Government supports micro-enterprises
--Views them as mechanisms in reducing poverty
By Chamanlall Naipaul
Guyana Chronicle
March 14, 2003

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THE Government remains committed to the development of micro, small and medium-sized enterprises in its efforts to reduce poverty in the country.

Declaring open a workshop earlier this week on the designing of a project for the sustainable development of micro-enterprises, Finance Minister, Mr. Saisnarine Kowlessar reiterated the Government's support for the process, and noted that its policy on this issue is comprehensively articulated in the Poverty Reduction Strategy Paper (PRSP).

At the workshop, which was organised by the European Commission (EC) and conducted at the Cara Inn, Georgetown, Kowlessar stated that further initiatives to stimulate economic growth and reduce poverty are contained in the National Budget, which is to be presented later this month.

It is imperative that new ways are charted in collaboration with civil society and the private sector to empower them to execute programmes to reduce poverty, he said.

He added that the Government alone cannot do it, and alluded to the important role of the social partners in successfully accelerating the goals and objectives of the PRSP.

The minister emphasised that under the programmes, it is essential that finances are spent properly so as to yield the desired results for the beneficiaries.

The European Union (EU), under the terms of the Cotonou Agreement, which was entered into with the 77-member African, Caribbean and Pacific (ACP) countries, has allocated $600M for micro-enterprise development in Guyana.

This week's workshop was organised to get inputs from stakeholders in the designing and formulation of a project to develop micro-enterprises as part of the strategy to reduce poverty.

Mr. Vincent De Visscher, Head of the European Delegation to Guyana, noted that under the LOME Convention with the ACP, aid was only channelled through governments.

However, under the current Cotonou Agreement, there has been a policy shift whereby civil society and the private sector are being involved in development activities.

Under this policy there will be greater participation of the "grassroots" for whom the project is intended to assist, Mr. De Visscher said, adding that consequently, the project is open to non-governmental organisations (NGOs), universities, religious organisations and trade unions, among others.

He noted that this approach has already been successfully tested in Suriname in a similar project, where the government was an observer on the management boards of micro-enterprises.

The project has a multi-pronged approach -- financing of micro-realisation, creating employment, reducing poverty and educating the beneficiaries; improving the professionalism of NGOs whereby they would have to formulate projects, prepare budgets and have the capacity to monitor the progress of projects; and to intensify dialogue between Government and civil society, De Visscher explained.

The financial assistance will be in the form of grants, but beneficiaries are required to provide 25 per cent of the project cost.

Minister of Amerindian Affairs Carolyn, Mr. Rodrigues called for a review of this criterion in relation to the communities, which are located in the interior.

She pointed out that many of them do not have the capacity to provide the 25 per cent project cost required, and therefore would be excluded from benefiting from the project.

Also, Rodrigues explained, in arriving at the administration cost of the project, the high transportation costs to reach the interior communities will be taken into consideration.

Earlier, Kowlessar had called for restricting administration costs of the project to the minimum.

It is anticipated that the project will become operational before the end of this year.

Two consultants, Mr. Tom Dahl-Ostergaard and Mr. David Moore are in Guyana assisting with the formulation and design of the project.

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