Top > Regional Affairs > Africa > TICAD > Illustrative List Of Ongoing and Pipeline Projects/Programs For African Development As a Reference Document for TICAD II > II. Economic Development : Promoting Private Sector (2.1 Private Sector Development) > Strengthening the Microfinance Sector in the Arab States

Strengthening of the Microfinance Sector in the Arab States
Project / Program Summary

I.Basic data

Sector(s): Micro finance
Title: Strengthening the Microfinance Sector in the Arab States
Donor country / organization: UNDP, government parallel financing
Other donors / organizations involved: Partnerships being developed
Beneficiary countries / regions: All Arab Countries with Morocco, Yemen and Bahrain serving and pilots
Implementing agencies in beneficiary countries / regions: Local NGOs
Duration: Three years
Starting Date: November 1997
Project / Program budget: US$2,075,000 (total)
Finance / Type of cooperation: Technical cooperation

II.Project / program description

  1. Objectives
    The project aims at strengthening the capacity of new and existing micro finance institutions (MFIs), and at disseminating lessons learned on micro finance in the region through a network of MFIs. Specifically, the project will:
  • Build the capacity of local micro finance institutions in three pilot countries to provide micro finance services to poor clients (with focus on poor women) and assist these institutions to achieve sustainability.
  • Develop a regional network of local MFIs for the region-wide learning and experience sharing in the field of micro finance.
  1. Activities / contents
    Through the Micro Start Programme and following best international standards and practices, the UNDP country offices in Morocco, Bahrain and Yemen are instrumental in extending technical assistance to up to 18 local NGOs and government institutions active in micro finance services. The activities are guided by national Advisory Boards.
    A suitable institution to serve as the Regional Coordinating Organisation will be identified. It will establish and support a network of micro finance institutions in the region for the purpose of region-wide learning, exchange of information and best practices.
  2. Expected outcomes / impacts
    It is expected that by the end of the 3-year period loans will be extended to more than 15,000 borrowers and valuable experience will be accumulated on the most suitable modalities of providing micro finance services in the region. The challenge is to test and disseminate practices that would lead to financial and operational sustainability of the micro finance institutions in the shortest possible time. Due to its "pilot" character, the project foresees conducting impact assessment studies and careful evaluation of its operation.
  3. Features in line with the Agenda for Action
    Access to and control of productive assets, including capital, has been identified as one of the main causes of poverty in the Arab States. It is estimated that there are approximately 45 million potential non-collateral borrowers in the region who can benefit from micro finance services. The demand for capital to be channeled through micro credit operations is estimated at over US$1.5 billion. If successful, the project will have a direct impact on poverty reduction and promotion of entrepreneurship, mainly via self-employment. The project is based also on the premise of regional and inter-regional (Latin America, Asia) experience sharing and as such builds on South-South Cooperation.

III.Contact point:

United Nations Development Progarmme
Arab States
One UN Plaza, NY, NY 10017
Tel: 212-906-5450
Fax: 212-906-5487
E-mail: fawaz.fokeladeh@undp.org

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