The global divide between rich and poor is startlingly large and has only increased in recent decades. Currently, the poorest 50 percent of the world’s population holds less than 1 percent of global assets. These high levels of wealth inequality are most obvious in one of the poorest regions in the world: sub-Saharan Africa. 45 percent of sub-Saharan Africa’s 726 million people live below the international poverty line, and it is the only region in the world where the number of poor individuals has risen since the 1970s. The startling lack of economic opportunity for the area’s “ultra-poor,” defined as those living on less than $1.25 per day, is one of the most persistent challenges. The effects of high poverty in the region, such as low primary school enrollment rates, high mortality rates, and poor health services, handicap the population. Those living in rural communities are particularly hindered by market stagnation, poor production levels, and low incomes.
Given that the region accounts for a third of the world’s ultra-poor, smarter anti-poverty campaigns that consider specific regional needs and have a focus on long-term, sustainable growth are necessary. Current anti-poverty campaigns frequently fall short of targeted outcomes because they fail to address particular regional grievances. Specifically, the lack of integration between rural and urban communities in sub-Saharan Africa leaves the agro-centered communities in isolated parts of the region estranged from potential domestic markets for their goods. Anti-poverty work since the 1990s has seen some successes but has failed to upgrade domestic production capabilities, improve intraregional transport networks, and bring modern business strategies to the most isolated populations.
Alongside the issue of market integration lies that of sustainability. Indeed, anti-poverty campaigns often focus on bringing new technologies and electricity to previously off-the-grid communities in rural Africa. But because the poor bear the lion’s share of the burden of climate change, development models that are not environmentally conscious have limited potential. Sustainable business models involving more efficient land use and mobile phone dissemination could help diversify and integrate markets while also preserving the environment.
Climate Change and the World’s Poor
Climate change is most likely to hit the world’s poorest inhabitants the hardest. The poor are more likely than the rich to live in places, like arid and coastal regions, most vulnerable to climate change and its associated weather crises. Additionally, the already inadequate health infrastructure in sub-Saharan Africa will be unequipped to handle an expected influx of diseases due to climate change. The WHO estimates that by 2030, climate change will lead to 48,000 additional deaths from diarrhea, 60,000 from malaria, and 95,000 from child malnutrition. The vast majority of these deaths will take place in sub-Saharan Africa or East Asia. This cycle of illness will add burdens to an already struggling workforce in the region, locking communities in a pattern of poverty and poor health. Additionally, chronic illness lowers capabilities for production and thus will negatively impact the area’s manufacturing potential.
Besides directly affecting the instances of disease in impoverished communities, continued climate change is also likely to result in agricultural degradation and the inefficient use of natural resources. Sub-Saharan Africa’s agro-ecology, which is simultaneously prone to extreme droughts and intense rain, will be extremely vulnerable to the unpredictable weather conditions many scientists are forecasting. Given that three fourths of the poor in the region live in rural areas and depend on agriculture for their livelihood, the consequences of climate change combined with inefficient farming strategies could have dire effects on impoverished people. Moreover, those who live in particularly isolated zones do not have access to the social safety nets and poverty reduction programs available in more urban areas.
The region’s economy and development prospects have already seen the setbacks that can be brought on by harvest failures, which affect both individual households and the wider economy. The food crisis in southern Africa in 2001 is a perfect case study of this phenomenon. Heavy rains late in the 2001 growing season dramatically reduced the yield for the region’s staple crop, maize. This not only affected crop-dependent households but also government revenue and regional imports and exports, launching 19 nearby countries into their own exceptional food emergencies. The World Bank projects reductions in crop yield as a result of food crises across the entire sub-Saharan region to reach 50 percent by 2020. The institution also predicts that crop industries could see reductions of up to 90 percent of total profits by 2100, with small-scale, rural farmers bearing most of the burden.
The Role of Technology
Better land use and upgrades to more efficient technologies can form the foundation of sustainable business models that mitigate environmental degradation. In Niger progressive agroforestry techniques, such as interplanting different types of trees and allowing extra shrubs to grow, have been helpful in restoring damaged lands and lowering greenhouse gas emissions. But on top of a healthier climate, agricultural innovation has also yielded substantial economic results. Enhanced production in Niger has raised gross annual per capita income by an average of $1,000 over a five-year period. The International Renewable Energy Agency estimated that restoring 12 percent of degraded lands globally could increase farmers’ incomes by a total of $40 billion and provide food for an extra 200 million people. Across the sub-Saharan region, increased agricultural efficiency in some countries has been responsible for a 40-70 percent reduction in poverty since 2000.
