Dan Banik and Raj Kumar discuss the role of the current media landscape in global development and how billionaires, tech disrupters, and social entrepreneurs are transforming the global aid industry.
Although traditional approaches to aid may often have been well-intentioned, they relied heavily on large-scale endeavors initiated by a handful of aid agencies and international organizations. The situation today is very different. There are disruptive forces in the form of large corporations, Silicon Valley startups, and billionaire philanthropists, who are spearheading a paradigm shift towards data-driven and outcome-focused global development. Entrepreneurial startups are also offering a range of services to farmers and rural inhabitants as well as urban customers; and new organizations are helping individuals to directly send money to those in need via an app.
Raj Kumar is the President and Editor-in-Chief at Devex, the media platform for the global development community. He is a media leader and former humanitarian council chair for the World Economic Forum and a member of the Council on Foreign Relations. His work has led him to more than 50 countries, where he has had the honor to meet many of the aid workers and development professionals who make up the Devex community. He is the author of the book The Business of Changing the World: How Billionaires, Tech Disrupters, and Social Entrepreneurs are Transforming the Global Aid Industry, which is a go-to primer on the ideas, people, and technology disrupting the aid industry. Twitter: @raj_devex
Key highlights:
Host:
Professor Dan Banik (Twitter: @danbanik @GlobalDevPod)
Subscribe:
https://globaldevpod.substack.com/
https://in-pursuit-of-development.simplecast.com/
Dan Banik Raj, it's great to see you again. Welcome to the show.
Raj Kumar Great to see you, Dan. It's a real pleasure to be with you.
Dan Banik I've really enjoyed reading Devex over the years and I want to talk to you about the role of the media. What do you think, having set up this media platform on aid on global development, how do you view the current media landscape on global development, so to speak?
Raj Kumar It's a great question and I think it's worth stepping back a little and just thinking about not just media, but the broader development landscape itself, because I think it's more that development has shifted than that media has shifted and the two are interacting together. I think in some pretty positive ways, you know development was for a long time very much a government dominated and fairly insular world. And when I was first trying to get a job in this field and learning about it, if I met somebody who worked at UNICEF and I say, what do you do? They say I work at UNICEF, you know, I'm. A UNICEF person, and that's their identity. And I think what's shifted a lot is that development has become the space where people see themselves as global development professionals, right? That they can hop from one agency to another. They can work in an NGO. They could join a private company they could join a government agency, right? And development itself has become this much bigger, more open space. I think what media has done to help advance that shift is to try to shed some light on the things that are working in the space. So, not the typical kind of calms approach that that I think dominated. A lot of what we might have considered media 20-30 years ago in our sector, the Comms department of big agencies, but rather journalists, you know, looking at this and saying here are some things that are working. And also, here's some things that are not. And bringing some real accountability to the sector. I think that's the big shift. We at Devex have tried to drive is to say the development sector is a is a public sector. It's owned by everyone, primarily it should be owned by the people in the low- and middle-income countries that this industry is designed to serve. If it's really owned by everyone, there needs to be some sunlight cast on how it's actually working, and there needs to be some accountability. So that's the big shift. We've tried to drive, and I think we're just one of many elements that have helped to drive a big change and social media is a big one too, because it's opened up some of these historically very closed agencies. This and this little kind of an old boy’s club that that dominated the way the development sector worked and now we get to have some real debates and we get to hear a lot of diverse voices on some of these really key issues. I just think media plays an outside role in the future of this industry, and I think that role is going to get bigger and bigger because I think development as a space is getting bigger and the need for more sunlight is getting greater.
Dan Banik I think there are two issues here. One is, as you rightly alluded to, this professionalization of the sector. So, we've moved a bit from the idealist do-gooder to maybe more of a professional setup where as you said, people could move between different jobs. You don't really have to live in poverty to do development. We've moved, I suppose, from that idealism to more pragmatism. Getting some of the best people in the field. But the role of media, as I see it, I think the newer forms of media, given the Internet, given social media, etcetera, this field has opened up more. So, you don't have to rely on mainstream media to cover an issue that editors don't find attractive or relevant for their audiences, right? So now you could cater to much more specialized fields; just look at podcasts, this is a good example of how, if you're really interested in something niche, you actually have a way out. So, I think that has democratized in many ways the field as I see it.
