It is a country that has high levels of poverty and inequality and asks its citizens on the very first page of the national census if they use a hole in the ground or open cesspit for a toilet. Yet despite all of these obstacles, the Brazilian government has embarked on the world’s first fully digital national census.

It has achieved this ahead of countries like the US whose digital trials failed and resulted in it reverting to an old-fashioned paper based census. The Brazilian census is another example of how developing and emerging countries are using technology to address the challenges they face and leapfrogging developed countries. Click here to see a picture slide show of the socio-economic and political issues of the Brazil 2010 census.

The Brazilian Institute of Geography and Statistics (IBGE), who conducted the survey, opted for off the shelf technology. It ordered 150,000 LG 750 GM smartphones which are widely available and retail at around £180 (US$280). Census interviewers collected responses onto the smartphones which in turn were used to send the data via GPS to one of 7,000 data collection units.

The Brazilians say that the digital census has several advantages over paper and pen methods. They say that the data is more accurate since GPS data will pinpoint the exact location of a household. The GPS data is cross-referenced with satellite images to ensure that responses are correctly geo-tagged. The digital approach allows changes to areas, streets and buildings to be incorporated. This is particularly pertinent in the slums as these areas tend to change quickly and their density mean that printed maps are quickly out of date. The use of digital technology means that mapping is considerably more accurate and that adjustments and changes can be made all the time to ensure that the coverage is as comprehensive as possible.

IBGE estimates that upto 5 per cent of households are incorrectly located in traditional censuses compared with 0.5 per cent of digital data. The census allows data to be collected from remote areas with digital data collection being easier and more robust than paper-based ones. It will ensure that previously hard to reach communities are included in the census for the first time.

The mapping technology also allows for more detailed information on the spatial distribution of public resources such as schools and health centres relative to the density and need of the people and communities around them. The census is also considerably cheaper and is environmentally friendly with the need for paper reduced to a minimum. The budget for the entire survey is R$ 1.67 billion (US$909 million) for a population of 58 million households. Compare this with the US where CNN.com suggests its census will cost US$14 billion for a population that is just one-third greater than that of Brazil’s.

Technology experts say that the US’s digital approach failed because Harris Corporation, the organisation hired for the job, failed because it looked to develop a bespoke hardware device to collect data. Brazil on the other hand had only to develop bespoke software and applications for its computers and smartphones.

Asked about the security and reliability of the data collection, Eduardo Nunes, IBGE President said that data is collected and backed up on the smartphones on two separate memory drives and that data transmitted to collection centres is immediately backed up with integrity tests. Mr Nunes said interviewers experienced little resistance not least because where possible they were recruited from within their communities. He added that paper censuses can get lost too and that their approach had been tested on other surveys since 2007. IBGE

IBGE will also benefit from the faster turnaround of data with the first tranche of data available in months rather than years.

The Government has invested in the digital approach not only to save money but also because it will be central to designing better public policy.

Mr Nunes said: “ Greater emphasis in the 2010 census was given to information on social and demographic spheres. We want to know when and how Brazil will be able to reach the Millennium Development Goals for 2015.”

Marcia Lopes, minister for Social Development said that many social programmes bring basic services such as electricity, health and education to the population: “This census is so important because we in the Government need to know what the population needs.”

Click here to see a picture slide show of the socio-economic and political issues of the Brazil 2010 census.

The report challenges the large supermarkets who are cashing-in on a boom in tea sales to insist on better pay and conditions for estate workers.

As well as linking to the WoW site – this gives me an opportunity to link to Tom Heineman’s excellent award-winning documentary, The Bitter Taste of Tea, on the not so fair practices of Fairtrade certified tea estates. His investigation found that Fairtrade tea estates were not passing on the premiums to the workers as Fairtrade certification states it ought to and serves to remind us that we all ought to read behind the headline message.

The documentary has been broadcast in a number of European countries and was the motivation behind some work that I produced a little while back

The plan is to get 110 million of these units into the hands of school children in India. But this got the alarm bells ringing. I interviewed Nicholas Negroponte, (apologies if you get The Times’ paywall/registration page) the brains behind the One Laptop per Child programme to get a laptop into the hands of every child in developing country, a couple of years back. There were issues with production and take up. His units are far simpler and a lot less sophisticated and still they cost $100 a piece. He’s also announced a tablet for $75 but this is scheduled for 2012.

