Check out this video to hear directly from Howard and learn more about Vittana. Photo: Vittana

Microfinance, as a poverty alleviation strategy, was popularized in the development sector thanks to the work of Muhammad Yunus. Traditional microfinance loans are distributed to small business owners and entrepreneurs with the goal of increasing the scale and profits of their businesses. What is surprising is that after more than thirty years of growth and popularity, the microfinance sector has largely neglected student loan programs.

One reason for this gap is that there has yet to be a proven track record of success for such loans. It was not until Yunus was awarded a Noble Peace Prize, and the astonishingly high repayment rates from borrowers were documented, that large scale funding institutions invested their resources toward microfinance. Vittana, a startup nonprofit were I currently intern, is working to create a track record of microfinance for student loans in developing countries by using a peer-to-peer lending platform.

Student loan programs are effectively nonexistent in countries outside of the US and Europe. Vittana helps students like Howard Rene Alvarez Morales receive the funding they need to get a higher education. Howard is a 21 year-old law and business management student at the Universidad de Ciencias Comericales in Nicaragua. He is an ambitious student who goes to school on the weekends, works as a legal assistant during the week, and takes English classes at night. In order to complete his thesis and get his degree processed, his university charged him a fee of over $1,000, a large sum of money he did not have. In an interview Howard said, “The main problem I have encountered is finding the financial means to finish my degree.” Vittana was a part of Howard’s solution.

Vittana formed a partnership with the microfinance institution (MFI) AFODENIC in Managua, Nicaragua. Our staff provided the expertise, and individual small-scale lenders provided the capital needed for AFODENIC to establish a sustainable student loan program. Howard received an student loan of $1,044 and was able to pay his school fees. The law and business management degree he is working toward is projected to increase his annual income from $2,000 to $12,000. Beyond Nicaragua, Vittana has MFI partnerships in Peru, Paraguay, Mongolia, and Vietnam and will soon be expanding to additional countries. Our long-term vision is a world where students, no matter where they live, have access to higher education.

Howard is pursing his degree because what he wants most “are the means to work and succeed, and everything begins with the first step.” When that first step is a degree, it is a giant stride toward ensuring that students and their families stay out of poverty and have more sound economic futures. Thanks to Vittana, when I imagine microfinance borrowers, I no longer only see animal farmers, salon owners, and the like. I also see students like Howard.

What can you do to help?

It is because of lenders like you and me that Vittana students have access to higher education. Visit www.vittana.org to find the student you connect with and make a loan today. Alternatively, purchase a Vittana Gift Certificate to empower someone in your life to become a lender.

We’d love to hear what you think! questions@vittana.org

Idle mining cars on a train track in La Oroya, Peru. Photo: Max Opp (exoppholdsvaer) (flickr)

La Oroya, Peru, is one of the ten most polluted places in the world, according to the Blacksmith Institute, a New York-based global health agency.

The pollution is caused by a smelter owned by Doe Run Peru, which melts and purifies metals from the mountains surrounding La Oroya. The process is highly toxic: It's estimated that the smelting process emits 890 tons of sulfur dioxide every day.

Today, the area is plagued by acid rain and pollution, among other health and environmental problems. A recent article by the New York Times cited a 2005 study by Saint Louis University that estimated that 97 percent of children under six in La Oroya have lead poisoning, which can cause seizures, anemia as well as problems with the brain and kidneys.

Financially, however, the community needs Doe Run Peru since the majority of residents rely in some way on the smelting plant to earn a living, says the New York Times. About 3,000 people work in the actual plant, and other thousands make a living from selling food to workers and cleaning uniforms.

Community members say they want environmental conditions to improve, but cannot afford to see the jobs go elsewhere. They share their opinions in this video from the U.S. environmental law firm Earthjustice.

Photo: Mark Sun (flickr)

When stomachs go hungry, the women of Lima, Peru, find themselves cooking for half a million of its residents in one of the thousands of community kitchens spread across the city.

Known as comedores populares, community kitchens started in the 1970s have been part of a collective social movement led by poor women across Lima to combat food insecurity in a country where 40 percent of its population of 28 million people live below the poverty line. Its members pool together their limited resources and take turns cooking for themselves and the community at large, preparing some 100 meals a day.

An article by Upside Down World, an online magazine covering activism and politics in Latin America, provided insight as to how these self-sustaining organizations work:

Sixty percent go to members and their families; 12 percent to the members who cook as payment for their labor (there is no other pay); and 8 percent is donated to poor people in the neighborhood (called "social cases"). Only 18 percent of the meals are sold, half to people in the community, usually the same individuals, and the other half to people who happen to be in the area, such as service people and others.

With food inflation rising twice as fast as other goods in Peru, these community kitchens continue to be a lifeline to those who would otherwise go hungry. Not surprisingly, the women "now cook 10 times as much as they used to before prices spiked," according to a recent article in The Christian Science Monitor. With only 19 percent of their food subsidized by the government, community kitchens rely primarily on their members and donations for support.

But the rewards of being part of a community kitchen go beyond alleviating hunger by giving these women a sense of solidarity, collectivity, and respect. Participating in a community kitchen means that they become members of the Federation of Women Organized in Committees of Self-Sustaining Kitchens, an organization that oversees 1,300 kitchens in Lima.

Most importantly, the organization offers lifelong skills by providing “leadership training courses for the women, information about health care, training in establishing micro-enterprises to generate additional family income, help and advice in obtaining credit.”

