I

103D CONGRESS

2D SESSION H. R. 4511

To amend the Foreign Assistance Act of 1961 to authorize the Administrator

of the United States Agency for International Development to provide

assistance for programs of credit and other assistance for

microenterprises in developing countries.

IN THE HOUSE OF REPRESENTATIVES

MAY 26, 1994

Mr. GEJDENSON (for himself, Ms. MCKINNEY, Ms. CANTWELL, Mrs. KENNELLY, Mrs. LOWEY, Mr. GILMAN, and Mr. BEREUTER) introduced the

following bill; which was referred to the Committee on Foreign Affairs

A BILL

To amend the Foreign Assistance Act of 1961 to authorize

the Administrator of the United States Agency for International Development to provide assistance for programs

of credit and other assistance for microenterprises in

developing countries.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Microenterprise Devel5 opment Act of 1994’’.
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1 SEC. 2. AUTHORIZATION OF MICROENTERPRISE DEVELOP2 MENT ASSISTANCE.

3 Chapter 1 of part I of the Foreign Assistance Act

4 of 1961 (22 U.S.C. 2151 et seq.) is amended by adding

5 at the end the following new section:

6 ‘‘SEC. 129. MICROENTERPRISE DEVELOPMENT AS7 SISTANCE.—(a) The Congress finds the following:

8 ‘‘(1) A strong microenterprise sector is a fun9 damental condition of economic pluralism.

10 ‘‘(2) Microenterprise development programs

11 offer an important mechanism to alleviate poverty,

12 develop private enterprise, and create employment.

13 ‘‘(3) The very poor, particularly poor women, in

14 the developing world often do not advance economi15 cally because they cannot obtain investment capital

16 to secure their asset base or expand their otherwise

17 viable microenterprise activities.

18 ‘‘(4) The development of sustainable

19 microenterprise institutions which provide credit,

20 training, and mobilize domestic savings are therefore

21 critical components to a broad-based economic

22 growth strategy.

23 ‘‘(5) Microenterprise credit also offers a tool to

24 leverage foreign assistance resources because unlike

25 grants credit can be continually recycled generating

26 new benefits to program participants.
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1 ‘‘(6) Interest income on a credit portfolio can

2 be used to finance recurring costs assuring the long3 term continuity of development assistance.

4 ‘‘(7) Because microenterpise development credit

5 programs foster self-reliance, such programs reduce

6 the dependency of program participants and indige7 nous institutions on foreign assistance.

8 ‘‘(b) The purposes of this section are—

9 ‘‘(1) to provide for the continuation and expan10 sion of the commitment of the United States Agency

11 for International Development to microenterprise de12 velopment programs;

13 ‘‘(2) to make microenterprise development a

14 part of the mainstream of the overall economic

15 growth strategy of the United States Agency for

16 International Development; and

17 ‘‘(3) to improve the access of microenterprise

18 credit to the very poor, particularly poor women, in

19 developing countries.

20 ‘‘(c)(1) In carrying out this part, the Administrator

21 of the United States Agency for International Develop22 ment is authorized to provide assistance for programs of

23 credit and other assistance for microenterprises in devel24 oping countries.
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1 ‘‘(2) Assistance authorized under paragraph (1) shall

2 be provided through—

3 ‘‘(A) United States and indigenous private and

4 voluntary organizations;

5 ‘‘(B) United States and indigenous credit

6 unions and cooperative organizations; and

7 ‘‘(C) other indigenous governmental and non8 governmental organizations;

9 that have a capacity to develop and implement

10 microenterprise programs.

11 ‘‘(3) A significant portion of assistance authorized

12 under paragraph (1) shall be used for poverty lending pro13 grams which—

14 ‘‘(A) meet the needs of the very poor members

15 of society, particularly poor women; and

16 ‘‘(B) provide loans of $300 or less in 1994

17 United States dollars to such poor members of soci18 ety.

19 ‘‘(4) The Administrator of the United States Agency

20 for International Development shall strengthen appro21 priate mechanisms, including mechanisms for central

22 microenterprise programs, for the purpose of—

23 ‘‘(A) providing technical support for field mis24 sions of the United States Agency for International

25 Development;
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1 ‘‘(B) strengthening the institutional develop2 ment of the intermediary organizations described in

3 paragraph (2); and

4 ‘‘(C) sharing information relating to the provi5 sion of assistance authorized under paragraph (1)

6 between such field missions and intermediary organi7 zations.

8 ‘‘(d) In order to maximize the sustainable develop9 ment impact of the assistance authorized under subsection

10 (c)(1), the Administrator of the United States Agency for

11 International Development shall establish a monitoring

12 system that—

13 ‘‘(1) establishes performance goals for such as14 sistance and expresses such goals in an objective and

15 quantifiable form, to the extent feasible;

16 ‘‘(2) establishes performance indicators to be

17 used in measuring or assessing the achievement of

18 the goals and objectives of such assistance; and

19 ‘‘(3) provides a basis for recommendations for

20 adjustments to such assistance to enhance the sus21 tainable development impact of such assistance, par22 ticularly the impact of such assistance on the very

23 poor, particularly poor women.’’.

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