WRITTEN QUESTION E-0083/02 by Chris Davies (ELDR) to the Commission. Microfinance services to the poor.
Date: 2002-01-24
Institutions: European Parliament, Provisional data
Subjects: EU aid, cooperation policy, developing countries, development aid, financial institution, job creation, microfinance, poverty

6.2.2003

EN

Official Journal of the European Union

C 28 E/7

(2003/C 28 E/007)

WRITTEN QUESTION E-3636/01

by Eryl McNally (PSE) to the Commission

(9 January 2002)

Subject: Microcredit and development

Of the EU development programmes which focus on the poorest, notably those concerned with food
security and rural development, do any include microcredit as a key component? If so, what have the
activities been in the last two years?

(2003/C 28 E/008)

WRITTEN QUESTION E-0016/02

by Graham Watson (ELDR) to the Commission

(18 January 2002)

Subject: Microfinance policy

What action has the European Commission taken in the last three years to implement those aspects of its
microfinance policy which impact on the provision of microfinance services to very poor people, in the
developing world?

(2003/C 28 E/009)

WRITTEN QUESTION E-0083/02

by Chris Davies (ELDR) to the Commission

(24 January 2002)

Subject: Microfinance services to the poor

In 1998 the European Union joined the Microcredit Summit Council of Donor Agencies, committed to
provide by 2005 credit to encourage self-employment amongst 100 million of the world’s poorest families
in developing nations.

What action is the Commission taking to implement microfinance policy through the provision of small
loans to the poorest people to enable them to work themselves out of poverty?

Joint answer
to Written Questions E-3587/01, E-3614/01, E-3636/01, E-0016/02 and E-0083/02
given by Mr Nielson on behalf of the Commission

(11 April 2002)

The Commission is fully aware of the relevant role that effective microfinance institutions can play in the
fight against poverty.
they can contribute substantially to making economic opportunities
accessible to the poor. Economic entities, like microenterprises, only need modest financial support to
improve their capacity to create wealth and employment.

Indeed,

A Communication focused on microfinance (1), some methodological orientation and a Communication on
private sector development (2), all issued in 1998, pointed out the important role microfinance can play in
fighting against poverty. This role is confirmed in the Communication on the ‘Development policy of the
Community’ (3), and in the Cotonou Agreement, of the year 2000, and will be clarified in the forthcoming
Guidelines on a harmonised approach to support private sector.

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Official Journal of the European Union

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6.2.2003

Community actions for support to small and micro-enterprises concentrate, among others, in the following
fields:

(cid:1) supporting the setting up of a regulatory framework and a banking supervision system ensuring an

appropriate regulation of the microfinance market;

(cid:1) encouraging micro-finance institutions to develop new services and financial products;

(cid:1) helping integrate micro-finance within local financial systems by disseminating best practices and
performance standards, setting up a framework for regulation and supervision, and supporting
institutional development;

(cid:1) strengthening and monitoring the performance of microfinance institutions, their governance system

and their ability to serve microenterprises.

These activities should be carried out in close co-ordination and collaboration with multilateral bodies and
with the financial institutions and, most of all the Consultative group to assist the poorest (CGAP).

In anticipation of the establishment of a new, comprehensive microfinance programme, the Community is
intervening in different regions, to the possible extent in co-ordination with other donors and with CGAP,
promoting initiatives in the field of microfinance.

Several projects have been financed in the context of rural development especially in Africa (Madagascar,
Guinea Conakry, Niger, Cameroon, South Africa), essentially aiming at supporting the institutional
development of local microfinance institutions.

Other projects have been implemented in Latin America and Asia to support a better access to credit for
microenterprises making credit lines available to intermediary financial institutions interested in serving the
market of small enterprises, both in urban and rural areas.

A European initiative for assessing the performance of microfinance institutions (MFIs) in Africa has been
recently supported by the Community, in co-ordination with CGAP, to streamline the culture of rating
among African MFIs. Given the positive results, the Community is now seeking to identify new ways of
pursuing the initiative co-operating with CGAP.

The European Investment Bank (EIB) has already approved some global loans addressing microfinance
institutions, like Finadev in Benin, Banco Ademi in Dominican Republic, Caribbean Microfinance Ltd in
Trinidad and Tobago. This last institution has been even supported, more recently, by one of the
Commission’s private sector programmes, the Union and African, Caribbean and Pacific countries (cid:1)
Business Assistance Scheme (EBAS), to set up an ad hoc technology to target the rural microfinance
market. Recently, the EIB has supported the new fund Africap, established to support existing microfinance
institutions in Africa.

