Many people want to do their part in making the world a better place. That can be anything from donating money to local charities to visiting third world countries and volunteering your time and effort to better the lives of those who are less fortunate. For people eager to help, it is not uncommon to donate without doing any research beforehand. Though there are countless nonprofits around the world helping tremendously, where and how they choose to help can have adverse effects.
With the number of commercials on television today spotlighting children without food, shelter, or clothing in third world countries, the sound of a nonprofit traveling directly to those countries to help sounds like the best possible thing for that country. Video footage of a child without shoes? Surely that country is in need of shoes. TOMS shoe company noticed this problem, and visited these developing countries to help, establishing factories in their name to produce as many pairs of shoes as possible. What this actually did was damage the economies of these countries.
In most cases, the commercialized products that we are led to believe is in high demand in developing countries is, in fact, not. Many of these countries don’t ask for things like shoes and construction companies coming in from other countries. When a nonprofit enters a developing community and establishes businesses that make goods or provide services, they are pushing the local businesses with the same goods or services out, bringing forth the argument that these charities and NGO’s are in it for profit.
Even if these organizations do have good intentions, it’s best to look at their services as a limited option. When considering the classic saying “Give a man a fish, and you feed him for a day. Teach a man to fish, and you feed him for a lifetime,” these charities are doing the former. These attempts being made at improving the quality of life in underdeveloped countries are short-term solutions, and do not have last effects. Moreso, they are harming the economies of these countries.
The film Poverty, Inc. casts light onto the topic of nonprofits actually hurting developing countries. One particular story highlighted in the documentary is that of Enersa; a solar paneling company in Haiti. Business was flourishing for the small company, as they were selling upwards to 50-60 panels a month. Then, upon the 2010 Haiti earthquake, a flood of nonprofits and international relief organizations poured into the country to help; some of which donating solar panels. This severely damaged Enersa, as their sales dropped tremendously due to the competition.
This isn’t to say that all nonprofits that offer their services to developing countries are bad, but rather, we need to rethink what or how we approach these subjects. The main thing to take away from this is that flooding developing countries with goods or services can have adverse effects. Developing educational systems and offering business loans to companies and entrepreneurs already within these countries’ borders is a much wiser investment, and presents the opportunity to allow these local businesses to grow, thus growing the economy.