In a devastating critique, Mike Elgan of ComputerWorld, explains exactly why the $35 is nothing more than government hype and in Elgan’s words:

The $35 tablet announcement was nothing more than shameless political opportunism. The world’s media were suckered (again) — hook, line and sinker.

The whole affair is a shameful, disgusting spectacle that represents everything that’s wrong with politics, the media and public gullibility in the new idiocracy.

Cheap computers are nice. But what we really need is a little common sense.

Put simply, he says that the components alone would cost well in excess of the announced price. He points out among many other things that the cost of a screen is $35 alone and these would have to be imported from China as they are the leaders in manufacturing such components.

Negroponte did offer some interesting anecdotes about the OLPC programme in Latin America. He said that not only were the kids learning but that they in turn were teaching their parents to use the computers and that some were then using them for their own businesses.

There’s no questioning the importance of bridging the digital divide but one might argue that it’s the folks in developing countries who need a lesson or two on what is and is not feasible in a digital world.

Below is a video that might help. This is not real – it’s only an advert. Peugeot have not moved their production facilities to India . . .

Here’s an experiment with pictures and video. I recently went to Valencia and looked to capture the city with a loose brief of Street Art and the things the tourist board would not want you to see.

There was a fantastic exhibition called Mean Streets at the Valencian Institute for Modern Art which presented representations of cities through video, music stills and film. It inspired this little experiment.

Stills taken on a rather restrictive 50mm lens on a Nikon D80. The video was shot on a £100 Sanyo Xacti. All edited on the ludicrously simple to use iMovie on the Mac.

Go full screen and crank up the volume.

In an excellent article in the Huffington Post, Lewis makes the point that Barack Obama’s criticisms of the “bandits” of Wall Street (in the run up to passing stricter regulation of banking practice) are just as applicable to the profit-seeking microfinance business.

He explains why the neat solutions offered by microfinance are attractive but that the reality in many cases is predatory behaviour, exploitation of the poor and misuse of the market and funds.

“Microfinance is not a cure-all, an economic development elixir. Microfinance does not build roads, schools or clinics; it has not stopped a war or cleared a mine field, nor does it preserve pristine rivers, protect endangered species or restore cultural treasures.

The public brand of microfinance is impoverished micro-entrepreneurs, mostly women, valiantly raising families while operating tiny businesses. For a nation [US] whose self-image extols the self-made man, the maverick Western sheriff and the college drop-out who becomes the richest man in the world, the narrative is seductive. It converts the self-employed poor, victimized by the formal economy, into an icon of economic opportunity.”

One interesting by-product of all the recent criticism is position taken by Muhammud Yunus of Grameen Bank who is quoted in this article. He is trying to distance himself from this criticism by balling out other banks as excessive profit takers. But he has failed to respond to criticism of his own organisation and the overblown claims of microfinance that he continues to peddle.

As I have recorded, there are increasing critiques, exposes and research papers which seriously question the claims of microfinance, its supporters and banks. It will be interesting to see how Yunus positions himself as what Lewis calls the, “whiff of hypocrisy and the odor of malfeasance” in the sector becomes a huge stink.

Were you surprised or did you chuckle at the thought that people in developing countries might be able to help those in developed? Well the author (who is from a developing country) says that this is is just plain wrong and I would agree:

“Design for the First World shouldn’t be funny. The phrase “Third World minds design­ing for First World Prob­lems” pro­vokes smiles in many includ­ing myself. But why is it funny? Why do we assume that Third World minds shouldn’t be involved in the prob­lems of the First World? In all hon­esty and bold­ness I think we (the Devel­op­ing World) have grown accus­tomed to the top help­ing the bot­tom and because of that we’ve grown lazy. We don’t even think things can be both ways. We can help them! I believe there is a need to re-educate our­selves as devel­op­ing coun­tries and gain agency.”

We’ve been working on a documentary which looks at the transformation and regeneration of Brick Lane and Shoreditch in the East End of London – especially through art, migration and gentrification.

It’s a very hip and trendy area (disclosure – I live there!) and has attracted many people over the centuries. Historically, it has always been an area where migrants have settled – from the Huguenots in the 18th century to the Jewish community in the 19th and 20th centuries to the Bangladeshis in the 20th.

