In Asia: Weekly Insight and Features from Asia

Since Sri Lanka’s decades-long civil war ended in 2009, we’re now witnessing the beginning of reconstruction in the country’s battered North and East. The government is rapidly investing in roads, rail, ports, and telecommunications that help connect marginalized communities with the vibrant, growing capital of Colombo. Meanwhile, the local economy is coming to life, and small businesses – typically on the margins of the private sector – are eager to take advantage of their long pent-up demand to grow their businesses. This is welcome news for people that have endured so much, but there are of course still challenges.

After a 30-year war that has rewarded Sri Lanka's banks and enterprises for playing it safe, they are hesitant to take on risk by offering loans to small businesses. Recently, however, new initiatives are reviving trust between banks and businesses owners. Photo: Karl Grobl.

“The small and medium enterprise sector is the backbone of the Sri Lankan economy – even more so in the North and East,” Anushka Wijesinha, Research Economist at Sri Lanka’s Institute of Policy Studies (IPS) who has been studying access to credit, recently said to me. “The majority of large businesses continue to take a wait-and-see approach, but it’s the small businesses that are ready to take some risks.”

Unfortunately, as ready as the smaller businesses are to take these risks, they lack the collateral needed to do so. Micro and small business owners constantly say how difficult it is for them to even get credit to expand their business, for example. Most small businesses can’t meet banks’ collateral requirements to get a loan, even though Sri Lanka’s financial system is flush with more liquidity than ever, due to lower interest rates and government policies and programs that are meant to push credit down to the grassroots.

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It would be a gross exaggeration to say that panic swept the development community in Manila when word spread that after 12 years on the scene as country representative of The Asia Foundation I was disappearing into a 4-month teaching sabbatical at Johns Hopkins School of Advanced International Studies (SAIS) in Washington, D.C. But some folks – donors, academics, and civil society types – did take notice, occasionally flatteringly making sure I would only be gone a short time.

Truth be told, this absence from the Philippines will be my longest since a 1989 stint at the Institute of Southeast Asian Studies in Singapore, and my stay in the States will be my longest since departing for the Philippines in 1981. I’m looking forward to stepping off the treadmill of heading a dynamic office full of energetic, brilliant staff and devoting some deeper thinking time to a wide range of issues.

I’ll be team-teaching “Domestic Politics of Southeast Asia” with Karl Jackson, who directs the SAIS Asian and Southeast Asia Studies programs. I get to talk about the Philippines, a subject which I find endlessly fascinating. (That I have opted to spend my life in the country makes this quite obvious.) The immediate audience will be SAIS graduate students, but I’ll also be engaging in discussions with policy-makers in D.C. and beyond. I’m also looking forward to blogging here weekly during my sabbatical.

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Oprah Winfrey looked nervous. Making her way across the stage, she stopped to smile for the herd of photographers and then quickly sat down in her chair. Waiting for the applause to die down, she folded her hands in her lap.

This was Oprah’s first visit to India; the press has tracked her every move as she traveled across the country filming an episode for her new show, “The Next Chapter.” Among her stops: a visit to the Jaipur Literature Festival, held in the Northwestern State of Rajasthan. The festival features five days of readings, panel discussions, and musical performances. In just seven years, it has become the largest literary festival in the Asia-Pacific region, attracting more than 60,000 people annually.

Author Deepak Chopra speaks at the Jaipur Literature Festival. Attracting more than 60,000 people annually, the festival is the largest in the Asia-Pacific region. Photo by flickr user Havelgotastory4u.

I thought I could sense curiosity and discomfort pass across Oprah’s face as she waited for her discussion, “O: Oprah in Jaipur,” to begin. When I landed in India seven months ago to begin my year as a Luce Scholar and writer-in-residence at the Sanskriti Foundation, I, too, had mixed emotions. Although I had experience living abroad, that hadn’t prepared me for the chaos, for the throb of life in India. Oprah said of her first impressions of India, “It’s a bit chaotic, and then I realized there’s an underlying calm, or flow, that everybody else here gets the flow, and that as a foreigner, you have to get in and move with the flow.”

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DVDs of popular Chinese, Korean, Thai, and Hollywood movies are readily available in Laos, but there are very few Lao films and only a small and nascent Lao filmmaking industry. With only a handful of movie theaters in the entire country, many citizens have never been to the cinema, and filmmaking is generally seen as a foreign industry. Not only are there few films about Laos, but even fewer told from a Lao point of view.

As part of our focus in Laos on expanding access to information, The Asia Foundation recently supported the second annual Luang Prabang Film Festival, held in partnership with the Ministry of Information, Culture, and Tourism. The festival brings contemporary international views and ideas to Laos through film and provides a forum and encouragement for present and future Lao filmmakers.

Young filmmakers participate in a 10-day workshop prior to the main festival. The students then wrote, directed, filmed, edited, and subtitled short films which were then shown in Luang Prabang. Photo credit: Utth Media Creation Co.

