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August 04, 2011

Gates Foundation official visits Ethiopia, answers green revolution, GMO questions

The Bill and Melinda Gates Foundation aims to innovate and lead in its philanthropic endeavours. With its 36.7 billion dollar endowment, the Gates Foundation is the largest charity in the world. The Foundation’s success is largely attributed to the business acumen of its founders, Bill Gates and his wife, Melinda, both of whom have introduced the notion of “philantrocapitalism.”

This is largely due to the Foundation’s underlying philosophy of being a “catalyst for change,” according to Sylvia Mathews, president of the Global Development Program.

Mathews was deputy director of the powerful Office of Management and Budget during the Bill Clinton Administration; she also served as Clinton’s deputy chief of staff. Mathews joined the Foundation in 2001, and her current responsibilities require her to design and implement programmes to combat poverty across the world through agricultural development and financial services to the poor.

But these projects are not without controversy. There are critics who allege that the Foundation wants to turn the continent into a test ground for biotech companies in the West.

While visiting Ethiopia, Mathews sat with Tamrat G. Giorgis, managing editor of Fortune, on July 17, 2011 to reflect on why the foundation is criticised for trying to do good.


Fortune: Let me go to your flagship programme, which is introducing the second green revolution in Africa. The tenet of this programme is to introduce sustainable growth in the agriculture sector by combining technology, innovation, and skill. But I understand that many people were not happy with the plan. Why?

Mathews: You may be able to understand that better than us.

Fortune: I am sure you are aware of these criticisms.

Mathews:Yes, we are aware, but we always want to hear more. I think some of the criticisms stemmed from issues with the initial green revolution. Whereas the initial green revolution saved millions of lives, it had some problems related to sustainability defined by environmental concerns. There is also a valid criticism on how the water table has been exhausted in India. We are working on all of those issues. We are probably the largest single and private donor for organic farming. We believe there are a range of solutions for the smallholder farmer that need to be examined and we are investing in a variety of them.

A second area that we, as an institution, receive criticism for is on the agricultural front; namely, on our engagement with Genetically Modified Organisms (GMOs). We believe that there are suitable solutions that farmers need; and when we engage in breeding, we do everything from conventional breeding to what is called marker-assisted breeding, which gives us the ability to understand what things a plant has to offer.

And then, we do transgenic, which is the part that I think many people have a problem with, but we believe it is a part of the solution. We believe it needs to be safe; that countries need to make their own decisions; and that these countries need the regulatory capability to make those decisions. We have funded Michigan State University, along with NePAD (New Partnership for Africa’s Development), to provide grants and technical assistance here in the continent of Africa for those countries which seek regulatory assistance, so that their scientists have the capability and equipment to conduct testing.

There is a third, which has to do with the question of how hybrid seeds relate to corporations and companies that sell it. But, again, we believe that choice is up to the farmer.

Fortune: Don’t you think that it is valid criticism? I understand that the Trust [Bill and Melinda Gates Foundation Trust has bought 27 million dollars worth of shares in a seed breeding company, Monsanto] It has a substantial investment in one of the corporations which is involved in the seed business. Therefore, while you are promoting this project in the name of charity, there is another corporation, where you have a vested financial interest in, which sells products to farmers you support. Are you not promoting a corporate interest here?

Mathews: The intellectual property for all the works that Monsanto does on drought-resistant gene is free. The company is losing money on this effort. We keep our investments and the work of the Foundation separate. It is what we choose to do, as we believe, the Foundation should focus on the issues we are discussing here.

Fortune: You have a Trust which manages the Foundation’s endowment, investing in companies with high returns. You also have the Foundation, which is going around the world, trying to support poor people and overcome poverty. But the criticism comes when the companies your Trust invests in are doing things that undermine the wellbeing of the very poor people the Foundation is trying to help.

Mathews: In the case of Monsanto, the investment is very small relative to our portfolio. But I do not think that is actually a relevant point. The more relevant point is that, I am not sure I understand what Monsanto does in undermining the poor. It gave the intellectual property away for free, a right which costs an American farmer a tremendous amount of money, but would not cost an African farmer anything. How is Monsanto undermining the poor here?

Fortune: By making them dependent on the very product that it is selling?

Mathews: It is the farmers’ choice whether or not to buy hybrid. A farmer can use Open Pollinated Variety (OPV) maize, or use a hybrid. That should be the farmer’s choice...out of an economic rationale...

The idea that farmers become hooked is false. We believe that putting choice in the farmer’s hand is a better approach than dictating what the farmer should do.

Fortune: I read a statement made by one of your officers a while back; he said he would like to see many African companies flourish in the African seed selling market. Is the Foundation interested in supporting such companies in Ethiopia, for instance, by providing financial support? How would it work?

