Economic Challenges in Developing Countries

What if philanthropy funded African entrepreneurs, not just NGOs? For decades, philanthropic capital in Africa has flowed primarily through nonprofit channels. But what if we expanded the lens? What if we recognized that entrepreneurship is impact and that investing in businesses can be just as transformative as funding charities? Because here’s what the data shows: 📊 Small and medium-sized enterprises (SMEs) make up over 80% of employment in Africa, yet they receive less than 10% of philanthropic or donor capital. (Source: IFC, African Development Bank) Now consider this: A bakery that hires 12 women is solving poverty. A solar startup reducing blackouts is improving health outcomes. A logistics company like Cloudy Deliveries is restoring dignity, mobility, and economic agency in townships. These aren't side stories. They’re frontline solutions. And in many cases, they’re achieving what NGOs alone cannot - sustainability, scale, and systems change. To be clear: NGOs remain essential. But we must stop seeing them as the only vessels for doing good. Because impact isn’t defined by tax status. It’s defined by outcomes. And if the outcome is more jobs, local ownership, dignity, and upward mobility - shouldn't that be worth funding? Yes, there are regulatory and risk constraints. But more philanthropic leaders are experimenting with: Recoverable grants Hybrid finance models Catalytic capital Equity investments in social ventures Imagine if philanthropy didn’t just react to problems, but invested in African builders. Not just donors funding projects but partners backing enterprises designed in and for the communities they serve. This is the shift from charity to co-creation. From aid to agency. From dependency to shared ownership of the future. So ask yourself: What African entrepreneur do you know who’s creating real, measurable social impact? Tag them. Celebrate them. And if you're a funder or advisor, consider this: What’s stopping you from backing one today?

Indian women have done everything the financial system asked. Opened accounts. Saved diligently. Built credit histories. But. We receive credit equivalent to just 25%+ of the deposits we put into the banking system. Men receive 50%+ of that, double what we get. We are, in effect, subsidising credit for men. The credit system was built to read a specific kind of financial life - formal salary, titled property, guarantors from the right networks. Women’s income is often informal, seasonal and home-based. Our assets are rarely in our names. So, the traditional system writes us off rather than underwrite us. Consider this - Women constitute 20% of India’s MSMEs and hold just 7% of MSME credit. However, we have better data today than we had decades ago. Digital payments history, Aadhaar-linked identities, GST trails and much more. If you are building a lending product, whether you’re a bank or a fintech, the question is whether you’re reading the additional signals, in fact the signals that can make or break women’s credit. 45 crore of us are credit-eligible and waiting. Is the ecosystem ready for us? Source: NITI Aayog-TransUnion CIBIL-MicroSave Consulting 2025, Microsave 2020 #CreditAccess #WomenEntrepeneurs #FinancialInclusion #IndiaFintech

Next year, 2026, is the International Year of the Woman Farmer. Women represent more than 40% of agrifood systems workforce, yet their contributions remain undervalued. They work longer hours, earn less, and have fewer protections. And inequalities are widening: every day of extreme heat reduces women’s crop yields by 3% more than men’s. Even when women cultivate farms of the same size as men’s, their yields are 24% lower because they have unequal access to land, technology, credit, and training, and continue to face structural barriers. Closing these gender gaps could add $1 trillion to global GDP and reduce food insecurity for 45 million people. Ensuring women have equal rights, access, and voice demands engagement from every government, donor, researcher, and private sector partner. The CFS Voluntary Guidelines on Gender Equality offer a roadmap, and ongoing UN Financing for Development processes provide an opportunity to align policies and investment with this goal. Without economic empowerment, gender equality cannot be achieved.

