Stichting Bakens Verzet
1018 AM Amsterdam, Netherlands
Reg.nr. 34235506 Chamber of Commerce/KvK Amsterdam
BTW/VAT nr. NL8150.17.972 B01
Bank: Triodos Bank : IBAN
NL90 TRIO 078.13.27.598
Directie
T.E.(Terry) Manning
Schoener 50, 1771 ED
Wieringerwerf, The Netherlands
Tel 0031-227-604128;
E-mail:bakensverzet@xs4all.nl; Homepage: http://www.flowman.nl
Edition 42 :17 December,
2005
"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, London 1958, page 228
"In the end, it's about
love for mankind. Freedom begins with love. Our challenge is to learn to love
the world"
Nigerian writer Ben Okri,
interview in Ode Magazine, Dec 2002-Jan 2003, p.49
Project applications under the Model for
self-financing integrated development lead to the general increase of quality
of life in the project areas. They are therefore more general in nature than
traditional projects, and involve women's leadership, productivity development,
capacity building, and creation of social security in the local communities.
A project area will
typically contain 50.000 to 70.000 inhabitants and might coincide with all or a
part of a given administrative district where the future project coordinator is
most active. There is nothing critical in the number, which happens to coincide
with the size of the ancient greek City States. The population must be large
enough to support the various structures created under the project, yet small
enough for everyone to be able to directly participate in the structures and
associate with all the events there.
Within each project area, an
interest-free, inflation-free cooperative financial environment is created. So what
we do is create local economies where financial leakage is blocked, and the
small amount of formal money available stays in the area 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), energy (all
energy sources, including fertilisers, which are not produced in the area), and
health ( medicines imported into the project area, often into india). There are
articles on these financial aspects at website www.flowman.nl.
Each of these local
economies must develop a zero trading balance:
a) Its local money systems
must have a zero balance amongst each other.
b) Its local money systems must have a zero balance with local money systems
outside the project area
c) Its formal money system must have a zero balance with the formal money
system within the host country
d) Its foreign currency balance (items imported into the project area from
outside the host country must be balanced by the export of items from the
project area exported outside the host country) must be zero.
So how are the local
economies set up?
A number of structures are
created in the project area. The order in which this is done is critical.
1) Health clubs are set up. The
health clubs are based on groups of about 40 families (200 people) based around
future tank commission (they could be also be called local development
committees) areas. 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. It is women who are
expected to take most of the responsibility for the projects. In many countries
local NGO's have already done a lot of work in this sector, and in some areas
there may already be a nucleus of active women available. The initial costs of
the health clubs are covered by the project funds until the local money systems
are set up.
2) Once the women's groups
are working, the local tank commissions (or local development committees) are
set up. These are based on about 40 families (200 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. It's functions are fully described
in the Model and illustrated in diagrams. The cost of organising the tank
commissions is covered by the project until the local money systems are set up.
3) Once the tank commissions
(or local development committees) have been formed, local money systems can be
created. Poverty is often coupled with "lack of formal money". If the
people haven't got any dollars or other 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 local money systems give the people the means of
transferring all goods and services produced within the project area. The art
then is to use technologies enabling most of the items basic to local
development to be built with up to 100% local value added in the project area,
so that they can be produced, installed, maintained and paid for within the
local money systems, without the need for a single cent of formal money. Under
the Model, the entire sanitation system can be built, installed, run and
maintained without one cent of formal money! The costs of running the local
money systems are covered under the local money systems themselves.
4) Once the local money
systems are in place, a distinction can be made between what can be done within
the local money systems and what can't. At that time the interest-free
micro-credit structures are put in place. These recycle the users' monthly
contributions interest-free for credits for productivity purposes, for the
purpose of purchasing goods which cannot be locally produced. The systems will
allow at least US$ 1500 of interest-free micro-credit per family during the
first ten years of the project. Probably more, as the US$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. Existing
local NGO's may already have their own, or access to, local cooperative
development bank structures.
