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Small, Medium and Micro-
Entreprise Innovation and Technology
| The Challenge
It is hard to earn a living in much of the developing world. Formal unemployment rates are high, and the Northern ideal of
full-time, secure, salaried employment is beyond the grasp of the majority of the poor. In South Africa, for example, almost
40% of those able to work remain jobless. Such figures translate into poverty, lost potential, and arrested economic and
social development. A stronger small business sector could reverse this trend. Already, most jobs in the developing world
outside of agriculture are created not by large firms or the public sector, but by small and micro-enterprises, including the
vast numbers of informal sector enterprises operating outside the "official" economy. But smaller firms face many
constraints: outdated technology, limited access to credit and training, a lack of state support, and increased competition
because of trade liberalization. Programs and policies to overcome these obstacles could transform small and
micro-enterprises into thriving sources of
productive employment and income.
The Response
The Small, Medium, and Micro-Enterprise Innovation and Technology (SMMEIT) program initiative builds on IDRC's
tradition of involvement
in the small enterprise sector, making the Centre an important source of research funding in this area. Much of IDRC's early
support focused on small-scale technologies — a durable hand pump and groundnut sheller were early success stories. But
although technology is a key to development, it does not unlock all doors. SMMEIT continues to support research on the
development and transfer of technologies, but as part of a broader strategy to address other small business needs. Improved
access to markets, financing, training, and business advice are therefore critical research issues. SMMEIT also works to
promote policies that encourage small enterprise innovation and development, such as favourable regulatory practices.
Whether they be high-tech start-ups or street vendors, SMMEIT recognizes that flourishing small businesses play an
important role in relieving poverty through job creation.
The Objectives
To support the development, transfer, and marketing of technologies for use by the small enterprise sector, especially
technologies that process local raw materials into nonfood natural products such as dyes, cosmetics, and pharmaceuticals.
To promote the identification, dissemination, and application of improved practices in small enterprise support services
and related policies.
The Results
Products developed with IDRC support — ranging from essential oils
to cassava-based adhesives — were showcased at a meeting of a research network devoted to improving the quality and
marketing of natural
products in Africa. (Featured project)
More than 50 small-scale tanneries in Bolivia, Colombia, and Ecuador have reduced industrial pollution and boosted
their profitability and competitive-ness, thanks to research on managerial and technical improvements by the
nongovernmental organization PROPEL.
The World Association of Industrial and Technological Research Organizations and the United Nations Industrial
Development Organization have developed a manual, based on IDRC research, to restructure industrial research
institutions. The aim is to strengthen
links between the research community and the private sector,
particularly small enterprises.
Researchers in South Africa are determining how many women eke out
a living as street vendors and how their work contributes to the economy. This information will be used to lobby for policy
and infrastructure changes that support the women's businesses.
Malaria is responsible for as many as half the deaths of children under the age of five in Africa. Research has shown that
bednets treated with insecticides are a highly effective method to control the disease. A task force that uses market-based
approaches to promote the distribution of the nets has published a directory of suppliers for sub-Saharan Africa, and is
devel-oping information packages to encourage local firms to enter this market.
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Industrial plants
 | Plants provide the raw material for the production of traditional dyes in Guinea and essential oils in Morocco. Projects involving these industries belong to a research network
that looks to plant-based products as sources of economic opportunity for poor communities. |
IDRC support in Guinea is helping to preserve the traditional art of dyeing cloth with the indigo plant. Textiles make up the largest sector of the country's craft industry, a major producer of manufactured goods. |
For centuries, women in Guinea have dyed cloth with the midnight blue shades of the indigo plant and their work is famous
throughout West Africa. It is also part of an important economic sector; the craft industry produces about 40% of Guinea's
manufactured goods and involves an estimated 10% of the population. Women, however, are switching to commercial
synthetic dyes, which are easy to use and available in many colours. In the process, they are losing the ability to compete in
an international marketplace that puts a premium on natural products.
Researchers in Guinea, aided by Canadian expertise, are reinvigorating the traditional textile sector with a new method of
extracting dye from the indigo plant and with improved dyeing techniques. These advances, which have been adopted by
several women's cooperatives, have lowered costs and increased production of the rich blue dye, while reducing the
demanding physical labour associated with traditional dyeing. The success of the project has attracted financial support
from other donors and the Guinean government.
