DOING IT THE BOAZ WAY

 FRIEDMAN IN INDONESIA: BOAZ OFFERS A NEW APPROACH                                              

There are 25 million poor in Indonesia living on AUD 3 a day or less. Should outsiders help and if so, how?

The answer’s clear for American economist Dr Charles ‘Chuck’ Nicholson who reckons governments should butt out of the aid business: “Public officials achieve little and tend to become perpetuators of bureaucracy.  They can’t address poverty – only individuals can do that.”

The self-styled "libertarian and definitely a free marketeer" says he’s spent almost 30 years refining his ideas and getting his principles to work in Indonesia.  Now he reckons he’s mastered a model that fits and that he plans to spread.

He runs Sunrei Food Products, a commercial dried fruit business in East Java linked to a training charity; together they’re The Boaz Project.  More of this later.

After teaching English in Indonesia, he returned to study.  His PhD thesis was on irrigation in Vietnam; he spent months seeing the defects of centralised control, hardening his anti-government resolve.

He became a disciple of the works of economist and Nobel Prize laureate Milton Friedman (1912-2006) and adopted his philosophy:

"We may want to help poor people. Not as a means of redistributing income but as a way of helping people who are in trouble and are poor. If possible, the ideal way would be through private activities and private charities.”

There’s a religious flavour in Nicholson’s venture though he says there’s no proselytising among the all-Muslim workforce and not a crucifix in sight. The hint is in the title. Boaz was an Old Testament landholder who helped the striving poor. 

This tale supposedly  implies the Deity wants Christian business people to use their resources “in a wise and generous manner.”  Said Nicholson: “Right and justice are the foundations of my goal. That thinking is also in the Koran.” 

Keeping governments at bay is impossible in a nation that strongly rejects the idea it’s socialist yet has more than 100 State-owned enterprises.

Sceptics would expect strife when Western faith-based idealism moves into a country with almost 90 per cent Sunni Muslims.  But it seems there’s no friction at Sunrei, probably because Nicholson’s style is respectful and he speaks Indonesian.

 His prime advice to foreigners should cheer academics frustrated that Indonesian classes are shrinking: “If you want to start a business here be flexible and patient; but first learn the language.”

And the politics: Nicholson was too diplomatic to comment but knows well the Republic is infamous for worsening KKN – Korupsi, Kolusi, Nepotisme.  The rule of law can be bent with an envelope while rogue officials shake down foreign ventures for taxes and controls not applied to indigenous ventures.

Covid crashed Sunrei’s already small annual profit from AUD 80,000 to below 10,000, yet they got through and completed a spacious and modern two-level plant. The products are packaged to Western supermarket standards and sold on-line, though not yet exported.

The factory is close to orchards on the slopes of the  Arjuno-Welirang stratovolcano that fills the horizon. The company is coupled with a local-run charity Yayasan Bina Manusia Seutuhnya (Building the Whole Person Foundation) to “advance a social enterprise agenda.”

YBMS trains staff to “increase work ethics, enhances interpersonal skills and raises competency in dealing with life issues.”  Nicholson insists these aren’t alien to local culture.

Sunrei employs women recruited through the foundation to slice and dry mangoes and men to heave and haul.  It’s seasonal work and they get the government-stipulated basic wage of around AUD 330 a month. The last call for workers had a queue of 200.

The whole outfit could be a showpiece for foreign investors who’ve been earbashed about potential by guys in ties who’ve never worn work boots. Ensuring Boaz will survive when Nicholson – now in his mid-60s - goes is an issue he’s pondering.

The project so far has cost AUD 1.64 million raised from about 300 US donors – some hoping their money will become an investment. Nicholson goes on speaking tours.  In a prospectus to find AUD 275,000 "for expansion," he nudges the right’s wallets:

“Government programs funded through taxation, burden unknowing citizens to provide benefits to others. Private donations … represent a fully transparent and fully voluntary method of addressing poverty. It provides the best way of contributing to the needs of those who have less.

“Only by reducing the costs of doing business will poverty-stricken areas attract investment and remedy generational poverty. The Boaz Project has a plan to reduce the cost of collaboration - the cost which is born by investors and businessmen (sic) when they attempt to work with those who are hard to work with.”

For populists that cost includes governments while pluralists claim they’re essential. Nicholson’s model might be worth a closer look by both sides. The poor need cash, not the ideologies of foreign aid donors.

First published in Indonesia at Melbourne, 20 September 2024: 

https://indonesiaatmelbourne.unimelb.edu.au/friedman-in-indonesia-boaz-offers-new-approach/