SINGAPORE (July 1): What if we could build a global economy that runs on neither self-interest nor altruism? With climate change and inequality the greatest threats to humanity in the years to come, urgent action and collaboration are needed to construct an equitable and sustainable future. The way to get there could lie in the experience of the war-torn region of Mindanao in the Philippines.
La Frutera is a plantation company that exports Cavendish bananas from Mindanao, where the Moro Islamic Liberation Front had waged a guerilla war since 1969. After a peace treaty in March 2014, the region and its people are now struggling to find livelihoods and get back on their feet. However, the story of La Frutera stands out. Amid decades of guerilla warfare, its plantations have been untouched by the conflict — a result of an understanding between those who own the plantation and the Muslim leaders in that region.
At the Shape the World Summit 2019, Annette Pelkmans-Balaoing, senior economist at the Rotterdam School of Management, shared the story of La Frutera, a company which invested even in times of war.
“War creates profound market failures because no form of cooperation is enforceable in a situation where trust cannot flourish. Certainly not long-run investments as they require stable relationships that would allow long-run planning and flexibility to address unforeseen challenges,” said Pelkmans-Balaoing. However, the CEO of Unifrutti-Philippines, which owns La Frutera, still invested US$27 million, even during the conflict — something that came from a vision of collaborating with the leader of the Muslim community.
“These are not just loose words. And perhaps the best proof of its authenticity is the fact that in the 36 years of the existence of Unifrutti, it has not once experienced any violent attack or sabotage, unlike other companies in the plantation sector that have suffered immense loss of property and even lives,” she added. “What is striking about the Unifrutti and La Frutera story is that the company did not start out as virtuous, but it became so in the course of building relationships that cut through the religious and cultural divide.”
New solutions required
She pointed out that perhaps the best way to reach a common good was not through altruism but, rather, through self-interest in what would eventually be a common positive outcome. “From this viewpoint, an economic exchange is a social but not an altruistic act, because it is conditioned on the confidence that the will to be useful to the other is reciprocal,” she added.
Indeed, new solutions are needed to remedy a global order that has seen inequality thrive to the point where the world’s richest 1% — those with more than US$1 million ($1.35 million) — own 45% of the world’s wealth.
“The art is therefore to reach that fragile balance where market incentives freely drive us to produce and buy, and where governments smartly throttle our individual inclination to seek every loophole, tax haven and unregulated policy space to exploit our environment and advance our self-interests. Imagine an economic system that is fair and inclusive because it must address our social nature, but also efficient because it must advance our collective and individual self-interests as well,” said Pelkmans-Balaoing.
The Shape the World Summit 2019 was held on June 20 and 21 at the National Design Centre, where speakers from around the world called for new ways of thinking about social design and collaboration for a better future for all.
Themed “Designing A More Equitable Economic System”, the summit was organised by innovation consultancy Consulus and multidisciplinary design consultants CPG Consultants. Throughout the two days, participants were challenged by six intense, thought-provoking sessions on tackling inequality and reforming the status quo.
The same thread of creating human relationships for mutual benefit was echoed by Anouk Grevin, associate professor at the University of Nantes and Sophia University, who pointed out that our economic system is problematic not in its ability to create wealth but in distributing it. She called for an economy of communion, one where the economy is driven by gift-dynamics — not of charity but an equal exchange of give and take.
“A French anthropologist, Marcel Mauss, [said], gift giving is what allows us to create relationships and trust so that we can then trade together instead of fighting,” she said. But gifting is not limited to the social activists; it has to be the engine of business. “People flourish when they can give themselves for the common good; it gives them the strength to fully develop their potential and give their best, to be creative and respond to the trust they are given. When we trust them, [they] believe that they also have a lot to give and are willing to give it.”
The theme of giving continued with “Imagine an Inclusive Healthcare System”, a presentation by the CEO of The Indus Hospitals in Pakistan, Dr Abdul Bari Khan. The Indus Hospitals in Pakistan are tertiary-care hospitals that provide free healthcare to all, a concept that sparked a robust discussion about a healthcare system that is no longer divided according to those who can and cannot afford it.
“While working at the Civil Hospital, Karachi, I saw people selling their assets to save their and their loved ones’ lives, and people who didn’t have things to sell either asked the doctors to help or let their loved ones die. Every time I witnessed such a case, I [thought], don’t people with less money have the right to live?” said Abdul Bari.
He said access to quality healthcare is one of the basic human rights. But when governments are not able to deliver that through public hospitals, and exorbitant charges in private hospitals have left the middle class crippled, it is the individuals and non-governmental organisations who have come forward to help. The Indus Hospitals are a self-sustaining healthcare system, funded solely from donations. Its primary funding mainly comes from individual and corporate donations, while it also receives government grants for public health projects.
Don’t ignore climate change
Another issue that stood out during the summit was that of climate change. Several speakers pointed out the devastation that humanity is wreaking across the planet, as the ice caps melt and wildlife chokes on plastic.
One initiative that showcased what can be done if everyone came together was Kota Baru Parahyangan — a township in Indonesia purpose-built to turn unproductive land into a commercial and residential town that is not only green but also inclusive of the villages in the vicinity. Its director of operations, Ryan Brasali, said through education and engagement, the city has flourished and empowered the villagers nearby, giving them access to new sources of sustainable income, such as beekeeping and green farming — a deliberate decision that shapes how cities could look in the future.
“Sustainable development is more than physical change; it is also a mindset change,” he said, adding that constant engagement was needed to educate villagers on composting, self-sustainability and eco-tourism.
Another speaker, Karthik Karkal, director of engineering consultancy firm Ramboll, said the design for sustainability begins at the overall master-planning stage of any city or space. He used the Bishan-Ang Mo Kio Park in Singapore as an example. The park was redesigned to transform from a utilitarian concrete channel into a naturalised river, creating new spaces for the community to enjoy. It was a part of the Active, Beautiful, Clean Waters Programme, a long-term initiative to transform the country’s water bodies beyond their functions of drainage and water supply into vibrant, new spaces for community bonding.
The continuous effort towards a sustainable future is multipronged and multifaceted, and requires a wholeheartedness from all stakeholders. Indeed, Singapore has done much in that respect, having released the Sustainable Singapore Blueprint in 2015 that outlines how it should manage its resources. Even though it was named Asia’s Greenest City in 2016, much still needs to be done as the population grows and resources diminish. To this end, innovative solutions must continue to come from every stakeholder, and it begins by reinventing and reimagining the status quo.
