The Problem with Mainstream Media Coverage of Haiti

Mainstream media pieces about Haiti are like Swiss cheese, full of holes. This week NPR/Frontline featured a report from Haiti, "The Problem with Giving Free Food to Hungry People," about a rice vendor and the supply chain in reverse from her to the Port-au-Prince port where the rice is delivered from the U.S. The reporter points out that rice is very important in Haiti, as it is a part of every meal. That's an interesting way to put it, but why is it that Haiti is no longer self-sufficient in producing rice? Haiti is the fourth largest importer of American rice. This question is easily answered and was addressed this year in a session of Congress by former President Bill Clinton. Clinton apologized for the "free" trade policies that allowed the dumping of Arkansas and "Miami rice" subsidized by the U.S. government on the market, resulting in the loss of livelihood for over 300,000 small farmers.

"The Haitian peasantry, which not so long ago kept the country self-sufficient in basic foodstuffs, became inconvenient after Washington forced Haiti to accept U.S. government-subsidized rice. Port-au-Prince, a town of about a quarter million in 1960, swelled to at least 2.5 million as small rice farmers were forced off the land and into the shanty-opolis, where they built what they could with the resources at hand. U.S.-imposed “structural adjustment” made Port-au-Prince a high-density death trap.

Somehow, this U.S.-mandated migration – which also contributed to the exodus abroad of many hundreds of thousands – is now numbered among the many “failures” of the Haitian people."

Bill Clinton said that he thinks about this everyday, but Haiti cannot regain food security by cashing in on his remorse.

Speaking of the loss of livelihood for the small farmers in Haiti, the U.S. Census Bureau released estimates about Haiti's population on Monday. The Bureau expects "Haiti's population will continue to grow quickly despite the tremendous loss of life in the January earthquake. According to the report:

"Haiti's current population at 9.6 million, based on an estimated quake death toll of 230,000. It projects the country will recove...r and surpass its pre-quake population level by 2012. By 2050, the bureau says, Haiti will have 13.4 million people. The Dominican Republic, with a nearly identical population, is expected to keep up the same pace."

This might be seen as good news, but the Washington Post story goes on to say that: "By contrast the populations of now-similarly sized European countries like Sweden and Belarus are expected to decline over the same period."

Then the story gets interjected with an element of the aforementioned holes, when it states that: "Overcrowding is already blamed by aid workers and experts for many of Haiti's woes, from environmental degradation and hunger to the deaths of thousands crushed by stacked concrete homes during the earthquake."

Haiti is not over-populated... the city of Port-au-Prince is crowded, no doubt, but these census takers fail to mention that there are huge tracks of land which are uninhabited in Haiti. The reason the "ti paysans" moved from the countryside to the city are two-fold, and both have to do with policies implemented by the U.S. and forced on Haiti.

1) "Free trade" policies forced on Haiti that allowed the dumping of cheap, subsidized food from the U.S. into the Haiti market, destroying Haiti's self-sufficiency at food production.

2) The eradication of the Haitian black pig. Many believe this was done to force the independent, proud farmers (who had resisted being forced off their lands up to that point) to abandon their land and come into the city to work (for slave wages) in sweatshops--something the U.S. had been unable to do prior to the killing of the pigs and loss of the livelihood of the farmers.

USAID/U.S. Embassy and their directors in the democrat and republican parties and their co-conspirators in the rich Haitian oligarchy who run the sweatshops and other slave wage enterprises only have themselves to blame for the conditions that led to so many people crowding into the cities. For most, the jobs they were promised never materialized and they ended up in the slums of Sité Soley, Bel Air, Martissant... etc.

The cheap subsidized rice replaced Haitian rice and now Haiti is the fourth largest importer of American rice, whereas in the past farmers in Haiti grew sufficient rice to feed the entire country. This loss of food security is traced by the experts directly to U.S. trade policies.

The good news is that an effort is being made to repopulate Haiti with "a new variety of pig with the same beneficial qualities as Haiti’s Creole pig.

