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Comment by petenixey | Hacker News Reader

I happen to have just watched a brilliant TED talk on the value of angel investment (not aid) in Africa. The talk underlined how it is capitalism rather than charity that creates wealth.

It would be wonderful to see some of SV's glitterati create more for-profit investment networks (bigger than Kiva, smaller than VC (...YC?)) in other hungry markets.

Kudos to Mark for committing to this. If he applies his product-brilliance to how he goes about it I'm sure he will do wonderful things.

(Alexis this has your name written all over it BTW ;)

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I will bet anyone that 20 years from now we will see that China's "greedy" investment in Africa has done more good than all the decades and $billions of "selfless" western aid, both public and private.

And I also will bet that privatized school systems will perform better than public school bureaucracies that receive hundred million dollar gifts.

The invisible hand is puckish like that.

I'll happily take that bet — but please check the local situation first.

You remember the Oil spill in the Gulf of Mexico, and its impact on local business? There has been the same disaster, continuously for decades, thanks to oil extractions by “greedy” Shell. Somali pirates? They were fighting illegal radioactive dumps that contaminated their food, that were more “lean and efficient” to leave there rather then properly process. When locals are up in arms, the local economy rarely benefit.

According to friends who worked for the UN or US Aid, there is far worst to come, thanks to Chinese company.

http://www.longbets.org/

Not that I'd go down as opposing, but it could also be a nice way to get this idea some attention/publicity.

(And make some money in 20 years :)

Hmm, could a free market approach to African development be what we were missing all along? If only we could come to some sort of consensus on that approach. We could call it the Washington consensus.

Do you have a link to the TED talk?

The most relevant I found http://www.ted.com/talks/lang/eng/euvin_naidoo_on_investing_...

Though I don't know if is about angel investing, the one OP watched.

Sorry, I should have put it in in the first place: http://www.ted.com/talks/ngozi_okonjo_iweala_on_doing_busine...

Capitalism creating wealth in Africa? Cruel joke?

Nope. Counter-intuitive truth.

It isn't even that counter-intuitive. The approach for the longest time was to give aid through food and other basic necessities. Teaching a person how to fish rather than giving him fish clearly produces better results in the long term.

This is the "dirty little secret" about the sudden rise in African fortunes in the last decade or so (it is the fastest ascension of the middle class for Africa in... well, ever).

And, I know correlation != causation, but it's interesting nonetheless to note that this has happened under unprecedented investment by China in the continent, while investment rates actually shrank in the West (particularly in Europe, which probably is attributable to the financial crisis). This ascension is a marked improvement compared to, say, the efforts of Colonialism (the so-called "scramble for Africa"), Apartheid, and guilt-ridden charity.

It depends, if your teaching the person to fish to improve his way of life or teaching the person to fish to further line the pockets of an overseas corporation.

I think the wikileaks stuff on shell's behavior in Nigeria highlights this issue.

The real issue for the longest time was subsidy. We gave aid to African dairy farmers...but we subsidized American Diary so much that it was cheaper for Africans to buy our milk, and neglect their own domestic production.

"We are often told that the poor are grateful for charity. Some of them are, no doubt, but the best amongst the poor are never grateful. They are ungrateful, discontented, disobedient, and rebellious. They are quite right to be so. Charity they feel to be a ridiculously inadequate mode of partial restitution, or a sentimental dole, usually accompanied by some impertinent attempt on the part of the sentimentalist to tyrannise over their private lives. Why should they be grateful for the crumbs that fall from the rich man's table?" - Oscar Wilde

http://flag.blackened.net/revolt/hist_texts/wilde_soul.html

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