Social entrepreneurship & finance

Tag ‘ argentine ’

CEGIN: The video report!

June 2, 2009 | Comments Off | Enterprises, Videos

Through the use of his CEGIN clinics and his SER system, Doctor Gronda aims at providing quality healthcare to the people at the base of the pyramid. By treating over 40 000 patients, CEGIN contributes to the development of the most marginalized communities of the Jujuy Province in Argentina. As labor force is the main working tool of the farmers in rural regions, access to healthcare constitutes the basis of economic and social development.

For more information, read CEGIN’s profile

Fair Street - CEGIN from Angalio Productions on Vimeo.

CEGIN: Healthcare for all

June 2, 2009 | Comments Off | Enterprises

After problems faced by cartoneros, education and water access, Fair Street’s third report puts forward a doctor who seeks to provide the poorest of people with access to healthcare.

Problem: healthcare

In our previous report, we focused on the essential role played by education in economic and social development. Health must be considered as a second fundamental factor in constructing a sustainable future. One cannot imagine a country adopting a development policy which does not seek to improve access to healthcare services. For rural populations, whose workforce is often the main production factor relied upon for agriculture, good health is an essential basis for any progress to be achieved. In far-off regions, particularly, women and children suffer from difficult living conditions; one of the UN Millennium Development Goals is to reduce by three quarters the maternal mortality ratio by 2015. The Juyjuy Province is especially affected by this problem, with a maternal mortality ratio ten times higher than in France.


In Argentina, over half of the population does not have access to social security. But even those whose work status allows them to enjoy social security benefits often choose in addition to subscribe to a private health insurance. This is because of the inefficiency of the public healthcare system, and for this two main causes are identified. First, it is decentralized and managed at the level of provinces, which leads to strong differences between regions in Argentina. Moreover, as the State is unable to offer a complete set of solutions, workers unions tend to create their own obra social (social security), which also causes irregularities and many organizational problems. The Argentinean population thus has two options: either to resort to private healthcare systems, usually too expensive for the populations at the base of the pyramid; or to use available public services and consequently accept its inefficiencies and waiting lines that can last up to several days. But this time spent waiting prevents the patient from working, and providing for the needs of his family.

The company:

CEGIN (Centro Ginecologico Integral) is a medical center founded in 1989 which specializes in the provision of medical services to poor women from rural areas. The CEGIN center manages to offer quality services at half of the market price! In order to achieve such results, their strategy is based on the use of the economies of scale. The medical industry is faced with very high fixed costs (equipment, infrastructure…), whereas the additional cost of a new client is actually relatively low. The CEGIN center therefore targets a very large number of patients in order to spread its fixed costs. By working many hours and treating a large volume of patients (40 000 total), the center can thus guarantee a quality service whilst achieving lower rates of consultations. Rather than offering free services, the CEGIN approach is to charge the patient a low — but fair — cost. They have come to realize that the patient feels more dignified that way, and in consequence is treated with greater respect by doctors.

Five years ago, Jorge Gronda launched the SER system within the CEGIN center. It is a membership card that patients can purchase for 10 pesos (€2) per year which gives them access to the 60 CEGIN medical practices. By presenting this SER card, patients enjoy preferential rates in CEGIN centers that charge less than half of the market price for medical services (for example, an ultrasound scanner costs 20 pesos in CEGIN centers, instead of 50 pesos normally). The main idea behind the SER card, beyond increasing access to healthcare, is to create a network that will later allow its members to enjoy various advantages. By creating this network, and taking advantage of its high amount of members, the SER system can have a considerable influence on shopkeepers in the Jujuy Province. Currently, card holders already enjoy discounts in some pharmacies, and in the long term, Jorge Gronda’s ambition is to develop a system of “social franchise”, and extend the SER card’s field of action to various fields such as food, construction and transports. His aim is that necessary fundamentals for a decent life be accessible at low cost for all the people living at the base of the social pyramid.

The entrepreneur:

Jorge Gronda is a doctor originally from the Jujuy Province. First active in the public sector, he left it over 25 years ago to found CEGIN. Tired of the public healthcare system’s many gaps, he launched the CEGIN initiative with two motivations: first, he wished to offer quality healthcare to those at the base of the economic and social pyramid; and second, he wished to reduce the distance between doctors and patients. Jorge Gronda’s has earned much recognition and gratitude for his work. He was first elected Entrepreneur of the Year by the Schwab Foundation in 2005, he then received the United Nations Development Prize, and he was finally invited to share his vision of the future at the Davos World Economic Forum in 2008.

Social impact:

The social impact of CEGIN and the SER system is obvious, and can be summarized as follows: to allow the people at the base of the pyramid (by definition, those who do not have access to social security) to have access to quality healthcare. Nowadays, over 40 000 people are followed by the CEGIN clinics (including 20 000 through the SER network). Over 10 000 biopsies are carried out each year in CEGIN clinics, which is estimated to have prevented the development of more than 300 cancers.