Leadership Lessons from Africa: Building Business Resilience in Uncertain Times   As global markets navigate these periods of uncertainty, I find myself reflecting on my years leading businesses across Africa— where managing volatility isn't just a skill; it's about survival.   In 2024 in Nigeria, markets have seen the 5th benchmark interest rate hike to curb inflation; there have been 11 power grid collapses; the currency has lost 70% of its value against the dollar since May 2023. Within this environment, businesses adapt and innovate. Some even thrive.   Here are five lessons I learned:   1. Political Uncertainty: Success means playing the long game. In one role, I operated through three different administrations. Maintaining relationships across the political spectrum while upholding strong governance is crucial. Our government affairs strategy had to go beyond election cycles.   2. Policy Shifts: We developed operating models that could pivot quickly.  Import Tariffs would change without warning. We always had backup plans ready—whether carrying extra inventory or activating alternative business lines.   3. FX availability and price: Survival meant securing the cash first, then solving for profitability. We had multiple supply chains with different risk profiles and developed flexible pricing strategies that could adapt. Not without significant pain.   4. Infrastructure Gaps: At one company, poor power supply birthed a solar business. In another, we built roads to our factories (one across a swamp!). A gas availability problem created a thriving alternative fuels business: waste, rice husks, palm kernel shells to energy. This fed the factories and created employment for local communities. Infrastructure challenges forced innovation.   5. Market Constraints: As purchasing power drops, companies have responded with "sachet economics"—offering smaller pack sizes… (an environmental headache)….. to maintain affordability   We learned that resilience isn't about avoiding challenges; it's about building systems that can absorb shocks and adapt quickly.    Luckily, most global CEOs will not face these multiple onslaughts, but will be building resiliency strategies to navigate today's uncertainties.   What strategies have helped build resilience in your companies?   #Leadership #BusinessStrategy #GlobalBusiness #Resilience #Innovation #EmergingMarkets  

👉 Are we using the wrong tools to assess climate risk? A new expert-led assessment, drawing on the judgment of 60+ climate scientists, says that #climatechange introduces forms of risk that exceed the design assumptions of existing economic and financial frameworks. Here’s what that means in practice ⬇️ 🔹 Climate damages are structural, they reshape economies: where people live, what can be produced, how infrastructure functions, and which regions remain viable. 🔹 Extremes drive real-world risk: what actually destabilises societies and markets are heatwaves, floods, droughts, grid failures, food shocks. It’s the tails of the distribution that matter. 🔹 GDP misses mortality, inequality, displacement, ecosystem loss, and can even rise after disasters due to reconstruction. This creates a dangerous illusion of resilience. 🔹 Repeated shocks erode recovery capacity and propagate across supply chains, finance, migration, and geopolitics. 🔹 Beyond ~2°C, uncertainty widens sharply. Confidence in precise damage estimates falls even as consequences grow. 🔹 Tipping points expose the limits of economic modelling: At higher warming levels, model outputs can appear precise while resting on assumptions that no longer hold. At the same time, many models also underestimate positive tipping points in clean energy and innovation. The goal is to build resilience under deep uncertainty. For treasuries, central banks, regulators, and long-horizon investors, this means recalibrating governance toward: ➡️ precaution ➡️ robustness ➡️ transparency Because avoiding irreversible outcomes is always cheaper than trying to price them after the fact. read the report "Recalibrating Climate Risk" here 👇 https://lnkd.in/dx8wmRZ4 Green Futures Solutions (University of Exeter) Carbon Tracker @aurora trust

Seven years ago, The Rockefeller Foundation made a bet: that a small amount of patient, risk-tolerant capital could unlock investment that private markets weren't yet ready to make on their own. The Rockefeller Foundation’s Zero Gap Fund's 2025 State of the Portfolio report shows the results. $30 million in charitable capital has helped mobilize $1.05 billion in private investment, a 35x return reaching people in underserved communities through food security, climate adaptation, healthcare, and U.S. jobs. Behind those numbers are real people. A growth equity fund has reached 362 million consumers across Asia and Africa through financial services and healthcare access. An employee-ownership model has converted six companies into worker-owned businesses, creating more than 1,500 new employee owners. And in Ukraine, a technology investment fund is supporting more than 5,100 jobs even as the country's economy absorbs the shock of war. As wealthy nations pull back, cutting more than $40 billion in aid last year alone, the UN estimates the world now needs $4 trillion a year to achieve its Sustainable Development Goals. Philanthropy alone can't fill that gap. But it can invest courageous capital, prove what works, and build the kind of partnerships that get private capital moving toward the world's pressing challenges. Read the full report: https://lnkd.in/e4H7zjXk

The latest reporting from the Financial Times highlights a point that energy analysts have been making for years: geopolitical shocks consistently strengthen the case for renewables, electrification and storage. Microsoft’s global vice-president for energy notes that oil and gas price spikes linked to the Middle East conflict reinforce the value of wind, solar and batteries in providing price stability. Once installed, renewables offer predictable cost profiles and reduce exposure to volatile global fuel markets. We saw this dynamic after Russia’s invasion of Ukraine. Europe accelerated solar deployment, heat pump uptake increased in several countries, and governments revisited questions of energy security through the lens of diversification and electrification. The underlying issue remains unchanged. Fossil fuels must continuously flow through complex global supply chains. When those flows are disrupted, prices spike and economies are exposed. Renewables, by contrast, are capital intensive upfront but deliver long term domestic supply and insulation from commodity shocks. There are short term risks. Inflation, higher interest rates and supply chain constraints can slow clean energy investment. Some governments may also respond by doubling down on gas infrastructure. The policy challenge is to avoid locking in further structural vulnerability. Energy security and climate policy are not competing objectives. In a world of recurrent geopolitical instability, they are increasingly aligned.

