Director,
T.E.(Terry)
Manning,
Schoener 50,
1771 ED
Wieringerwerf,
The
Tel:
0031-227-604128
Homepage:
http://www.flowman.nl
E-mail:
(nameatendofline)@xs4all.nl : bakensverzet
and
"Money is not
the key that opens the gates of the market but the bolt that bars them"
Gesell, Silvio The
Natural Economic Order
Revised English
edition, Peter Owen,
“Poverty is created scarcity”
Wahu Kaara, point 8 of the Global Call to Action Against Poverty, 58th
annual NGO Conference, United Nations,
The activities of the second phase
carry a budget of Euro 1.943.284.
This is the most
critical phase during which the basic structures necessary for the operation of
the entire system are set up by way of a series of organizational workshops
following the method introduced by the Brazilian sociologist Clodomir Santos de
Morais.
Refer to schedules 1 and 2 for some material and a bibliography
on Organisational Workshops.
The sequential order
of the workshops is very important. The first workshops are the ones setting up
the Health Clubs, which offer women
a platform from which they can organise themselves. After that, the tank commissions, which are the heart of
the system, can be established. The third structure is the local money LETS systems, followed by the micro-credit system, then the gypsum composite manufacturing units,
the water supply system, the recycling system and, where applicable,
the radio station and other planned structures.
Within the project area, an interest-free, inflation-free cooperative
financial environment is created. Local economic systems are created, from
which financial leakage is discouraged and where possible blocked, and the
small amount of formal money available in the project area stays there and is
re-circulated locally. Financial leakage is caused mainly by interest (up to
40% of the price of a typical industrial product is in fact accumulated
interest), all energy sources, including electricity supply and fertilisers,
not produced in the area, and health costs for medicines and medical
services imported into the project area,
often also into the host country. Articles
on these innovative cooperative local financial and economic structures.
Within each of these
local economies:
a) Each LETS local
money system in the project area must have a zero balance with others (if present)
in the project area.
b) The LETS local
money systems in a project area must have a zero balance with LETS local money
systems outside the project area.
c) The formal money
system in the project area must tend towards a zero balance with the formal
money system within the host country.
d) The foreign
currency (formal money) balance between the cost of items and services imported
into the project area from outside the host country and the value of items and
services exported from the project area outside the host country must be zero.
So long as these balances tend towards zero, it is impossible for one
local economic system to get rich at the cost of another. The idea is to set up
a patchwork quilt of these local economic structures in a given country. Local
development is then powerful, fully sustainable, and decentralised. The local
people (and especially women) are fully empowered and manage their own
decentralised structures.
So how are the local economic systems set up?
A number of simple, cooperative financial, economic, social, and
productive structures are created in each project area. The order in which
this is done is critical.
1) Cooperative health clubs
are set up. The health clubs are based on groups of about 20-25 extended
families (200-300 people) based around what the Model calls tank commissions
but which could be called local development committees. The health clubs are
important because they constitute a platform enabling women to organise
themselves so that they can vote in block at meetings and participate fully in
the structures. The gender issue (the role of women in development) is
addressed this way as it is women who are expected to take most of the
responsibility for the projects. The initial costs of the health clubs are
covered by the project funds until the LETS local money systems are set up.
2) Once the women's health clubs are working, the local tank commissions or local
development committees are set up. These are also based on the same 20-25
extended families (200-300 people) . The people can decide how many members the
tank commissions will have, typically 3 or 5.The tank commission is the heart
of the project. Its functions are fully described in the Model and draft
projects and illustrated in diagrams. The cost of organising the tank
commissions (local development committees) is covered by the project until the
local money systems are set up and become operative.
3) Once the tank commissions have been formed, LETS local money systems can be created.
Poverty is often coupled with "lack of formal money". If the people
haven't got any formal money, they cannot buy goods and services. Yet the
absence of formal money does not mean they do not have goods and services to
transfer. The LETS local money systems give the people the means of exchanging
all goods and services produced within the project area. The art then is to use
technologies enabling most of the items and services basic to local development
to be built or executed with 100% local value added in the project area, so
that they can be produced, installed, maintained and paid for within the LETS
local money systems, without the need for formal money. For instance, under the
Model and the draft projects, the entire integrated sanitation system can be
built, installed, run and maintained without a cent of formal money! The costs
of running the LETS local money systems are covered under the local money
systems themselves.
4) Once the LETS local money systems are in place, a distinction can be
made between what can be done under the local money systems and what cannot. At
this point of time the cooperative
interest-free micro-credit structures are put in place. These recycle the
users' monthly contributions to the Cooperative Development Fund interest-free
for credits for sustainable productivity purposes, for the purpose of
purchasing goods not locally produced. The micro-credit systems will allow at
least Euro 1500 of interest-free micro-credit per family during the first ten
years of each project. Probably more, as the Euro 1500 is conservatively based
on an average two-year pay back time. The costs of running the micro-credit
structures are covered under the local money systems. Where local cooperative
bank structures willing to work within the local money systems do not exist, the
project in question will set one up.
5) Once the cooperative micro-credit structures and the LETS local money
systems are in place, the gypsum composite
factories can be set up. Amongst the priority items for manufacture in
these factories are products necessary for the water supply project such as
water tanks, well linings, water containers, etc. and even some or all of the
water pumps themselves, though work on the development of these is still
on-going. When capacity is available they can start making the planned
ecological sanitation systems, and other necessary items such as high
efficiency stoves.
6) Cooperative interest-free self-terminating building society type
structures can be set up at tank commission, well commission, or central
project level to finance the purchase of interest-free solar home systems and
other renewable energy structures of particular common interest to the people
in the project area.
The following graphs can be downloaded from internet
site www.flowman.nl or transmitted as attachments to an a-mail message on
request.
GRAPH SHOWING DEVELOPMENT OF MICRO-LOANS .
THE INTEREST-FREE LOAN CYCLE .
HOW THE ORIGINAL SEED LOAN MONEY IS USED.
GRAPH SHOWING QUARTERLY EXPENDITURE.
DETAILED TYPICAL EXPENDITURE FIRST QUARTER.
DETAILED TYPICAL EXPENDITURE SECOND QUARTER.
DETAILED EXPENDITURE THIRD QUARTER.
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