As for the Haitian farmers, they are in a new battle for their survival with Monsanto "generous" donation of its pesticide covered hybrid seeds, which Monsanto says are not the Genetically Modified (GMO) seeds banned in Europe and other parts of the world, but are just as insidious in that they require sterile land that require specific expensive pesticides and fertilizer. And by the way, they are not good for replanting, so the farmers will have to go back to Monsanto to repurchase seeds.

Haiti's Calamity Is a Windfall for Everyone, Except Haitians-Part II

Guest post by Terroroftyrants

President Barack Obama meets with President Luiz
Inacio Lula da Silva of Brazil in the Oval Office,
March 14, 2009. (Official White House
Photo by Pete Souza)

Most mainstream media coverage won't explain the massively lucrative nature of the Haiti venture to the US, the United Nation and Brazil. The financial interests in "their plan" for Haiti. The general spin is that the fundamental motivation of this trade initiative was humanitarian – to aid Haiti's economic development through sustainable production activity.

The authorities in the US, UN and Brazilian governments won't explain that the Brazilian-headed UN troops are, by-the-way, in Haiti not only to secure the use of cheap Haitian labor for their transnational corporations, exploit Haiti's natural resources, but also to defend Brazil’s dream of becoming more of a status quo power itself and gain a seat in the UN Security Council. Brazilian corporations have successfully lobbied Washington and made Brazil a beneficiary under the Washington HOPE Act that allows for duty free textile goods from Haiti for 10 years.

That means, for instance, the Brazilian company, Coteminas - Latin America's largest textile company, owned by the brother-in-law of Brazilian President, Luiz Inacio Lula da Silva.

Brazil will be able to make clothing in Haiti or the Dominican Republic and ship them to the US with preferential treatment. Currently, Brazil is the top maker of textile in the region. The textile empire is owned and controlled by President Lula's brother in law. Brazil retained a high-powered law firm in DC to broker the trade deal in Washington.

In an article that appeared in the August 15, 2008 issue of the Brazilian newspaper Valor Economico, explained why Brazil should get preferential trade terms:

"In the midst of chaos [the chaos of the Haitian economic situation and earthquake disaster], Brazilian companies are searching for opportunities and are beginning to profit from their strategic position as leader of MINUSTAH.

Coteminas [Brazilian giant of the textile sector, whose chairman is none other than the son of the vice president of Brazil] wants to use Haiti as a platform for export and clothing manufacture aimed at the US. Brazil is a known collaborator in the rescue process of Haiti. Our country has the right to demand preferential treatment, said Valor Josue Gomes da Silva, president of Coteminas.

In spite of institutional confusion, Haiti presents important advantages for a company in the textile sector: proximity and access to the biggest market in the world, the US, and very inexpensive labor. A dressmaker for the capital Port-au-Prince is paid $0.50 an hour. That is a wage lower than the $3.27 paid in Brazil, and comparable to the $0.46 of Vietnam and $0.28 of Bangladesh."

Coteminas' plan is to export fabric from Brazil, have it made into clothes in Haiti at very low cost, and enter the US market without customs duties. The whole process protected by free trade agreements.

Haiti's Calamity Is a Windfall for Everyone, Except Haitians-Part I

Haiti's calamity is a windfall for everyone, except Haitians living in Haiti in the camps.

However, it looks like the sweatshop owners and business class in Haiti don't stand to make anything from the provisions in the deceptive HOPE act for the DR either.
Most Haitians are well aware of the deceptions that are often used to keep aid and funding from getting to the people; this realization has already sparked massive demonstrations against the government of Rene Preval for not only their lack of presence and incompetence during and after the quake, but for the state of emergency that the Parliament declared which gave a commission made up of foreigners and Haitians the power to disburse donor funds.

There are signs that the "International community" is preparing to crush any dissent. They have mobilized several means for militarizing Haiti and the Caribbean by:

1) Withholding funds from the Haitian govt. This is being justified by the Democrat Patrick Leahy as a response to the alleged massacres at Les Cayes prison by Haitian Riot Police. This is in spite of the fact that both the UN and the Haitian gov't are said to have launched investigations.

By the way, the call for investigations is echoed for Jamaican police by the U.S. State Department's tool Human Rights Watch along with other members of the international community.