Mathews: Given that we are a large organization based in Seattle, most of our work is done through intermediaries. 

AGRA will be supporting the agro-dealers and the seed producers that are producing the largest volume of seed on the continent of Africa; and they are private. That would be a place where we could add value, and the support comes in a number of forms. There are direct grants that AGRA does; it also provides technical assistance to help these countries think about a concept known as the “business development portion.” AGRA will help with their financial management, set up their books, business practices, as well as give them direct cash support.

These seed companies, the agro-dealers and distributors, are springing up everywhere. In Mali, I have visited a woman who has started up a company that uses smaller seed packs, which is what farmers need in terms of their ability to pay.

Fortune: I understand the laws of Ethiopia prohibit the import and use of genetically modified food [GMO], which I see you are passionate about.

Mathews: Only six per cent of our financing goes to GMOs. The project has transgenic and non transgenic components. The benefits of these products are to the farmers. The changing lives of the poor will determine how people think about the laws. We respect the laws of the countries and that will determine what they want and where they want to be on the GMO issue. But as I said, countries will make their own choices on what is good for them.

On the importation of seeds and the ability to move products across countries, we will probably be working on our policy. For instance, eight new breeds of pigeon pea have come out from Uganda. In the next two months, they will move to South Sudan because they do not have a law prohibiting it. For South Sudan, right now, the top quality pigeon pea breeding seeds will make a very big difference.

Fortune: Are you a grant providing agency or are you also involved in the actual operations that you support?

Mathews: We are a grant making agency, but we have active partners. I am sure some of our grantees would say we may be more active than they want us to be as a partner. For instance, an example of our deep engagement is with AGRA...

Fortune: Much of the allegations from your critics come as a result of their ideological worldview. They see the alignment of forces coming together against what they say is an imposition of a neo-liberal agenda on Africa. You have international financing organizations such as the IMF and the World Bank imposing policies. You have foundations, which are somehow in line with these international financing institutions. You have corporations, which are part of the whole foundation network, because the foundations come from these corporations. The concern is that for the first time, there is an alignment of these three groups imposing the interests of the West on Asia, Africa and the underdeveloped world, in order to control resources.

Mathews: We are hopeful that our role is for more forces to come together within the country. I think Ethiopia is a very good example of what we hope can happen in the agriculture sector. We hope to contribute support to the government in developing the sector. Both the strategy and the implementation are nationally owned and our job is to provide support in developing the strategy, helping get the transformation off the ground, and bring other partners to the table to fund the Ethiopian plan. We see ourselves as part of that triangle. But what drives off the relationship is what a country needs. Then the process would be on how you drag resources against that, and support the country with tools, technologies and funding to try and make achievements.

I appreciate the Washington Consensus problems, in terms of how the IMF and other agencies were driving certain standards and certain change. I also appreciate the concerns when corporations, or other parties, come in with certain view on resources.

Fortune: How do you feel when you come with funds to support projects, and you are subjected to these criticisms?

Mathews: Criticisms usually make you stronger and better if you stop and listen. It will make you more effective. You have to come with the mindset of pausing and listening to what the criticism is all about. Even in their exaggerated forms; criticisms are words of some kind. So we stop, listen and try to get to the core of the issue.

Fortune: You seem to give a lot of emphasis on the individual farmer’s choice; on whether or not to embrace what you are trying to introduce and your interest to improve their lives. But in a situation where they may have a state that is not accountable, or refuses to be accountable, and in a situation where the governance issue has a lot to do with the inability to make individual choices, how concerned are you with the governance issue and a government’s lack of accountability in countries where you work, including Ethiopia?

Mathews: There are places where there is not enough governance, at any level. There are places that are completely unstable, and those are places where we do not do much work. We do not work in the Democratic Republic of Congo (DRC), for instance. We actually have great sympathy, but we are not engaged in the kind of work we do with Ethiopia.

Yes, we are concerned about it in a sense that one of the things we believe about our work is creating broad ownership. It is not that government leadership is central; however it is a necessary component, but it is not a sufficient component.

I think, what we do is try to make sure that we consistently have our eyes open and embed the work with people as much as possible. We fundamentally believe that when you empower people economically, you empower change because their knowledge, desires and everything moves. That is an important part of an evolving process, one that we can contribute to good governance.

Fortune: Do you believe there is a kind of political setting in Ethiopia that allows you to make a difference towards your goals?

Mathews: We feel it is sufficient, or we would not be working here. We hope we are a part of long-term positive change for the individual on the ground in this country, that we can support them in the change, because they are the change agents, not us.

full interview...Addis Fortune

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