SUDAN WATCH: MicroSave-Africa - USAID sponsors southern Sudan’s First Microfinance Conference

Sunday, August 01, 2010

MicroSave-Africa - USAID sponsors southern Sudan’s First Microfinance Conference

HISTORIC stuff.

Quotes of the Day
"Microfinance is dynamic and SUMI will adapt to change as it grows. I envision that SUMI, in the future, will be a bank." -Edward Lokule, Sudan Microfinance Institution (SUMI) Managing Director (Source: see report below)

"SUMI is striving to ensure that 50 percent of all lending goes to women." -USAID (Source: see report below)
IN just seven years since microfinance services began in southern Sudan, there are now an estimated 45,000 active loan recipients, borrowing between approximately 200 Sudanese pounds (about $80) and more than 400 Sudanese pounds (about $160) to launch or expand their businesses.

In 2003, when USAID helped establish the Sudan Microfinance Institution (SUMI), there were no financial services of any kind in southern Sudan, a region the size of France.

MicroSave-Africa began operations in October 1998 as an initiative to promote savings services for poor people in Africa. It was started by United Nations Development Programme (UNDP) and UK Department for International Development (DFID) as a result of the African Conference on ‘Savings in the Context of Microfinance’ held in February 1998.

Through four major activities, MicroSave-Africa seeks to build the capacity of MFIs to provide secure, high quality savings services to poor people. These activities are Research, Curriculum Development, Training, and Dissemination.

The Goal of MicroSave-Africa is stated as:
To promote secure, high-quality savings services for poor people.

Financial information is unavailable for Finance Sudan, which is a joint venture between Micro-Africa Limited, a regionally managed for-profit organization established in 2000 that provides financial services in East and Central Africa, and American Refugee Committee (ARC), an international nonprofit that provides humanitarian assistance to refugee communities.

Further details here below.

USAID Sponsors Southern Sudan’s First Microfinance Conference
Copy of a monthly update from U.S. Agency for International Development (USAID) - July, 2010 - excerpts:
On July 20 and 21 in Juba, USAID sponsored the First Southern Sudan Microfinance Conference. Organized in partnership with the Government of Southern Sudan (GOSS), the Microfinance Association of Southern Sudan, and the Southern Sudan Microfinance Development Facility, the conference provided a forum for 115 international, regional, and southern Sudanese technical experts and microfinance practitioners to exchange views about the state of microfinance in southern Sudan and develop a strategy to build the sector, which is still in its infancy.

In 2003, when USAID helped establish the Sudan Microfinance Institution (SUMI), there were no financial services of any kind in southern Sudan, a region the size of France.

In the seven years since then, SUMI has disbursed more than $2.7 million in loans to 10,000 clients—half of them women—empowering entrepreneurs to launch and expand businesses such as tea houses, bakeries, restaurants, and retail shops throughout southern Sudan. SUMI has expanded to six branches in four states—Central Equatoria, Western Equatoria, Lakes, and Western Bahr el Ghazal. Two international microfinance institutions—Finance Sudan and BRAC—are also now operating in southern Sudan, in locations including Wau, Malakal, Aweil, and Juba.

Numerous local start-up organizations are also emerging as demand continues for more access to financial services. There are now an estimated 45,000 active micro-loan borrowers in southern Sudan, borrowing between approximately 200 Sudanese pounds (about $80) and more than 400 Sudanese pounds (about $160).

The U.S. Consul General in Juba, Ambassador Barrie Walkley, told conference participants that “the microfinance sector has the potential to transform millions of lives.”

GOSS Minister of Commerce and Industry Stephen Dhieu thanked USAID for “taking a proactive approach to the expansion of financial services in southern Sudan.”

To build on its efforts, USAID last year launched a three-year project to strengthen southern Sudan’s microfinance sector with technical assistance and lending capital with the goal of expanding services to new areas and ultimately increasing employment opportunities and household incomes. The project, Generating Economic Development through Microfinance in Southern Sudan (GEMSS), is being implemented by AED in partnership with ACDI/VOCA.

The conference was part of USAID’s efforts to strengthen the sector. Participants discussed the challenges they face in dealing with southern Sudan’s poor infrastructure and low levels of financial literacy among both customers and staff, but recognized the need for advocacy, staff training, and increasing the overall population’s financial literacy. Conference speakers challenged the industry to grow by focusing on the basics, increasing the capacity of MFI staff, and responding to client demand for services.

Local market research and client feedback will be essential in developing a microfinance environment in southern Sudan that meets specific local needs.

As MicroSave Africa Director David Cracknell explained, “The smallest adjustment to a loan product can sometimes transform a product utilized by a few hundred borrowers to one that benefits thousands, and the only way we can change is to listen to our clients.”

