POST-CORONA RECOVERY PROGRAMME: NO GOING BACK

The Italian newspaper Repubblica published the opinion of a well-known populist who urged “No going back”, to address the Recovery Programme, but learn from the past experiences to get the economy running again. https://www.repubblica.it/esteri/2020/04/19/news/post-corona_recovery_programme_no_going_back-254431614/?ref=RHPPTP-BH-I254407830-C12-P4-S7.4-T1. In our view, one could have expected more than a prose piecing together social business, social entrepreneurship, impact investment, non-profit organizations and unemployment. Indeed, it is hard to find out which resources to use, how to have a durable impact of the interventions, not to mention the lack of a logic framework to refer to. By the way, neglecting the sustainability factor is the denominator of all populists’ proposals.

Here, further to the invitation to contribute, we would like to position ourselves on the matter, which isn't a simple re-start of the activities, but a real RECONSTRUCTION, meaning the build on a new fundamentals.

The big question is:

Should we go back to the financialization of the economy, which didn't produce real wealth, but virtual affluence?

We do think that any programme the day after Covid-19, shouldn’t neglect the sustainability factor, which importance we reiterated over the past decade. In 2016 we published FINANCIAL INCLUSION, which sub-title “Give people a job, not a loan”, well synthesised the new approach to finance for development https://www.amazon.co.uk/dp/B01ENJP37S?ref_=k4w_oembed_XABBfUDmCDeygV&tag=kpembed-20&linkCode=kpd.?

Sometimes there are unexpected coincidences: in November last year we made available THE THEORY OF CHANGE APPLIED TO FINANCE FOR DEVELOPMENT https://reader.ilmiolibro.kataweb.it/v/1252660/the-theory-of-change-applied-to-finance-for-development_1268103, which conclusions, among other issues, reiterated and expanded the concept to move from CREDIT-BASED ECONOMY to COMMUNITY-BASED ECONOMY, which in a very succinct way, can be explained as follows:

1.????To re-design the entire architecture of the approach in favour of poor people and small business as well and?shift the paradigm of?the financial interventions from the over-indebted economy at a micro and macro level to a real people’s empowerment through jobs creation and opportunities’ promotion.

2.????To have the private investors really involved in the development process either directly sitting in the Development Agencies’ Board Room or setting up a National Development Fund, to assist the growth of their own communities.

3.????To use the financial leverage for sustainable interventions, which is as much easy to say as much complicated to achieve, because it asks for a revision of the decision-making process and fulfil the credit eligibility criteria.

4.????To digitalise the services with a sustainable and market transparent product: this can be reached via an appropriate market segmentation.

5.????To conjugate together three main Goals of the UN 2030 Agenda for SDGs, namely Goal 1 (End of poverty), Goal 8 (Promote inclusive and sustainable growth) and Goal 17 (Partnership).

The market segmentation is the appropriate way to approach the inclusive growth, which deserves a correct and detailed investigation of the landscape, to understand which kind of service is suitable to meet the demand for.

It also asks for making the difference among lenders, developers and philanthropists, who have different sources of capitals and use different management tools as well. In this perception, to make it a successful approach, the Stakeholders’ business’s behaviour will play a very important role along with the experience and expertise of the Team in charge to run the field operations.

We are sure each one and everybody has his/her own vision on re-start, the day after the Covid-19. Our position is: NO GOING BACK to unsustainable way of fighting poverty, which meaning should include both the unserved and underserved people (Basel III terminology), the former being the laissez-pour compte and the?latter, entrepreneurs, traders, who although having a link with the finance providers ask for a wider access to the source of financing.

Dr Ascanio Graziosi, https://ascaniograziosi.net - Four decades in the field.