Raj Kumar It's very true, and certainly Devex couldn't have existed without the Internet age, right? I mean, we didn't start in print and shift to digital. We started in digital from day one and we probably couldn't have made this work in terms of a business model that generates revenues from advertising and subscriptions probably couldn't have made it work if we had to start in print, right? And that was part of the reason why when we started, I went around asking people, where do you get your information? I was interested in getting a job. I wanted to have a career and I was shocked when people said, you know, you gotta you and meet people, go to Washington D.C, go to cocktail parties. That's how you find a job and develop, and I was blown away. I thought this is a mission driven industry. This is how it really works. But we thought there's got to be a website out there that just lists the jobs. Or a list of projects or list the news, what's happening …
Dan Banik You wanted a Craigslist …
Raj Kumar Right, something basic. And there was nothing and I was totally shocked by that, and the truth is, we couldn't have made this work. This was a very small bootstrapped, you know, little start-up out of my apartment. We couldn't have made it work without the Internet age because we were able to contract with researchers and journalists in different countries over the Internet. And sending them payments digitally. And none of that would have been possible if we had to go to kind of some old system of having bureaus and you know more formalized approaches. So, we were able to do it in a really scrappy way from the start. As a bunch of students and build them into something over time that now is much bigger and more professionalized organization. But yeah, the Internet was key to this evolution for us. And I think to to the whole sector, it has really shifted things.
Dan Banik How do you think this has resulted in greater numbers of people reading about global development in low- and medium-income countries? Because as I see it this sector seems to generate a lot of listeners and readers in some of the donor countries where aid is important – the US, the UK, Scandinavia. Do you find that you have more readers, people engaging in this stuff also in some of the countries where development is done?
Raj Kumar Yeah, we certainly do. I think there's a long way to go and I'll explain what I mean by that. But just in terms of our audience and our focus is development professionals. And when we started, we even had to figure out what should we call these people. You know, people who dedicate their lives professionally to working at institutions like the World Bank or an NGO. What are they called? And honestly, back then, people didn't really say development professionals. We somewhat invented that term or maybe it wasn't just us, but we kind of decided to formalize that language because there was the term “aid worker”. That existed, but that evoked this idea of someone with a backpack and maybe a bag of grain or something in the field at the moment of crisis, supporting a humanitarian response. But that wasn't what most people did in this field, and so we needed a different term, and we started using, in our newsletters “development professionals”. We just tried to create that term and it took a long time, but I think it's somewhat stuck. And the truth is back then, when you imagined a development professional, you probably imagined a white European or American who was off and on planes but was living in Frankfurt or in London or in Washington DC, right? And I think the sector has shifted so much that when today when I think of the development professional, I'm thinking of people who are in India or are in Kenya. I'm thinking people often from the very countries where the work is happening, and they too are developing professionals. They might hop from 1 institution to another, one project to another. So, I think the audience for us is just the nature of, you know, who we consider part of this work has really shifted in a very significant way over a couple of decades. To your point about who in low- and middle-income countries reads about this stuff, I mean, if you're in India and you're talking about better tax collection or you're talking about health insurance, you might not call it development, right? Because it's not some other country coming in and imposing this or bringing you this resource. It's very much domestically driven in a country like India, the issues are development issues though, and often the World Bank or the Gates Foundation or USAID or someone is playing some role in that domestic development process. And so, I think domestic audiences in a lot of middle-income countries, but even low-income ones too, they are consuming information about development through their national media and through their social media. But it's just not termed in the way you and I might talk about it, right? It's much more just about their domestic approach to issues and the way that in the US, you know, we have a lot of philanthropies that are domestically focused, and you might read about some urban renewal project that's certainly the mayor would be in that article, or maybe the state’s governor would be in that article, but maybe also some big philanthropist. And I think that's kind of the way that this has evolved.
Dan Banik Two specific functions that the media could or has right in in all societies, one is very basically providing more information. So, this is the first point that we were discussing that now you have a greater variety of choices. You don't really have to go to mainstream media, which may or may not cover a particular issue or the media may be captured by political forces in some countries, which means that the reports may be biased, so the actual coverage may be very tainted in favour of or against the ruling party. As I see it, one is the information and the credibility aspect, the other is to hold the authorities to account when something hasn't worked, something has failed and that is the watchdog function, which I would imagine mainstream media does not do that much of a job of unless it's a big corruption scandal, right? It wouldn't necessarily cover the nuances, about ideas or failed projects or something that is not effective enough. It would be more about these big scandals. It reminds me of Amartya Sen and his work on famines, which I've been very inspired by. The way he talks about the role of the Indian media and holding authorities to account, which is important, you know, in terms of preventing famines, but it doesn't work in relation to say, starvation deaths. Democracy works when there are big crises. So, do you see that holding people to account is crucial or is it more like Devex’s job to provide more detailed information about what works and why not so much the scandals?
