All Articles Tagged "developing nations"

Money Lessons From Living With Less In A Developing Country

June 15th, 2015 - By Ann Brown
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Image:  Joli Moniz

Image: Joli Moniz

When I moved to Cabo Verde from New York City, I was expecting a cultural shock but had not thought much about the financial shock. For those who have not heard of Cabo Verde (and a lot of folks haven’t), it’s a group of 10 islands (nine inhabited) right off the coast of Senegal; about a seven-hour flight from Boston. While considered a developing nation, the overall living conditions are better than some wealthier African nations–and even some American inner cities, for that matter.

Moving to the capital city of Praia on the isle of Santiago, I got an immediate lesson in personal finances. At first I rented a fully furnished two-bedroom apartment in what was considered the upper middle-class area. It cost me about $900 plus electricity and water. Seemed reasonable, considering New York City rents. I soon learned I could not compare the American cost of living to Cabo Verde. The minimum salary here is around $150 a month. You’re doing fairly well if you are pulling in about $400 a month.

With my finances stretched thin, I moved into a lower-income zone where my rent was about $300 a month, but I lacked furniture. I learned to live without a refrigerator, stove, and television for at least eight months. These appliances are not cheap here. As long as I had my bed, I was fine. And I did have a gas contraption I could cook on. And, I was one of the more fortunate as I had running water (only cold!) in my apartment. Many here still have to go in the morning and collect water for the day from a distribution center or from neighbors with running water.

Sounds horrible, right? No, it was actually freeing not to have a lot of bills to think about. You can’t accumulate credit card debt because there aren’t any places (except  some of the high-end hotels) that take credit cards. You don’t need to use lights during the day; for the most part you have sun streaming into your home. And with the countless blackouts we had here for my first couple of years–it’s now much much better–I learned to not be stuck on electronics for entertainment. During blackouts, I’d socialize with friends, maybe dance with music from a battery-charged radio.

Shopping is another animal all together. While in the States I loved coupon clipping (my vices were designer shoes and high-end beauty products) there is no such thing as coupons in Cabo Verde. It’s extremely difficult to get good quality shoes in my size. And you can forget about finding Clarins, Mac, or Dior cosmetics. There is not an array of clothing in different sizes. If you find your size, it fits, then you should buy it ’cause you never know when you might get lucky again. American clothes that are used or donated and then sold are abundant, but you have to be willing to pick through clothes on the floor at “bend-downs.” Some boutiques sell American clothes and housewares, but you’ll pay a lot more.

Food shopping is just as tricky. Since Cabo Verde doesn’t have many resources of its own and tends to be dry, the country has to import nearly everything, which makes groceries expensive. There are about two or three stores that brings in food items from America, but you can expect to pay for it. Doritos brand salsa might be about $4 or $5 a small jar; a box of stuffing mix about $3; a bag of fresh celery, $5. The locally grown food (aka cimida de terra) can be more expensive than what you get in the store. Butter from the countryside, for example, might run you $5, but packaged imported butter around $2. Meals out can range from just about $3 US at a home-cooked style restaurant up to more than $50 (with a cocktail) at a nice restaurant.

All of this is to say you learn how to manage your money, your resources and to save. People here spend a lot on parties and special events, and will start saving for them early. Six months before New Year’s Eve some people start planning financially for the money they will spend at the end of the year celebrations.

And Cabo Verdeans will save for big purchases like a smartphone, which can run $800 or more. I know one woman with an executive job at one of the ministries (so a well-paid government worker) who wanted a $500 smartphone, so she stopped buying bread in the morning and afternoon. While it was only a daily savings of about .50 cents, in six months she had her phone without spending extra money.

I saved enough to move back to the higher end neighborhood into a more reasonably price two bedroom ($350), where my electricity and water (cold and hot!) is about $50 a month. I now have a refrigerator, stove, plasma TV, and some furniture. Still working on the washing machine (clothes are washed by hand), but after a year of protesting, my husband even convinced me to get a housekeeper (something pretty common here) who comes three times per week to clean, cook, and wash clothes. This has really freed up my time to work more, leading to more income.