In the fight to stop the destruction of resources, the more daunting task for governments and institutional developmental investors is attempting to bring affordable, sustainable energy to rural communities in order to help supplement better farming practices. Goal 7 of the UN Sustainable Development program is to “ensure access to affordable, reliable, sustainable and modern energy for all.” Energy for lighting, artificial climate control, and hot water accessibility make everyday tasks easier and lowers incidence of disease. And although energy in any form is a step in the right direction, green, sustainable energy is the only solution that will protect sub-Saharan Africa in the long term. Unfortunately, such initiatives come with the high costs of research in low-carbon technologies, which require large sums of up-front capital investment. Nevertheless, interest has grown over recent years as investors realized that alternative energy promises to pay for itself in the long run, since the costs of maintaining green energy sources like solar panels are nearly zero.
The World Bank recently implemented a global “green bonds” project that raises funds from fixed income donors to support World Bank lending to projects that mitigate climate change or help those affected by it. In 2014, $37 billion was lent to low-carbon investments in sub-Saharan Africa.
Additionally, mobile telecommunications is a valuable resource in the fights against both poverty and environmental degradation. Mobile communications are especially beneficial in the sub-Saharan region because utility poles used to construct telephone lines adversely affect regional water supplies via chemicals used to treat the wood and electrical wires. This contamination is only made worse if fertilizers are already common in the water. Given the regional dependence on agriculture, telephone poles could seriously impact the health of crops and animals, thus impacting the livelihoods of those living in rural communities. Thus, from an environmental and humanitarian standpoint it is preferable to increase connectivity with mobile phones rather than landlines.
Moreover, mobile telephones can help address the region’s chronic struggles with market fragmentation that result from poor infrastructural and institutional linkages by more effectively integrating different sectors. Mobile phones increase the speed of communications and improve producers and traders’ access to information. This makes producers reactions to market fluctuations more immediate and accurate, potentially reducing the number of unforeseen economic shocks. Additionally, payments via mobile devices lower transaction costs and thus facilitate economic exchange, particularly in a region where costs of business are unusually high due to inflated shipping costs and poor physical infrastructure. The region suffers from underdeveloped roads, ports, rail, and communications systems. Currently, the cost of telephone connectivity on landlines is higher in sub-Saharan Africa than anywhere else in the world.
Agriculture entrepreneurs in sub-Saharan Africa have already begun to recognize the efficacy of cell phones in lowering costs while increasing market integration. Not only do mobile communications improve producers’ access to information; it also helps producers reach more buyers in distant communities. In Tanzania, agriculture-dependent households that had cell phones improved their market access and saw 33 percent more per capita income than the regional average. It seems that this trend will continue, as Africa is the largest growing cell phone market in the world, with 732 million current service subscribers and yearly growth rates nearing 20 percent.
Innovators are finding ways to combine energy provision with the use of mobile technology in a way that maximizes environmental protection and economic growth. Notably, an innovative business model that utilizes solar power and cell phones is bringing mobile telecommunications and energy to the area. The M-KOPA program asks customers make an initial $30 deposit toward a solar panel, ceiling lights, and charging outlets for their home or business. The customer then makes scheduled payments through a mobile banking service, and once the solar unit has been fully paid for—typically after a year—energy becomes completely free. The initiative takes advantage of the interconnectivity allowed by wireless technology in order to provide low-cost, sustainable energy.
It is increasingly obvious that it will not be possible to address poverty without considering the effects climate change will have on the world’s poor. Its potential effects on temperatures, precipitation, and chronic illnesses pose risks for future gains in socioeconomic welfare in sub-Saharan Africa. Additionally, sustainable development has benefits independent of climate change threats. Technological upgrades—either in sustainable energy or business practices—can be both beneficial for the environment and helpful in streamlining and modernizing domestic markets. Innovative private investment, alternative energy plans, and more efficient agriculture techniques are all steps in the right direction.
Image source: Wikimedia // SunJack // Kul Wadhwa