Raj Kumar Really, it's both. I wouldn't say it's necessarily about scandals, but you know, Amartya Sen’s point is that media has influence, right? Media really has influence over opinion leaders, policymakers. It can shift the debate in a big way, and we see that, yeah, we publish an individual article even on the topic. And people start buzzing about that, leaders of NGOs, people inside the US Congress or the British Parliament, and it can lead to a different view on an issue or prioritizing an issue more than it was the day before. And that can lead to some kind of ultimate action. I think media has huge influence and it does that through both of the mechanisms you described. One is just this is a credible source of information. You know there's a process that you go through. We have, you know, trained reporters. They usually come from major publications because we are small enough, we can't really train many journalists, so we're hiring from major publications – Bloomberg or Politico or the New York Times, etc. Our journalists come from such places and when they're with us, they're then focused on a very particular food security or renewable energy. And they become real experts in that topic. And then when they want to write something, they have to go through a couple of layers of editors and we have a strong editorial policy and so by the time something's published by us, we're putting our stamp on it and saying this is credible information doesn't mean we never make a mistake. We certainly do. But I think part of what journalism brings to the table in a sea of information available on social media and on the Internet is OK. This is something that's gone through. A process, a journalistic process, and it therefore gives it some more credibility and therefore should be taken a bit more seriously. So, I think that first function you talked about just providing information in a credible way is really important and we're trying to do that all the time. And so, something like the world banks for meetings a couple of weeks ago, you know we're there covering in part just to say here's what we think. There's a lot happening. Here, here's what we think is most important. Here's what's come out of it. And so you, Dan, as a reader can say, OK, I don't have time to attend 20 World Bank Sessions during that week, but I can glean from Devex what was most important, but that that second function of accountability is really key to that. Leaders and institutions know, OK, there are journalists out there following our work. And if we make a big mistake, or if we're saying one thing but doing another, someone might actually write about this and that is important. I think in our space there needs to be accountability. And there really is nowhere near enough.
Dan Banik Going back to how you started Devex, I just recently read in this wonderful book that you've written – The Business of Changing the World – I read about our friend Joe Nye, who was the Dean at Harvard Kennedy School, and you were a student there, and you started dabbling in this Devex project on the side, and he encouraged you to pursue your dreams. I found that fascinating, because usually we professors never encourage students to not finish their study. It's like you do all that other stuff after you finish your masters, but the fact that you did that I think is wonderful. You took that risk. I'm sure my listeners are very interested in hearing about the kind of impact your platform, your outlet, the Bloomberg of foreign aid and development, the kind of impact you feel Devex has had in these years that that you've existed.
Raj Kumar Yeah, happy to talk about that and I do. Oh, by the way, I owe Joe Nye a lot. A big debt of gratitude because you're right, it was surprising to me. I ran into him recently at something and told him the story again and it was just surprising when the Dean tells you no, you can drop out. You can always come back anytime you want to go and pursue this. So that made a big difference. Yeah, I think, you know, we try to have impact in a few ways. So, one through our journalism is to really influence our sector to follow what you see in our tagline, which is “do good, do it well” and that motto is essentially it's not enough to try to do something good to be charitable and to care. You have to actually do it with a certain degree of professionalism and a focus on results. So, our journalism, I think, helps to really push the top issues to the to the highest part of the agenda and to push that accountability and a sense that what we're doing matters and it just elevates, I think the work of everyone in the sector because there's someone watching. And if someone's writing about this in a serious way. And there are millions of people reading it and paying attention, right, that that really matters. So, I think our journalism is all about influence with the right audiences, really influential audiences that are making these big decisions around things like the World Bank Spring meetings looks. In maybe the other ways that we have an influence might not have an impact, might not be as familiar to your audience, but we are also a major provider of recruitment services in global development, right? A lot of younger people when they're in grad school, and they're interested in the job and development like I was a couple decades ago. Now there is that website and it's ours. So, they go to Devex; we bring together all the jobs in global development. They can search through them. We have career advice helping them write their resumes or figure out how to apply, and because this is a somewhat opaque sector, you get, you know, an amazing graduate student in a middle-income country that might say: “I really want to work with the Gates Foundation, but I don't really understand it”. And so, we try to demystify this sector for really lots of professionals all over the world. That's a very big part of our impact and it is one of the most gratifying things for me when I'm out there, in the field someplace or meeting somebody in an organization. I say, you know, I got my Java Devex, like that's how I'm in this chair. That's pretty great. And then the last area is another thing. Maybe not everyone familiar is with, but we track all of the funding in global development. So, we have a team of researchers that are capturing what the USA is funding, what the Gates Foundation, what the World Bank is funding. We're putting all of that into a real time database and providing e-mail alerts and it's used by NGOs and companies to track funding opportunities that they can apply for, and again, similar to the democratization of recruitment, we're trying to democratize funding. In the past, a very small number of organizations, often literally physically clustered around the donor agency in a rich country capital. Who know how things work. They understand what's happening and they win a lot of the business. And we're trying to just open that up and we've been doing that for a couple of decades, and I just get to hear similar stories about how small local NGOs have actually won Asian Development Bank contracts. They say that the project that we didn't know about was happening in our community and we found out about it on Devex. So, those are the ways we try to have a real impact in the world.
