We already know that of the 550 million extremely poor people living on less than $1.25 a day, 180 million are self-employed in some form of micro-businesses or agriculture but earning very little (Working-Extreme Poor- WEPs). The other 370 million are children, old adults and sick people (Zero Income People – ZIPs). We know that the 180 million WEPs are mostly the breadwinners for the 370 million ZIPs. We know that the reason the WEPs earn very little is mostly because of low capital input and they also find it difficult to qualify for bank loans. So if we assist the 180 million WEPs to move up the poverty line, we will automatically be bringing along, their 370 million (ZIP) dependents. In our calculation, the immediate population to help get out of poverty, are the 180 million (WEPs). If the aim of the ODA industry is to reduce or eliminate poverty completely, here below, is a suggestion to be considered:
The United Nations and the developed world can sustainably stimulate grassroots economy (the informal sector) in all of Africa and eliminate extreme poverty with just between 10 and 54 billion dollars (depending on how fast the full result is expected), by simply facilitating the funding of the approximately 180 million already working poor families (WEPs) directly, to become more productive, earn more and move up above the poverty line. (Maximum cost Fund 180 million poor producers -WEPs @ $300 ea = $ 54 billion)
A recent ICAfrica study has shown that by empowering the 180 million Working Extreme Poor (WEPs) (entrepreneurs and farmers) with an average of $300 in small-business expansion micro-loan/grants, their capacities will be leveraged. They will be more productive and their daily incomes will rapidly increase. Since these WEPs are basically the same people who are already economically supporting the 370 million Zero-income people (ZIPs) (children, old parents and the sick), it means that the living standard of everyone (the WEPs plus all the ZIPs) will rise quickly, leading to mass Extreme Poverty reduction that could an End Poverty in the region within 2 years.
Who will deliver the program?
Africa-based Local Social Entrepreneur NGOs will deliver the programs, with guidance and support from international NGOs, while African governments would be encouraged to not obstruct the program.
What happens to recovered micro-loan funds?
Funds recovered from loan repayments will go to maintain social programs while African governments adjust to the new economic realities.
It will take 12 months to identify and train local NGOs and another 12 months to reach all the 180 WEPs in 47 sub-Sahara African countries, with funding and business coaching support.
Eugene Nzeribe, Founder & Executive Director