Colombia: New report puts the case for pro-poor business

19 Nov 2010

Workers in Chocó, Colombia, practice
small-scale, social and eco-friendly
mining for a living
(Photo: ‘Oro Verde’)
Chocó - An innovative approach to business that offers the potential for new products, services and jobs to almost 20 million Colombians living below the poverty line, was launched recently in a report by the United Nations Development Programme (UNDP).

Some 19.8 million people, nearly half Colombia’s population, who live on less than US$1.25 per day, could benefit from a new broader business model, according to the report ‘Growing Inclusive Markets: Business Strategies to Overcome Poverty and Exclusion in Colombia.’

The report draws on 13 case studies of successful initiatives throughout the country where low income communities, often also affected by Colombia’s 40-year long conflict, have become actively involved in trade and commerce as clients and customers or employees, producers and entrepreneurs.

“This is an event of inclusion,” said Bruno Moro, UN Resident Coordinator and UNDP Resident Representative in Colombia at the report launch on 26 October in Bogotá attended by more than 250 participants from the private and public sectors, foundations, civil society and academia.

“Inclusion of business leaders, workers, government, non-governmental organizations, international cooperation and ordinary citizens in search of a fairer and more equal world for those who suffer from poor social and economic conditions.”

Businesses that benefit all
One of the report’s case studies focuses on the conflict-affected region of Magdalena Medio in Antioquia Department where a large Colombian palm oil producer, Indupalma, has helped local farmers become plantation owners and increase their incomes.

Indupalma’s operation contributes to a steady supply of raw material and expansion of its palm plantations by working with 30 cooperatives and 1,300 families.

In Chocó, Colombia’s poorest region, also a site of conflict and major displacement, the Oro Verde initiative promotes social and environmentally responsible small-scale mining practices through gold and platinum fair-trade certification and commercialization. In 2008, sales reached US$222,000, benefiting nearly 200 low-income mining families.

“Some important benefits for us are preserving our traditional responsible mining practices and improving our living conditions thanks to the fair price being paid,” said José Aristarco Mosquera, from a community council representing members of the largely afro-descendent community of San Juan, Chocó.

Despite sustained economic growth over the last few years, Colombia is the fifth most unequal country in Latin America, according to the recent ‘Regional Human Development Report’. The worst affected groups are women, indigenous people, the afro-Colombian community and the approximately 3.16 million people uprooted by conflict. In rural areas, the population living below the poverty line rises to 64.3 percent.

Speaking at the launch, Hernando José Gómez, Director of the National Planning Department, explained that the inclusive markets initiative will be a strategic component of the government’s recent policy of income generation for extremely poor or internally displaced populations.

“We must maintain what works and build on what exists, filling the gaps with best practices to line up all actors towards the same goal: a Colombia free of misery,” said Samuel Azout, the Colombian President’s Senior Adviser on Social Prosperity during the launch.

“Social investments alone are generating little impact; hence the discrete progress in social mobility in the country over the last eight years.”

In addition to examples that companies and other partners can learn from, the report offers action-oriented research tools to improve understanding of how businesses can contribute to peoples’ wellbeing: promoting human development and the Millennium Development Goals (MDGs).

The report was developed in partnership with a wide advisory board composed of government agencies, civil society organizations and Colombia’s largest business association, aiming to learn from and share experiences in dealing with constraints and finding solutions.

The report is available in electronic form  (Spanish version only).