Interview : Mechai Viravaidya

Mechai Viravaidya, founder and chairman of the Population and Community Development Association (PDA)

THE NATION

By Achara Deboonme Chularat Saengpassa
Published on March 16, 2009

After 21 years of trial and error in more than 400 villages around the country, Mechai Viravaidya, founder and chairman of the Population and Community Development Association (PDA), is ready to share his knowledge on sustainable rural development with other countries in Southeast Asia. In this exclusive interview, he tells The Nation's Achara Deboonme and Chularat Saengpassa about the venture into Cambodia.

What's the general description of the project in Cambodia?

We will implement the process in 20 villages, starting late this year. Some of them will be along the ThaiCambodian border and others in Phnom Penh and Siem Reap. Our focus will be on two areas: first, to provide microcredit and knowledge to villagers and broaden their views so they can stand on their own feet; second, nongovernment organisations will be strengthened through new business models.

Why Cambodia?

We have been approached by many countries such as Bhutan, Indonesia, the Philippines, India and East Timor, but we don't have enough funding. I also discussed with Asean SecretaryGeneral Surin Pitsuwan the possibility of creating the Asean Endeavour to End Poverty, which could be a new initiative to eliminate poverty in Asean nations.

In Cambodia, the project will be partly assisted by funding from the Bill and Melinda Gates Foundation. The foundation recently awarded the PDA US$7.3 million [Bt262 million], and half of that will go to Cambodia with help from other private companies. [During the interview, it was revealed that a brokerage firm in Sweden had agreed to pay $1 million to support four villages in Cambodia and eight in Thailand.]

What's the difference between this help and other social contributions?

Individuals and corporations and the government mostly throw [the poor] money without teaching them or evaluating the results. Then, how do they improve their abilities? They will remain poor. Under our programme, we're matching a corporate donor with a village. The village is given funding in return for the planting of trees, which is equivalent to Bt40 per tree. The funding will go to the village, managed by a village bank which is represented by people of different sexes and ages for equality. Then, the corporate donor will assist in training and trips to broaden villagers' perspectives.

The poor usually face problems in obtaining loans, as they have only labour. At the village banks, they can use it as collateral or for debt repayments and this will help them become independent. If you want to help the poor, it's necessary to give them access to credit, as it is a human right.

What about NGO involvement?

It's an old idea that NGOs must not be involved in business. But how can they survive and continue with their projects if funding dries up? Under our programme, we will help NGOs start up their businesses. Some returns will be reinvested while the rest will be used to finance their projects. It's like what the PDA is doing with the returns from its Condoms and Cabbages restaurants. The world has changed. NGOs can no longer live like beggars, particularly when the economic crisis hurts many companies.

Who are your target donors in Cambodia?

Companies in the country, be they Thai, Cambodian or French. We believe there are many, as we witnessed in Thailand. Here, starting with Bangkok Glass, we have secured assistance from many companies such as Swedish Motors and Novartis, which is implementing a similar project in every country in which it operates. We have also struck an agreement with the Stock Exchange of Thailand, to encourage listed companies to join the programme. A similar agreement has also been struck with the Thai Chamber of Commerce, which has many members.

How will the rural development proceed?

We target implementing help in all villages in a tambon. Then, the tambon will set up a foundation. While our experts teach them how to tap overseas funds, the tambon will also have its own company with villagers as shareholders and endowment funds from local administrative bodies. The foundation will take care of noneconomic issues, like health, to ensure that poverty does not revisit the better off. In the long run, these tambon can combine their forces through an assembly, to help develop the economy, society and democracy. Through this mechanism, they can voice what they want.

What drove you to this model?

There's no government in the world that can deliver everything to its citizens. Sometimes, people expect too much from their governments. Governments are mostly channelling money to infrastructure, which is good for the entire country but may not benefit the poor. It's also not the government's duty to teach business skills to citizens and, importantly, it has no knowledge about business. Social contribution like giving out money won't help, as it does not create new knowledge or enhance the poor's energy and ability. Worse, it teaches them to ask for free things.

People don't really [understand] when they talk about eradicating poverty. Only business methods can do the magic. And to me, the poor are businessmen who are not good at making profits.