The women are also actively engaged in Peru’s public policy, particularly the country’s food production and distribution system. According to The Christian Science Monitor, community kitchens “have risen as one of the most significant women's organizations in Latin America, and today are on the forefront of protests demanding solutions to a cost of living that many say is reversing recent progress in reducing poverty.”

Filling in where the government falls short, and acting as a source of hope for the poorest of the poor, it appears that community kitchens in Peru are also inspiring other parts of the world to follow suit. Community kitchens can be found in places like India and the United States, where restaurants, such as One World Cafe in Utah, depend on the kindness of the rich and poor to survive.

Rainforest destruction and tribal interests conflict with development. Photo: Orvarati (flickr)

One of the world’s last uncontacted tribes was photographed this week from a helicopter flying over the Amazon rainforest, near the Brazil-Peru border. The photos were taken by the Brazilian government’s Indian Affairs Department to, “show the [tribes’] houses, to show they are there… This is very important because there are some who doubt their existence.”

Proof that this tribe exists complicates the current battle between those who want to conserve the Amazon and those who want to develop it. Even though they've not been contacted before, these tribes are a casualty of the forest battle.

Currently, the Indian Affairs Department guesses there are about 500 uncontacted Indians living on the Brazil side of the border. However, as previously uncontacted tribes in Peru have tried unsuccessfully to defend their territory from loggers, they have been systematically killed and forced to move across the border.

This migration is a problem not only for the tribes losing their traditional homeland, but also for the uncontacted tribes who are already living in Brazil. The Indian affairs department of Brazil predicts more violence in the area, not only between tribes and loggers, but between tribes now living in the same territory.

Contacted tribes in both Brazil and Peru have been active in attempting to prevent further intrusion into the rainforest. Brazilian Indians are holding a mass rally this week in Altamira, protesting the series of dams the government wants to build on the Xingu River. They say that they have not been included in the decision making process, even though the dams would essentially destroy their way of life. Kayapó Indian leader Raoni, sent a defiant letter to Brazil’s President Lula vowing to stop the construction. He also protests the government's violations of indigenous rights enshrined in Brazil's 1988 Constitution.

The conflict over the rainforest is not confined to regional politics. In Peru, a French company is being sued by an Amazon Indian organization, AIDESEP, in an attempt to prevent drilling for oil nearby the border area where the uncontacted tribes were just photographed. AIDESEP asserts that Perenco, a U.S. company recently taken over by French owners, should be prohibited from working in the area and contacting any tribes.

Any contact with the tribes could be catastrophic. The recently contacted Murunahua tribe by the Yurua river watched half of their members die from disease, a mortality rate common in recently contacted tribes.

Despite the danger to the tribes, and international law that acknowledges the uncontacted tribes as the rightful owners of their land, Perenco is currently expanding into these areas.

José Carlos dos Reis Meirelles Júnior, head of the Indian Protection post near the Peru border says, "What is happening in this region is a monumental crime against the natural world, the tribes, the fauna and is further testimony to the complete irrationality with which we, the ‘civilized’ ones, treat the world."

Photo: Tatiana Cardeal (flickr)

Peru has one of the fastest growing economies in Latin America. Over the past six years, the country’s GDP has grown more than 6 percent annually. This is largely due to high market prices for mineral exports, increases in private investment and liberal economic policies that have been put into place by President Alan Garcia and his predecessor Alejandro Toledo.

Yet Peru’s economic growth is having a limited impact on poverty rates. While the capital, Lima, and the northern and coastal regions are flourishing, over 70 percent of the Andean region still lives in poverty. A major factor in this persistent poverty is the fact that many Peruvians continue to work in the informal sector of the economy, writes the Economist:

These unwaged people are often more or less cut off from the market economy. And it is market connections that make economic growth “trickle down” to the poor, points out Richard Webb, a social researcher and former central-bank governor. Enabling that to happen is thus a job for public policy. Better roads, education and social policy are all needed.

President Garcia has worked to increase social spending on anti-poverty programs, and staunchly advocates market-based solutions to Peru’s poverty problem. However, Garcia’s ability to combat poverty continues to be hampered by his unpopularity (his latest approval rating is only 26 percent), his lack of a legislative majority, and fears of corruption in lower levels of government. Unless Garcia can find a way to make Peru's growth work for more Peruvians, his liberal economic policies may lose support from those who aren't seeing the benefits of market capitalism.

Photo: marirs (flickr)

The potato has been making headlines recently, and the gist of all the stories is that we are not to be taking this celebrated spud for granted.

In Peru, where the potato originated, cultural identity is interwoven with this root vegetable. "Potato is not just food. Potato is also spirituality; it's culture," one Peruvian told National Public Radio. "There are songs, dances, ceremonies. So this is a potato land … a culture of potato."

The potato may be in for some rough times ahead, though, as climate change and unpredictable weather create conditions that may allow for diseases and growing problems never before seen in this region.

The Economist links the potato to the growth of free trade in 19th century Britain. Even today, it claims in a recent exposé, "potatoes are now an icon of globalisation."

Declaring 2008 the "International Year of the Potato", the United Nations is working hard to remind us all about this tuber’s higher merits. UN experts emphasize the potato’s value as a prospective solution to poverty, hunger and economic security issues.

All that potential, in just one little vegetable? We would never have guessed....

Lucy Conger's story "The Big-Country Enigma" examines why micro-credit has flourished in smaller countries like Peru and Bolivia while remaining somewhat small in scale in countries such as Brazil.

Does both over and under government regulation stand in the way to microfinance?