI was introduced, Adera tried to start a fish farm in nearby Lake Victoria, but he realized that he did not have enough capital to sustain it. “For a bank loan, the interest was too high,” he says, noting that he feared he would lose his initial investment.
“If you give me money, I know what I need better than somebody else.”The UBI revived the project, which he now runs along with other investors. He has hired several people for the farm, including those paid to keep an eye on the fish. “You cannot keep fish in the lake alone,” he explains. “They will be stolen.”
Adera is not the only one who has managed to create some local employment. Phoebe Abagi, the 84-year-old, used parts of her UBI to pay for casual laborers to help her with tending her fields and the harvest. Because of her arthritis, she lately hasn’t been able to do all this work herself. Thanks to the help, she says, her harvest for this year increased even with the drought.
Makanga’s residents make clear they prefer the UBI to other means of development aid, such as food donations. “You go for relief food and expect 3 kilograms,” one elderly woman says. “But you get 1 kilogram, or 2 kilograms, or 4 kilograms. It is very unpredictable what support you get.”
Abeta summarizes the general sentiment: “If you give me money, I know what I need better than somebody else.”
The UBI recipients also report that there has been a reduction in petty crime in the community. This seems to be connected to the increased money available for food, which has made stealing out of hunger unnecessary.
Does a UBI Make Long-Term Sense?
A cursory poll among the population of Makanga reveals broad support for an extension of the UBI across the whole of Kenya. But it will take a few years to get the first meaningful sets of data on longer-term impact and how the UBI compares to other development interventions.
So far, the UBI hasn’t featured prominently in Kenya’s debate about economic development. Touring the country prior to this year’s hotly contested general elections, nobody outside of Makanga’s immediate environment and GiveDirectly’s own staff had even heard of the trial.
Kenyan President Uhuru Kenyatta waves to his supporters as he arrives for his inauguration ceremony,
Nairobi, Kenya, Nov. 28, 2017 (AP photo by Sayyid Abdul Azim).
The two main candidates for Kenya’s presidency, incumbent Uhuru Kenyatta—who ultimately prevailed—and his main challenger, opposition leader Raila Odinga, offered competing visions for economic development, but the UBI was not part of either one. While Kenyatta’s platform focused on large-scale infrastructure investments, Odinga promised greater social cohesion through reconciliation in a country still plagued by political violence; further devolution of resources and responsibilities from Nairobi to the counties; and more emphasis on social justice in general.
While Odinga’s vision may have sounded more conducive to the implementation of the UBI, Kenyatta’s administration is closely cooperating with GiveDirectly to make the trial possible. The government is also working on a universal pension scheme for those over the age of 70, building on a pilot program that provided $19 every two months to 200,000 households in three counties.
According to Teti, GiveDirectly’s UBI trial is not meant to function as the sole basis for radical policy change. Instead, she hopes it will strengthen arguments for cash-based benefit programs. Ideally, she says, the results of the trial will help convince Kenya and other developing nations to slowly but steadily transform their social safety nets, bringing them more in line with the philosophy behind a UBI, even if a UBI itself is not implemented.
“There is a lot of evidence that cash works,” Teti says. For example, programs involving lump-sum cash transfers to recipients in Kenya, Uganda and Rwanda, as well as in other parts of the world, have been shown to reduce poverty and child labor while increasing the labor market participation of adults, among other things.
Even if GiveDirectly’s UBI trial in Kenya results in similarly positive outcomes, the broad implementation of a universal basic income in developing countries faces long odds.
Researchers hope the results of Kenya’s universal basic income trial will convince developing nations to slowly but steadily transform their social safety nets.Financing is one challenge. For Kenya, a UBI along the lines of the pilot program in Makanga would cost about $6.6 billion per year to roll out nationwide, slightly more than the $6.1 billion the government is currently spending on all economic development programs, including investments in new hospitals, roads and power stations.
Given that the UBI would not cover structural investments, the government would have to close a funding gap of several billion dollars to introduce a nationwide UBI. This could potentially be achieved by increasing the tax base—not an unthinkable solution, given that Kenya’s government spending is currently about 30 percent of GDP, less than many industrialized countries.
Resource-rich countries like Angola, or countries with stronger economies like South Africa or Senegal, could also conceivably shoulder the financial burden of a UBI designed to lift people out of abject poverty.
But for other, poorer countries like the Central African Republic or the Democratic Republic of Congo, a UBI program could cost around 50 percent of GDP.
Kenya also has important structural advantages over other poor countries: its M-Pesa mobile money system, which reaches almost every adult in the country, as well as widespread access to biometric IDs. Both of these are essential tools for the deployment of a UBI, and few developing countries can match them.
Despite these myriad challenges, both GiveDirectly and the residents of Makanga are bullish on the concept of a universal basic income. Although the goals of the Kenya experiment are quite different from those of UBI studies carried out in wealthy countries, the data it generates will likely be useful for policymakers the world over, especially those curious about the choices workers make once they attain a guaranteed level of financial security.
Given the ambition, scale and audacity of the experiment, it is certainly one worth following. If, as Teti says, cash does indeed “work,” the data may tell researchers whether a universal basic income is the best way to distribute it.
Peter Dörrie is a freelance journalist and analyst specializing in resource politics and security in Africa. Follow him on Twitter @PeterDoerrie.
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