In conjunction with the Fifth High Level Dialogue on Financing for Development (FfD) in New York, the UN Capital Development Fund (UNCDF) and the Global Clearinghouse for Development Finance (GlobalDF) co-organized today the side-event “Domestic Resource Mobilization in the Least Developed Countries (LDCs)”.
Speakers from UNCDF and GlobalDF articulated recent efforts to emulate the principles recognized by the 2002 Monterrey Consensus and the Doha Conference of 2008 on domestic resource mobilization for poverty reduction and the achievement of the MDGs. The objective of this event was to present and discuss selected initiatives that are designed to mobilize domestic resources for development in the LDCs.
Specifically; the event featured a discussion on MicroLead, a $50 million UNCDF programme co-funded by the MasterCard Foundation and the Bill & Melinda Gates Foundation; and the Local Economic Development Finance Initiative (LED-FI).
The UNCDF programme MicroLead aims to contribute to the development of strong inclusive financial sectors by supporting the expansion of microfinance market leaders in underserved countries. MicroLead began in 2009 when UNCDF, in partnership with the Bill & Melinda Gates Foundation, initiated a flagship global microfinance programme to provide loans and grants on a competitive basis to microfinance institutions, commercial banks and financial cooperatives based in developing countries. To date, the Bill & Melinda Gates Foundation/UNCDF-funded MicroLead programme has awarded funding for 13 projects worth $20.1 million to southern-based market leaders to enable their entrance into developing countries with savings-led methodologies.
In September 2011, UNCDF and the MasterCard Foundation launched the expansion of the successful programme. The $23.5 million, six year expansion will increase access to microfinance, particularly savings services, to 450,000 low income people in Sub-Saharan Africa. In this new phase, experienced institutions or networks from developed and developing countries may apply to either establish greenfields or provide technical assistance that results in significant impact, particularly in the number of small-balance savers reached.
The Local Economic Development Finance Initiative (LED-FI) is a partnership between UNCDF, GlobalDF and the Swiss Agency for Development and Cooperation (SDC) designed to unlock domestic financial sectors and channel capital toward basic needs by broadening access to domestic private sector finance for local development while helping to improve conditions for the sector to participate in economic development. The initiative focuses on infrastructure projects that can unleash local economic potential, including energy, transport, warehouses, and food processing plants. Working at local, national and international levels, the programme aims to generate interest in and support for inclusive finance and local economic development among regulators, project developers, and the financial sector.