III. BACKGROUND - Microfinance in Africa

The model seeks to identify a microfinance methodology-model adapted to Africa's specific needs for poverty eradication. It draws upon the findings from the project GLO/99/315/A/11/31, titled Women, Microcredit, and Poverty Eradication. This project follows up the Second Tokyo International Conference on African Development (TICAD II), and the Asia/Africa Forum on the Economic Empowerment of Women. It reflects the ongoing United Nations commitment towards poverty eradication, a key theme expressed in the United Nations New Agenda for the Development of Africa in the 1990s (UN-NADAF, GA 46/151), at the 1995 World Summit for Social Development in Copenhagen (A/CONF.166/9), and by the United Nations resolution (A/RES/50/107) proclaiming 1997-2006 as the First United Nations Decade for the Eradication of Poverty.

The project also takes into account and builds upon United Nations documents pertaining to microfinance and poverty eradication in Africa, including Advancing Financial Intermediation in Africa (A/50/490 of 6 October 1995), the final report of the Africa Advocacy Forum:

Microcredit and Poverty Eradication, The Tokyo Agenda for Action: African Development Toward the 21st Century (TICAD II, October 1998), Poverty Eradication in Africa: Selected Country Experiences (UN/OSCAL 1998), The Constraints and Challenges Associated with Developing Sustainable Microfinance Systems in Disadvantages Rural Areas in Africa (UN/CDF, CIDR/Renee CHAO BEROFF, 1999), and Case Study on Best Practices Aimed at Popularizing Micro-Financing (UNECA, Working Paper Series, ECA/DMD/PSD/WP/98/8).

The design and execution of this project were overseen by the United Nations Office of the Special Coordinator for Africa and the Least Developed Countries (UN/OSCAL) in close collaboration with the United Nations Development Progamme, Gender and Development Programme (UNDP/GIDP). The process consisted of three phases:

Phase I: Microfinance Factsheets: Presented in the publication, Microfinance and Poverty Eradication: Strengthening Africa's Microfinance Institutions (UN/OSCAL, 2000), over 85 microfinance factsheets are compiled examining successful and unsuccessful microfinance initiatives in Africa, as well as non-African and international initiatives. Emphasis is placed on identifying strategies for a microfinance model responding to Africa's realities.

Phase II: Women, Microcredit, and Poverty Eradication (Ethiopia, Cameroon, Nigeria): Three one-week observation missions were undertaken in 1999-2000 to examine initiatives from three different African sub-regions, each region culturally differing in language, population distribution, and management skills. This phase was a direct follow-up of the Asia/Africa Forum on the Economic Empowerment of Women, held in Bangkok in July 1997.

Phase III: Expert-Group Meeting on Microfinance and Poverty Eradication in Africa: The Expert-Group Meeting provided a platform for African practitioners of microfinance to exchange experiences and lessons. It constituted a follow-up to the Microcredit Summit, in which OSCAL participated in February 1997 as a member of the Council of Advocates; to the recommendations of the one-day briefing, organized by OSCAL in February 1997, on “Microcredit and Poverty Eradication in Africa”; to the Asia/Africa Forum on the Economic Empowerment of Women, held in Bangkok in July 1997; to the VI International Conference on “Communication and Technology: Impact on Women in the Global Economy,” held in Accra in September 1997; and to TICAD II, held in October 1998. The following microfinance model was adopted during the Expert1Group Meeting held in Addis Ababa, Ethiopia (25-29 September 2000).

Microfinance in Africa: Combining the Best Practices of Traditional and Modern Microfinance Approaches towards Poverty Eradication To learn more about this author, visit United Nations Economic Commission for Africa's Website.

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