CAIRO: Several businesses in Egypt have been leading the way in giving the poor a chance to contribute to and become part of the global economy — a win-win scenario for both the business sector and the economically downtrodden.
In a country where poverty is preponderant — an estimated 18 million people — the task of making the poor part of the global economy isn’t easy, but this is equaled by the potential for business development and opportunities.
Daily News Egypt spoke with three organizations that are leading the way in this endeavor.
Two local organizations — Environment Quality International (EQI) and SEKEM Group — and Unilever, a multinational corporation, have been working in various ways to provide jobs to the poor, by making them part of the global production and distribution chain.
EQI in Siwa
EQI, a consulting firm and direct investor in sustainable development initiatives, has been actively working since 2000 to protect the fragile ecosystem in Siwa, an oasis in Egypt’s Western Desert, as well as provide the local community with employment by building ecolodges.
“Today there are three lodges in total, which have no running electricity, are constructed out of rock, salt and mud as well as wood and palm rope; thus representing true sustainable housing. What is more, 95 percent of the staff are locals from the Siwa community”, said Siwa Initiative project manager, Heba Abdella.
As part of its dual mandate to create jobs as well as promote sustainable development, EQI aids the locals introduce their products to the global market by supporting the Siwan women in selling their embroideries abroad.
To this end, EQI supplies their business knowledge as well as the design and materials, whereas the women provide their inherent talent. Once the embroideries are ready to be sold, EQI provides support for export.
“The women’s work eventually ends up in chic, high-end boutiques in Europe, especially in Italy, France and the UK”, Abdella indicated.
In total, EQI estimates that around 800-1,000 families in Siwa have been provided with employment — a formidable feat for a small community of 23,000.
The organization provides similar support to local agriculture producers in Siwa. Although their produce is sold on the local markets rather than exported abroad, EQI is assessing ways in which they can market Siwan farmers’ products in foreign markets.
“The Siwa initiative has provided a link between the outside world and this small, isolated community, which is a veritable win-win situation for both the local community and western consumers.”
Following the success of both the initiative in Siwa and its agriculture businesses, EQI, Abdella explained, is seeking to expand its operations even further.
3 Decades of SEKEM
SEKEM is another local Egyptian business that has been striving to improve the lives of the poorer segment of the population by helping sell their products abroad and providing them with employment.
The organization is an umbrella for a network of companies that seek to support social and cultural enterprises, and has been in existence for over three decades.
In fact, SEKEM was the first organization in Egypt to introduce the concepts of organic farming and fair trade. It produces everything from fruit to cotton as well as textiles, which target high-end consumers in foreign markets, particularly in Europe and the United States.
SEKEM has directly created more than 2,200 jobs — a number that does not encompass employment that has been generated indirectly, explained the organization’s CEO Helmy Abouleish.
“Our farms cover about 60,000 acres in Egypt, which translates to around 1,000 farmers and families working the lands. But if you look at the total number of jobs that have been created through these 60,000 acres, the number is estimated to be between 20,000-30,000 jobs,” Abouleish explained.
SEKEM’s concept is certainly not to be scoffed at: “We are expanding at an annual rate of 25 percent, and our objective is transform 100 percent of Egypt according to our concept of organic farming and fair trade,” he boasted.
Abouleish’s ambitions for SEKEM reach beyond just the agriculture sector; the organization has branched off into several other fields, which include research and development, pharmaceuticals, hospitals, and vocational training. In 2011 a university focusing on sustainable development will be launched.
The Multinational Player
Multinational corporations are on the same track.
Alongside local Egyptian organizations, one of the biggest multinational corporations has also been doing its part to bring the poor into their vast international network.
Unilever, a global corporation that sells products ranging from food products to personal care items, with over €3.6 billion in profits in 2009, has been employing Egyptians from the lower-income bracket to distribute company products to their local communities.
Khaled Fayed, managing director for the Mashreq countries at Unilever, explained that the project, which kicked off in 1998, has led to the creation of 20-50 jobs in each governorate in Egypt.
That figure might seem modest, but the fact that other companies have been replicating this type of socially responsible distribution model seems to signify that Unilever is on the right track.
“Many companies throughout the globe are applying this concept … but in Egypt Unilever is presently the only international firm doing so,” Fayed said.
Unilever is intent on expanding this program. “It has reached its limit”, Khaled explained. Thus, he is currently assessing different models that are presently being applied in countries such as Vietnam, Indonesia and Bangladesh so as to expand this operation.
“These countries have a similar GDP and socio-economic situation, which means that their concepts would be easily applied in Egypt,” he added.
In spite of the obstacles the program is facing in taking off, already more than 2,000 jobs have been created in Egypt through Unilever’s initiative.
Furthermore, Fayed firmly believes that this model has more room to grow, as it has a strength over the competing model of having only 3-4 major distributors, which is what other MNCs operating in Egypt prefer.
“Local people have a better grasp of the needs and culture of their consumers. Also as the local distributors are at the point of sale, consumers’ comments are quickly obtained and relayed upward to top management,” he explained.
Fayed mentioned that this type of information is of high quality, and is crucially important in an increasingly competitive global marketplace where details and instant feedback are decisive in a company’s success.
When asked whether this initiative has been beneficial to Unilever and achieves its objective of bringing the poor into the global economy, Fayed affirmed, “We are definitely on the right path, and the situation has been improving.”