In 2008 HRW issued a flawed report entitled, "A Decade Under Hugo Chavez" ahead of a constitutional referendum in Venezuela. Read this report which questions HRWs real motives (PDF).

2) There is a ramp up and launch of an "international police" force:
Security Council authorizes extra police for UN force in Haiti

"The deployment of 680 further officers as a result of todays Council resolution will bring the total number of UN Police (UNPOL) serving with the UN mission, which is known as MINUSTAH, to 4,391."

3) Also, Hillary Clinton and a U.S ambassador have announced the launch of a Caribbean security force to protect "our people."

"For all of us, the safety of our people must be our highest priority. That's why today we are committing ourselves to CBSI," the chief US diplomat told the gathering at a beachfront hotel."

The Caribbean is getting harder to handle for the Western Colonial powers. It is unfortunate that peaceful protests, political organizing and calls for human rights and living wages to combat the skyrocketing cost of living in the Caribbean are often met with deadly violence from those who are in power.

It is instructive to know that U.S. foreign policy has spurred some of these developments in the Caribbean. In Jamaica for one, the CIA created the Jamaican Shower Posse which battled with Jamaican police to protect politically connected alleged drug lord, Dudus Coke. In Haiti, of course there were two successive coups, one in 1991 and the other in 2004 which was planned by the U.S., France and Canada, and primarily supported and financed by the U.S.

A change in U.S. foreign policy is necessary to stop the steady progression towards chaos in the Caribbean. The Caribbean is just a tiny microcosm for the same dangerous situations around the world. Just last week a report on Columbian, rated it the most dangerous place in the world for trade union members. Therefore, it was incredible to hear U.S. Secretary of State Hilary Clinton make the following statement about Columbia:

"In her speech Clinton said lessons learned in Colombia, which she visited on Wednesday, as well as in Mexico and Central America are being applied to the Caribbean region."

Is there a disconnect here? No, because everything is going according to plan. This is clear from the op-ed piece, "Rebuilding Haiti," which was posted on March 10 this year at the Huffington Post by one Eric Farnsworth, a former State Department official. Farnsworth, is now the VP of an organization called the "Council of the Americas":

There's really only one way to establish such a framework for action [rebuilding Haiti] : via U.N. mandate. Existing U.N. authorities should be expanded, and Haiti be given special status under international law, a virtual enterprise zone of international governance. Reconstruction requires a unified command with a common vision and mandate, as well as authorities for donor nations to conduct humanitarian and reconstruction efforts without fear of being labeled interventionist or imperialistic, as some have already experienced.

Under such mandate, historically relevant democracies including the United States, France, Canada, Brazil, the Dominican Republic, and others will be able to come together with key sectors of Haitian society to build a long-term redevelopment plan for Haiti. Political and economic institutions, physical infrastructure, investment and regulatory matters, the environment and clean energy use, social development, and public health, among other issues, would all be considered."

In other words, the "International Community," which controls virtually all the money and aid projects to Haiti, and has done such bang up job of keeping Haiti underdeveloped and poverty stricken, should continue wielding the real power in Haiti. The State Department was in agreement with Mr. Farnsworth in 2004, when they supported a coup against the democratically elected government. See how that works?

The Haitian people would rather go with the course prescribed by Loune Viaud of Zanmi Lasante and with Monika Kalra Varma, director of the Robert F. Kennedy Center for Human Rights, who co-authored an Op-Ed in today's Boston Globe. (06.13.10).

The piece describes the need for Haitians to be involved in the decision making process of rebuilding of their country.

"Since January’s devastating earthquake in Haiti, well-meaning experts have proposed an abundance of short-term and long-term recovery solutions. They ask why aid delivery has been so slow, why previous development plans for Haiti have rarely been successful, and why billions of dollars in funding over decades have not improved conditions for the most impoverished people in our hemisphere.

Some blame the government of Haiti, while others, including the organizations we represent, often point fingers at the international community. The simple answer is that those who have the greatest stake in rebuilding Haiti, Haitians themselves, don’t now and never have had a real seat at the table.

