Michael Otto has been awarded the Walter Scheel Prize for his commitment to development cooperation. The Federal Ministry for Economic Cooperation and Development presented the Hamburg businessman with the award for founding the Aid by Trade Foundation and the Cotton made in Africa initiative, which seeks to improve the living conditions of African smallholders.
The Aid by Trade Foundation pursues an innovative development cooperation goal: instead of sending donations to Africa, its Cotton made in Africa initiative provides help for self-help through trade on the principle of "social business". It has created an alliance of international textile companies that purchase and process sustainably grown African cotton for the world market. The initiative improves the living conditions of around 240,000 African smallholders in this way. Michael Otto, who started up the Aid by Trade Foundation in 2005, is currently chairman of the Foundation's Board of Trustees.
The idea for setting up the Foundation and the initiative came at the fifth WTO Ministerial Conference in Cancún in 2003. The negotiations there had stalled because of protests by African states against distortions in trade caused by farming subsidies. In order to rectify this injustice in global trade and to improve the income of cotton growers in Africa, Michael Otto created the Cotton made in Africa initiative and the Aid by Trade Foundation.
The prize was awarded for the first time this year on 26 May 2011 in Berlin in the presence of former president Walter Scheel, after whom it is named. It is given to individuals and organisations performing particular services to development in society. The other recipients apart from Michael Otto were Ulrich Wickert for the non-governmental organisation Plan International, the retired German women's footballer Nia Künzer, and the Ethiopian business consultant and writer Dr. Asfa-Wossen Asserate.
James Shikwati, known for his criticism of classic development aid, is to join the Board of Trustees of the Aid by Trade Foundation. The founder of the Kenyan Inter Region Economic Network supports the Foundation's innovative development approach: the Aid by Trade Foundation does not transfer any financial resources to Africa but helps people to help themselves through the Cotton made in Africa initiative.
The Aid by Trade Foundation has recruited the Kenyan market economist James Shikwati to its Board of Trustees. "I support the Foundation's initiative to offer an opportunity to African smallholder cotton farmers to connect to global markets," he says. "I believe that those who want to help Africa should trade with the continent and support value added production there."
Members of the Board of Trustees of the Aid by Trade Foundation include leading international figures from environmental associations, the public sector and private business. Chaired by Michael Otto, it ensures the long-term pursuit of the Foundation's overarching aims of improving the social situation in Africa and promoting environmental protection.
The Aid by Trade Foundation further expands the Demand Alliance for its Cotton made in Africa initiative to the USA: Anvil is the first North American apparel manufacturer to join. The additional demand from this textile company for sustainably produced cotton will significantly help grow the program.
The Cotton made in Africa Demand Alliance continues to grow. With Anvil the network gains a further textile manufacturer that places a very high priority on its corporate responsibility. Anthony Corsano, Chief Executive Officer of Anvil Knitwear explains the deepening of the company's sustainability strategy: "Cotton made in Africa is another source of sustainable fiber for Anvil. It is rain fed, utilizes principles of soil conservation, reduces pesticides, and incorporates important ILO labor principles. We also hope our purchases help African smallholder farmers improve their own living standards." Headquartered in New York, Anvil Knitwear produces sportswear and accessories under the Anvil® brand and for major private label brands. Anvil has earned its reputation in the textile sector as a transparent sustainability pioneer, marketing its sustainable projects through its AnvilOrganic® and AnvilSustainable® collections.
SUSTAINEO is the name of this strategic initiative which strives for a stronger involvement of global market dynamics in development approaches to enable smallholder farmers in coffee, cocoa and cotton to improve their income and living conditions.
On Tuesday, 19th of April 2011, an alliance of the renowned entrepreneurs Dr. Michael Otto, Dr. Christian Jacobs and Michael R. Neumann was officially announced in a press conference held in Hamburg. SUSTAINEO is the name of this strategic initiative which strives for a stronger involvement of global market dynamics in development approaches to enable smallholder farmers in coffee, cocoa and cotton to improve their income and living conditions. Furthermore, SUSTAINEO aims to establish a strategic dialogue with policy makers. An intensive exchange of experiences between the foundations Hanns R Neumann Stiftung, Jacobs Foundation and Aid by Trade Foundation is foreseen to continuously improve the quality of work and document its impact.
Population growth, surface erosion and other use of cultivated areas make the supply of agricultural products a major global challenge. At the same time, the production of coffee, cotton and cocoa is of outstanding economic and social importance to many developing countries. Approx. 250 million people are depending on the production of said commodities which are primarily grown in poor rural areas. A professionalization of the entrepreneurial activities of smallholder farmers is a great opportunity to increase the typically very low income achieved.
"The demand for sustainably obtained products is going to increase more and more. By pooling our strengths in form of an alliance, we want to achieve that especially smallholder farmers contribute to the required supply volumes and benefit from an increasing demand by means of more productivity and better access to markets", states Dr. Michael Otto.
"In the project work of our foundations, we encounter comparable social and economic framework conditions and challenges when it comes to implementation and achievement of our objectives. In order to be able to enhance efficient and sustainable development cooperation we want to place our projects at new quality levels", says Michael R. Neumann.
"It is substantial to provide access to education to the children of smallholder farmers and to allow the communities to recognize education as necessary prerequisite for economic advance. It is this approach that I want to anchor more firmly by establishing SUSTAINEO", states Dr. J. Christian Jacobs.
SUSTAINEO was warmly welcomed by the Minister of International Development Cooperation of Germany, Mr. Dirk Niebel.
Education is the key to sustainable development. This is why the Otto Group is making a financial contribution to a social project established by the Cotton made in Africa Initiative to promote adult literacy.
This Public-Private Partnership project receives major support from the Otto Group and offers some 5,000 adults in the Central-South region the opportunity to learn to read and write in evening school. "Improving the literacy rate is one of the key factors in establishing a sustainable development process", is how Andreas Streubig, Otto Group Director of Environmental and Social Policy, explains the company's engagement.
The project was established in the autumn of 2009 within the framework of the Cotton made in Africa Initiative, together with the fashion company Apart, the German Society for Investment and Development (DEG) and German Agro Action. The illiteracy rate of around 71% has an extraordinarily high impact on the economic development of Burkina Faso and also poses very specific challenges for the smallholder farmers who participate in the Cotton made in Africa initiative: many cannot enjoy the potential benefits of the educational courses on offer because they cannot make notes or even read the course materials. Here, the literacy project helps people to help themselves.
Cotton made in Africa is not only committed to the sustainable cultivation of African cotton but also sees itself as an intermediary for a number of Public-Private Partnership projects. These PPP projects are characterised by companies and public organisations bundling their resources in order to strengthen social infrastructures in Benin, Burkina Faso, Côte d'Ivoire, Zambia and Malawi through social projects.