Now we have the street artists, economic migrants, and fashion victims all rubbing shoulders in the area.

The spoils from the area’s recent gentrification are not equal. Some have opened businesses and are making a fortune despite the economic recession. In fact – I reckon there are more businesses open here now than before the economic crash.

But, scratch the surface, and you’ll find people living in desperate conditions. We met a group of Romanians who were living in a condemned building which was barely 12 square-metres in size. They were working for a local businessman and when the work was done – they were told to bugger off.

At the same time – the vibrancy of the area comes through in many ways. A very public version is through the street art. Six Oranges has been working with local street artists in the creation of a documentary to record and capture a snapshot of this change.

We’d sought permission to get a Belgian street artist by the name of ROA (who by the way is a really decent and humble guy)  to create the largest piece of street art in London. He completed it this week and it really is a stunning piece of work. It literally stopped the traffic. We got a piece in the Evening Standard about it.

But like the area, street art is transitory, a place where things come and go to be replaced by someone or something else.  And this piece will disappear when the site is used to build a hotel. I really suggest you go and see it (Hanbury Street) along with the other street art there. I will be offering tours in the near future.

The article highlights lots of examples where microfinance is leading to interest rates as high as 130-40 per cent – way above mainstream market rates.

I was alerted to the article by an industry insider who has become disillusioned with the way things have gone in the sector. He also suggested that I investigate further the practices of the largest Nigerian microfinance firm LAPO (Lift Above Poverty Organisation) which is mentioned in the article. The author, Neil MacFarqhar, says that LAPO charges some clients rates in excess of 100 per cent despite criticism of its practices. My insider contact says that LAPO has too many high profile investors and that the risk of failure has become too big for its backers – hence the deafening silence from key investors such as Grameen.

Most of the backers, including Grameen which provided multi-million US dollar loan guarantees to LAPO, are aware that the organisation is acting illegally (practices are explained in the article), yet nothing has been done to address this situation.

I’ll be writing about this deal in greater detail over the coming weeks and months as my insider suspects that there is a much bigger story here.

The MacFarqhar article shines a light on the way in which the sector has grown rapidly as hot money tries to find higher rates of return than the paltry rates on offer in the mainstream financial sector.

This money is going into a sector where legislation and regulation is poor at best. The market is supported by an almost religious like belief that microfinance can be used to lift millions out of poverty despite the there being such little evidence to support this.

The question I’m going to put to Grameen is: “What are you doing to prevent usurious rates of interest in organisations that you support and what will you do about LAPO’s illegal savings scheme?”

Watch this space.

A survey of 50 VC and PE firms in India found that three-quarters of the respondents fear the sector is getting ‘‘overhyped to a bubble-like proportion’’. It says that microfinance is one of the most attractive financial sectors in India but cautions that there is too much money chasing firms in the sector. The research also says that there is a danger that borrowers are simply taking out new loans to pay off old ones.

One PE manager says that there is a real sub-prime situation in microfinance with asset inflation and over valuations. He adds that the 40 per cent expected returns are not realistic and that a good concept will turn ugly.

This sounds really familiar. Let me think . . . when did we last have an asset bubble where too much money was chasing too many bad borrowers while agents profited from fees? Ah yes, that’ll be the sub-prime crisis from 2007 when the world economy was brought to its knees – hard to forget that really. It’s only a matter of time before the microfinance bubble bursts.

Not that there is a shortage of cash going into the sector – not while there are millions to be made. The Economic Times of India reports that SKS Microfinance chairman Vikram Akula has part sold his stake in the company making a 12-fold profit before the bank’s initial public offer (IPO). Other senior bank staff have also sold shares to realise handsome profits which are thousands of times greater than the microfinance loans offered.

The bank’s IPO is highly contentious. By floating the bank, management will be accountable to profit seeking shareholders rather than making sure that the poorest households are no longer financially excluded. The theory behind microfinance being a tool for poverty reduction has its flaws but the dangers of the poorest being exposed to private credit and shareholders is even scarier to say the least.

There’s very little mention of poverty reduction in many microfinance stories these days and is perhaps a reflection of the real concerns of the sector.