[This is the first of a series of posts aimed at the World Humanitarian Summit.  More generally, this post and the next one offer ideas on how development and humanitarian organizations can work better together. Many thanks to WhyDev for their encouragement, editorial help and posting of this blog. Check out their excellent site if you don’t know it. – MD]

How many times have we seen this: a complex emergency with a decade or two of heavy humanitarian intervention (maybe some development organisations and peacekeeping forces as well), scores or even hundreds of millions of dollars spent by aid agencies, legions of expats trafficked through–and yet close to zero planned impact on local economic development or resilience? Sound like Eastern DRC? Haiti? South Sudan?

Foreign aid policy and practice have failed to view humanitarian crisis as an opportunity for development. This gap highlights a missed potential to capitalise on the presence of such a well-resourced foreign enterprise as humanitarian intervention.

A house divided

The aid community has improved its performance these past years by learning that, particularly in complex emergencies, contexts cannot be shoehorned into one end or the other of a false continuum, designated as either “humanitarian” or “development”, with one-size-fits-all implications for the aid response. Nonetheless, this divide is deeply ingrained, reinforced by the two-pronged architecture of the aid system, from funding streams to academic departments to organigrams of agencies and governmental ministries.

This divide has given rise to a fair amount of acrimony, and to a blind spot when it comes to opportunity. It is good–but not good enough–to comprehend that humanitarian crisis and developmental needs lie side by side. We must take the next step and see long-term development opportunities as residing within crisis. It’s time for development agencies to seize the presence of the humanitarian machine, by exploiting its potential as a source for financially sustainable (small) businesses. It’s time to make friends with the enemy.

Mind the gap

We understand almost intuitively how humanitarian crisis, whether conflict, flows of refugees or natural disaster, generates destruction, including damage to the local economy. Yet crisis often means that business is booming for the humanitarian endeavour. Viewed through an entrepreneurial lens, humanitarian response, particularly those stereotypical Western-led interventions in long-standing emergencies, resembles a pretty fat cash cow.

In crisis contexts, INGOs possess relatively massive resources, and they often represent the biggest fish in the pond. In line with these resources, humanitarian NGOs also have needs–many of which could be met locally. Why is it, then, that an organisation like MSF/Doctors without Borders works in Goma for decades, and still expends resources on importing and servicing its own vehicles? Or why in Nyala were there so few restaurants where an expat could go out to eat, even at the height of the Darfur response?

With a large, wealthy and needy humanitarian community present for decades, why do we still find development NGOs teaching women to make soap? Okay, that’s an exaggeration. There is nothing wrong with soap. The point is that many income-generating efforts are not successful, in part because of the lack of people willing or able to buy. But the humanitarian industry and the expats it employs are willing and able – so why aren’t development NGOs helping local people meet this demand?

In places like Port-au-Prince and Goma and Nyala, there are, of course, some local businesses and people who take advantage of the presence of foreign NGOs and expats alike, such as landlords, nightclubs and security services. Typically, though, the untapped demand is much larger, particularly for in-house service at NGOs; and, these businesses are either ad-hoc or pre-existing (especially in the early stages of a humanitarian response). Importantly, they are not the result of development agencies capitalising on opportunity, and so do not by design benefit the community, contribute to self-reliance or help establish an entrepreneurial culture.

The major humanitarian NGOs (and the UN) continue to be the managers and providers of an internal set of non-humanitarian services, which is inefficient. Here, one could talk of NGOs that hire and manage staff to clean their offices or residences, rather than having a development NGO work with a local group to create a cleaning service business. Ditto for vehicle maintenance, transport, catering, many aspects of supply and other functions that typically remain in-house to the INGO. And what of demand for highly-skilled counselling or consulting services (why do Westerners get so many of those contracts?), outsourced not necessarily due to a lack of local expertise, but because the local expertise lacks the know-how to package and market itself effectively?

Closing the gap

There needs to be a convergence of policy and practice aimed at the progressive outsourcing of services from within the foreign humanitarian community to local NGOs and businesses. The first step requires a teaming of development NGOs with their humanitarian cousins to delineate the concept. What services already exist? What services and businesses might comprise “easy wins”? What are the no-go areas (where humanitarian NGOs should retain direct control)? In what contexts would outsourcing be most likely to work? How can the development actors reduce the risks of negative impact when the humanitarians go home?

Next, the development agency must negotiate with national and local authorities, humanitarian NGOs and institutional donors to establish coordinated action and goals. NGOs will need to progressively cede control over important components of their activities. Donors may need to nudge them towards compliance, and national governments may be able to encourage change through regulation.

Most importantly, NGOs will have to work in the local community to build the actual businesses and services. This requires working in tandem with humanitarian organisations to ensure that needs are met and the quality of services is sufficient. The point is to create sustainable local capacity–businesses, services, NGOs, etc.–that can fill gaps or replace existing services that are owned or managed by humanitarians themselves.

Even to the extent that the activities proposed here already exist, they remain exceptions, haphazard in their genesis and limited in their impact. They do not reflect policy choices aimed at exploiting large-scale, protracted humanitarian interventions for the benefit of local development. Can we not imagine increasing local businesses’ support and service to the humanitarian community, to the point where it becomes a successful core component of development aid?

This opportunity may prove infeasible in some contexts, or it may be counter-productive to become dependent on cash cows whose presence is temporary. But, there is significant potentially successful development work in transforming existing functions into sound, income-generating local businesses.