| Home > 104th Congressional Bills > H.R. 1129 (rh) To amend the National Trails Systems Act to designate the route from Selma to Montgomery as a National Historic Trail. [Reported in House] ...
H.R. 1129 (rh) To amend the National Trails Systems Act to designate the route from Selma to Montgomery as a National Historic Trail. [Reported in House] ...
105th CONGRESS 1st Session H. R. 1129 _______________________________________________________________________ IN THE SENATE OF THE UNITED STATES November 10, 1997 Received November 13, 1997 Read twice and referred to the Committee on Foreign Relations _______________________________________________________________________ AN ACT To establish a program to provide assistance for programs of credit and other assistance for microenterprises in developing countries, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE. This Act may be cited as the ``Microcredit for Self-Reliance Act of 1997''. SEC. 2. FINDINGS AND DECLARATIONS OF POLICY. The Congress makes the following findings and declarations: (1) More than 1,000,000,000 people in the developing world are living in severe poverty. (2) According to the United Nations Children's Fund (UNICEF), mortality for children under the age of 5 averages 100 child deaths per thousand for all developing countries, with nearly double that rate in the poorest countries. (3) Nearly 35,000 children die each day from largely preventable malnutrition and disease. (4)(A) Women in poverty generally have larger work loads, and less access to educational and economic opportunities than their male counterparts. (B) Directly aiding the poorest of the poor, especially women, in the developing world has a positive effect not only on family incomes, but also on child nutrition, health and education, as women in particular reinvest income in their families. (5)(A) The poor in the developing world, particularly women, generally lack stable employment and social safety nets. (B) Many turn to self-employment to generate a substantial portion of their livelihood. (C) These poor entrepreneurs are often trapped in poverty because they cannot obtain credit at reasonable rates to build their asset base or expand their otherwise viable self- employment activities. (D) Many of the poor are forced to pay interest rates as high as 10 percent per day to money lenders. (6)(A) On February 2-4, 1997, a global microcredit summit was held in Washington, District of Columbia, to launch a plan to expand access to credit for self-employment and other financial and business services to 100,000,000 of the world's poorest families, especially the women of those families, by 2005. (B) With five to a family, achieving this goal will mean that the benefits of microcredit will thereby reach nearly half of the world's more than 1,000,000,000 absolute poor. (7)(A) The poor are able to expand their incomes and their businesses dramatically when they can access loans at reasonable interest rates. (B) Through the development of self-sustaining microcredit programs, poor people themselves can lead the fight against hunger and poverty. (8)(A) Nongovernmental organizations such as the Grameen Bank, Accion International, and the Foundation for International Community Assistance (FINCA) have been successful in lending directly to the very poor. (B) These institutions generate repayment rates averaging 95 percent or higher, demonstrating the bankability of the poorest. (C) International organizations such as the International Fund for Agricultural Development (IFAD) and the United Nations Development Program (UNDP) have demonstrated success in supporting microcredit programs. (9)(A) Microcredit institutions not only reduce poverty, but also reduce the dependency on foreign assistance. (B) Interest income on a credit portfolio can be used to pay recurring institutional costs, assuring the long-term sustainability of development assistance. (10) Microcredit institutions leverage foreign assistance resources because loans are recycled, generating new benefits to program participants. (11) The development of sustainable microcredit institutions which provide credit and training, and mobilize domestic savings, are critical components to a global strategy of poverty reduction and broad based economic development. (12)(A) In 1994, the United States Agency for International Development launched a 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, half of all microenterprise resources would support programs and institutions providing credit to the poorest, with loans under $300. (C) In order to achieve the goal of the microcredit summit, increased investment in microcredit institutions serving the poorest will be critical. (13) Providing the United States share of the global investment needed to achieve the goal of the microcredit summit will require only a small increase in United States funding for international microcredit programs, with an increased focus on institutions serving the poorest. (14)(A) In order to reach tens of millions of the poorest with microcredit, it is crucial to expand and replicate successful microcredit institutions. (B) These institutions need assistance in developing their institutional capacity to expand their services and tap commercial sources of capital. (15) Nongovernmental organizations have demonstrated competence in developing networks of local microcredit institutions so that they reach large numbers of the very poor, and achieve financial sustainability. (16) Recognizing that the United States Agency for International Development has developed very effective partnerships with nongovernmental organizations, and that the Agency will have fewer missions to carry out its work, the Agency should place priority on investing in these nongovernmental network institutions through the central funding mechanisms of the Agency. (17) By expanding and replicating successful microcredit institutions, it should be possible to create a global infrastructure to provide financial services to the world's poorest families. (18)(A) The United States Agency for International Development can provide leadership to other bilateral and multilateral development agencies as such agencies expand their support to the microenterprise sector. (B) The United States Agency for International Development should seek to improve coordination of donor efforts at the operational level to promote the use of best practices in the provision of financial services to the poor and to ensure that adequate institutional capacity is developed. (19) Through expanded support for microcredit, especially credit for the poorest, the United States Agency for International Development can continue to play