Page:United States Statutes at Large Volume 114 Part 2.djvu/198

 114 STAT. 1080 PUBLIC LAW 106-309—OCT. 17, 2000 this short time-period, the realization of this goal could dramatically alter the face of global poverty. (B) With an average family size of five, achieving this goal will mean that the benefits of microfinance will thereby reach nearly half of the world's more than 1,000,000,000 absolute poor people. (7)(A) Nongovernmental organizations, such as those that comprise the Microenterprise Coalition (such as the Grameen Bank (Bangladesh), K-REP (Kenya), and networks such as Accion International, the Foundation for International Community Assistance (FINCA), and the credit union movement) are successful in lending directly to the very poor. (B) Microfinance institutions such as BRAC (Bangladesh), BancoSol (Bolivia), SEWA Bank (India), and ACEP (Senegal) are regulated financial institutions that can raise funds directly from the local and international capital markets. (8)(A) Microenterprise institutions not only reduce poverty, but also reduce the dependency on foreign assistance. (B) Interest income on the credit portfolio is used to pay recurring institutional costs, assuring the long-term sustainability of development assistance. (9) Microfinance institutions leverage foreign assistance resources because loans are recycled, generating new benefits to program participants. (10)(A) The development of sustainable microfinance institutions that provide credit and training, and mobilize domestic savings, is a critical component to a global strategy of poverty reduction and broad-based economic development. (B) In the efforts of the United States to lead the development of a new global financial architecture, microenterprise should play a vital role. The recent shocks to international financial markets demonstrate how the financial sector can shape the destiny of nations. Microfinance can serve as a powerful tool for building a more inclusive finsincial sector which serves the broad majority of the world's population including the very poor and women and thus generate more social stability and prosperity. (C) Over the last two decades, the United States has been a global leader in promoting the global microenterprise sector, primarily through its development assistance programs at the United States iA^ency for International Development. Additionally, the Department of the Treasury and the Department of State have used their authority to promote microenterprise in the development programs of international financial institutions and the United Nations. (11)(A) In 1994, the United States Agency for International Development launched the "Microenterprise Initiative" in partnership with the Congress. (B) The initiative committed to expanding funding for the microenterprise programs of the Agency, and set a goal that, by the end of fiscal year 1996, one-half of all microenterprise resources would support programs and institutions that provide credit to the poorest, with loans under $300. (C) In order to achieve the goal of the microcredit summit, increased investment in microfinance institutions serving the poorest will be critical.

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