If you want to work in international development, go work for a big, bad multinational company.
- By Charles Kenny<p> Charles Kenny is a senior fellow at the Center for Global Development, a Schwartz fellow at the New America Foundation, and author, most recently, of Getting Better: Why Global Development Is Succeeding and How We Can Improve the World Even More. "The Optimist," his column for Foreign Policy, runs weekly. </p>
Perhaps it’s the combined Twitter power of the Two Bills (Gates and Easterly), but working in development is hot, and not just for their 5.9 million followers. I’m not kidding: The website GradSchools.com lists 204 master’s programs in international development, meant to prepare students for the glamorous life of managing technical assistance to water and sanitation departments in Bangladesh or dealing with the logistics of emergency food programs in Somalia. Devex, the international development portal, boasts a database of 410,000 candidates for employers working in the aid arena to search. And the World Bank’s Young Professionals Program, a route to a permanent position at the organization, routinely attracts about 10,000 applicants for about 30 spots each year. In other words, it’s a lot harder than getting into Harvard. Kids today — they just want to save the world.
But there is more than one way to make the planet a better place. Here’s another option: Get an MBA and go work for a big, bad multinational company. Consider this: Over the past decade, foreign direct investment in Africa topped foreign aid — and in 2011 alone, by $7 billion. And unlike food handouts or free latrines, this kind of investment built factories, financed banks, and opened mines and oil fields, creating tens of thousands of jobs and transferring invaluable knowledge to the countries that need it most. That’s good news, because it is increasingly clear that new technologies are what’s driving improved quality of life in Africa, and new ways of doing business are vital to sustaining economic growth on the continent.
Yet there’s still a widespread feeling that multinationals are the rapacious, profit-obsessed spawn of globalization and free markets, running amok across the developing world. Some surely are. But think about how hard U.S. states compete to attract a Toyota factory. Or how happy Britain was when the Indian firm Tata bailed out its ailing steel industry. If multinationals can make that kind of difference in job creation and productivity in the rich world, consider the even greater role they play in poorer countries.
Foreign firms’ biggest impact in developing countries may not be the jobs they bring or the money they pay out, significant as those are, but the products they make. Take Vodafone, which provides services from texting to mobile-phone banking in Africa. The company not only employs some 84,000 people worldwide, but it also provides telecom services to 213 million subscribers in developing countries. And mobile-phone service does a lot more than just allow you to gab all day. It gets people money in emergencies, improves the prices farmers and fishermen earn for their goods, and helps people search for jobs. Economists Stefan Klonner and Patrick Nolen estimate that the proliferation of mobile phones has increased employment in rural South Africa by as much as 15 percentage points by allowing people to search for jobs farther afield. In Kenya, Vodafone affiliate M-Pesa’s mobile-banking service had 14 million customers in 2011 — about one-third of the population. That’s huge in a country with fewer than 900 bank branches — or about one branch for every44,000 people.
How about improving personal hygiene and preventing deaths from diseases like diarrhea? Unilever, one of the world’s biggest consumer products companies, produced items used by more than 2 billion consumers in 180 countries in 2010, and 53 percent of the company’s revenues came from developing markets. In India, where Unilever’s Lifebuoy soap has the largest share of the market, the company ran an 18,000-village campaign to educate and encourage people to wash their hands with soap. A review of evidence in the Lancet medical journal suggested that washing hands with soap is associated with at least a 40 percent decline in the risk of diarrhea and that if everyone worldwide washed hands with soap after going to the bathroom and before preparing food, between 500,000 and 1.4 million lives would be saved each year. (Granted, the study was partially funded by Unilever.) Does Unilever make a lot of money from selling soap in India? Yes. But it’s also doing a lot of good.
Sure, multinational pharmaceutical companies get criticized for selling vital drugs at prices that poor people can’t afford. At the same time, for every drug that helps with male pattern baldness or gives a bump to middle-age sex lives, Big Pharma develops another one to kill off parasites living in tropical water or protect kids from pneumonia. Take GlaxoSmithKline (GSK), which is testing a malaria vaccine in seven African countries. The Britain-based GSK donated more than 2.6 billion albendazole treatments to 58 countries from 2000 to 2010 to support deworming programs. Intestinal worms don’t usually kill people, but they are a major cause of kids missing school, which leads to lower incomes as adults. GSK’s ongoing donations are enough to deworm every schoolchild in the most affected countries. The same pill also works against the parasite that causes elephantiasis, a disabling disease that affects 120 million people worldwide. GSK’s donation is sufficient to support the World Health Organization’s effort to wipe out the disease by 2020. This is real foreign aid.
Of course, the private sector is motivated foremost by profits, not the drive to eradicate poverty worldwide. And multinationals have been involved in some pretty appalling investments. Remember when U.S. energy company Enron sold the Indian state of Maharashtra a $2.9 billion power plant that produced electricity at a cost four times higher than local producers? Or the infamous 1984 gas leak at Union Carbide’s chemical plant in Bhopal, India, which killed thousands? Consider, too, the involvement of such firms in the everyday corruption of developing economies: In 2008, the German company Siemens agreed to pay $1.6 billion in fines as punishment for bribes it doled out around the world.
But that’s far from the whole story. Across much of the planet, the items the rich world takes for granted on supermarket and drugstore shelves have for decades only been available to a lucky few. Multinational firms bring in technologies and business practices that lower the costs of these items and extend their reach. Competition creates markets in ways foreign aid just can’t, turning goods like mobile phones and medicines that were previously luxury items for an urban elite into products used by rich and poor alike. When a simple bar of hand soap does so much to promote income growth, lower child mortality, and improve adult health, there’s no shame in working for the faceless corporation that sells and markets it. So, get that international MBA. Then you can really say: “I work in development.”