[Congressional Record Volume 140, Number 68 (Thursday, May 26, 1994)]
[Extensions of Remarks]
[Page E]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: May 26, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
            MICROENTERPRISE AS A MEANS TO ALLEVIATE POVERTY

                                 ______


                           HON. SAM GEJDENSON

                             of connecticut

                    in the house of representatives

                         Thursday, May 26, 1994

  Mr. GEJDENSON. Mr. Speaker, more than one billion people in the 
developing world live in absolute poverty. According UNICEF's, State of 
the World's Children, mortality for children under age 5 averages 104 
per 1,000 in developing countries. In the least developing countries, 
that figure rises to 179 per 1,000; in Africa it rises still further to 
181 per 1,000.
  It is difficult to read these statistics and not to respond with a 
pro-active policy to stem this loss of children--the world's most 
vulnerable citizens. Six Members of Congress join with me today in 
introducing the Microenterprise Development Act of 1994; a bill 
designed to reduce poverty dramatically. This bill formally authorizes 
a microenterprise development program within the U.S. Agency for 
International Development [AID]. The bill includes a strong poverty 
lending component, loans of $300 or less. For those that follow this 
issue, you may note that this is not the first time I have introduced 
language on microenterprise development. It is the first time, however, 
that the language has been supported by the Administrator of AID. Brian 
Atwood and his staff have worked with me for months to craft a bill 
that cannot only be implemented effectively by AID, but be supported by 
this administration.
  We believe that the very poor, particularly women, can lead the fight 
against hunger and absolute poverty through the development of self-
sustaining microenterprise projects. It is an unfortunate fact that 
women in poverty generally are less educated and have less access to 
economic opportunity than their male counterparts. Therefore, directly 
aiding women in the developing world will have a positive effect on 
family incomes, child nutrition, health, and education.
  Microenterprise development offers the opportunity for the poor to 
play a central role in undertaking strategies for small scale, self-
sustaining businesses that can bring them out of poverty and into a 
world of self-sufficiency and dignity. The World Bank estimates that 
there are over 400 million self-employed poor in the developing world 
and projects that by the year 2020, 95 percent of African workers will 
be employed in the informal sector. For many people, the lack of credit 
creates an obstacle to the development of self-sustaining enterprises. 
Projects like those developed by ACCION International, Care, FINCA, 
Catholic Relief Services, and Save the Children to name a few, have 
lent money directly to the world's poorest. Repayment rates in these 
programs average 95 percent indicating that it is possible to bank on 
the poor. Because these institutions charge interest for these loans, 
over time the programs themselves become self-sustaining--saving 
foreign assistance dollars.
  The Members joining me in introducing this bill, Representatives 
McKinney, Cantwell, Kennelly, Lowey, Gilman, and Berueter, recognize 
that the Agency for International Development had been a leader in 
small and microenterprise development for over 20 years. This bill, 
which will strengthen AID's current program, as well as increase the 
agency's work in poverty lending, is the result of extensive 
negotiations between the Congress, AID, and the many private 
organizations that implement these programs. A great deal of credit 
must be given to the Microenterprise Coalition, a coalition of private 
voluntary organizations, credit unions and cooperatives, which has kept 
this issue alive and on the front burner for several years.
  It is my hope that microenterprise will continue to be a major weapon 
in AID's arsenal in fighting poverty and malnutrition in the developing 
world.

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