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Nike and its Partners Address the Challenges of Globalization in Rural China and Thailand

Submitted by: Nike Inc.

Categories: Community Development

Posted: Jan 20, 2004 – 11:00 PM EST

 

Company Establishes New Micro Enterprise Program in China and Launches Phase Two of Nike Village in Thailand

Jan. 20 /CSRwire/ - BEAVERTON, OR – Nike, Inc. today announced its first micro-enterprise initiative in China, expanding the company’s six-year-old micro-enterprise program to four countries in Southeast Asia. Nike will provide US$275,000 over three years to help fund a joint micro-enterprise program run by the China Foundation for Poverty Alleviation (CFPA) and Mercy Corps serving rural communities in Fujian province.

In addition, Nike recently launched the second phase of Nike Village in Thailand, a community development project that aims to stem urban migration and create income in rural communities. Nike will invest an additional US$150,000 over the next three years for Nike Village. Both programs address the challenges of globalization and use micro loans as a catalyst for economic development.

Partnership with Mercy Corps and the China Foundation for Poverty Alleviation In China, Nike’s donation will be used in Fuan County, situated in Fujian province, to provide credit for the poor in rural farming and fishing communities, who do not have access to credit through formal financial institutions. In addition, through its donation, Nike and its partners will offer vocational training and education to loan recipients. Programs will include purchasing and negotiation, project management and marketing classes. Thirteen contract factories employing approximately 30,000 workers manufacture apparel, footwear and equipment for Nike and its licensees in Fujian province.

"Nike is about sport, but we also recognize our responsibility as a global company to address our impact in the communities where we live, work and play," said Robert T. Speltz, Nike’s Director of Global Community Affairs. "It is our intention to participate in the communities where we do business and to act as a catalyst to improve quality of life through job creation, employee involvement, contributions and partnerships."

Over the three-year period, the goal is for the initiative to evolve into an independent, self-sustaining micro-finance institution in the Fujian province. According to Mercy Corps and CFPA, it is expected the micro-lending institution will serve a client base of over 8,000 beneficiaries and aim to increase the average annual income of the target population of loan recipients by more than 85 percent by the end of the four years.

"Mercy Corps and CFPA have been working together in China for several years to build capacity and develop financial resources for our micro finance program," said Ells Culver, Senior Vice President of International Relations and Co-founder of Mercy Corps. "We welcome the partnership with Nike to further our ongoing efforts in helping rural farmers in China address limited access to economic opportunities through small business development, training and poverty alleviation programs."

Nike Village
In Thailand, Nike has renewed its partnership with the Population and Community Development Association (PDA) to expand the Nike Village Development Project (Nike Village) in the Chakkarat district, near Nakhon Ratchasima province through July 31, 2006. PDA is helping build networks of smaller factories in rural areas – enabling more families to stay united because they are able to stay home and find meaningful work.

While Nike contract factories utilize a number of remote stitching centers in Thailand, the Nike Village is the only one where local manufacturing is complemented by local enterprise development via micro loans.

During Nike Village phase one, Nike donated US$200,000 and worked with PDA and Nike contract manufacturing partner Union Footwear (UF) to create a community development project in Chakkarat to provide jobs and reduce migration to Bangkok. Through the creation of small stitching centers in the community, Nike Village offers about 500 villagers, primarily women, the opportunity to return to their homes and families from jobs once held in Bangkok. Phase two will focus on income generation, education and individual empowerment as well as the continuation of projects initiated in phase one of the program. In addition to micro loans, components of phase two will include: a mobile AIDS unit; environmental reforestation to promote forest conservation; school lunch programs; mini-farms that produce high-quality products via the utilization of limited natural resources available; sports activities and facilities; and development and training programs for women.

The Importance of Micro Enterprise
By providing access to credit, micro lending plays an important role in the fight against many aspects of poverty. On average, loans range from US$50 to US$200 and help individuals engage in farming activities or grow small businesses. Typically, recipients of micro loans are self-employed and home-based entrepreneurs engaged in small income-generating activities. In most countries, the majority of micro-loan recipients are women.

Since 1997, micro enterprise in Southeast Asia supported by Nike has played a small but important and direct role in building the number of locally-owned businesses in the region. Nike has funded micro loans and provided technical assistance in Thailand, Vietnam and Indonesia, working with Population and Community Development Association, Vietnamese Women's Union and Opportunity International, respectively. Through Nike’s commitment to micro enterprise, loans, typically of US$100 or less, have reached a total of nearly 15,000 largely female borrowers. Nike has distributed over US$2 million in funds over the last six years and supported small businesses such as small livestock farms and businesses producing basic goods including rice paper for spring rolls and incense sticks. Through Nike’s micro-enterprise program, the company hopes to create self-sustaining institutions through permanent endowments.

About Mercy Corps
Mercy Corps is an international relief and development organization based in Portland, Oregon that exists to alleviate suffering, poverty, and oppression by helping people build secure, productive, and just communities. The agency now operates in more than 30 countries reaching five million people worldwide. In 2001, Mercy Corps and CFPA formed a strategic partnership in which Mercy Corps would build capacity and develop financial resources for the micro finance program.

About the China Foundation for Poverty Alleviation (CFPA)
Established in 1989 and based in Beijing, CFPA is a non-profit organization registered by the Ministry of Civil Affairs and whose operations are permitted by the People’s Bank of China. In order to achieve its goals of poverty alleviation and sustainable development, CFPA raises funds and provides training to the poor, helping increase their productivity, lifestyle, and health.

About Population and Community Development Association (PDA)
PDA is a non-profit organization that operates a wide variety of programs designed to serve and assist the rural poor of Thailand. These programs cover such diverse activities as free vasectomies, income generation programs at village level, forest replanting schemes, vegetable banks, industry relocation into rural areas, mobile health clinics, environmental education programs, and a democracy project.

About Nike
NIKE, Inc., based in Beaverton, Oregon USA, is the world's leading designer and marketer of authentic athletic footwear, apparel, equipment and accessories for a wide variety of sports and fitness activities. Nike focuses its philanthropic effort on two key areas: bringing the benefits of physical activity to young people, and investing in innovative solutions to the challenges of globalization faced by women and girls. Each year, Nike targets to give three percent of its prior fiscal year’s pre-tax profits to charitable organizations around the world. In fiscal year 2003, Nike donated more than $30 million in cash, product and in-kind contributions, meeting its three percent goal for the third consecutive year. For more information, visit www.nikeresponsibility.com.

For more information, please contact:

Margaret Larson Mercy Corps
Phone: +1-425-746-2674
Jill Zanger Nike, Inc.
Phone: +1-503-532-0316

 

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