Showing posts with label Business. Show all posts
Showing posts with label Business. Show all posts

Wednesday, June 04, 2014

Fundamental Microfinance

English: Roadside billboard of Deng Xiaoping a...
English: Roadside billboard of Deng Xiaoping at the entrance of the Lychee Park in Shenzhen (Photo credit: Wikipedia)
I am a huge fan of microfinance. But it has to be reimagined. It is one of the three basic ingredients, the other two being education and health.

A country like Nepal can not afford to only educate the kids, although it currently does a poor enough job of that as well. But adult education has to step in. You use the same school buildings, but perhaps in the evenings and during weekends, for adult education. Everyone, child or adult, needs at least 10 years of schooling. And you should be able to pick up no matter where you left. And you should have the option to move at your own pace sometimes. Perhaps you put FM radio to use. People could tune in at a certain time of the day to listen into lessons. There is one frequency for the first grade, another for the second grade and so on. Lessons should be available in your primary language. The Chinese have proven beyond doubt that you don't have to learn English first before the world opens up for you.

People like Mao and Fidel Castro have done impressive work in basic health. You provide basic training to a large number of workers who then fan out to where the needs might be. There is a fundamental need to take up this work with revolutionary zeal.

But a left leaning country like Nepal where even the so-called right of center party like the Congress calls itself "socialist" sometimes tends to not grasp entrepreneurship well. You can educate your people all you want, you can turn them into fighting shape in terms of health, but unless you can create jobs for them they are going to rust with disuse. You are going to pump up a population that is all ready with nowhere go to.

Left leaning political leaders should cultivate a healthy respect for entrepreneurs who might be millionaires. They are like hens that lay the golden egg. You don't kill those hens. You don't get in their way. When they create more wealth for themselves, they pay more in taxes. You can use that tax money to serve the poor all you want.

But then entrepreneurship goes way beyond people who establish and run big factories. Small businesses are all the rage. Even in a country like America the vast majority of new jobs get created by small businesses.

And then there are micro businesses. I am talking raising goats to sell, or cultivating vegetables to sell, small businesses that you could start with a hundred dollar loan. Access to credit should be like a right, just like basic education and health.

But then sometimes it is hard to create any meaningful business with just a hundred dollars. China does not have a track record in microfinance, but it has lifted more people out of poverty than anyone else. And they have done that by creating jobs at large scales through large scale factories.

Very few rich people choose to become entrepreneurs. I like to say being an entrepreneur is kind of like being gay. It is assumed perhaps one per cent of the population is biologically gay. So if very few rich people are entrepreneurs, it is erroneous to think all poor people are inclined to entrepreneurship.

Another dimension to microfinance would be that you would have something like a right to a hundred dollars in business loans every year, but you would also have the option to pool your resources. So 100 individuals should have the option to bring together 100 dollars each into a pool of 10,000 dollars for a one per cent share each in an enterprise led by one entrepreneur who perhaps ends up employing most or all of those 100 people.

If you make room for the fact that 5-10% of those loans will fail that you will happily write off, I think that could create a lot of small business action. And you will end up with a lot of workers who are also part owners in enterprises. That is key. Deng Xiaoping started by letting Chinese farmers own small plots of land. The sense of ownership is key. The right to property is a fundamental human right, like free speech. And the act of exercising free speech takes some practice.

Completely state owned enterprises are not simply failed Soviet era ideas. Modi proved in Gujrat they can outperform the market if they are kept free of political interference and are allowed to run on meritocratic guidelines. It makes sense for some companies and some enterprises to be 100% state owned. As long as they perform is all that matters. What is dead weight is companies that are state owned and run losses year after year.

You can also have companies that are partly owned by the state. You can have companies that are partly owned by foreign investors.

There is no one size fits all. The key point is entrepreneurship has to be nurtured. It has to be allowed to flourish. There does not seem to be only a left or right way of doing it. State owned enterprises can work. Private companies can fail. Small business owners can create jobs. Large companies can stagnate. The job market is and should be a dynamic situation. As long as the cat catches mice is all that matters.
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Monday, January 07, 2013

नेपालमा आर्थिंक क्रांति र न्यु यर्कका नेपाली


म 2005 मा न्यु यर्क आएको आफ्नो टेक्नोलॉजी कम्पनी स्थापना गर्न, तर फुल टाइम नेपालको लोकतान्त्रिक आन्दोलनमा लाग्न पुगेछु। नेपालको अप्रिल क्रांति, मधेसी क्रांति सकिएपछि, ओबामाले दुई दुई पटक चुनाव जितिसकेपछि, अमेरिकाको आर्थिक मंदी अलि साम्सुम भैसकेपछि अब त आफ्नो काममा लागौं कि भन्ने अवस्थामा नेपाल फेरी front and center भएर आइदिएको छ। नेपालमा संबिधान र संघीयता आइसकेपछि त्यस पछिको 20-30 बर्ष त आर्थिक क्रांति नै हो। आर्थिंक क्रांति भनेको टन्न पैसा कमाउने भनेको हो।

टेक्नोलोजी कम्पनी भनेको software हो तर software मा Google र Facebook जस्तो cutting edge काम गर्न सक्ने मेरो पृष्ठभूमि छैन। Software पछिका next big things मा clean energy, biotech , nanotech पर्छन। Clean Energy मा Hydroelectricity पर्छ। Hydro मा ब्राजिल पछि नेपाल कै स्थान छ। 2005 मा नेपालका लागि सोंच्दा पैसा खर्च हुन्थ्यो। आगामी 20-30 बर्ष नेपालका लागि सोंच्दा पैसा कमाउने बाटा हरु देखा परेका छन। नेपालका hydro प्रोजेक्ट हरु का लागि न्यु यर्क मा funding खोज्ने काम फलदायी हुने मैले सोंचेको छु।

Software छोड़ने भनेको होइन। Hydro पनि गर्ने भनेको हो। न्यु यर्क का विभिन्न नेपालीका website मेरो टीम ले बनाई दिया छ। मोबाइल app को राम्रो स्कोप छ। जैक्सन हाइट्स मा एउटा पान दोकान खोल्न लाग्ने पूँजी भन्दा कम पूँजी मा एउटा app बन्न सक्छ, र idea राम्रो हो र त्यसले hit खान्छ भने त्यसले पटेल Brothers लाई  डाउन पार्न सक्छ।

दुनियाको office भारत, दुनियाको फैक्ट्री चीन। इम्पोर्ट बिज़नस को पनि राम्रो स्कोप छ।

न्यु यर्क जस्तो opportunity भएको ठाऊँमा आफ्नो व्यक्तिगत आर्थिक क्रांति गर्न नसक्नेले नेपालमा आर्थिक क्रान्तिको नारा दिनु खोक्रो हुन्छ। त्यही भएर साथी हो पैसा कमाऊं।
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