NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Thirty Chinese NGOs recently won awards totaling $650,000 from the World Bank. The winning ideas included projects that supply environmentally sustainable bio-gas to single mothers, create support networks for waste collectors, and establish community service centers to teach deaf youngsters vocational skills.

Support for such projects may come as a surprise to those more familiar with hearing about the Bank’s funding of mega-projects, such as the building of dams or power plants. The Chinese grassroots initiatives were funded through the Development Marketplace (DM), a competitive grant program of the World Bank that funds innovative, small-scale development projects. DM’s primary objective is to identify and support creative ideas that deliver results and have the potential to be expanded or replicated. Read: those that have a sustainable business model component.

The global business plan competition had humble enough roots. In 1998, the first event was held in the lobby of the World Bank building here in DC. A hundred or so projects set up booths and a handful were granted funding to further scale their activities. The competition proved so successful that it quickly outgrew its venue.Today they are held at the national or regional level. Nine competitions, involving 17 countries, are scheduled between December 2005 and June 2006.

The DM is indicative of a change in focus and approach at the Bank. Perhaps the increased support for social services like health, nutrition, education and pensions is partly a result of the protests that accused the Bank’s mega-projects of largely benefiting the wealthy people in western nations and transnational corporations and furthering the race to the bottom. The Marketplace addresses these concerns by tackling newer issues like gender, community-driven development and the rights and roles of indigenous people in development.

“It is important and necessary for civil society organizations to play a key role in supplementing the government’s efforts in the fight against poverty,? says World Bank Vice President Frannie Leautier. “Often focusing on particular districts, and working closely with local governments, CSO interventions involve capacity building, training and service-delivery in micro-credit, agriculture, off-farm employment, education, health, water and sanitation, and other activities.?

The program has already spawned one spin-off. GlobalGiving was founded by two former World Bank executives who decided to use the Internet to create a highly efficient marketplace. The GlobalGiving platform enables donors to give money directly to projects, and monitor their progress online as goals are met.

Both the DM and GlobalGiving push development dollars further into the communities where they?re needed most. In doing so, they put more control into the hands of the people who will benefit most from a project’s success.