While Haitian resilience has been duly recognized around the world, few appear to be interested in talking to Haitians about how to rebuild their communities and how the billions likely to be pledged to their country will be used. And no one is talking about what recourse Haitians will have if promised projects are never completed, or worse, pledged money never arrives. Unfortunately, past failures can be found in every community across Haiti - water projects that were promised but never built, resulting in water-borne illness and death; food aid that was delivered, but spoiled or sold in markets below the prices asked by local farmers; non-government organizations that started educational programs, but then shifted priorities, leaving children without access to schools.

[…] Those who have worked in Haiti and other places around the world and have suffered large-scale death and destruction know that successful long-term recovery needs to be driven by the people most intimately affected. Beyond the enormous funding and international experts needed to rebuild Haiti, it is time to make a new pledge - to heed and support the experts who can truly rebuild Haiti, the Haitian people."

– Give Haiti control over its recovery
By Monika Kalra Varma and Loune Viaud

The HOPE Deception of Haiti

The following is a guest post by terroroftyrants

Rep. Charles Rangel takes questions from reporters regarding alleged financial improprieties on Capitol Hill in Washington. Photo Credit: Associated Press

They are working their plans while keeping folks busy.

Between 2005 to 2007 the apparel industry of the Dominican Republic was in bad shape. So Charlie Rangel -- who has a superb residence in the Dominican Republic-- introduced legislation to rescue and enrich DR captains. But there was something missing that the earthquake provided. Hence came H.R. 5160 Haiti Economic Lift Program Act of 2010 (HELP). At first, everyone worried about the creation of sweatshop jobs in Haiti. Well, the first to benefit from this bill is not Haiti. Although the bill title leads everyone to believe that it was about Haiti, everywhere in the bill, the real beneficiaries are "Haiti or the Dominican Republic."

Note the bill title: "To extend the Caribbean Basin Economic Recovery Act, to provide customs support services to Haiti, and for other purposes."

Both the Senate and House version of the bill acknowledged that the factories and infrastructure in Haiti were destroyed by the earthquake, so the immediate theater of operations is the Dominican Republic.

There are 168 textile companies in Dominican Republic that are benefiting now from the signing of the HELP Act into law.

In Haiti, there were 24 textile companies before January 12, 2010, but most did not survive the wrath of the quake.

Rangel, the miracle worker for the Dominicans, introduced the bill on 4/28/2010. There was only 40 minutes allocated for debate, enough time for the co-sponsors to speak on behalf of the bill and the measure was passed. Believe it or not, in four weeks, the bill was introduced, voted on and signed into law by the president on 5/24/2010.

It was Congressman Hank Johnson who said something that raised suspicion. He told the speaker of house that the bill will benefit Haiti, the Dominican Republic and their economy. Three weeks earlier, Hank Johnson asked a general if the island of Guam would capsize if the number of soldiers are increased. This time, it was his support of the bill, since there was no recorded vote, which capsized Haiti on the floor of the House. He also let the cat out of the bag. He was the only one of the co-sponsors who mentioned the Dominican Republic on the floor of the House.

Why would a bill design for Haiti/post earthquake be beneficial to the Dominican Republic? Of course, Rangel. Since the president signed the bill into law on 5/24/2010, these companies can now export duty free to the States no matter where the fabric originated from. So the guys in Brazil got their lobbying money's worth and cheap labor. Also, we know that all the big names in clothing in the US have their clothing made in DR.

The president of the DR quietly signed his version of TPS to all Haitians living in the DR. That was probably part of the deal; no more ugly scenes of mass deportations of Haitian nationals from the DR. All Haitians on Dominican soil have a three year permit to stay in the DR legally until they can have permanent residency. All Haitian students in the DR have either a substantial reduction in tuition or free tuition for one year. So the DR gets to keep the labor force in case anyone notices that no Haitian workers benefited from the bill. Rangel successfully rallied members of the black caucus to co-sponsor the bill – his retirement package abroad. Since no one asked for a recorded vote, the measure passed with Voice Vote only. So we won't know who else screwed Haiti on the Hill besides the co-sponsors. Well we know, except there is no record of it.