Dan Banik It reminds me of somebody I met in Kampala, Uganda over a decade ago who told me that he had finally figured out how to get funding from Western donors. It was about mentioning “poverty”, “human rights”, “gender”, etc. as often as possible. That the donors looking at the proposal, they were counting the number of times certain development buzzwords were being used. So, I can totally sympathize. I'm glad that you're providing that service, Raj. Going back to global development generally, there seems to be quite a bit of frustration with how things are moving. Let's forget about the pandemic, this, this problem existed even before. You have donors becoming more and more stingy, looking inwards into their own problems and not willing to fund that much. And I'm talking about rich countries where the aid budgets are being slashed. There's also growing frustration with just the model of development. Do we actually have the right advice to offer? Because everybody, every scholar, everyone writing a book has a different take on the problem. Then we have Indias and Chinas moving and perhaps advocating for a different world of development with different ideals that may or may not suit Western countries. And then there is the role of the private sector because there's considerable frustration that this wonderful agenda that we had – moving from billions to trillions – did not really work out. The Sustainable Development Goals that relied on businesses and the private sector to provide revenue for achieving sustainable development – well, it has worked in some places, but nearly not enough so. Can we maybe discuss the role of businesses in the private sector, because this is something that you do a very good job of in the book? How easy or how difficult do you think it is today to attract private capital for global development?
Raj Kumar Yeah, I think, this has largely failed, right? If you look back on the agenda of the SDGs from 2015 and you think exactly as you say, it was all about crowding in private sector capital. If you look at the numbers around blended finance and tiny. I don't think it's because the appetite is low in the private sector. In fact, we've gone through this market of low interest rates, 0 interest rate policy. There's a huge amount of capital sitting on the side-lines waiting for some kind of return. Now we're entering a different era where interest rates are high, inflation is high, and it's actually going to be harder to attract private capital because of that. But there's still a huge, enormous amount of capital on the side-lines. A lot of the growth in the next couple of decades going to come from low-and middle-income-countries, right? That's where growth will be, not necessarily from Europe and the US and Japan. So, the question is, how do you bridge the gap? And I think we've largely failed it. We've mostly done a great job talking about it as a development community. It's what we hear about it nonstop. And there are some good examples, those examples, those companies that are doing a lot in this for those investors, we see them at every conference, the same ones, right? But they're the exception and the fact is that the vast majority of major corporations or major investors are on the side-lines here. So, what went wrong? I think part of it is we need to find an on-ramp for this money. We can't just assume that private capital is going to somehow chase after the twin goals of making money and supporting the SDGs in very challenging parts of the world when there are other things they can do with their capital. Chances are they're not going to go there. And so that's what the big debate happening right now, about the Multilateral Development Banks, especially the World Bank, it's all about how do we take these institutions, that we have got, how do we change the way they work? Pretty fundamentally from being bankers to countries which is essentially how they've been structured to actually being more like deal makers. And if they can be deal makers, they can say let's find a way to bring in private capital and the government around a large scale industrial transformation, you know, change an entire sector That's how you bring in the private capital, you de-risk it. Give them a platform in which to invest, and I think we've done a pretty poor job of that as a broad development sector and we're seeing it in the numbers.
Dan Banik There are some positive developments here in the sense that there are more guarantees being given by governments to offset risks that the private sector often must take if they were to involve themselves in global development. So, I see that rise in guarantees. You have MIGA as part of the World Bank Group doing that, but some of the criticisms is that it is slow, time consuming and investors get impatient with this the long screening process. But one area where I think there is some, well, considerable disagreement, is the role of profits in the global development business. One argument would be, a lot of activists would say, that the private sector should invest but just break even. You can't make a profit, or even if you make a profit, it shouldn't be too much. There should be some threshold where some business leaders would say, “No, without that profit incentive, there's no real incentive or interest for me to be involved in this”. So, there's something about that – how much profit making can we allow or is acceptable in this field? If there's another venture that is much more profitable within our countries – in safe spaces, in countries where there is political stability and the rate of returns are high – why not invest there? Why take a chance? Is it that fear of risks or could it also be that they just don't have enough information? They don't know that maybe there is money to be made and promote a social good on the African continent in Asia and India?
