Representatives of major international organizations, non-governmental agencies, donors and the Sri Lankan government met last week in Colombo to examine how microfinance can better contribute to ongoing tsunami recovery efforts.
“Microfinance is vital not only to help the Sri Lankan people rebuild, but also to address the more persistent issue of poverty among those hardest hit by the tsunami,” said Eric Schwartz, the United Nations’ Deputy Special Envoy for Tsunami Recovery.
The event, which was organized with support from the German Technical Cooperation GTZ, on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ), was hosted by the Washington, DC-based Consultative Group to Assist the Poor (CGAP) and the Office of the Special Envoy, led by former U.S. President Bill Clinton.
The meeting was part of a broader move in the region to evaluate the tsunami response and push for the long term impact of development assistance.
Thoughtfully executed, microfinance programs can continue to grow long after aid money dries up. That is good news for communities throughout Sri Lanka, which have already used microfinance services -- from loans to savings to insurance -- to rebuild homes and businesses. The same services, say microfinance proponents, can help families educate their children and cover unforeseen healthcare and other costs.
In the aftermath of the tsunami, many development agencies increased their microfinance funding, but a recent CGAP report said agencies could do more to make sure this funding is having a lasting impact. (Visit www.cgap.org to read the Sri Lanka Country-Level Effectiveness and Accountability Review.)
Building in part on the report’s recommendations and on the work accomplished by the Microfinance Network operated by development partners in Sri Lanka, participants at the recent meeting they re-confirmed their commitment to common rules of the game and reporting standards for their post-tsunami microfinance programs. The standards aim to build financial sustainability among microfinance providers so they can provide permanent access to financial services for their clients.
Consultative Group to Assist the Poor (CGAP) The Consultative Group to Assist the Poor (CGAP) is a global resource center for microfinance standards, operational tools, training, and advisory services. Its members - including bilateral, multilateral, and private funders of microfinance programs - are committed to building more inclusive financial systems for the poor. For more information, visit www.cgap.org.
Office of the Special Envoy for Tsunami Recovery (OSE) The UN Secretary-General appointed President Clinton as Special Envoy for Tsunami Recovery in February 2005. President Clinton’s role since then has been to keep the world's attention on the tsunami operations; support coordination efforts at the country and global levels; promote transparency and accountability measures that will ensure resources are used well and for the reasons intended, as well as retain the engagement of the millions of "investors"; and champion a new kind of recovery that not only restores what existed previously, but goes beyond, seizing the moral, political, managerial, and financial opportunities the crisis has offered governments to set communities on a better and safer development path.