So, although this is a bill to revive Haiti after the quake, there was no mention of it in the media about the president signing the bill into law. The New York Times chose to write about something else. Distrust of the Haitian government and in-fighting within Haitians have always been the tool used to rob Haiti. It is used to empower NGOs and special business interests. In order to overcome the struggle, we must always keep an eye on the money and who stands to benefit from everything. As always, it is rarely the Haitian people. Remember that Brazil was asking for favorable treatment for clothing made in Haiti, but the factories are in the DR. They hired a law firm in DC and they took care of business. Perhaps DC stands for Diabolical Circle and not District of Columbia.

Here are the Senate version and the House version. The language used in both redirect operations to the Dominican Republic, which stands to benefit from the Haiti bill. Note that the bill arrived in the Senate on 5/5/2010 and it passed on 5/6/2010 and I guess they ran to the white house with it before the end of the day.


_______________________________________________________
BACKGROUND INFO:


SENATE BILL

[...] SECTION 2. FINDINGS.

[...] (2) The earthquake has devastated Haiti's infrastructure, including homes, offices, factories, roads, ports, communications, and other facilities. The loss of life attributable to the earthquake was massive.

(6) However, the Haitian apparel sector has been hard hit by the January 12, 2010, earthquake. A number of apparel factories based in and around Port-au-Prince have been heavily damaged, including the collapse of one major apparel factory that had employed nearly 4,000 workers.

(7) The Port-au-Prince seaport that had served the apparel trade has been badly damaged. And extensive damage to roads has made it difficult to transport apparel to the Dominican Republic for shipment from ports in that country.

(8) According to estimates by the Department of Commerce, imports of apparel articles from Haiti to the United States in 2010 have decreased by 43 percent as compared to the same period in 2009.

(9) The earthquake has increased significantly the costs and uncertainty of doing business in Haiti. A strong and unequivocal commitment from the United States is needed to help Haiti offset these costs and preserve the gains made under United States trade preference programs, and to encourage buyers and investors to stand with Haiti through this crisis.

[...] SECTION 4. APPAREL AND OTHER ARTICLES SUBJECT TO CERTAIN ASSEMBLY RULES.

[...] (F) CERTAIN OTHER APPAREL ARTICLES-

(i) IN GENERAL- Any of the apparel articles described in clause (ii) that is wholly assembled, or knit-to-shape, in Haiti from any combination of fabrics, fabric components, components knit-to-shape, or yarns and is imported directly from Haiti or the Dominican Republic shall enter the United States free of duty, without regard to the source of the fabric, fabric components, components knit-to-shape, or yarns from which the article is made.

House of Representatives Version (H.R.5160)

SUMMARY AS OF:
5/6/2010--Passed Senate without amendment.

[...] Extends, in each applicable one-year period through FY2020, the duty-free treatment of imported apparel articles made in Haiti or the Dominican Republic.

(Sec. 4) Prescribes duty-free treatment also, without regard to the source of the fabric, fabric components, components knit-to-shape, or yarns from which the article is made, for specified apparel articles or made-up textile articles: (1) wholly assembled, or knit-to-shape, in Haiti from any combination of fabrics, fabric components, components knit-to-shape, or yarns; and (2) imported directly from Haiti or the Dominican Republic.

MAJOR ACTIONS:

4/28/2010		Introduced in House
5/5/2010		Passed/agreed to in House: On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote.
5/6/2010		Passed/agreed to in Senate: Passed Senate without amendment by Voice Vote.
5/6/2010		Cleared for White House.
5/13/2010		Presented to President.
5/24/2010		Signed by President.
5/24/2010		Became Public Law No: 111-171 [Text, PDF]

Monsanto seeds in Haiti: Haitian farmers' epic struggle for survival

The following is a repost of Nadine Renazile's report from Seeds for Haiti on Facebook (posted today, 06.07.10 @ 4:00pm)

This is the FACT SHEET Seeds for Haiti [that] will be distributing as part of our campaign to support Haiti's farmers in their epic fight against the Monsanto multinational corporation.

All thanks go to ANJI for her scrupulous research and reporting of facts.

• Monsanto is donating “$4 million worth of conventional hybrid corn and vegetable seeds to be made over the next 12 months…” Donations will include 60 tons of hybrid corn and vegetable seeds, a second shipment of 70 tons and possibly another 345 tons over the next 12 months.