Raj Kumar I think market mechanisms are really powerful. Incentives are very, very powerful. And I think money would chase returns, you know, no matter what, I don't think it's a lack of information or a perceived risk that is the biggest issue. I think these are real risks and I don't think MIGA and others are doing anywhere near enough on providing guarantees and that philosophical debate is mostly philosophical and mostly doesn't actually play out or matter that much in low-and middle-income countries. A piece here which does matter a lot though, and that is as we redesign these multilateral development banks, turning them from bankers into deal makers. The idea is not to take away all risk from private companies or private investors. You have to take risk if you're going to make a profit, make a return. There has to be risk, but the point is to reduce the risk in certain ways and maybe reduce the returns in certain ways so that it's reasonable, but it still drives an incentive and money still flows into these kinds of investments. So, what do I mean? For example, if you're gonna invest in a low-income country, their currency may not be very easily convertible. And their currency might drop in value overnight by 20% or something, right? Those kinds of risks are very real. And investors say I'm not going to invest in that low-income country because of that. So, you can get the World Bank or others to say, look, we will provide some currency risk protection if their currency drops by a lot. The World Bank will absorb that risk, not the private investor. That's reasonable. Private investors still taking on the business risk if they invest in in the solar farm and it fails, they should lose money, right? But if they invest in that solar farm and it works, they should be able to make money. So, I think this debate is mostly philosophical, but the clear direction we need to go in is finding reasonable ways to mitigate risk that don't just, like, socialize all the risk and privatize all the returns you know, but reasonable ways to do this. And the ultimate goal is to drive more money into these markets and into these investments and we need to judge ourselves against that because if we judge ourselves against that now, very little money has flowed. So, clearly whatever we're doing now, we might be protecting ourselves and that we're not providing unnecessary guarantees and we're not supporting profits. But we're not actually driving enough investment into these countries.
Dan Banik When the SDGs came into force like 7 years ago, I noticed that the private sector, for the first time in my career, I witnessed the private sector really enthusiastic about global development. In fact, I think on the 2030 agenda and the SDGs, there's no bigger supporter of that agenda than the private sector. There's been so many reports saying, oh, you know, there are trillions of dollars to be made. There are so many opportunities; if you just focused on food or infrastructure consumption, or whatever, rhere's a lot of money to be made. But somehow that message really hasn't come across. I was also thinking about something that you wrote about in your book – the poor as customers – it isn't just selling very expensive polished goods in a high-income country context. You could sell a bar of soap that becomes hugely popular or detergent like “Wheel”. Or even using technology like the “Hello tractor” model in Nigeria where people could use the Uber model to borrow a tractor in a country that doesn't have that many and people often don't have access to these tracts. Thinking about some of these countries and the citizens of these countries as not just being a lost cause, but there's actually something that that could promote development and yet you could make money out of it.
Raj Kumar One of the things I try in the book to emphasize is take get us away a bit from the Western debate about profit motives and incentives and capitalism versus socialism and focus instead on the idea of market mechanisms. They could be profit making or not, they could be non-profit making, but market mechanisms are really powerful. And that's what this story is in general. That's what they all connect with. It's the idea that somebody wants to need something, and you can create a market for that. Hello Tractor, I think, they're now in seven and more than seven countries in Africa. They started in Nigeria. The big insight there wasn't, you know, we're going to put a computer on a tractor that lets you share it, like a ride app. Like a like an Uber. That was, you know, a good innovation and they were using satellites and they were using mobile telephony and digital payments. All these technological revolutions that were key to it, the really big insight was that the smallholder farmer is a customer. They're not a beneficiary. That was the big mental shift and I think it's the big mental shift that our sector is still going through. There's still a sense that there's the development organizations and we're out there helping the poor people. And that shift is going to be hard to complete. But when you do it, when you see the people at the end of that chain as customers or partners or neighbors, not as beneficiaries, you can unlock all kinds of thinking around how to serve them. And I talk about Give Directly in the book. I think they're on track to do a billion dollars in just, you know, completely unconditional transfers, $1000 per household. You might do that if your neighbor's house burned down. If your neighbor's house burned down and they needed money, you know them, they're your neighbor, they'll pay you back. Maybe they won't pay you back, but they would do the same for you if your house burned down. We historically have not treated beneficiaries that way, and we can't trust them with money and with decision making. So, that shift is huge, and it's connected to market mechanisms and seeing people as customers. The other thing worth mentioning, I talk a little bit about this in the book, is we got a little bit euphoric about the bottom of the pyramid idea, which hasn't really panned out that well. Part of the reason is the transaction costs to sell things to people at the bottom of the pyramid. Because they're really hot and people at the bottom pyramid are really poor, you know, they have very little income. So, you have to actually add up billions of customers to make any real money. And so there are some good examples like soap and things but the next wave of this is coming now where maybe these transaction costs are going to come down a lot because of changes in digital payments. It is a great example, Brazil. A part of this is the D5 work in crypto, but part of it is just other platforms for making really cheap micro payments. And that could actually open up this space a lot and make it possible to do very small interventions of cash to people or to create little markets where otherwise they would have been completely inefficient.