Despite these accomplishments, problems remain. The project is entering
a second phase to explore the full economic potential of the technologies through research on the wide-scale
commercialization of locally produced dye, the identification of other natural dyes, marketing, quality control, and the
dynamics of the textile industry as a whole. The project will also benefit from the resources, experience, and knowledge
concentrated in an IDRC research network on the development of products from plant materials.
The Network for the Valorization of Plant Materials in Africa brings together researchers from some 20 IDRC projects in
14 countries to share information and expertise. The network has evolved from years of IDRC-supported research on
improving peoples' livelihoods through the production of marketable goods from local raw materials.
Examples of projects that are part of the network — including the dyeing initiative in Guinea — illustrate this approach. In Morocco, researchers have worked with small-scale producers to
commercialize essential oils derived from aromatic plants. The oils are exported and used in soaps, perfumes, and
cosmetics. In Senegal, coastal communities harvest red algae as a source of carrageenan, a substance used in products
ranging from printing inks to ice cream. |
Before the bloodshed in Rwanda, François Gasengayire was a leading scientist in that country. He was a lecturer in
organic chemistry at the Université Nationale du Rwanda and was the director general of
the Rwandan Institute
of Scientific and Technological Research.
He had also served on many international
committees on science and technology.
At the outbreak of violence in 1994, Dr Gasengayire hid with the Barnabite Fathers and then managed to flee the country.
Later that year, he assumed his current responsibilities as the leader of the IDRC-supported Network for the Valorization of
Plant Materials in Africa. Of his survival of the Rwandan tragedy, he says: "In a word, I was lucky."
Dr Gasengayire is based in IDRC's regional office
in Nairobi. |
The network, which began in 1994, applies these experiences to address issues and problems shared by its members. Most
of its activities relate to the quality and marketing of natural products, the sustainable management
of natural resources, and community involvement in the development and adoption of new technologies. Members
exchange information through workshops, electronic communications, and meetings. The network also gives small research
grants to support the work of its members, such as a project to refine essential oil technologies developed in Morocco.
The Moroccan project demonstrates the impact of research that focuses on technology as just one element of a multifaceted
investigation. Like Guinea, Morocco has a centuries-old artisan tradition; cottage industries for extracting essential oils
have existed since the 7th century. Equipment for distilling the oils was unproductive and the sector as a whole suffered
from a lack of innovation and research. A team of Moroccan and Canadian researchers improved the technology as one part
of an integrated effort to boost the competitiveness of the sector. The result was a series of important breakthroughs:
Little scientific information existed about the plants used to make essential oils — sagebrush, rosemary, thyme, verbena,
henna, and rose. The project studied and described the chemical composition of several plants and identified a new species
of rosemary.
The project's analysis of exports, trade volumes, market trends, and the structure of the essential oils industry helped to
identify the sector's problems and potential.
A newly equipped scientific laboratory and trained staff enable researchers to analyze plant material in Morocco rather
than sending it to overseas laboratories.
In 1997, new products developed or commercialized by the project generated an estimated US$500 000.
Building on the project's work, the Moroccan government has initiated
a national program on adding value to aromatic plant resources.
The project has generated interest in essential oil production in Canada, particularly among small firms and producers
in the Saint-Jean region
of Quebec.
Thanks to the African research network, the achievements of this project are now being shared on a broader scale. The
Moroccan researchers are providing expertise to a second project in Guinea, which is studying aromatic plant extracts. At
the same time, the Moroccans are receiving network support for technical research. Network members hope that such
collaboration in the
scientific community will lead to more secure livelihoods for a larger number of the developing world's poor.
|
A shea nut press was designed in an IDRC project. Ways to refine the extracted butter and provide
additional income for women of the Sahel are now being explored.
|
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Future Directions
In September 1998, IDRC approved a second phase of the Network for the Valorization of Plant Materials in Africa. This
phase will focus on the wider dissemination and commercialization of technologies developed on IDRC projects. Plans are
also under way for a companion network in Latin America, to be launched later this year.
Through its own projects and links with other donor agencies, the SMMEIT program initiative is working to distill "good
practice" guidelines for small enterprise programs. SMMEIT will increasingly focus research on means of supporting
entrepreneurship and enterprise development by groups that are traditionally hard to reach, such as isolated rural
communities and women. Information and communication technologies may provide cost-effective ways to help meet this
goal.
Further Reading
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Copyright 1999 © International Development Research Centre, Ottawa, Canada
info@idrc.ca | 15 August 1999
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