Nonetheless, Gronda does not limit himself to the provision of healthcare services. Instead, he takes an interest in acting out of consideration for the poorest of people. During his interview, Gronda insisted several times on the important role of the SER card. First, people pay in order to subscribe for this card, therefore valuing it more than if they received it for free. This requirement has a direct impact on the level of the care they receive, as they are more inclined to share information on their health that facilitates the work of their doctors. Second, belonging to the SER networks and enjoying quality healthcare services considerably increases the self-esteem of people suffering from social exclusion. Thanks to the satisfaction of SER clients, Gronda has never had to publicize his system. The pride they take in being part of this network encourages people to talk about it in a positive way, and this word of mouth has proved to be an essential contribution to the development of CEGIN.

Financial impact:

 Support from a fund: Gronda is currently attempting to finalize negotiations with a European fund. Because of a confidentiality clause, we are unfortunately unable to divulge its name. The financial contribution from this fund should allow the consolidation and extension of the SER network. The objective is to extend the number of members from 20 000 to 50 000 over the next five years. According to Gronda, such financial support from an external organization is necessary in order to achieve this objective.

Use of microfinance: 80% of health problems can be resolved with an SER card and the consultations at half price that it allows. However, some serious problems require much more expensive surgery. In these cases, CEGIN uses the benefits of micro-credit in order for its clients to afford these operations. The most common operations they have to carry out cost on average 3 000 pesos (€ 600 +/-). A micro-credit fund financed and managed by CEGIN allocates credits equivalent to the costs of the required operations. These credits are usually reimbursed in ten regular payments. Gronda is a pioneer in the use of micro-credit for health purposes; considering that health is a basis for development, he believes that it is essential for people to have access to capital in order to extend their access to healthcare. For the worst cases that micro-credit cannot finance, CEGIN is trying to set up a micro-insurance system. Statistically, these cases only represent one in a 100 000 patients, so Gronda is trying to take advantage of the “strength in numbers” effect of the SER network; the small contributions of all members of the network would finance the treatment of exceptional cases.

The SER system rests on a fundamental financial principle: diversification. Members of the network are at the base of its success and development. That is why, by extending the network, Gronda is consolidating it. With more members, the various risks are diversified and the global risk is reduced. This diversification that reduces the system’s profile of risk also plays an essential role in financing both the workings of micro-credit and the development of a micro-insurance system.



 Interview with Jorge Gronda, founder CEGIN and SER System

Llobeta Robert, Recuperando la salud, Grupo Editorial Lumen, Buenos Aires, 2007





ETV: The video report!

May 21, 2009 | Comments Off | Enterprises, Videos

ETV: Water at the source of social change; the video of our second report…

Fair Street - ETV from Angalio Productions on Vimeo.

From Salta to La Quiaca

May 20, 2009 | Comments Off | Travelogue

Friday May 8th, we head to Jujuy in order to meet with the 3rd entrepreneur. Trips are always a surprise; a new destination always means a new culture, new landscapes, new meetings…One big surprise of our Northern-Argentinan adventure that will surely remain in our memories is our meeting with the Gronda’s family.

Jorge Gronda is a doctor who has developed, in the Jujuy Province, an innovative healthcare system (personal profile and video coming soon). His organization’s model has taken him to the World Economic Forum of Davos in 2008 to share his view of the change.

After our visit at the CEGIN Center, Jorge invited us for lunch at his home with his family. In a very casual atmosphere, we quickly realized the essential role Jorge’s family plays in the development of his organization ; His wife, Irene, and his son, Simon, know the minor details of the organization, and their involvement is fundamental to Jorge’s way of thinking.

More than one entrepreneur, it is an entire family who is keen to solve social issues.

Very soon, we mentioned their visit to Davos and listened carefully to their story…

Their opinions are divided; on one side, they realize the strong determination of the West to contribute to the development of developing countries, therefore they feel honored to take part in that change. On the other hand, they are conscious of the numerous obstacles and high stakes involved with moving forward in a rigid global economic system.

Their vision is, however, very clear: political leaders are the only ones with the power to make significant changes. But in order to develop an adequate answer, it is paramount to hear the voice of those at the Bottom of the Pyramid and the aid organizations working with them; they are the impulse for change.

After this hopeful meeting, we headed to Tilcara by crossing the Quebrada of Humahuaca… As often happened during that trip, we spent hours discussing the importance of social entrepreneurship and the different ways to strengthen the North-South collaboration.

We are more than ever convinced that the contribution of capital is a key element to accelerate development.

In the middle of canyons, cactuses and disused railways, we have the impression of being in the middle of a western movie. This region, ranked in the world patrimony of the UNESCO, is nicknamed the « Paleta del Pintor » (the painter’s palette) ; among red rocks, green valleys and yellow sand, the color mix is enchanting !

On our way on this outstanding « Ruta 40 » we will next head to La Quiaca where we will cross the Bolivian border…

See you very soon,

Jo and Max

Etilplast: A cartonero’s adventure

May 5, 2009 | Comments Off | Enterprises

Our first visit to a company takes place in Buenos Aires and starts off with an epic beginning…

We have an appointment on Wednesday morning at 10:00 am near the Tigre suburb, outside Buenos Aires. To get there, we take a rémis (like a taxi, but cheaper) but the driver obviously has no idea of the road he needs to take.