🌍 Climate Change is Disrupting Global Supply Chains—What Does This Mean for Businesses? A recent study by Nora Pankratz, Ph.D. and Christoph Schiller, published in The Review of Financial Studies, offers a sobering insight into how climate hazards, particularly heat, are impacting firms and reshaping supply chains globally. 📉 Key Findings from the Study: 💥 Heat exposure reduces suppliers' operating income by 13.8% for a one-standard-deviation increase in heat days—and the effects ripple downstream, cutting customer operating income by 0.6% per quarter. 🚫 Firms are 7.4% more likely to terminate supplier relationships when heat exposure exceeds expectations, with this likelihood increasing for repeated or extreme deviations. 🌱 After terminating risky suppliers, businesses actively choose replacements with lower climate risk, reflecting proactive adaptation strategies. 🛠️ Customers also adjust by increasing inventories, cash holdings, and R&D investments to buffer against disruptions. 📊 A Broader Picture: The study highlights that firms in developing countries, often more vulnerable to climate change, are disproportionately impacted. Suppliers in countries with low climate adaptation readiness face higher termination risks, emphasizing the need for systemic solutions. 💡 My reflections: 🌩️ Climate risk isn’t just financial—it’s systemic. As businesses retreat from vulnerable regions, they risk exacerbating global inequality and isolating the areas most impacted by climate change. The true cost of climate risk might be the long-term instability created by economic withdrawal from these regions. 📉 Relying on short-term signals like observed heat days for long-term decisions is risky. Many firms act reactively, focusing on immediate climate disruptions rather than the underlying trajectory of climate projections. This approach could leave them exposed to larger, systemic risks in the future. 🤝 Resilience requires collaboration, not isolation. At a time when nations are becoming more protectionist and the dark clouds of trade wars loom large, businesses have a choice: sever ties with vulnerable suppliers or co-create resilience. The study reveals that many firms are opting to replace suppliers in climate-vulnerable regions, but imagine the alternative. What if businesses worked alongside suppliers to share technology, co-develop adaptive solutions, or finance localized climate resilience? This isn’t just a moral question—it’s a strategic one. Investing in mutual resilience could secure long-term supply-chain stability in an increasingly uncertain world. 🔗 https://lnkd.in/eBMv8GN9 How do you see businesses navigating these challenges? Can collaboration replace isolation as the default strategy for addressing climate risk? #ClimateChange #SupplyChain #Resilience #BusinessStrategy #Sustainability #PositiveScholarship

Climate Risk = Business Risk 🌍 As climate impacts intensify, the connection between environmental risk and business risk is becoming more direct and more difficult to ignore. These risks are no longer theoretical. They are affecting assets, operations, and financial planning across industries and regions. Severe weather events such as storms and floods are damaging infrastructure, halting operations, and increasing the costs of repair, insurance, and downtime. Heatwaves are lowering workforce productivity and raising the incidence of heat related health issues, particularly in sectors dependent on physical labor or lacking adequate climate control systems. Droughts are limiting access to essential inputs like water, disrupting industrial processes and increasing operational costs for water intensive sectors. Sea level rise is placing facilities, warehouses, and offices in coastal areas at risk of flooding, requiring significant investments in adaptation or relocation. Wildfires are interrupting transportation networks and regional supply chains, resulting in logistical delays, inventory disruptions, and increased delivery costs. Increased climate variability is making business planning more uncertain. Fluctuating weather patterns complicate forecasts, investment decisions, and long term strategy development. Energy infrastructure is also affected. Extreme temperatures and natural disasters are disrupting electricity and fuel supply, creating additional risks and increasing energy expenditures. Insurance markets are responding. Coverage in climate exposed areas is becoming more expensive or unavailable, leaving businesses with greater financial exposure and limited risk transfer options. These risks highlight the need for companies to integrate climate considerations into core decision making processes, from operations and procurement to finance and long term strategy. Addressing climate impacts is not a secondary issue. It is essential to maintaining competitiveness and resilience. #sustainability #sustainable #business #esg #risk