Dakar Conference on Financial Access for the Poor Opens to Widespread Optimism and Support
United Nations Conference on Financial Inclusion in Africa Brings Delegates from 53 Countries
"The Dakar Conference should put us on the path to building, expanding and deepening inclusive financial sectors — an approach that is indispensable for expanding development opportunities and improving livelihoods in Africa."
- Alberic Kacou, UNDP Resident Representative and UN Coordinator in Senegal
6 June 2006, Dakar - The UN Capital Development Fund and UN Development Programme launched a joint conference Monday to improve the delivery of financial services - such as savings, insurance and credit opportunities -- as an approach to poverty reduction in Africa. The conference, which takes place on 5 and 6 June in Dakar, Senegal, was organized in response to an evolving concern for a shift in development assistance from microfinance to inclusive finance - from supporting discrete microfinance institutions (MFIs) to building inclusive financial sectors.
In Africa, more than half of the region's population (approximately 300 million people) live in extreme poverty. Only about 4% of the population has a bank account, and the number of bank deposits per person is far below other regions. In addition, only 1% of Africans has obtained a loan or other form of credit from a formal financial institution.
The Conference marks the first time such broad representation from ministers, governors of central banks, development partners, financial service providers and their networks, and private sector representatives, have gathered to discuss, share experiences, and deepen their background regarding inclusive finance in Africa. Delegates from African countries and eight non - African countries are participating in the Conference.
UNCDF Executive Secretary Richard Weingarten said in his keynote address (link) that the number and reach of MFIs in Africa is still far below what would be required to provide an appropriate continuum of financial services to all. "Furthermore," he added, "the legal, policy, and regulatory environments in Africa too frequently constrain, rather than encourage, financial inclusion, and financial services infrastructure is too often inadequate for the efficient delivery of a broad range of financial products and services. In addition, African capital markets are largely undeveloped and too frequently are unable to provide the capital required to build strong, sustainable financial institutions and finance economic activity."
Alberic Kacou, Resident Representative for UNDP and UN Coordinator in Senegal, said in his opening address that the Dakar Conference offers an opportunity for Africans and their development partners to exchange lessons and best practice experiences with one another. "The results of our discussions should permit us to improve our efforts in combating poverty and addressing the challenges of the Millennium Development Goals in Africa. The Dakar Conference should also put us on the path to building, expanding and deepening inclusive financial sectors - an approach that is indispensable for expanding development opportunities and improving livelihoods in Africa."
Weingarten points out that there is a general consensus in the development community that achieving large scale outreach of financial services on a sustainable basis is a critical development goal. The Monterrey Consensus, for example, highlights the contribution that a range of financial institutions can make in providing financial services to enterprise development and calls for public and private actors to work collaboratively to provide access to all.
The Commission for Africa and the Brussels Declaration identify inclusive finance as a significant and cost-effective means for promoting and assuring economic growth and improved standards of living in countries at the lowest end of the income spectrum. The final report of the Millennium Development Project also identifies inclusive finance as one of the most practical and effective development strategies at country level that should be implemented and supported to attain the goal of reducing world poverty by half by 2015.
Makarimi Adéchoubou, UNCDF Microfinance Director for West and Central Africa, said the quality of representation at the Conference is highly impressive. "We have all the elements in place here that are needed to truly forge a way forward in meeting the formidable challenges of overcoming extreme poverty in Africa - by providing people with the financial opportunities they need to make a difference in their lives," he said.
Contact in Dakar: Adam Rogers +221 402 11 49
