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Business tie-ups that help the Himalayan poor

by Curtis S. Chin

Even as Japan and the rest of Asia look skyward — with perhaps a mix of admiration and trepidation — to the latest success to date of China’s 20-year-old, multibillion dollar space program, much more needs to be done here on earth to bring business growth to some of the highest parts of Asia and the Pacific, a region which is still home to the vast majority of the world’s poor.

As Afghanistan struggles to break free from a turbulent modern history that seems at times to keep that nation mired in poverty and the past, China joins the United States and the former Soviet Union as the third nation to soft-land a spacecraft on the moon. The contrasts could not be starker.

Yet, poverty remains a persistent challenge among the people who continue to make their lives in some of the world’s most remote mountain regions in Asia, including in China. Limited economic opportunities still characterize sparsely populated communities on the Tibetan plateau as well as Himalayan villages that Edmund Hillary and Tenzing Norgay Sherpa once passed through 60 years ago this year en route to the first successful ascent of Mount Everest.

That was the clear message in Nepal at the recent conference on poverty reduction, which helped mark the 30th anniversary of the International Center for Integrated Mountain Development.

Headquartered in Kathmandu, ICIMOD is an intergovernmental knowledge and learning center founded Dec. 5, 1983, to serve the eight member nations of the Hindu Kush-Himalayan region — Afghanistan, Bangladesh, Bhutan, China, India, Myanmar, Nepal and Pakistan.

In many of these places, Japan is heavily involved, with tens of millions of dollars of official foreign aid and assistance programs, ranging from Japan international Cooperation Agency (JICA) efforts in Bhutan to Japan Bank for International Cooperation (JBIC) lending for Myanmar. Even the heavily Japanese-influenced Asian Development Bank (ADB), on whose board of directors I once sat with now Bank of Japan Governor Haruhiko Kuroda, continues to provide with Japanese board support more than $1.5 billion in annual assistance to China, though little is targeted to the Himalayan region in that country.

Here and elsewhere in Asia, however, the reality remains that while government might have been the key driver in putting a lunar lander, or man, on the moon, it is the private sector that is key to sustainable economic growth, job creation and poverty reduction. That is as true in the plains and lowlands of Asia, as it will be in its remotest mountain regions, typically home to indigenous peoples and characterized by inaccessibility and fragile agricultural ecosystems.

To address this, business, government and civil society must come together and move beyond the politics, stereotypes and animosity that have for too long divided the Hindu Kush Himalayan region — home by some estimates to more than 180 million people and to vast water, forest and other resources at risk of unsustainable exploitation — and focus on partnering for sustainable economic growth.

At the ICIMOD conference, I joined with several business and chamber of commerce counterparts on a panel moderated by CSR Asia. Together, we outlined three important areas that must be addressed to spur private-sector engagement in Asia’s remote mountain regions.

The first is innovation. The private sector is often ready to explore partnerships, but joint activities and plans for engagement must be innovative, with a business model that is not purely philanthropic but structured to ensure both end beneficiaries in the community and the private sector can benefit.

This will include an assessment of risk and return, something that the private sector is long accustomed to, and which government and civil society should also integrate into their own efforts in increasing accountability for time and money spent.

The second is involvement. Too often, the business community is invited to “participate” in a project or asked to fund a piece of research that already has been outlined and decided. The message is, in essence, we want your money, but any other involvement is not welcome lest it “taint” the effort.

Instead, the private sector must be engaged early on. An innovative partnership would go beyond business as usual and involve the private sector in fashioning programs that also leverage a commercial partner’s market experience and knowledge. Such innovative, involved and engaged partnerships can be to the long-term benefit of both mountain communities and the bottom line. This is critical to success and sustainability of any private sector involvement.

One spotlighted example of private- sector intervention discussed in Kathmandu was a pilot effort to work with marginalized farmers in South Asia, helping catalyze linkages — just as other programs have facilitated cooperatives — to share information, improve agricultural products and yields and, ultimately, build better supply chains and profits.

The third is impact. For the business community, impact assessment is critical. Unlike government, business depends on past success to fund future successes. Results must be measured to ensure there is rationale for sustained or expanded business involvement.

The remoteness of mountain communities cannot be an excuse for the lack of financial returns on a business investment. When a pilot program is brought to the business community for assessment and possible expansion, its impact and scalability must be clear and transparent.

Pilot projects help demonstrate that something is possible, but impact assessment is necessary for the business community to decide on scaling up an engagement. Don’t throw good money after bad, as it were.

While governments typically drive basic infrastructure investments such as rural electrification and farm-to-market roads, the private sector is well positioned to help mountain communities by providing financing, market linkages, knowledge and other services.

The innovation, involvement and impact of government in a nation’s initial journeys into space are clear and unquestionable in the United States, in Europe and now in Asia. As China sends forth a rover onto the lunar surface, an Indian spacecraft is en route to Mars, and Japan has long launched satellites from a space center in Kagoshima.

But here on earth, and even in space where the private sector has become increasingly involved in commercial satellite launches, it is clear that business can be a powerful partner in any endeavor. This must include the fight against poverty in Hindu Kush-Himalayas. Even as Asia reaches for the stars, let’s not forget the poorest of the poor still at home, in the shadows of Asia’s tallest mountains.

Curtis S. Chin served as U.S. Ambassador to the Asian Development Bank under Presidents Barack Obama and George W. Bush, and is managing director of advisory firm RiverPeak Group, LLC. Follow him on Twitter at @CurtisSChin