Dan Banik Yeah, I think that's a good point that the poor are important as customers, but you know there are certain other problems that mean that you may not have as many customers as you as you think you know you need. Some countries in southern Africa such as Malawi, where I do a lot of my research … there are lots of people who could be customers, but very many who would not be for a certain product. This also means that a lot of companies don't want to do any manufacturing there because the costs are high and because of regulatory frameworks that each country has, it is difficult to produce in Malawi and sell it in a neighboring country. So, you're dependent on having the customers in the same area. Where the global development scene has really changed is in relation to philanthropy, the role of the big billionaires, the mega donors. We're talking about the Gates Foundation, about all of these hugely important actors such as Warren Buffett, the Giving Pledge, and then you have Amazon. You have all of these companies setting up their foundations. And in terms of global health, in terms of polio in terms of maybe malaria, HIV, there's been tremendous progress, but one argument you make in the book is that these billionaires actually have disruptive perhaps and they've changed the global development scene. How have they done that, Raj? Is it by giving global development another set of actors than just the government than just the official agencies? Is it bringing some elements of the corporate world into this global development business? Is that how they've been disruptive?
Raj Kumar I'll tell you some negatives. I don't want to sound like I'm being too positive of billionaires. Because there are some big negatives, but let me just start with the positive, which is they take risks, right? And the big downside of the way the development sector has been organized since it since it began is that it's been largely dominated by government and government funding because it comes from taxpayer money. It's very risk averse. And the big fear everyone has in this space is they're gonna wake up in the morning to some headline. That, you know, money was stolen from their project, and then there's going to be a hearing on Capitol Hill or in the parliament or something. And you know, the government's going to say we can't fund this anymore and. And I give examples in the book of actually successful development programs that were really successful in terms of results and return on investment, but there was some tiny bit of corruption. And you know, that turned into a political problem and the governments cancelled their funding for through their bilateral aid agencies. So, risk is the number one issue in our space. It's the number one issue and what the billionaire philanthropists have come in and done is they said we can take risks. We're so rich. We're donating some money; we can risk some money on an interesting intervention.
Dan Banik So, there's continuity then …
Raj Kumar And so that has really disrupted the space because there are a lot of the most exciting social enterprises that are working in our sector now. They never would have gotten give directly, wouldn't have gotten going. Without google.org. And money from I think Chan Zuckerberg gave them money. I think Kerry, Tuna and Dustin Moskovitz gave them money. You know, it was a Silicon Valley LED effort. So many of these things come from the new billionaire philanthropist. The other thing they. They, the billionaire Philips, can bring to the table is they are not all, but many of them are looking at this space in a. Very strategic way. Right? Whereas a bilateral aid agency might say, well, we have a relationship with the Government of Malawi, we have a goal with the, we're gonna work with that one government and we're therefore gonna give, according to some diplomatic priority. The eight billionaires can come in and say we want to cure polio, right? We have like a bigger cost-cutting goal. What I call in the book “Zero Goals” often like we want to get down to zero child marriage, 0 polio cases and so they can look at this cross-cutting way and they start to say how do we leverage other people. And so now we've reached a point where everyone trying to leverage each other. And you know, the idea is like, I'll bring some money to the table if you come and join me in this. And then you know that other donor says, well, I'll bring some money, but you've got to come and join me in this. Everyone trying to leverage each other because as big as these foundations are as big as government agencies are. The problems are so much grander, there is no way that these drops of money can actually address them unless you align all of it together. So, many billionaire funders are trying to do that, and some, like the Gates Foundation, which is probably the most prominent working in the. What you know is now gonna have in 2 1/2 years from now they will be at 9 billion in annual grant making which, if you stripped out, what the UK Government is doing domestically. But that's called ODA technically according to the tax rules. They're probably going to be about that size, maybe bigger than the UK government. They're going to be top four or five countries in the world in in bilateral donations – the Gates Foundation, and that's just the Gates Foundation. And then you look across the other billionaire donors. Many of them have signed the giving pledge and they've just begun giving. They're giving small amounts, relatively speaking, so we're at the beginning of a tidal wave of philanthropy. And here's the negative. There's still almost no accountability, so you can be very whimsical. You can have one idea one day and another idea another. You can do things that are kind of like akin to green. Rushing, trying to make your reputation look better but not really do much. And we're trying to provide some of that accountability to Devex. But we're just at the beginning of it. It's there, there is a lot more to do there because this is going to become such an outsized component of global development that we we're going to need a lot more scrutiny of how building our philanthropists are doing their work.
Dan Banik I think that accountability point is really important because it reminds me of the traditional criticism of charity that if you give something, you're praised, if you don't give, you're not criticized, it's win, win, win all the time. And some would say that maybe these philanthropists are in it for getting a better reputation. You're not really tracking how much I pledged and how much I ended up giving. Maybe Devex is, and these billionairs need to be called out, right? I think Adam Grant from Wharton -- he has the saying – “The more you give, the more you get”. You may actually end up getting even more business and can make more money, you could be an effective altruist, have a lot of money that you could then then give out.