• The hybrid seeds create the need for water and fungicides that cost more than locals can afford. The price of the seeds as well as shipping will also ultimately likely cost more than Haitian farmers can afford.


• According to the Monsanto blog, the seeds are treated with fungicides to prevent fungal diseases. The New Jersey government issued a cautionary statement on commonly used fungicides such as Thiram, which is used as a fungicide and seed disinfectant, and can have negative impacts when you breathe it in. According to the NJ Department of Health and Senior Services Hazardous Substance Fact Sheet, it can also cause skin allergies, rashes and breathing problems and “repeated exposure can affect the kidneys, liver and thyroid gland. High or repeated exposure may damage the nerves.” The document also dubbed Thiram a mutagen and recommended wearing protective work clothing while exposed to Thiram and using local exhaust ventilation or respirators.


• Monsanto’s May 20, 2010 blog post claims the seeds are hybrid and not GMO. The donation of the seeds have long-term consequences because they create a dependency on Monsanto seeds, which are expensive and corrosive to the land. They also said: “There are no contractual obligations between Haitian farmers and Monsanto since this is a donation. In fact, there are no business transactions at all between Monsanto and Haitian farmers in regards to these seeds. Monsanto is earning no revenue from this donation.”


• Some seeds from Monsanto are described in the media as terminator seeds. According to the 2009 post on the Monsanto website, “Sterile seed technology is a type of Gene Use Restriction Technology (GURT) in which seed produced by a crop will not grow.” The company says it sees positive and negative aspects of GURT but claims it “has never developed or commercialized a sterile seed product… If Monsanto should decide to move forward in the area of GURTs, we would do so in consultation with experts and stakeholders, including NGOs.”


• The act of using these seeds contaminates the land and eliminates the ability of these Haitian farmers to grow and export organic agriculture in the near future. According to the California Organic Foods Act of 1979, foods described as organic or naturally grown must be produced: without the use of synthetically compounded fertilizers, pesticides or growth regulators. In the case of annual and two-year crops, no synthetically compounded fertilizers, pesticides or growth regulators may be applied to the area for 12 months before.


• The use of seeds also impacts the land in neighboring Dominican Republic.


• Monsanto has a history of making harmful chemicals. According to the Dow Chemical website, “Companies supplying Agent Orange to the government included The Dow Chemical Company, Monsanto Company, Hercules Inc., Diamond Shamrock Chemicals Company, Uniroyal Inc., Thompson Chemical and T-H Agriculture and Nutrition Company.” While Dow says “scientific consensus is that when the collective human evidence is reviewed, it doesn’t show that Agent Orange caused veteran’s illnesses,” the U.S. government thinks otherwise. On March 25, 2010, the U.S. Department of Veteran Affairs (VA) said this is a press release: “Well over 100,000 Veterans exposed to herbicides while serving in Vietnam and other areas will have an easier path to qualify for disability pay under a proposed regulation published by the VA that adds three new illnesses to the list of health problems found to be related to Agent Orange and other herbicide exposures.” Based on data from an independent study by the Institute of Medicine, these three illnesses are: B cell leukemias, such as hairy cell leukemia; Parkinson’s disease; and ischemic heart disease.

Read full report on Facebook.

A Market-Based Microcredit Strategy Alone Will Not Alleviate Rural Poverty

"Indeed, donor and practitioner enthusiasm for such market-based development strategies, at the expense of addressing these other critical issues, threatens to make conditions of poverty worse."

In 2008, the Institute for Food and Development Policy issued a report on the microcredit strategy for alleviating poverty. It evaluated the effectiveness of microcredit – particularly in rural areas. The report (read some of it below) outlined some critical steps needed, to move pass "the assumption that market integration reduces poverty and increases social equality." The report concluded that "Microcredit programs will not achieve their stated goals of eliminating the crushing burden of poverty and providing social equality," until " they move beyond repayment percentages as the sole measure of success."

