Published March 27, 2008
RICHMOND, Va. — “For us, it’s all about the dollar.”
That’s how the International Mission Board sees the growing financial crises’ impact on mission fields worldwide. About 85 percent of its budget is spent on oversees ministries where the costs of fuel are much lower than what is seen at gas pumps in the U.S. But it’s the lowering of Federal interest rates and declining value of the dollar that is putting the squeeze on missions personnel far from home.
A gallon of gas in Dubhai was $1.50 a gallon in mid-March vs. $3.25 for the lowest grade octane in Georgia. But it’s the shrinking dollar against the powerful Euro that is taking its toll as missionaries strive to keep their heads above the financial waterline.
David Steverson, vice president for finance and treasurer of the IMB, closely monitors the swings in the value of the dollar on global markets and suggests adjustments in missionary reimbursement. Sometimes the dollar’s value goes up, other times it goes down.
But lately it’s been mostly down.
“About 80 percent of our concerns are tied to the dollar while only 20 percent is tied to rising fuel costs. Fuel is actually rather stable oversees and is not the concern that we are experiencing here in the States,” he said.
Without becoming too bogged down in details, Steverson quickly sums up the trials the agency faces to balance its budget without sacrificing ministry.
About 85 percent of the IMB’s budget is earmarked to overseas use, and 71 percent of that it designated to missionary support, he says. He then tosses out a simple illustration.
“Last year’s budget for cost of living adjustments – not necessarily raises but an increase just to break even with the previous year – was budgeted at $17 million. However, we spent $19 million, which means we had to underspend in other areas by $2 million.
“People are used to hearing me say that you can only spend a dollar once, and if you overspend it has to come from another budget and those funds can’t be used elsewhere.”
What is good news to Americans caught in a credit crunch – the Federal Reserve Board’s repeated lowering of interest rates – causes headaches for missionaries and others living oversees. That’s because the dollar becomes less attractive to foreign investors and its value drops, requiring more dollars to purchase fewer goods.
Impact of a dollar
“Unlike most U.S. exporters who benefit from a weak dollar that makes their goods cheaper on international markets, our export is our missionaries – who are spending U.S. dollars,” said Steverson. “The weak dollar has had a tremendous impact on the purchasing power of the dollars we are spending.”
As an example, in 2002 individuals could buy one Euro for one U.S. dollar. In January 2006, that same Euro cost $1.17; in January 2007 it was $1.27, but ten months later, in November, it had jumped $1.45. As of mid-March the Euro had risen again to $1.56.
Not every missionary budget has been hit that hard. Steverson acknowledges that it obviously costs less to fund a missionary serving in parts of Africa than it does in Europe. That means those serving in lower cost of living locations may receive fewer adjustments in the cost of living supplement and those serving in higher cost locations might receive adjustments more frequently.
Cost of missions
But there is one universal truth in the economic equation – the weakness of the dollar is being felt to one degree or another worldwide. In a typical year on 160 selected mission fields, cost of living supplements change an average of 250 times – with half reflecting increases in the supplement and half showing decreases. Last year rates changed 400 times with 370 being increases and only 30 being decreases.
At least there are adjustments for missionary living expenses. Mission operating budgets, which pay for actual ministries, have no such protection.
“There is no supplement to adjust those budgets for loss in value of the dollar,” Steverson said. “Our missionaries simply have fewer funds to work with.”
That means less money for evangelism, discipleship programs, church-starting – the ministries missionaries are sent overseas to carry out in the first place.
“Where it’s hitting us mostly is in the cost of housing,” explained John Brady, regional leader for Northern Africa and the Middle East. “We got one of the largest increases in our overseas budget this year, and every dime of it has gone toward housing.
“We didn’t get to increase our training. We didn’t get to increase our Bibles. We’re having to cut back on all sorts of things – not because Southern Baptists aren’t giving more, but because of the weakness of the dollar.”
Consider Northern Africa and the Middle East, one of the primary global centers of spiritual lostness. Currencies (and mission budgets) in many countries there are pegged to the Euro or the British pound. IMB workers in the region have lost about 35 percent of their buying power since 2003.
If there is one bright spot in the picture, it is that Southern Baptists remain strong in their support of their missionaries. Giving to the 2006 Lottie Moon Christmas Offering goal of $150 million was surpassed by nearly $200,000, delivering the largest gift in the offering’s 118-year history. It also marked an 8.9 percent increase over the 2005 offering of $137.9 million.
But IMB finance officials project Southern Baptists will need to meet their $165 million goal for the 2007 Lottie Moon Christmas Offering for International Missions just to sustain ministry budgets funded by last year’s record $150 million offering.
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