Posted on March 13, 2009 - by Gavin

Quake-hit Sichuan to be Assisted by Microcredit…

CRI English.com

A microcredit program, aiming to give small loans to families in quake-hit Sichuan province, has started in Beijing.

Called ‘Danone Microcredit Foundation’, the project is a cooperative project between three parties, namely the State Council Leading Group Office of Poverty Alleviation and Development of China, the Grameen Trust and the Danone Group from France.

The project will help finance local people in the earthquake affected area to rebuild their ruined homes and restart businesses.

It was designed to replicate the famous Grameen Bank program, which has been practicing in Bangladesh for over 30 years and has released about 5 million Bangladeshi people from poverty.

The French Danone Group offered a total of 20 million RMB to establish a fund to support the project.

Grameen Trust, the sister agency of Grameen Bank, will help to supervise the operation of the fund.

Dr. Mumhammad Yunus, founder of the Grameen Bank attended the opening ceremony of the project in Beijing.

He explained how he began to push forward a microfinance project in China. “Earlier in 2006, I met Ms. Wu Xiaoling, deputy chief of the People’s Bank of China, we talked about setting up a microcredit program in China. We chose to carry it out in Sichuan province because we all agreed it was hugely stricken by poverty. It was before the deadly earthquake.”

Six cities and counties were chosen as trial areas for the program, including cities of Mianzhu and Shifang, which were hugely affected by the earthquake.

Up to the beginning of 2009, over 100 families have received their first loans from the project. It plans to offer a total of 168 million RMB to over 24,000 poor farmers in the next three years.

According to Dr. Yunus, he hopes the Chinese microcredit model could be an example to other countries who are still questioning whether the Grameen Bank prototype would fit situations in their own countries.

Cooperation between Danone and Grameen Bank dates back to 2006, when they set up a joint venture in Bangladesh to provide low-price, high-nutrition yogurt to the local children.

This is the first time they have brought the social business concept to China. They hope a more practical microfinancial model could be invented through combining the poverty alleviation experience in China with the Grameen bank mode. This idea was strongly backed by the State Council Leading Group Office of Poverty Alleviation and Development of the Chinese government.

Source: http://english.cri.cn/6909/2009/03/13/63s464091.htm