The Commission has the following projects in Bangladesh with a ‘micro-credit component’:

(cid:1) Rangpur Region Rural Development Programme (ALA/84/21). Approximately EUR 2,5 million out of
the total EU grant of EUR 32,5 million is earmarked for credit under the Revolving Loan Fund. The
aim of the project is to make a sustainable contribution to poverty eradication in Rangpur Region by
enabling some 1,5 million organised poor households to graduate permanently from poverty by 2004;

(cid:1) Proshika: Towards a Poverty Free Society (ALA/99/297). Around EUR 16 million out of the total EU
grant of EUR 41,1 million allocated for credit under the Revolving Loan Fund. The project purpose is
to enable 1,5 million organised poor households to graduate permanently from poverty by 2004;

(cid:1) BRAC: Poverty Alleviation (ALA/96/05).

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Official Journal of the European Union

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the total EU grant of 32,3 is assigned for Village Organisation
Almost EUR 7,85 million out of
Development and Credit. The project purpose under the component Village Organisation Development
and Credit and Savings is the promotion of 16 760 new village organisations (Vos) with about 774 000
members bringing the total number of direct beneficiaries of the programme to approximately 2 million
people in 500 000 Vos.

ALA/01/89 ‘Challenging the Frontiers of Poverty Reduction’. Approximately EUR 17 million out of the
total EU Grant of 28 million. Euro is earmarked for ‘capital
investments and subsistence grants’. The
money will be used to provide approximately 72 000 ultra poor beneficiaries with necessary inputs to
enable them to start Income Generating Activities (IGA) as well as with a subsistence grant during the first
18 months. The grant is to help them with their daily expenses until they begin to earn a regular income
from their IGA. In addition the beneficiaries will receive extensive technical support as well as relevant
business development services. Strictu sensu, therefore, we are in this specific case not dealing with a
micro-credit scheme but rather with a micro grant scheme.

(1) COM(98) 527 final.
(2) COM(98) 667 final.
(3) COM(2000) 212 final.

(2003/C 28 E/010)

WRITTEN QUESTION E-3632/01

by Herbert Bösch (PSE) to the Commission

(9 January 2002)

Subject: Misleading information in connection with the MED case

In my Written Question E-2043/01 (1) I drew the Commission’s attention to the fact that in connection
with the so-called MED case (estimated loss: EUR 20 million) it had possibly been misled by its own units
responsible for combating fraud. Within the Commission, but also vis-à-vis the European Parliament, the
impression was given that the matter had been referred to the Belgian judicial authorities as long ago as
1996, although the referral had in fact been delayed until
late 1999, shortly before the statute of
limitations would have come into effect.

In her answer, Mrs Schreyer, writing on behalf of the Commission, refuted those claims and maintained
that the anti-fraud unit UCLAF had referred the matter to the competent Belgian judicial authorities in
1996 with a view to the opening of criminal proceedings, if appropriate.

It has now emerged from the answer to my supplementary Written Question PE-2784/01 (2) that in 1996
only ‘informal consultations’ were apparently held with the Belgian judicial authorities, that there is no
correspondence relating to the consultations and that it cannot even be stated which department of the
Belgian judicial authorities was contacted.

1.
Does the Commission nevertheless stand by its position that UCLAF note No 6039 of 19 November
1996 provided it with correct and accurate information? In particular, does the Commission take the view
that informal consultations can in all seriousness be described as a referral to the competent judicial
authorities, as they were in the note in question?

2.
Can the Commission give a plausible explanation as to why, in the final UCLAF report on this case
(No 2803 of 15 May 1997), no reference whatsoever is made to the supposed referral to the Belgian
judicial authorities?

3. Why, despite repeated requests, is the Commission still refusing to provide me with a copy of its
letter of 13 December 1999 to the Brussels state prosecutor, Mr Dejemeppe?

Is it true that copies of this letter were forwarded to other Members of the European Parliament more

4.
than one year ago?

(1) OJ C 40 E, 14.2.2002, p. 170.
(2) OJ C 147 E, 20.6.2002, p. 54.