Twenty-five feature-length films from across Southeast Asia were shown over the course of the festival, with an average audience of around 600 people per screening. All screenings were free, and most were held in open-air venues to encourage anyone with an interest to stop by. In addition, 18 short films created by Lao filmmakers were included in the festival. This was generally the biggest, and in some cases the only, public screening most of these films have ever had.

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Female entrepreneurs in Bangladesh represent a miniscule percentage of business owners (0.05 percent), according to The Asia Foundation’s 2010 firm-level survey results. Issues of concern to women business owners, such as difficulties in accessing information on regulations or obtaining loans for their businesses, are concomitantly raised in a relatively diminished voice. Yet by joining together to form a Women’s Business Forum and working with local public authorities, a group of women entrepreneurs successfully negotiated over the course of several months to improve the terms for accessing credit from a local commercial bank.

Female entrepreneurs in Bangladesh represent a small percentage of business owners. However, recent Business Forums have provide them with a voice for expressing their challenges and concerns about the business environment. Photo by Geoffrey Hiller.

Although this was a success, in many of Asia’s developing economies, this type of collaboration is difficult due to an absence of a strong, organized private sector and active civil society (whether local business associations, consumer or citizen groups, or farmers’ collectives). As a result, mutual collaboration between the private and public sector is often weak, or in some cases nonexistent. Even when the private sector’s demands for reform are expressed, they may not always be clearly articulated, due to lack of capacity, or acted upon effectively by the government.

Public-Private Dialogues (PPDs), such as the one illustrated above between the Bangladeshi women entrepreneurs and their local bank, help facilitate constructive interaction for reforms  by providing a forum for participants to identify constraints and issues that need to be improved. Issues vary widely, ranging from the quotidian (garbage collection, the need for more street lights, or better parking facilities), to the complex (onerous business licensing regulations, informal fees, improved food safety regulations, or gender-based discrimination).

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For three days in December, individuals from a range of industries gathered at the 3rd Annual Big Ideas Fest to explore the future of education. In a venue overlooking the Pacific Ocean, a stone’s throw from Silicon Valley, teachers, administrators, and representatives from policy and advocacy groups, non-profits, foundations, social enterprises, and cutting-edge technology companies discussed the unique opportunities offered by the intersection of education, technology, and innovation.

I registered for the Big Ideas Fest hoping to better understand innovative trends in education and assess their potential application for the developing world. Based on its growing reputation, I knew that Big Ideas would be unlike any other conference I had attended. Challenging from the start, the ice-breaker exercise asked us to reflect on our earliest memories of learning and the most dramatic shifts in our own personal education experiences, and to then share them with all 175 participants, in a span of 15 minutes. I was immediately brought back to my experience as an English as a Second Language (ESL) student. Born in a refugee camp in northern Thailand to parents who fled war-torn Laos, I was very young when we were sponsored to resettle in the United States. Speaking only my mother tongue, Mien, and placed in an ESL group at school, I felt lost and at times ostracized in the classroom. But as I gained fluency in English, I remember the wonderful “aha” moments that occurred as I found a voice in my new environment. As it turns out, my own early memories were about to inform another dramatic shift in my perception of education at the Big Ideas Fest 2011.

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Bangladesh is one of the most vulnerable countries to climate change. Interventions will be required over a long time for adaptation and mitigation. They will need to adopt different approaches to programming, while the ongoing development initiatives will need to be sensitive to climate change. One such approach is Public Private Partnership (PPP).

Bangladesh is one of the most vulnerable countries to climate change, and while businesses are among the causes of climate change, they are also at risk from its effects. Photo by Srabani Roy.

Despite delays in staffing the PPP Unit and implementing the Policy and Strategy on PPP that was approved in 2010, the government took a timely step for the economic growth and development. The government has also been applauded globally as one of the pioneers to formulate the Bangladesh Climate Change Strategy and Action Plan (BCCSAP). If applied properly, PPP can be an effective approach to reduce vulnerability. Such partnerships can also ensure “climate proofing” of other projects implemented through PPP in the country.

People in semi-urban and rural areas directly depend on climate-sensitive sectors like agriculture and businesses for their livelihoods. On the other hand, while some businesses are among the causes of climate change (e.g., emission of carbon dioxide and similar gases), they are also at risk from its effects.

Many, if not most, of the large scale “solutions” will continue to be undertaken by the government. However, the government cannot act alone as it may not have adequate funds, skills, and capacity. Also, some interventions (e.g., building and enhancing large infrastructures) may require long implementation time if they are implemented as public-only projects.

Due to the global scale of the challenge, we need multiple actors including private sector funding and diverse sources of expertise to deliver sustainable solutions. Public funding is likely to be restricted for years to come following the financial crisis, which makes exploring alternative funding and expertise more critical than ever.

