Economic Impact Assessment

The Economic Impact Assessment (EIA) project entails the development of a model which quantifies the direct and indirect impacts of a (foreign) company on the local economy of a developing country.

In 2006 the Economic Impact Assessment (EIA) model was developed by Triple Value and InReturn. The model was tested for Sierra Leone Brewery Limited, a subsidiary of Heineken. In 2007, Triple Value completed an assessment for Heineken in Rwanda and started with studies in Burundi and Greece. On page 36 of Heineken’s Sustainability Report 2007, General Manager Door Plantenga of Bralirwa (Heineken’s operating company in Rwanda) comments on the insights generated. Heineken set as one of its targets to conduct two more of such studies in 2008. Heineken’s Sustainability Report report can be found on www.heinekeninternational.com

NCDO and Heineken International jointly initiated and financed the EIA project in 2006.

A company’s economic impact
The presence of foreign companies is often perceived differently by different people. Some regard them as providers of economic activity, jobs and wages while others see them as extractors of (hard) money and exploiters of cheap labour. These two view points are two sides of the same coin. Companies point to the benefits that their presence brings - economic activity, jobs and taxes - but seldom underpin this with quantitative analyses. Company critics often point to the negative effects while disregarding the positive economic contributions.

By developing the Economic Impact Assesment (EIA) model, NCDO’s BiD Programme contributes to this debate.