As we are already 45 minutes late, our driver keeps stopping at every street corner to ask the way. After yet another stop, his engine caughs and dies… and will not start up again. We get out and push the car for 50 meters until the engine starts. According to the directions we received, we must now be close to our destination, so we chose to continue on foot…

We finally arrive at the Etilplast Cooperative where we are greeted by Walter, the cooperative’s co-founder. The discussion begins at the entrance of the cooperative, and continues in his small office after he has taken us on a guided tour of the place. Although seemingly shy, Walter is indefatigable when it comes to talking about his cooperative, its objectives, the problems it tackles and his plans for the future.


Argentina, like many other emerging markets, does not enjoy a waste sorting system at the national level. Waste and rubbish are not sorted because the population is not conscious of the consequences that poor waste management can have on the environment. Recycling is an activity that has only recently started to take hold. And it’s true that as long as the Argentinean Peso benefited from the trust of investors, the import of raw materials was cheaper than the purchase of recycled products.


Between 1998 and 2002, Argentina experienced a serious economic crisis which intensified in 2001 when the Ministry of Economy announced that the country was no longer able to reimburse its debt. This crisis deeply damaged the country’s economic, political and social situation and led to a strong increase in poverty, the consequences of which are still visible today.

The entrepreneur: 

In 2001, at the height of the crisis, Walter Lizarazu finishes secondary school. The bankruptcy of his father’s store means he can not pay to continue his studies. He starts looking for work, but the intensity with which the crisis hit the country rapidly makes his job search futile. He then has little choice but to become a cartonero. Walter is quickly confronted with the difficulty of his task: rubbish is scattered from one street to the next, nothing is sorted, few elements can be recuperated, and the money he makes is no match the amount of energy he expends. He is particularly struck by the fact that all he is doing is sorting what others have mixed together beforehand… One day, a shampoo company needs to get rid of 6 tons of plastic: Walter takes care of it, and sees the opportunity to launch a project with a wider scope than anything he had imagined. In 2003, the cooperative Etilplast is born!

The company:

Etilplast is a cooperative that currently employs 38 people. Under Walter’s drive, and that of his father, its members started by focusing on recycling plastic. They gradually extended their activity, and now treat various types of waste. Anything that cannot be recycled is sent directly to the rubbish dump, the rest is taken to the warehouse. There, the waste is sorted; after separation, cardboard and glass are sold as raw materials to other companies. Plastic, on the other hand, is redirected towards the recycling factory where, after treatment, it comes out as a raw material virtually indistinguishable from the original product.

Social impact:

The cooperative has two fundamental objectives. The first is to raise the population’s awareness of the environmental issue of waste management. Etilplast is not content with simply sorting and recycling, it aims at solving the problem at its source. They collaborate with several schools where they educate young students on the issue. Walter is convinced that if young people understand the stakes involved in sorting and recycling, they will have the capacity to influence their parents’ habits. The second objective is to offer destitute people a status-enhancing job. Walter is proud of the fact that Etilplast has improved the living conditions of 38 families. However, his humility is striking and he does not like saying that he is the founder of Etilplast, as he considers that all the people working with him have contributed to its development.

Financial support:

The cooperative is largely self-financed. Most profits are reinvested into the company to improve its working practices and to increase its social impact. In 2008, Etilplast received a 600 000 pesos loan (around €145 000) from the Dutch fund Oikocredit (see profile in the category “Financial Players”). This credit has specificities that make it beneficial to the development of Etilplast; for example, Etilplast enjoys a two-year capital exemption,  which means that during the two first years they need only pay back interest, and they will begin reimbursements only in the third year. This exemption allows Etilplast to enjoy the full benefits of the credit before having to reimburse it. Walter’s account was sufficient for us to measure the impact of Oikocredit’s contribution: “In five years of existence, we had managed to employ 20 workers and we collected the waste of approximately 2300 families. Following Oikocredit’s loan, in six months, we have increased our workforce to 38 employees, and we can now collect the waste of 1800 extra families.”

Walter concludes the interview by telling us that “Etilplast’s vision is that nothing is impossible”. He has begun as a cartonero, and is now planning to replicate his model and extend it, in the hope that this will push political authorities to take appropriate measures. Similar initiatives have emerged in other areas of Buenos Aires. The devaluation of the peso which followed from the Argentine crisis has injected some dynamism into domestic recycling initiatives, as recycled materials have become cheaper than raw material imports. As a new crisis is hitting the world economy, Walter can this time face the future with fresh optimism…

(1) In Argentina, “cartonero” refers to individuals who collect waste in the streets, essentially to recuperate cardboard. They then sell the collected materials and live off the proceeds, earning an average salary of €3 per day. The cartoneros are held in low regard by society because of the degrading nature of their work, and as a consequence, the majority of them suffer from social indifference. They are also exposed to extremely hazardous hygiene conditions, and suffer repression from both the police and organized crime groups. The number of cartonero families increased dramatically as a result of the crisis that hit the country at the turn of the 21st century: according to the World Bank figures, over 100 000 new families began to live off this activity in 2000.