PPP models can potentially address the challenges posed by climate change in sectors like housing, communication, infrastructure, health, agriculture, livelihood, water, and sanitation. The private sector can bring innovative solutions and scale to the models for climate change adaptation and mitigation shaped by the government and civil society organisations (CSO). PPP can allow large scale projects to go forward when public sector authorities might not be able to afford them.

Read the full article originally published in The Daily Star on Jan. 7, 2012.

Shameem Siddiqi is The Asia Foundation’s senior program director in Bangladesh. He can be reached siddiqi@asiafound.org. The views and opinions expressed here are those of the individual author and not those of The Asia Foundation.

My colleagues in The Asia Foundation’s Environment Program recently returned from Bangkok, where the Asia-Pacific Climate Change Adaptation Forum they were scheduled to attend was canceled due to the worst flooding in Thailand in 60 years.

Bangkok residents evacuate flooded neighborhoods during Thailand's worst flooding in over half a century. Experts predict that massive floods will hit Asia’s coastal megacities even harder due to stronger storms and sea level rise. Photo: Voice of America.

The disaster resulted in over 600 deaths, approximately 10 million lives affected, $21 billion in lost revenues from major industries, and an estimated $24 billion dollars in damage to property, according to the World Bank. Technical specialists blame the disaster in part on an unusually wet monsoon period coupled with the bad timing of a seasonal high tide in the Gulf of Thailand, but also on the government’s inefficient watershed management and infrastructure for draining high floodwaters on the Chao Phraya river.

In October, the Foundation’s country representative in Thailand, Kim McQuay, blogged about the poor readiness of the recently elected Puea Thai government and the Bangkok Metropolitan Authority to protect communities and businesses and to coordinate recovery for flood victims. In November, In Asia interviewed McQuay about the lack of foresight and responsibility on behalf of a succession of Thai governments and other stakeholders to undertake necessary preventive and mitigation plans that build resiliency to natural disasters.

So it’s sadly fitting that a flood prevented a network of adaptation practitioners from meeting to discuss solutions on how to make watershed management, among other challenges for strengthening disaster preparedness, more resilient to climate change. In fact, it was in the script. According to a 2009 World Wildlife Fund report, massive floods – predicted to be even harder on Asia’s coastal megacities due to stronger storms and sea level rise – are bound to disrupt business-as-usual more frequently by 2050 as a result of missed investments in crucial urban infrastructure over the past few decades.

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Indonesia’s economy could grow even faster than its current rate of around 6 percent, according to a statement made by Vice President Boediono last week, if the government and private sector worked together to overcome a major technical hurdle – infrastructure.

The collapse of one of Indonesia's longest bridges, above, on November 26 took the lives of more than 20 people. Despite concerns over technical problems, the local government did not allocate funds for repairs until this fiscal year. Wikimedia Commons: Katakutu.

And, it’s not just Boediono who feels this way: 38 percent of 12,391 private firms – mostly small and medium enterprises – surveyed in the 2011 Local Economic Governance Survey also named infrastructure constraints as their main impediment to growth. The Asia Foundation and Regional Autonomy Watch (KPPOD) have implemented four such surveys since 2007, covering 444 districts (90 percent of all districts in Indonesia). Of the nine aspects of local economic governance covered, infrastructure has consistently been identified as the most important factor.

Roads, water supply, and street lighting – all of which are managed by local governments in Indonesia – were considered to be in bad condition by more than 40 percent of firms surveyed. The most likely cause of this sobering statistic is the limited funds allocated for infrastructure development. In June 2011, Standard Chartered Bank estimated that less than 5 percent of the $145 billion worth of infrastructure projects earmarked at the beginning of President Yudhoyono’s first term in 2004 had been completed. Local government road budgets were, on average, only about one quarter of the amount needed for periodic maintenance according to a local budget study conducted by the Indonesian Forum for Budget Transparency (Fitra). Funds lost to corruption in procurement and implementation of infrastructure projects is another pressing issue.

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While local governments are widely viewed as critical to development because they are considered citizens’ most accessible government unit, in many developing countries these local government institutions don’t live up to their potential because they suffer from inadequate capacity and resources. Nevertheless, local governments can do better despite these constraints.

Despite the relative stability in Sri Lanka following the end of the civil war, local governments are limited in their ability to work effectively due to vague and at times contradictory expectations. Photo by Karl Grobl.

This is certainly the case in Sri Lanka. For the Local Authorities (LAs) – a general term encompassing elected municipal councils, urban councils, and village-level pradeshiya sabhas – their ability to lead is hampered by vague and at times contradictory expectations, despite the relative stability following the end of the civil war in 2009. Decentralization reform in Sri Lanka is challenged by a dualistic system of de-concentrated government (secretariats at the district and town level which are agents of the central government) coupled with a weak, devolved government (provincial councils and LAs). Both tiers are involved in services and planning, which confuses the public and increases opportunities for corruption, political conflict, and wasteful duplication in service delivery.

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