CHALLENGES IN EMERGING MARKETS
For you who refuse to look away, you likely are considering the following important questions:
• How can I invest my limited time and resources to make a difference?
• Are there solutions that get to the roots of these problems and aren’t just another band-aid?
• Is there a way for me to help bring lasting change to the hardest places, especially when they are often so far away?
Extreme Poverty Is Again on the Rise.
For almost 25 years, the number of people living in extreme poverty—on less than $1.90 per person per day—declined steadily. 1) Before the COVID-19 pandemic, economists estimated that 657 million people would live below the $1.90 extreme poverty line in2020.(2) This has risen to a projection of 711 million, with the majority living in sub-Saharan Africa.(3) COVID-19 is causing an enormous spike in unemployment throughout emerging market economies.
Youth Unemployment Is a Major Risk.
Nineteen of the 20 countries with the youngest populations are in Africa.(4) The average age in Uganda is 15.7, and in Burundi, it is 17.0.(5) Over the next decade, the World Bank estimates that over one billion young people will try to enter the job market, but less than half of them will find formal jobs. As our world continues to urbanize, and as populations in emerging market nations swell, we can either meet these employment needs and foster new levels of flourishing or witness the consequences of destabilized economies and the potential for riots and revolutions.
Corruption Persists and Disproportionately Affects the Poor.
Corruption is a major factor in material poverty. It erodes economic growth and places an extra burden on the poor as they pay bribes to navigate daily life. The World Economic Forum estimates that corruption costs the global economy 5% of GDP per year, equivalent to $3.6 trillion.(6) Sadly, in many countries in the Global South where a majority of the population identifies with Christianity, corruption is the norm. For instance, in Kenya, 85% of the population identifies as Christian, while the nation ranks 124th out of 180 countries in Transparency International’s Corruption Perceptions Index.(7) Corruption stands in blatant opposition to the teachings of Christ and hinders the mission of the Church.
The Global Church Is Struggling to Impact Culture.
How is the Church doing in spreading the gospel globally? The data is sobering. In the past century, the total number of Christians has tripled, but we’ve been stuck at 33% of the global population with no signs of growth.(8) We’re treading water. We need new ways to reach people for Christ and influence culture. A life in Christ transforms our spiritual identity, but perhaps just as importantly, it transforms our relationships with our neighbors and our understanding of how all aspects of our lives—spiritual, social, and physical—are important to God.
ENTREPRENEURS CREATE BUSINESSES THAT GET TO THE ROOTS OF POVERTY.
LOCAL ENTREPRENEURS, LOCAL BUSINESSES
For over 10 years, Sinapis has trained and accelerated local emerging market entrepreneurs. These business leaders understand their communities—both the challenges and the opportunities. Their companies provide valuable products and services, create and sustain jobs, and function as economic engines that fund the growth of local churches, nonprofits, and governments. God ordained a vital role for the marketplace. Business has intrinsic value as a means of material provision and can be an agent of social, intellectual, physical, and spiritual transformation. As the Wealth Creation Manifesto from the Lausanne Movement powerfully explains, wealth creation is a holy calling.(9) Wealth creation through business has proven power to lift people and nations out of poverty.
Why Are Entrepreneurs So Important?
Profitable businesses that create jobs are one of the best, most sustainable ways to reduce poverty. In every major economic development success story, GDP growth fueled by the private sector is the driving force of sustainable solutions.(10) As entrepreneurs identify business opportunities and build profitable companies, they grow the economy, create jobs, and increase incomes for their employees and suppliers. Good jobs allow families to plan for the future and make dignified decisions about housing, food, education, and healthcare. Jobs lay a foundation for generational change.
So, who are the job creators? The data shows that entrepreneurs who grow companies by choice, not by necessity, create the majority of new formal jobs and a significant portion of overall economic growth.(11)
Why Do Emerging Markets Deserve Special Attention?
Poverty exists everywhere in the world, but it is categorically different in the most difficult environments. Families living in poverty in the world’s hardest places lack adequate food, shelter, clean water, and medical care. They fight every day to live.
However, these challenges are only part of the story. Emerging markets have consistently demonstrated higher GDP growth than developed countries, and most of the fastest growing economies in the world are located in these markets. The combination of abundant labor, growing innovation, and rising demand for a wide variety of products and services present attractive opportunities for local and foreign direct investment.
Why Small and Medium Enterprises?
Worldwide, Small and Medium Enterprises (SMEs) represent about 90% of businesses and more than 50% of employment. In emerging markets, SMEs create seven out of 10 formal jobs.(12) Large companies play a vital role in any economy, but there are too few homegrown companies of this size and multinational corporations are less prone to establish significant operations in less developed emerging markets.
SMEs form the backbone of a strong market economy.(13) In addition to creating jobs, SMEs are engines for economic growth, driving innovation and competition across markets. However, in emerging markets, there is a deficiency of financing and support options for SMEs, creating a "missing middle" in the economic structure.(14) These entrepreneurs are vital for sustainable development, but too often lack the skills and capital to endure. With training, advisory services, and ongoing community, more SMEs can reach their full potential.
Why Is It Critical to Support Local Entrepreneurs?
For generations, international development experts and government leaders perpetuated the idea of alleviating extreme poverty through top-down, outside intervention. This commonly took the form of aid, and more than $1T in foreign aid has poured into Sub-Saharan Africa since World War II.(15) Rather than producing lasting change, well-intentioned aid has often stunted the growth of local markets and fostered endemic corruption. Further, a legacy of emphasizing outside solutions mars the image of those who God made to create, work, and build.