MicroSave Africa is currently in the process of developing such products for Finance Sudan.

Other conference participants included David Baguma, executive director of the Association of Microfinance Institutions of Uganda; Lene Hansen, an international microfinance expert; and World Bank Country Manager Laurence Clarke.

The conference was an important step in the evolution of southern Sudan’s microfinance sector because it was the first time that government representatives, international donors, and microfinance experts and practitioners came together for frank discussions about their needs, challenges and potential solutions—an event that conference master of ceremonies Lemi Lokosang of USAID/Sudan’s economic growth team noted in his closing remarks was “making history” in southern Sudan. [...]

In addition to Finance Sudan, USAID also supports the Sudan Microfinance Institution [SUMI] and Ananda Marga Universal Relief Team through the GEMSS program. With increased organizational capacity and efficacy, these institutions have been able to open new branches, bringing opportunities to populations that previously never had access to credit facilities. Finance Sudan alone projects it will increase its client base from 1,152 to 6,000 by the end of 2010. Together, the three MFIs have made loans to more than 8,600 southern Sudanese entrepreneurs thus far. [...]
Click here to read USAID's monthly report in full at www.usaid.gov
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MICROCAPITAL BRIEF: Southern Sudan Holds Microfinance Conference with Sponsorship from United States Agency for International Development (USAID)
Copy of a report from MicroCapital.org by Conner Brannen
Tuesday, 27 July 2010 - excerpt:
Microfinance institutions (MFIs) operating in Southern Sudan, include several international MFIs – Finance Sudan, Equity Bank and BRAC – and one Sudanese – Sudan Microfinance Institution (SUMI). There are also several smaller start-up institutions.
According to the Microfinance Information Exchange (MIX) market, as of 2008, BRAC Southern Sudan reported USD 8.3 million in total assets, a gross loan portfolio of USD 1.8 million, USD 412,000 in deposits and 10,400 active borrowers.
As of 2008, SUMI reported USD 1.5 million in total assets, a gross loan portfolio of USD 1.1 million and 8,500 active borrowers.
As of 2009, Equity Bank reported USD 1.27 billion in total assets, a gross loan portfolio of USD 818 million and 716,000 active borrowers including operations in Uganda and Kenya.
No Breakdown specific to Southern Sudan is Available. Financial information is unavailable for Finance Sudan, which is a joint venture between Micro-Africa Limited, a regionally managed for-profit organization established in 2000 that provides financial services in East and Central Africa, and American Refugee Committee (ARC), an international nonprofit that provides humanitarian assistance to refugee communities. [...]
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Sudan – Generating Economic Development through Microfinance in Southern Sudan (GEMSS)
INCREASING ACCESS TO FINANCIAL SERVICES FOR POOR ENTREPRENEURS AND HOUSEHOLDS
Copy of a report (undated) from the website of www.acdivoca.org:
ACDI/VOCA has won a $10.4 million subaward from the USAID-funded Generating Economic Development through Microfinance in Southern Sudan (GEMSS) FIELD Leaders With Associates (LWA) Program. AED is the prime implementer of the FIELD LWA, which will work to increase access to financial services in Southern Sudan for poor entrepreneurs and households.

Southern Sudan is in the process of rebuilding after a protracted civil war. Under the agreement with the Republic of Sudan, Southern Sudan is largely autonomous now and has the chance to vote for full independence in 2011. Currently in Southern Sudan, there are three microfinance institutions, a microfinance association and a newly established currency. Nonetheless, the financial sector is still hampered by low technical and managerial capacity, insufficient resources and inadequate physical or legal infrastructure.

Strengthening the sector to meet underserved client demand will allow the microfinance sector to play an important role in rebuilding the region, helping microenterprises to grow and meet Southern Sudanese expectations for concrete benefits to peace.

For more information, contact Seth McDonagh at smcdonagh@acdivoca.org.
Updated: 1/09
Note from Sudan Watch Ed:
According to its About page, "ACDI/VOCA is a private, nonprofit organization that promotes broad-based economic growth and the development of civil society in emerging democracies and developing countries. Offering a comprehensive range of technical assistance services, ACDI/VOCA addresses the most pressing and intractable development problems"

Also, note the following excerpt from one of the above reports: "To build on its efforts, USAID last year launched a three-year project to strengthen southern Sudan’s microfinance sector with technical assistance and lending capital with the goal of expanding services to new areas and ultimately increasing employment opportunities and household incomes. The project, Generating Economic Development through Microfinance in Southern Sudan (GEMSS), is being implemented by AED in partnership with ACDI/VOCA."
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Building a Microfinance Institution from Scratch
Copy of a report (undated) from the website of USAID:
Sudan Microfinance Institution (SUMI)

Photo: SUMI is striving to ensure that 50 percent of all lending goes to women. (Photo and caption: USAID)

Sudan Microfinance Institution's objective is to offer financial services on a self-sustaining yet efficient basis to microentrepreneurs living in southern Sudan, with emphasis on the agriculture sector, women, returned refugees, and internally displaced persons.

