Development’s 1-2 Punch! The Power of Partnering with Diaspora Groups

May 13, 2013 By Ashley E. (Chandler) Chang

Psssst! Over here…I want to let you in on a little secret.

When executed properly, the partnering of public and private forces to solve critical development challenges can produce a “win-win” for all parties involved.  Alright, so maybe the Power of PPPs (public private partnerships) isn’t much of a secret.  After all, they’ve been used by U.S. foreign assistance agencies for more than a decade to successfully leverage private sector expertise and multiply government resources – and to create economic opportunities overseas and right here in the U.S. of A.

Partnering to Build a Better World

Some of America’s biggest corporations (really big – as in household names such as Walmart, Coca-Cola, PepsiCo, Cargill, General Mills, GE, Nike, and more big) have partnered with the U.S. government on a whole range of issues.  And these companies aren’t just doing it to feel warm and fuzzy. The benefits to the private sector can extend well beyond public relations kudos.  In fact, there is growing recognition that PPPs are becoming more important to success and sustainability.

Think you have to be a global giant to qualify for this “expand your business and build better the world” package?  Well, think again.  Small and medium sized companies, including diaspora-owned businesses, are an increasingly important part of the PPP Equation, which looks a little something like this:

PPPs + Diaspora Groups = impactful change + increased economic opportunities (at home and abroad)

Take for example this year’s IdEA* Global Diaspora Forum.  Themed: Where Ideas Meet Action, the Forum starts today in DC, Dublin, Silicon Valley, and Los Angeles. In 2011, Secretary of State Clinton launched the forum as a way to try and tap into the enormous investment potential of the 60 plus million first and second generation Americans, whose remittances alone “dwarfs any foreign aid that our government can give.”

The Role of the Diaspora

Partnering with America’s Small Businesses on Development

Let’s start by looking at the Overseas Private Investment Corporation (OPIC), India, an Indian American, and Ohio.

DLZ Corporation is a successful Ohioan architectural and engineering firm that was founded by an Indian-American, who in the late ‘90s saw an opportunity to expand his company into India via the country’s underdeveloped energy sector.  With a $5 million loan from OPIC, this American company rehabilitated a hydropower plant in India which has been providing “clean energy and green jobs to the local region” for well over a decade now.

Why OPIC?  Well, according to the founder’s son and DLZ’s Vice President, Shyam Rajadhyaksha, it was simple, really.  One, “there were no other sources of funding available to us at the time,” and two, OPIC gives American small businesses “instant credibility in a foreign market.”

Right, so I’m starting to understand the incentive from the diaspora side, but what about for OPIC?

The fact of the matter is that global development and business development are hard work.  OPIC views diaspora-owned businesses as potential partners who (1) “have a better understanding of the risk assessment capability” of their country of origin and (2) as “investors with a longer-term outlook.”

1-2 PPP Punch, anyone?

This is just one story of many – too many, in fact for this post.  So I’m afraid we’ll have to stop here.

What’s that?  You’d like more 1-2 PPP Punch examples?

Deal!  Tune in next time to find out Where (and how) the Ideas part of the 2013 Global Diaspora Forum met the Action, and we’ll even discuss why diaspora groups make “natural partners for USAID.”

*IdEA is a non-partisan, non-profit organization managed via a public-private partnership between the U.S. Department of State, the U.S. Agency for International Development (USAID), and the Migration Policy Institute (MPI).