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Creating Shared Value In A Newly Democratic Country

Burma is haltingly moving from dictatorship to free society. In a country with a clean slate, what can social enterprises do to thrive and help the economy thrive, as well?

Creating Shared Value In A Newly Democratic Country
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“So today we say to American business: Invest in Burma,” Secretary Clinton proclaimed in May, within a month of opposition politician Aung San Suu Ki’s taking of office. Driven by vast reserves of oil and gas, timber, and precious gems, western foreign investment has started pouring into the country for the first time since 1988, when Burma-specific sanctions were implemented following severe human rights abuses.

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Despite concern from NGOs and the likelihood of rapid influx of foreign cash to benefit a small minority of the population, giants like Coca-Cola, GE, and oil and gas companies are lining up to enter the country (also known as Myanmar). Last year, more than $20 billion in foreign investment, mostly from China, Hong Kong, and Thailand, flowed into the country–more than all the foreign direct investment from the previous two decades combined.

Burma, however, may be the perfect breeding ground for social entrepreneurship to bolster democratic institutional development and stimulate economic growth. Political strategist Brian Klein explains: “Myanmar has a rare opportunity to create an economy driven by domestic demand rather than on manufacturing for export. With a large population, vast natural resources, and increasing capital inflows, the country already has the basic foundation needed for an economic renaissance.”

Entrepreneurship is a particularly important facet of growing a healthy, inclusive economy–one can look to Eastern and Central Europe after the collapse of the Soviet Union and see the effect of rapid, often corrupt privatization. While Burma has a unique socio-political-economic context, some models of social entrepreneurship can be borrowed from history and countries that have also gone through democratic transitions.

Bolster the ITC sector

The growth of BarCamp Yangon (a web-focused “unconference” in the country) marks the emergence of the Burmese tech community in a country with the lowest number of cell phones per capita in the world. A gathering of thousands of IT and other professionals since 2009, BarCamp has become “an incubator for young software developers, bloggers and budding entrepreneurs,” according to Digital Democracy’s Emily Jacobi.

In countries like India, Senegal and Vietnam, social capacity building ventures are often piggybacked on investment in ITC infrastructure, and are fueled by the grassroots knowledge cultivated in tech communities like BarCamp. Rwanda is an example of an emerging democracy dedicated to using science and technology to improve its citizens’ quality of life, bolster institutional capacity, and attract foreign investment. Rwanda’s small private sector is different than Burma’s investment boom, but the country’s socio-political context is similar: a history of government sponsored human rights abuses, high levels of poverty, feuding ethnic groups, and a relatively low-tech economy coupled with recent massive growth in GDP.

Companies like Manna Energy are using market based carbon credits in Rwanda to finance water technology-driven treatment systems, biogas generators, and high efficiency cook stoves that have been critical to improving the quality of life for millions of Rwandans. Other social enterprises like Camara have a built a business on teaching and promoting digital literacy.

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Continue to nurture the rural economy

Nearly 70% of Myanmar’s population is rural, with agriculture accounting for 60% of the country’s GDP. Boosting the income of farmers through innovative business models that increase individual productivity (or pool commodities) and build capacity of small and medium-sized farmers can increase the economic mobility and political voice of rural populations. Additionally, supporting domestic food production stems the need for costly imports and has the potential to alleviate food insecurity.

Proximity Designs is a Burma enterprise that boosts agricultural productivity through affordable products and services, such as irrigation and rural energy products. Other innovative agricultural models that focus on building revenue through scale could be useful in building the collective political power of rural populations. Both India’s Calypso Foods and Amul, the world’s largest dairy cooperative (generating revenues of approximately $1 billion), work with thousands of small farmers in India. Through vertically integrated supply chains, the farmers are supported with the start-up capital, infrastructure development and technical assistance that have lifted millions of farmers out of poverty.

Leapfrog to sustainable development

Rich natural resources, poor governance and lack of environmental regulation are generally a recipe for disaster for the long-term well-being of a country. Regulations surrounding extraction activities are going to be up to the Burmese government and civil society, but social enterprise can be a way to kick-start green initiatives and highlight their success, paving the way to greater environmental consciousness in future policy making.

Two social enterprises in Asia demonstrate how clean technology can create the foundation for healthier cities and sustainable development. Pioneered in Bangladesh (and now operating in Nepal, Pakistan, Sri Lanka, and Vietnam), Waste Concern promotes waste recycling and organic farming, and works with both local governments and the private sector to build institutional capacity around environmental management. Another company, Clean Engines Initiative sells kits to Tuk-tuk drivers in the Philippines through a financing scheme–with the kits increasing fuel efficiency by as much as 70% and cutting down on urban exhaust pollution.

These examples illustrate the vast potential for emerging economies like Burma to “leapfrog” to next generation environmentally friendly technologies–a celebrated characteristic of innovation in emerging economies.

Despite the obstacles on its journey to democracy, Burma boasts a 90% literacy rate, newly elected leadership dedicated to government accountability, and a vibrant civil society hungry for social change. Investing in Burma carries the big business lure of quick cash, but the key to long-term stability for foreign investors lies in investing in the Burmese people and the businesses that will create shared value for everyone.

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About the author

Deciding to trade in her legal training for an unconventional path in social innovation and interdisciplinary design work, Nicole works to create opportunities for collaboration, idea synergy and benefit among the business, policy, and social change worlds. Nicole is a social innovation strategist with Apricot Consulting, a small international boutique management consulting firm

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