Rose Anite is a 26-year-old woman who sells dried fish at the open market in Yei. She began her business in 2000 with the equivalent of $75. She buys the fish twice a month in Uganda near the river Nile at a place called Panyamur, but the trip takes about seven days due to poor roads and infrastructure.

Given the lack of infrastructure, few businesses, no legal or regulatory framework, and a culture of heavy dependence on relief aid brought on by a quarter century of war, few thought a microfinance institution could be developed. When the operations and logistics manager first assessed the potential of South Sudan for such an initiative, he reported hearing, "The Sudanese will run away with your money." Despite initial skepticism, however, a successful microfinance institution, governed by a local board of directors, has been built from scratch.

Created with USAID support in 2003, the Sudan Microfinance Institution (SUMI) is performing above international standards and growing. Through solidarity groups and salary loans in three southern Sudan branches, the total value of loans disbursed by February 2005 was close to a half million dollars to more than 1,600 clients, above the targets set in their business plan. SUMI's repayment rate is over 98 percent with a portfolio-at-risk rate of less than 6 percent.

Rose joined SUMI so that she could increase her capital. She has taken a loan equivalent to $100, which allows her to now buy in larger bulk and thus increases the profitability of each buying trip to Uganda. Like the other four members of her borrower group, Rose is servicing her loan on time and looks forward to paying it off so that she can access a larger loan next time.
Further Reading

MicroSave
Visit MicroSave website at http://www.microsave.org/
Follow MicroSave on Twitter at http://twitter.com/MicroSave

World Bank
Excerpt from Worldbank.org re MicroSave-Africa - A CGAP/UNDP/DFID Initiative:
MicroSave-Africa began operations in October 1998 as an initiative to promote savings services for poor people in Africa. It was started by UNDP and DFID as a result of the African Conference on ‘Savings in the Context of Microfinance’ held in February 1998. Through four major activities, MicroSave-Africa seeks to build the capacity of MFIs to provide secure, high quality savings services to poor people. These activities are Research, Curriculum Development, Training, and Dissemination. The Goal of MicroSave-Africa is stated as:
To promote secure, high-quality savings services for poor people.
American Refugee Committee (ARC) Southern Sudan
Excerpts from ARC's About page at www.arcrelief.org:
Head Office: Juba

Where ARC Works in Sudan: Juba, Kajo Keji, Malakal, Nimule, and Yei in southern Sudan

People We Serve: 600,000 Returning Sudanese Refugees and IDPs

Since independence, southern Sudan has known little but civil war. The most recent conflict began in 1983 and mired the region in extreme poverty and suffering. Hundreds of thousands of civilians died from violence, hunger and disease as a result of the conflict, and millions more were forced from their homes.

The Comprehensive Peace Agreement was finally signed in January 2005. The task now facing the government of southern Sudan and the international community is the reconstruction of the country and the reintegration of hundreds of thousands of returning refugees and internally displaced people. In 2011, southern Sudan will vote on whether they want to remain part of Sudan or become an independent country.

ARC will continue to provide services in southern Sudan and work to build the capacity of the government and local community organizations to serve the local population.

Operational Since: 1994
ARC began operations in Kajo Keji County in southern Sudan in 1994, providing health services to people displaced by the war. Operations have since grown dramatically, and ARC now operates an integrated program of health care, water and sanitation, and microenterprise development for war-affected residents and returning refugees.

Milestones:
In September 2006, Finance Sudan, an ARC microfinance institution, began operations. It is one of only two such institutions currently operating in the region. Finance Sudan has given small loans to hundreds of entrepreneurs, more than half of them women.

Since 2006, ARC has been implementing a major, long-term initiative to expand comprehensive reproductive health care services in southern Sudan (as well as in Darfur). We’re addressing emergency obstetrics, family planning, sexually transmitted infections, HIV/AIDS, and the clinical management of rape.

Current Needs:
ARC has recently initiated the Through Our Eyes project in southern Sudan. The project uses hands-on video and community participation to get people talking about gender-based violence and how to prevent it.

Participants produce video dramas and documentaries on such issues as rape, wife-beating, sexually-transmitted infections and forced marriage. The videos are then shown at community forums, which spark discussions about how to solve the problems. The goal of Through Our Eyes is to amplify the voices of change from within communities.

