On 3 July, eBay participated in the Annual Meeting of the Donor Committee for Enterprise Development. The DCED is a forum for donor and UN agencies to promote economic opportunity and self-reliance through Private Sector Development in developing countries. eBay contributed to a day of discussions with donor agencies and guests from private sector and civil society on the topic “working with and through the private sector for PSD”.
The meeting was hosted by Netherlands Ministry of Foreign Affairs. In his welcoming remarks, Christiaan Rebergen (Deputy Director of International Cooperation) noted a trend of moving from the traditional donor-recipient relationship towards other types of investment. That reflection was supported by Shannon Kindornay of the North-South Institute presenting her study on models for trade-related PSD. The study finds that private sector actors are taking on an increasing role as both funders of development interventions and key business partners. Moreover, Kindornay described the emergence of a “hybrid development model” that brings together economic, social and environmental considerations and makes business sense for private sector partners.
The notion that a good business concept can be combined with positive social and environmental change is at the core of the eBay Inc. identity. Since eBay Inc. started in 1995, we’ve been fundamentally rethinking the old models of buying, selling and paying to create a new paradigm for commerce. One that empowers all people – no matter their skills, abilities or geographic location – to join in, contribute and succeed.
Today digital technology is enabling us to push the boundaries of traditional commercial interactions, fueling increasingly connected commerce. The extent to which this is making the world flatter can almost be quantified. An economic research study by Geneva-based economists found that the eBay platform reduces the negative effect of distance on international trade by 65%.
At the DCED meeting, Hanne Melin of eBay’s Public Policy Lab described how this is creating a more open, diverse and inclusive commerce. Almost all business with sales above $10,000 per year on the eBay marketplace sell to foreign markets, and the majority reach more than five markets compared to traditional trade which is mostly bilateral. The ability to reach customers worldwide facilitates market entry and growth the first crucial years as well as increases chances of longer term success – see our US, EU and APAC research papers.
What this research also tells us is that Global Value Chains is not the only way for small firms to participate in the global economy. Internet technology services create an alternative path to global growth opportunities. It is about bringing together a set of services & conditions that can all be adapted to address the needs of the very small businesses everywhere in the world. We call this phenomenon the Global Empowerment Network.
We have identified four big themes – services & conditions - of the Global Empowerment Network: (1) connectivity at low cost without gatekeepers; (2) moving products around the world in new ways; (3) payment, marketing, translation, marketplaces services; and (4) rules and procedures for a world where micro firms and consumers can do global trade.
During the meeting, a three-year strategy plan for the DCED was discussed. One of three objectives of the strategy would be to “explore new themes, in response to … changing circumstances”. Here, the Global Empowerment Network could provide a structure for identifying new themes as well as new PSD models that supplement GVC structures.
In this vein, working “with and through” the private sector for PSD could involve a two-pronged effort of developing the digital technology and shaping the appropriate public policy that can help bring visibility to, create customer trust, and allow the scaling (whether that is locally, regionally and/or globally) of an economic activity. An example of putting technology solutions to work for economic development is the partnership between the eBay Foundation and the Grameen Foundation in Indonesia on a mobile commerce project.
The DCED 2013 Annual Meeting was eBay Inc.’s first encounter with the DCED and its members. We hope it to be the starting point of a dialogue – a conversation on how we could marry the experience and expertise of the DCED members in the area of PSD with eBay Inc.’s global approach to Social Innovation centered on creating economic opportunity with the goals of:
- Scaling 10 social innovations that catalyze economic development
- Helping >10,000 low income entrepreneurs achieve increased financial returns
- Expanding access to goods and services for >5 million people living in poverty
More information on our contribution to the DCED 2013 Annual Meeting: http://www.value-chains.org/dyn/bds/docs/detail2/851/5