The focus of Secretary Clinton’s Global Entrepreneurship Program (GEP) is building and sustaining entrepreneurial capabilities in Muslim communities worldwide, utilizing the power of private-sector development to improve standards of living and relations with the United States. President Obama hosted the first Presidential Summit on Entrepreneurship in April 2010.
Congress and the State Department should contribute to Secretary of State Clinton’s GEP strategy by creating a one-stop online marketplace to aid entrepreneurs in developing countries. While a number of NGOs engage in such market-connection activities, US government involvement would bring added diplomatic benefits to innovative, effective international development. The State Department’s creation of such a program contributes to fulfilling US declarations of support for development, lending credibility to the United States in its interactions with foreign governments and peoples.
This online marketplace will connect sellers in developing countries with buyers for their products in the United States. Consumers could browse the site for the products they are interested in and purchase them. Then, with the help of US logistical aid, sellers can ship those products. This marketplace would act as both an economic boon to existing entrepreneurs and as an incentive for others to undertake entrepreneurial activity. Business owners, their families, and their communities would all benefit from this kind of consumer-driven aid. As incomes rise, locally directed spending power would also rise in these developing economies. The US should negotiate to place the goods sold on this marketplace into the Generalized System of Preferences (GSP), a trade preference program in the US that allows products from low-income countries tariff-free access to the US provided that these goods can be shown not to have significant direct competition with domestic US producers.
Americans, too, benefit from a new source of innovative and interesting products. Small businesses in the US will not be threatened by the entry of these products into American markets, which can be guaranteed under the GSP framework. Further, increasing incomes in developing countries is an investment in future trading partners that will benefit US businesses. This empowering approach to foreign aid is a progressive contribution to American interests as well as to those of the global community at large.
One obstacle to the implementation of such a program is that local business owners often lack the skills they need in order to ship their products to the United States. Off-setting this obstacle is part of where substantial "foreign aid" comes in. There would be a very low cost to creating and maintaining a sales registry, but some additional funds should be spent on training to maximize use of the online marketplace. This security-enhancing alternative to traditional foreign aid would not increase the deficit. Extraneous defense spending should be pared down, and a small portion of this spending should be redirected to provide more effective foreign aid. Congress can re-appropriate funds into this program’s training and physical-shipment components alongside the small amount required for the maintenance of the online marketplace.
The foundations for this program already exist in the form of the GEP. In November 2010, the State Department celebrated business promotion as a form of foreign aid, calling empowering entrepreneurs "A New Pillar of US Foreign Policy." The State Department is already at work on entrepreneurship training and development programs, often in the same countries in which this new program would be implemented. Existing training pro- grams serve a similar function to this new approach, but the payoffs can be expected to grow massively from this market opening for the beneficiaries of entrepreneurial training and support programs. With the US and global economy still reeling, sustainable income growth is beneficial now and as a valuable investment in the future. Such a sustainable security strategy benefits US interests by improving the personal security of people worldwide while avoiding the perils of traditional aid-based corruption.
Kevin Dean is a student at Michigan State University. This article was first published by our partner Roosevelt Institute Campus Network in their "10 Ideas for Defense & Diplomacy" publication.