I didn’t really know what it was to economize until moving the Cabo Verde. I knew how to save money by looking for discounts, but when forced with a lack of consumer choices, it is a lot easier to save. And you learn to live will less–even though I do dream about Haagan Daaz every now and then.

You don’t have to leave the country to save on your expenses. There are a number of things you can do to scale back your lifestyle and even be happier.

“When we own too many things, the things end up owning us. Whether it’s the latest smartphone we’ve decided we can’t live without, the new outfits we insist on buying for every event, or the takeout we purchase several times a week, nothing is ever enough no matter how much we spend or how much stuff we collect,” Kendal Perez, savings expert with CouponSherpa.com, tells MadameNoire. “Living on less and making a conscious effort to enjoy what you own results in a more carefree lifestyle. It may seem counterintuitive to reduce the amount you own in order to desire less things, but it works. Realizing you can live the life you want with half the stuff in your possession is incredibly freeing.”

To achieve this feeling of freedom, start to discard the unnecessary. Begin with your home and finances. “Look around and identify those items that no longer serve you, and donate or sell them. Look at where your money is going and cancel or cut out anything that isn’t adding value to your life. An example might be a subscription (or two or three) to a magazine you never get around to reading, or an ever-increasing cable bill for hundreds of channels you rarely watch. You don’t realize how much these expenses and things are weighing you down until you get rid of them and suddenly find yourself breathing better,” notes Perez.

You can actually make some money on the things you throw away. “Remember that exercise equipment you bought at the beginning of last year? If it’s still collecting dust in your garage, start listing items on Craigslist. Warmer weather is a great time to plan a yard sale. Team up with your neighbors to make it a block party. You’ll attract more customers if there are multiple households involved, and you can split the marketing costs and/or responsibilities… Sell old smartphones at sites like ebay, Gazelle or trade-in at Amazon. Finally, check through your closet for clothes that you haven’t worn in a while but are still in great condition. Check out online consignment shops such as thredUP, or sell it on your own through clothing resale apps like Poshmark,” suggests Regina Novickis, consumer expert at Slickdeals.

But don’t go thinking it’ll be easy at first. You will miss your luxuries. But the ultimate result is worth the sacrifices.

“It’s a struggle to let go of how you’ve lived your life up until this point, especially if you’re lifestyle includes buying what you want, when you want it, all the time,” says Perez. “It’s certainly a sacrifice to change your habits and stop indulging yourself on every purchase, especially if your social group or significant other isn’t on board. However, once you tune in to the value of saving money over spending it and discover how amazing it feels to have the money to cover an unexpected expense or go on a dream vacation, you’ll quickly find the feelings of struggle and sacrifice aren’t nearly as strong.”

Where Have All the Women Entrepreneurs Gone?

December 16th, 2011 - By Charlotte Young
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female entrepreneur

Looking for the women business starters? Try Ghana. Fifty-five percent of the entrepreneurs in this West African country are women, the only country with more female entrepreneurs than male. In the US, women comprise almost half of the entrepreneurs, but the Washington Post reports that a study shows that western women are less likely to start businesses than women living in emerging economies.

The study was conducted by Global Entrepreneurship Monitor and Babson College using 90,000 women in 59 countries. Women entrepreneur levels varied across all of the countries, from the high level in Ghana to only 16 percent in South Korea.

There are several factors in play behind a woman’s choice in taking on business creation. The study finds that the economic situation of one’s country is one of the larger factors. Becoming a business owner in a developing nation is completely different than becoming a business owner in the US, parts of Europe or Japan. Business startups in developing nations generally require less financing as they are smaller and more necessity focused. Entrepreneurs living in countries such as the US tend to create more service-driven companies that demand a larger investment.

Next, women must consider motivation and need to create a business. Women in western societies often fear giving up a stable job in favor of stepping out on a dream, while women struggling to make money in developing nations simply create businesses to survive.

Lastly, women may also face a lack of role models. In countries such as Ghana, where there are so many women entrepreneurs, it’s easier to see and access the successful business entrepreneurs.  In the US, it may be harder to relate to another woman’s business vision and even harder to access the successful women at the top.

So it all boils down to location, job security and access. The most important thing is that women find enjoyment in whatever they choose to do no matter the position or country.

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