Good news: Aid agencies are beginning to catch the dumb-as-rocks projects

by Laura Freschi Goods for sale. Photo credit

The NYT recently ran an article chronicling the failure of the now-abandoned Women's World Market, a 2007 donor-funded mall on the outskirts of Kabul. The project was set up with money from GTZ, the German bilateral aid agency, the small business arm of USAID, and the private savings of an Afghan entrepreneur.

Here are a few facts about the project:

- the mall was planned for an out-of-the-way location that attracted little traffic

- the goods sold were already commonplace

- the prices were set much higher than Afghans could afford

- the prices were also much higher than those of comparable goods nearby

Now, I don't have an MBA, but the chances for success on this project sound low. The Times reported: "Ueli Müller, who oversees GTZ’s Women Employment Promotion Project, said that the question being asked before any economic program gets support today, no matter how well-intended, is: What are the market linkages? And where are the customers?"

It's a relief that GTZ has developed a grasp of these obvious principles. Here’s hoping that other aid agencies are keeping up.

At least aid agency officials—from GTZ and Unifem— are talking frankly about past failures, using specific examples about what went wrong and why. Perhaps future failure discussions will convey more subtle lessons.