5) Once the micro-credit
systems and the local money systems are in place, the Beosite® factories can be
set up. Amongst the priority items for manufacture in these factories are
products necessary for the water supply project, water tanks, well linings,
water containers, etc. and even some or all of the water pumps themselves. (We
are currently working on Beosite® water pumps - one pump should be ready in a
few months' time, the deep well pump about mid 2004.) When production capacity
is available they can start making the sanitary systems and other items such as
high efficiency stoves.
6) Interest-free
self-terminating building society type structures can be set up at tank
commission or other level to finance the purchase of interest-free solar home
systems and other structures of common interest.
Apart from structures basic
to an improved quality of life, such as hygiene education at home and in the
schools, water supply, sanitation in the homes at schools and in clinics, solar
lighting for study purposes, solar refrigeration for medicines in clinics, improved
cooking stoves etc, the Model does not list all of the initiatives which could
take place, as these are as varied as the minds and wishes of the people.
However, any services the
local people may consider of special importance can be included in the project
and itemised in the budget. Some examples are the setting up of a local radio
station, setting up local milk shops for the pasteurisation and distribution of
milk, the creation of cooperative storage facilities for food, the creation of
a seed bank, the draining and re-structuring of market squares and bus centres,
all of which may require formal money funds. Other local initiatives, for
instance, creating sports clubs, theatre groups, local consultants offices,
communications centres, plant nurseries, and reforestation would be carried out
under the local money and interest-free micro-credit systems.
Project applications
directly mobilise about 15% of the adult population and the remaining 85%
indirectly. Unemployment in the project area should be eliminated within three
or four years. The financial structures are fully described in the Model and in
specific papers written. Of particular interest are:
a) The application of the compensation principle whereby savings in one sector
of a project cover the costs in other areas and
b) The new possibilities offered under the Kyoto treaty for the sale of CER
reduction certificates.
Under the compensation
principle, the monthly contributions of users are covered by savings on some of
their current expenditure. For instance, where families now spend a large slice
of their income for wood for cooking or for drinking water or medicines, these
costs will be eliminated or reduced under the project, releasing formal money
for other uses. Wood will not be used. It will be replaced by mini-briquettes
made under the local money systems. The supply of drinking water and the
maintenance of structures are already covered under the monthly contributions.
General increases in living conditions (hygiene education, clean drinking
water, sanitation, elimination of smoke, better drainage, a more varied diet)
should lead to less illness and less need to buy medicines.
Some applications under
integrated projects under the Model reduce CO2 emissions. The main one is
through the use of high efficiency stoves, others are the substitution of
kerosene burning by solar home systems, and of some pumping systems by solar or
advanced hand pumping technologies. They therefore qualify for the issue of CER
certificates, which can be sold to industrialized countries. The value of these
certificates could be enough to pay for the project - the catch is that they
are on a re-imbursement basis, so they would be redeemable only a few years
into project execution.
What about the project
structures?
An NGO (which may already be
in place and well respected, with good working relations with national and
international agencies and with a network of local NGO's) fronts for a given
project application. It will nominate a project coordinator, who, during the
project, may not be a member of the NGO. They are counterparts - the Project
Coordinator is the executive (government), while the NGO is the controller
(Parliament). Structures for auditing are set out in the Model.
A project application is
prepared by answering questionnaire form LIST OF
INFORMATION NEEDED, IN ENGLISH. This information can be supplied within a
couple of hours by the future project coordinator, who should originate in the
project area and therefore know the area well. We will then be able to prepare
a first draft of a detailed project which can them be modified and varied as
required by the people.
The project application is
then adopted by the NGO and submitted by the NGO for financing under a country
programme with one of the host country's aid partners, the UNDP or UNICEF.
Since the projects meet all possible development priorities, financing in the
form of an interest-free loan is not expected to be a major problem.
Main menu Model for self-financing integrated development.