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UNITED NATIONS CAPITAL DEVELOPMENT FUND Microfinance |
Issue 1 / January - February 2004 |
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Featured Guest | Ambassador Joël Wassi Adechi Note from Ambassador Joël Wassi Adechi, Ambassador Extraordinary and Plenipotentiary of Benin Ambassadeur extraordinaire et plénipotentiaire Joël Wassi Adechi Représentant permanent de la République du Bénin * Benin will begin a two-year term on the United Nations Security Council in January 2004.
It is my great pleasure to welcome the resolution on the Programme of Action for the International Year of Microcredit 2005 recently passed by the UN General Assembly. The provision of financial services to poor and low-income people is of tremendous importance to the Least Developed Countries of the world. With the government of Benin as Chair of the LDC Group, I see the Year as an unprecedented opportunity to invigorate commitment to the microfinance sector and enhance its role in achieving the Millennium Development Goals and the goals enshrined in the Programme of Actions of the LDC’s. The “ripple-effect” of microfinance is well documented. In Benin, I have seen how access to this powerful asset-building tool contributes to the MDG’s by going beyond the household level to affect the health, and the level of education and employment of the community as a whole. Let me share with you how Microfinance has long been integral to poverty alleviation in Benin. Access to financial services has unleashed the potential of millions around the world as well as hundreds of thousands in my own nation. Allow me to stress that microfinance represents a participatory approach to development where people can take control of their lives and become self-sufficient; thus this development intervention can be felt at the community level. This perspective has been vividly demonstrated through evidence that shows one does not need to be an individual of significant means to have creative business ideas, save according to one’s own priorities, and ultimately plan for the future. Benin’s financial sector underwent deep structural adjustments during the 1990s. In response, the government implemented a program designed to build on rural savings and loans to better serve the poor by decentralizing and empowering local members in the management and ownership of local cooperative banks. Many microfinance institutions were created as a result, often with funding support from international donors. With a consistent annual growth rate of about 5% over the past five years following these changes, Benin’s entrepreneurial spirit is well known throughout the region and has contributed to this positive economic performance. Tapping this spirit is the Project to Assist the Development of Micro Enterprises (PADME), the pillar of the microfinance sector in Benin serving mostly women and small-scale entrepreneurs. Filling a gap in the provision of financial services, PADME targets microentrepreneurs without access to funding by other lending organizations and without personal or family assets that would allow them to cultivate their business ideas. By offering loans and savings to individuals, groups, and also NGO’s, the range of choices for poor people in Benin has greatly expanded. With its 99% loan repayment rate, those designing financial products for poor people around the world often cite PADME as an example of an effective institution with well-trained staff that use the best technology to reach out to poor and low-income clients. The work of PADME is complemented by the savings services provided by a range of diverse initiatives such as FECECAM (Fédération des Caisses d'Épargne et de Crédit Agricole Mutuel), the largest network of credit unions in West Africa that reaches rural women and farmers, groups often isolated from the impact of some development projects. Benin and the Least Developed Countries look forward to observing the Year of Microcredit 2005 to promote the rapid expansion of well-designed financial products for poor people. |