God strategically places local entrepreneurs to change their communities from the inside out. As their companies grow, they create innovative products and services that improve lives. Their success leads to growth for suppliers and business partners. They understand how to solve the most stubborn problems because they deeply understand the culture and their local community. To see a major shift in global poverty, we must see millions of local entrepreneurs launch and grow profitable companies.
Why Kingdom Business?
Jesus pointedly asked, “For what does it profit a man to gain the whole world and forfeit his soul?” (Mark 8:36)
Without a relationship with God, business success does not produce true flourishing for the entrepreneur and leads to diminished holistic impact in the community. We define a “Kingdom business” as an enterprise directed by the Holy Spirit and managed by a godly leader that uses its time, talent, and resources to meet the spiritual and physical needs of the surrounding community. Successful entrepreneurs working within their own communities are ideally placed to change culture for Christ. As their companies grow, they can show the love of Christ to their employees, suppliers, and customers. In time, their company can become an economic engine that supports the local church and addresses problems like hunger, corruption, and drug addiction.
SAVING PRODUCE AND CHANGING LIVES
Take the example of Yvonne Otieno of Miyonga Fresh Greens. Yvonne came to Sinapis in 2015 with a desire to change the course of her family’s struggling 1.5-acre farm. “I didn’t have the skills to do farming as a profitable business, and that’s what I got from Sinapis.”
Within one year of graduating from Sinapis’ Entrepreneur Academy course, she was exporting fruits and vegetables to Germany, Norway, the Netherlands, and South Africa. A few years later, her markets expanded to the United Kingdom, Romania, Greece, Ireland, Singapore, and Spain. Miyonga currently employs 39 people and works with a network of over 2,400 farmers.
Her success has not gone unnoticed. In 2018, Yvonne was selected as one of Africa’s Top 50 Innovators at the Africa Innovation Summit. In 2020, she was awarded £100,000 GBP from UK Aid through the Kenya Catalytic Jobs Fund to set up a mobile fruit processor. This project, Wheeling Fruits, is a distributed processing concept aimed at eliminating the exponential rise of food waste in East Africa, while also reducing transportation costs, creating jobs in rural areas, and improving the digital traceability of food from different regions.
The global Church has an enormous opportunity to embrace entrepreneurship. By supporting business leaders who can create growth, we can get to the roots of problems that have plagued communities for generations. This approach requires fresh thinking and a longer time horizon to achieve lasting impact.
As we equip and support entrepreneurs who are growing vibrant Kingdom businesses by choice, we will see:
IT IS TIME FOR GENERATIONAL CHANGE SPARKED BY LOCAL ENTREPRENEURS WHO HAVE A VISION FOR GOD’S KINGDOM COMING IN THEIR NATIONS.
1 - World Bank, “https://www.worldbank.org/en/topic/poverty/overview#1.”
2 - World Bank.
3 - Brookings, “www.brookings.edu/blog/future-development/2019/03/28/poverty-in-africa-is-nowfalling-but-not-fast-enough/.”
4 - World Economic Forum, “https://www.weforum.org/agenda/2019/08/youngest-populations-africa/.”
5 - World Population Review, “https://worldpopulationreview.com/country-rankings/median-age.”
6 - World Economic Forum, “https://www.weforum.org/communities/gfc-on-transparency-and-anticorruption.”
7 - Transparency International, "www.transparency.org/en/cpi/2020/index/nzl."
8 - Pew Research Center, “www.pewforum.org/2011/12/19/global-christianity-exec/."
9 Affirmation 3, Wealth Creation Manifesto from the Lausanne Movement, “https://lausanne.org/content/wealth-creation-manifesto.”
10 From The Poverty of Nations: A Sustainable Solution by Wayne Grudem and Barry Asmus. Wheaton,IL: Crossway, 2013.
11 World Bank, “https://blogs.worldbank.org/jobs/opportunity-entrepreneurs-are-key-jobs-and-growth”
12 World Bank, “www.worldbank.org/en/topic/smefinance"
13 Harvard Univeristy, "https://iri.hks.harvard.edu/files/iri/files/iri_-_sustainable_sme_investment_-_investing_in_the_backbone_of_emerging_markets.pdf"
14 Harvard University.
15 Moyo, D. (2009). Dead aid: Why aid is not working andhow there is a better way for Africa. New York: Farrar,Straus and Giroux.
Sinapis has hugely contributed to our business's growth, sustainability, and success. They have helped link us to potential investors/funding opportunities, publicized our business to the market, and provided ongoing strategic advice.
"This is one program every business owner should consider enrolling in. The benefits are immeasurable. I'm a beneficiary. Thank you, Sinapis!"
"Sinapis gave me a full kit to use to start my business."
"At Sinapis I gained the skills I needed in order to manage my business. I also learned how to raise funds from investors."
"The Crisis Crash Course was very instrumental in improving my general business management, time allocation, building strong networking connections as well as improving my lobbying skills."
"The Sinapis Entrepreneur Academy unit economics class helped me determine my unit and how much it costs for me to produce one."
"When we started our Sinapis classes, we were asked to pick one business. I chose a new venture I was getting into - speaking. I would never have imagined that just over a year later I would be speaking on the biggest stage - TED. May this be a testimony that Kingdom business has a benefit here and in Heaven."
"Sinapis gave me conviction to know that you can still do business the right way - The Kingdom Business Way. You do not have to bribe or pay your way into a contract. Hard work, faith, and prayer works wonders. I am truly grateful for this."
"I loved the Kingdom Business aspect and approach in the program. I am more enlightened than I was when I joined the program. It is very worthwhile."