____________________

The Limits of Microcredit— A Bangladesh Case

By Jason Cons and Kasia Paprocki of the Goldin Institute

Since its emergence in the 1970s, microcredit has grown in popularity as a tool for development. Today, microcredit organizations have assets well in excess of $22 billion USD and serve more than 113 million clients.¹ Microcredit has enormous potential as a tool for poverty alleviation. Yet as this strategy moves into the development mainstream there is an urgent need to reflect on its role in market-led development initiatives and its limitations, as well as its historic successes. There is significant risk in microcredit’s often uncritical adoption. This risk is compounded by the systematic failure of many microfinance institutions (MFIs) to engage the communities where they work in the process of designing and evaluating microcredit programs. As with many development programs, the voices of communities and individuals who are the supposed beneficiaries of microlending are conspicuously absent from the projects that seek to determine their futures. As debates over the pros and cons of microcredit rage and donor support encourages rapid adoption, it is crucial to evaluate the impact of microcredit from the perspective of those who have the most to gain and lose — the recipients.

This Backgrounder outlines the results of a study on the impact of microcredit on recipient livelihoods in rural Bangladesh. It is a story that highlights the dangers of viewing microcredit as a “silver-bullet” for development and the limits of employing purely market-led development approaches as strategies for poverty alleviation. Microcredit claims to improve the lives of recipients by providing them with small loans to purchase productive assets for entrepreneurial activity. Advocates of microcredit argue that this helps recipients break cycles of poverty, reduce dependency on “charity” and other forms of aid, and empowers women as economic decision makers within the homes by targeting women as loan recipients. While microcredit has helped accomplish these goals in particular situations and contexts, it also relies on economic integration as the primary mechanism for development and assumes that all poverty is a function of the inability to enter into market relations.

While lack of credit is a critical issue in impoverished rural regions throughout the world, it is only one structural aspect of poverty. Food insecurity, lack of access to health and education, and gender inequality (not just in economic but also in social and cultural contexts) are realities for those living in rural poverty that microcredit may not be suited, in-and-of-itself, to address. Indeed, donor and practitioner enthusiasm for such market-based development strategies, at the expense of addressing these other critical issues, threatens to make conditions of poverty worse.

In Bangladesh, the “birth-place” of microcredit,² microcredit is seen as a key strategy in overcoming many of the hurdles of rural life, including low per-capita land holdings, underemployment, poverty, and gross wage disparity.³ As microcredit has grown in popularity with funders, it has become relatively easier to fund microcredit projects in Bangladesh than other kinds of programming. Not only are many new NGOs forming specifically to deliver microcredit, but other organizations are increasingly shifting their funding away from social safety net programs and towards microfinance. This has led to a marked reduction in the diversity of services available in rural areas.

What follows is an exploration of what happens to recipients in an oversaturated microcredit market; a market in which microcredit has become the, as opposed to a, mechanism for poverty alleviation. In rural Bangladesh, microcredit is not achieving its core goals of poverty alleviation, financial independence, and gender equality. While this is very much a story about Bangladesh, we stress that with the increasing global popularity of microcredit, it is also a cautionary tale for donors and practitioners alike. This research was conducted cooperatively with a group of landless laborers living in Arampur, a village in Northern Bangladesh. Using digital voice recorders, they conducted unstructured interviews with their peers and neighbors, gathering life histories and experiences with microcredit. What follows is based directly on villagers’ words, concerns, experiences, and ideas.

Read the full report here (PDF).

Contact the authors of this report: Kasia Paprocki: kasia@goldininstitute.org and Jason Cons: jason@goldininstitute.org

1. Real numbers are likely to be higher.See MICROCAPITAL STORY: What Are the Total Global Assets in Microfinance?”2007.Microcapital:The Candid Voice for Microfinance Investment. Available here.

2. The Grameen Bank was founded in the mid-1970s to provide micro credit loans. While it may be disputable whether this organization was the first microcredit provider, they have certainly, over the past thirty years, become the most famous, resulting in the joint awarding of the Nobel Peace Prize to the Bank and its founder, Mohammad Yunus, in 2006.

3. For an excellent overview of the context of microcredit in Bangladesh see Qazi Kholoquzzaman Ahmad(2007), Socio-Economic and Indebtedness-Related Impact of Micro-Credit in Bangla- desh. 2007. Dhaka: University Press Limited.