Raj Kumar Well, and it and it shouldn't just be about amounts, right? It should be about effectiveness. That's the key component here about accountable. Nobody, not just I, gave away this much money, but what did it do?
Dan Banik And therein lies also a challenge as I see it. The typical criticism is that some of these big actors, like the Gates Foundation and the other philanthropists, may undermine national governments. It becomes almost like an island of excellence. I adopt A goal. The zero goal that you were alluding to, I'm going to reduce polio and I'm going to do a very good job about it. I'm not really taking care of all the other stuff that's going around, and thereby you, I can undermine, maybe that holistic perspective that global development has long tried to cultivate.
Raj Kumar I think that's absolutely right and I think it could get worse because of some of the big trends. That are happening now. You know, the big one is more and more bilateral aid is going to humanitarian response, not to long term development. And as you see more conflict as you see climate driving more migration and more disasters that trend, I think, is going to continue. And so, I look at it to the future and I think we have a future where bilateral aid becomes largely about humanitarian spots and the long-term development space is filled by a combination of the multilateral development banks working with private sector on investable areas like renewable energy or transport and the rest of what we think of as long-term development – health, education, agriculture – becomes the domain of. And I think there's some real danger there. As you say, that you end up with lots of exciting projects, but they're siloed and they don't build up government capacity because not many philanthropists want to donate to a government or through a government. They want to do their own thing, so I think you're on to something and I think that's a real challenge that needs to be highlighted just given the trends that we're going to see in the next.
Dan Banik This reminds me of some of the work I've done with my colleagues in Malawi about how certain actors bypass local government in an attempt to achieve effectiveness. You want to have total control and so you establish parallel structures, and you bypass the local administration because you're so obsessed with results. Because we are, in the aid business or whoever is in the aid business, is really concerned with impact and results nowadays. So, it makes for a nice fancy report back home that what we did really had the intended results, but you did not consult, you did not involve local actors. I wanted to ask you again, just staying on Malawi, on the role of celebrities because it's not just the Bill Gates or the Zuckerbergs or the others. It's also the Madonnas of the world that are all these goodwill ambassadors for the UN. And then you have people like Madonna who are not just there for the publicity but are actually giving money, trying to build schools, make a difference, and then they run into all these other obstacles and they may end up not having that much of an impact that you thought you would have. And then you may end up pulling out. So, what is your take? I know you hang out with all these celebrities in Washington. What is the talk of the town there? Can they make a big difference in global development?
Raj Kumar I think just like the billionaire philanthropist, there can be a great role for celebrities. But with that accountability, and I think oftentimes celebrities have this comic book view of other countries, and we all are somewhat at risk of having the same view where you see this other country from a long distance away and you think: oh, if only they had that school like in the case of Madonna, we can set up a school and we know how to do this. And of course, you can go and do this. But of course, if you spend time, I've only been to Malawi once, but you spent a lot of time there, and you understand the local context. You know the political situation, the culture, some of the barriers, some of the reasons why poverty exists, which is, you know, it's not just a lack of resources, it's a justice issue, right? There are people are being actively marginalized. The government is actively picking winners and losers in society. These are these are very political things. And so, if you know that if you have this comic book view from a distance, you might think, well, I can raise money and I can do this, I can do a good thing. And that impulse is a great positive. Impulse to do a good thing, but boy, it can be destructive. It can backfire. You can actually hurt people. So, I think there needs to be a lot more accountability and I think celebrities absolutely should use their influence in this space. But within the confines of really respected institutions. I tend to appreciate it when I see a respected nonprofit organization that brings on their celebrity ambassadors, but they're working through an institution that really knows what they're doing is locally rooted, right? When I see a celebrity doing their own thing completely disconnected from credible development, you know institutions, that worries me. And I wonder how are they designing this, you know, where are they getting these ideas?
Dan Banik One person I've admired over the years, Paul Farmer, who you've also met, I believe … He was extremely good at mobilizing all this goodwill through celebrities, through politicians. And he channeled this attention and the finance to building up this NGO on health – Partners in Health. And what Paul told me several times is the importance of focusing on capacity building. Doing the long-term things, not just the immediate results that some celebrities are more concerned with. It is just investing in all the stuff that is often hidden away and not prioritized. Which brings me to the final set of issues right, the role of aid. As you see it going forward, because now global development, viewed from an aid perspective, it is no longer just the global North. It is no longer just the rich countries that dominate. You have India, you have China, you have South Korea, Japan, some rich, some new rich countries, some emerging countries entering the field, the Middle East. So, there is that old aid rhetoric and now there's a new aid. And I increasingly see people questioning really the motivations for doing it at all. So, I don't know where read this recently, but somebody made the point that the reason why it continues is because the US and Europe want to maintain their dominance in the world because they decide. And they're the expats. They're the ones who use the development buzzwords. How do you see that scene changing or shifting if it is in relation to some of these new ideas coming from China, from India, from elsewhere? Are they making a difference or are we still living in these parallel worlds where Western aid has its own agenda and the others have their own agenda, and never the twain shall meet?