Related Reading

Jan 18, 2005 - "ARC and Rock For Democracy Partner to Raise Funds for Darfur" - "Concert For Darfur gives ARC a great opportunity to publicize our vital work with the thousands of people of the Sudan displaced by the brutal civil war," said Hugh Parmer, ARC's president. "And all of the money raised will fund our relief programs, ultimately saving many lives."

Aug 9, 2005 - "ARC Receives $2.8 Million from U.S. Government to Continue Life-Saving Work in Darfur" - The US Agency for International Development’s (USAID) Office of Foreign Disaster Assistance recently awarded the American Refugee Committee International (ARC) $2,797,000 to continue providing health care, water and sanitation training programs for internally-displaced persons (IDP) and war-affected populations in Darfur, Sudan. ARC has been working in Darfur since 2003, collaborating with USAID and UNHCR to assist local people.

ARC's Through Our Eyes

Photo: ARC's Participatory Video Communications Project to prevent gender-based violence (Photo credit: ARC's Through Our Eyes)
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Lack of infrastructure hinders growth of micro finance institutions in S. Sudan
22 July 2010 - (Juba) – A lack of infrastructure in southern Sudan is preventing micro financing organizations from reaching rural areas in the region.

Members of the Southern Sudan Micro-finance Association are appealing to the Government of Southern Sudan to improve roads so that funds can reach the needy populations.
Full story at SRS - Sudan Radio Service.
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Food prices rise In Rumbek, S. Sudan
22 July 2010 - (Rumbek) – The prices of essential food commodities in Rumbek have risen due to heavy taxation by the custom authorities.

Speaking to SRS from Rumbek on Wednesday, one of the traders, Abui Noel, said that they are charged at every roadblock when transporting goods.
Full story at SRS - Sudan Radio Service.
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Islamic Bank to help develop S. Sudan
27 July 2010 - (Juba) - The Islamic Development Bank has expressed readiness to assist in the development of southern Sudan before the forthcoming referendum.

On Monday, a delegation from the Islamic Development Bank met GOSS Vice President Riek Machar.

The vice president of the Islamic Development Bank operation office, Sidebe Birama addressed reporters after the meeting.

Doctor Riek Machar said that he will present the issue before the council of ministers to decide on the Islamic Bank proposal.
Full story at SRS - Sudan Radio Service.
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Government to pay southern pensioners
27 July 2010 - (Khartoum) – The federal government has pledged to pay the arrears of pensioners from southern Sudan whose dues have not been paid during the war up to the 31st of December 2005.
Full story at SRS - Sudan Radio Service.
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South Sudan denies allegations of excessive sugar consumption
28 July 2010 - (Juba) – The GOSS Ministry of Commerce and Industry has disputed claims by the press in Khartoum that most of Sudan’s sugar is consumed in southern Sudan, soaring sugar prices in the north.

The report states that the Southern Sudan Beverage Brewery Limited uses a huge amount of sugar.


Stephen Dhieu spoke to SRS in Juba on Wednesday. He said the brewery gets its raw materials from South Africa.

The report also said that about one million tons of sugar has been exported to southern Sudan since the signing of the CPA, an allegation Dhieu refutes.
Full story at SRS - Sudan Radio Service.
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No Taxes For Food Items In Southern Sudan, Says GOSS
29 July 2010 - (Juba) – The Government of Southern Sudan has passed a resolution waiving taxes on all imported food items.

Southern Sudan imports over eighty percent of its products from neighboring countries such as Uganda, Kenya, in addition to those coming from northern Sudan.

The directors from the GOSS ministry of commerce and industry added that since 2005, southern Sudan has offered a free market zone which accommodates more foreign investors than local investors.
Full story at SRS - Sudan Radio Service.
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UK Donates Funds To Ensure Food Seurity In South
28 July 2010 report from SRS - Sudan Radio Service:
(Juba) - The government of the United Kingdom has donated 30 million US dollars to World Food Program to avert looming starvation in Sudan.

Addressing the press on Tuesday in Juba, the World Food Program deputy coordinator for South Sudan Alghassim Rhasin Wurie said the donation has come at a critical time of hunger in the country.

[Alghassim Rhasin]: “The funding we have received from the UK government is 30 million US dollars. It will feed 5.3 people in the whole of Sudan for one month. It is a very big contribution now critical for south Sudan. People now without any food aid, they would not harvest any crops. So with this contribution, we are now going to make sure those who are affected by food security will receive timely food rations. In south Sudan, we see there is food insecurity everywhere but the key areas are; Northern Bahr El Ghazal, Lakes and Eastern Equatoria. These three areas are heavily food insecure. So most of this food donation will immediately go to these areas which are food insecure.”

Rhasin also said that the main cause of hunger in Sudan and mainly in the south is drought, hiked food prices and insecurity in some areas.
More news from SRS - Sudan Radio Service:

Thursday - 29 July 2010

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