a leadership role in the global effort to expand financial services and opportunity to 100,000,000 of the poorest families on the planet. SEC. 3. PURPOSES. The purposes of this Act are-- (1) to provide for the continuation and expansion of the commitment of the United States Agency for International Development to the development of microenterprise institutions; (2) to make microenterprise development the centerpiece of the overall economic growth strategy of the United States Agency for International Development; (3) to support and develop the capacity of United States and indigenous nongovernmental organization intermediaries to provide credit, savings, and training services to microentrepreneurs; (4) to increase the amount of assistance devoted to credit activities designed to reach the poorest sector in developing countries, and to improve the access of the poorest, particularly women, to microenterprise credit in developing countries; and (5) to encourage the United States Agency for International Development to provide global leadership in promoting microenterprise for the poorest among bilateral and multilateral donors. SEC. 4. MICRO- AND SMALL ENTERPRISE DEVELOPMENT CREDITS. Section 108 of the Foreign Assistance Act of 1961 (22 U.S.C. 2151f) is amended to read as follows: ``SEC. 108. MICRO- AND SMALL ENTERPRISE DEVELOPMENT CREDITS. ``(a) Findings and Policy.--The Congress finds and declares that-- ``(1) the development of micro- and small enterprise, including cooperatives, is a vital factor in the stable growth of developing countries and in the development and stability of a free, open, and equitable international economic system; ``(2) it is, therefore, in the best interests of the United States to assist the development of the private sector in developing countries and to engage the United States private sector in that process; ``(3) the support of private enterprise can be served by programs providing credit, training, and technical assistance for the benefit of micro- and small enterprises; and ``(4) programs that provide credit, training, and technical assistance to private institutions can serve as a valuable complement to grant assistance provided for the purpose of benefiting micro- and small private enterprise. ``(b) Program.--To carry out the policy set forth in subsection (a), the President is authorized to provide assistance to increase the availability of credit to micro- and small enterprises lacking full access to credit, including through-- ``(1) loans and guarantees to credit institutions for the purpose of expanding the availability of credit to micro- and small enterprises; ``(2) training programs for lenders in order to enable them to better meet the credit needs of micro- and small entrepreneurs; and ``(3) training programs for micro- and small entrepreneurs in order to enable them to make better use of credit and to better manage their enterprises. ``(c) Eligibility Criteria.--The Administrator of the United States Agency for International Development shall establish criteria for determining which entities described in subsection (b) are eligible to carry out activities, with respect to microenterprises, assisted under this section. Such criteria may include the following: ``(1) The extent to which the recipients of credit from the entity do not have access to the local formal financial sector. ``(2) The extent to which the recipients of credit from the entity are among the poorest people in the country. ``(3) The extent to which the entity is oriented toward working directly with poor women. ``(4) The extent to which the entity recovers its cost of lending to the poor. ``(5) The extent to which the entity implements a plan to become financially sustainable.''. SEC. 5. MICROENTERPRISE DEVELOPMENT GRANT ASSISTANCE. Chapter 1 of part I of the Foreign Assistance Act of 1961 (22 U.S.C. 2151 et seq.) is amended by adding at the end the following new section: ``SEC. 129. MICROENTERPRISE DEVELOPMENT GRANT ASSISTANCE. ``(a) Authorization.--(1) In carrying out this part, the Administrator of the United States Agency for International Development is authorized to provide grant assistance for programs of credit and other assistance for microenterprises in developing countries. ``(2) Assistance authorized under paragraph (1) shall be provided through organizations that have a capacity to develop and implement microenterprise programs, including particularly-- ``(A) United States and indigenous private and voluntary organizations; ``(B) United States and indigenous credit unions and cooperative organizations; or ``(C) other indigenous governmental and nongovernmental organizations. ``(3) Approximately one-half of the credit assistance authorized under paragraph (1) shall be used for poverty lending programs, including the poverty lending portion of mixed programs. Such programs-- ``(A) shall meet the needs of the very poor members of society, particularly poor women; and ``(B) should provide loans of $300 or less in 1995 United States dollars to such poor members of society. ``(4) The Administrator should continue support for mechanisms that-- ``(A) provide technical support for field missions; ``(B) strengthen the institutional development of the intermediary organizations described in paragraph (2); and ``(C) share information relating to the provision of assistance authorized under paragraph (1) between such field missions and intermediary organizations. ``(b) Monitoring System.--In order to maximize the sustainable development impact of the assistance authorized under subsection (a)(1), the Administrator shall establish a monitoring system that-- ``(1) establishes performance goals for such assistance and expresses such goals in an objective and quantifiable form, to the extent feasible; ``(2) establishes performance indicators to be used in measuring or assessing the achievement of the goals and objectives of such assistance; and ``(3) provides a basis for recommendations for adjustments to such assistance to enhance the sustainable development impact of such assistance, particularly the impact of such assistance on the very poor, particularly poor women.''. SEC. 6. MULTILATERAL COOPERATION WITH THE INTERNATIONAL FUND FOR AGRICULTURAL DEVELOPMENT. (a) Findings.--The Congress finds the following: (1)(A) The International Fund for Agricultural Development (``IFAD'') has as its mission serving the poorest of the poor in rural areas. (B) IFAD has had two decades of experience in assisting the economic development of the rural poor. (2) IFAD has been a significant supporter of microenterprise and other microfinance activities for the rural
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