Raj Kumar Yeah, I think. We're at an inflection point here in the global development space because of the growing conflict between China and the US and the West. And I think we're heading, it's not clear that it will definitely go that way, but it sure looks like the. The rift is going to get worse and worse, and China, maybe in alliance with some other countries including Russia, take a very aggressive view to their own approach around development and look at the Belt and Road. And the West has a different set of values and approaches, and I think that's coming to a real head, you know where it's not all new. This has been happening. Malawi's Parliament building, I think, was a beautiful, air-conditioned space built by the Chinese government. These are trends we've seen, but they're coming to a different point now. Because the rift is getting so big and it's not just about development, actually it's on many other issues, but development now is in the picture too. And if you look back to the Cold War, the Cold War conflict between the West and the Soviet Union, it's actually pretty good for aid spending levels, right, we spend a lot more on aid because we thought we've got to fight the Soviet Union. We want countries to not be communists, so we're going to partner with their often dictatorial regimes and give them give them money to do projects. It was really good for aid spending levels, and it was really bad for aid effectiveness. And the nflection point we're at now is we might land in the same place if we're not careful. Where we end up with the West trying to show how much we're partnering with low- and middle-income countries to keep them out of China and Russia's orbit. And so, we're doing things that don't make sense in terms of long-term development. We're not following the lessons. And I think it's a big risk on the other side of that coin, maybe there's a chance to say, look, what is Western aid? What is our model and how is it different and maybe the way it's different is that it is actually more effective because we're bringing in private sector, we're crowding in these other sources of funding, including philanthropy, and maybe because we're more focused on results. Yes ,and yes. We do have certain values and so maybe there's a way to repackage and rethink about how we do aid from a Western perspective that hopefully doesn't lose all the lessons that we have fought very hard to learn. And oftentimes at the cost of low- and middle-income countries and their own development that we can do this in a new way. Not going forward, but I think we're at a real point where we will very soon see and it's kind of a decision in fact that Western governments will have to make will very soon see the direction that our aid policy takes us.
Dan Banik I see that there is a huge challenge going forward in terms of reducing poverty, addressing humanitarian crises, and then the third element of global public goods. For me, a huge challenge and an opportunity is. How we see these things as being connected but also separate. A lot of leaders in lower medium income countries are worried that this focus on global public goods, climate change, pandemic preparedness is going to divert even more resources away from poverty reduction. And some of these immediate crises that that we face. So how we address that by making sure that aid for poverty reduction isn't reduced in our quest to do all of these other important things that's going to be pretty important going forward. The last issue I want to raise, and I would like you to reflect on please, is the role of technology, because this is often seen to be the magic bullet in terms of resolving climate change and all the adverse impacts of climate change. In India you've seen in terms of Aadhar, this ID card you know biometric ID cards that are used to get a bank loan, but also to prove your identity. Some of these things are having an impact. Are you optimistic about how technology can be used even more effectively in this global development domain going forward?
Raj Kumar Yeah, very much so. I mean, in some ways, I think it is the magical in a lot of ways, right. I mean it's you're always hesitant to say there's a magic bullet, but technology advance is incredible. And if you think about where AI is heading, you know, with these generative AI models, you're never going to have enough trained medical professionals in many of the low-income countries to provide the needed medical services. You can have an AI model potentially in a couple of years. This is not far off into the future where a community health worker can be with a patient and talk into a phone and get a response instantly with some kind of reasonable diagnosis and plan for a patient who otherwise may have never gotten any kind of care. So, this is pretty radical and there are many technologies that are shifting very quickly that will allow us to not have to wait 50 years for people to come out of poverty. So, I think this is a magic bullet. However, the big caveat is just about how we see what poverty is. So, if we see poverty as a just a lack of resources and technology lets us deliver those resources better. Then we'll be fine. And we'll get there quick. But if you see poverty as more of a deep-seated set of injustices of discrimination of, you know, marginalized people, women who are being, you know, kept in a certain position in society, if you see poverty in this political and justice framework, which I do, then you know that look, just providing the technology isn't going to solve this. Because the benefits of the technology are going to be captured by certain people, they're not going to be delivered to others. The status quo, the inequalities will continue to persist. If you don't address some of those root cause issues of poverty. So, we need to do both things. We need the very technocratic technology driven approaches to delivering better healthcare and education, while we also need the advocates and the human rights people and the people working at the political level could change society. These things have to come together. They can't just be about a technological revolution.
Dan Banik Raj, it was great fun to see you again. Thank you so much for coming on my show today.
Raj Kumar Love the discussion. Thanks Dan.