Rural Investment Overseas Ltd (RIO)

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During my closing years at CDC the aid programme as a whole came under increasing criticism from intellectuals who warned of 'aid dependency' and advocated alternative uses for the funds. The main proponent of this theory was a Professor Peter Bauer at the LSE, an adherent of the Chicago school of economics which had become dominant with the arrival of Mrs Thatcher. Additionally, CDC was coming under direct attack for its involvement in an oil palm development in the Philippines which several human rights organisations claimed had used strong-arm methods to clear farmers from the plantation area. As Head of External Relations representing the Executive Management Board, it fell to me to counter these attacks on both fronts. My principal platform for an arm's length duel with Peter Bauer was my lecture to the Royal Society of Arts, an august institution founded in the age of enlightenment, by William Shipley and much supported by Benjamin Franklin, with the purpose of finding citizen-based solutions to social problems. Since 1754 it has been at the forefront of innovation, as a bridge between individuals and questions affecting their communities and corporate undertakings. As a result of this lecture, I was invited to become a Fellow, which provided some extra leverage in the debate.

In both these crusades, I became aware of a strong defender of our position, Dr John Meadley, an agriculturalist with a PhD in plant pathology and strong overseas experience in Southern Africa. My esteem for his abilities grew as we found ourselves advocating appropriate forms of development based on whatever the peoples and soils of the poorer countries could support, with the assistance of patient capital and responsive management. Our friendship developed alongside our collaboration, which became directed towards his establishment of a company that would promote such development opportunities. RIO was to be in fact a microcosm of CDC, a generator of development projects prepared for investment by those whose business it was to provide long-term capital. Shortly before my retirement, John invited me to become RIO's Chairman. Thus began a joint endeavour which was to take several forms and last for the next 15 years.

John had done a great deal of research and travelled extensively. He had made a detailed study of project opportunities in the agricultural sector in Thailand and discussed these with the Thai Bank for Agriculture. The route from grower to middle man to market lay fully mapped out, complete with incentives to be built in at every stage. Sadly, the Asian financial crisis intervened to thwart the whole plan. But contacts had been made in other areas of the system and it was not long before we were able to design a venture capital fund which was not confined to agriculture but would operate across all sectors. Detailed discussions began with a handful of interested Thai banks and the plan started to assume a well-defined shape. By now its size and reach had become substantial, and the institutions felt that an experienced venture capital specialist would need to manage the scheme. American sources directed us to a Californian venture capital firm with whom to complete negotiations.

These 'negotiations' proved a Kafkaesque experience. We went into them with complete openness, but found our putative partner obstreperous at every step. One became used to

midnight calls demanding new areas of irrational 'due diligence' or contesting points already agreed. We never knew what lay behind this prevarication or who could possibly benefit from it. With great good fortune we received tremendously loyal support from Robert Williams, CDC's Chief Legal Adviser who had retired around the same time as I. But in the end we just ran out of time and our Thai partners out of patience. However, these were instructive lessons, and we at least gained an insight into venture capital. As a result, we were able to apply the principles, shorn of their exquisite Californian tortures, to 'retail' development finance, ending up with models which looked remarkably like CDC's earlier operations in this field. In fact, we were eventually able to design venture capital funds for Ghana and Tanzania which were then taken on as CDC operations and supplied with the capital they needed.

Another organisation active in this area was EDESA, a Swiss-based development fund which had particular interests in Zimbabwe. Its Managing Director, Rene Gerber, became interested in RIO's activities and decided to invest in the company, eventually taking over from me as Chairman. As we worked together, we found areas in which our operations could mesh. I was able to design an investment fund for EDESA in Zimbabwe, and assist John with a similar venture capital plan in Portugal. In addition, we launched a sister company called Farm Services Company, which provided technical and marketing services for existing enterprises.

Predictably, there came a point when many of these activities had run their course. The countries with which we had special links were fully served and RIO was increasingly forced to look for contracts from governmental sources. This made John Meadley into a consultant, whilst clients were oblivious to the extra benefits they were getting from RIO's corporate structure. RIO, effectively a group of friends, was dissolved. It had been a courageous attempt to augment, on a small palette and with only minimal capital resources, the essence of what CDC was traditionally doing in grand style. And for fully 15 years we had been able to do that, until history surpassed all our endowments for that task.

John has since applied·his uniquely imaginative approach to other unsolved problems, becoming a widely respected consultant on development matters and making a dramatic breakthrough with provision of sanitation in India. His greatest achievement to date, however, is on home ground, with the founding of the Pasture-Fed Livestock Association, a major turning point in animal husbandry which is weaning farmers off feeding their cattle with expensive and wasteful grain, to go back to browsing on natural pasture. His elegant solutions to problem solving, as well as the friendship with him and his equally gifted artist wife Fiona have added much joy to my life.

The RIO team, John Meadley centre with wife Fiona Kam and son Thomas