Liberia: Financial Institutions Empowered To Boost Economic Productivity Through MSMEs
Monrovia – The Ministry of Finance and Development Planning (MFDP) and its partners on Wednesday, November 14, 2018 concluded a one-day capacity building training on environmental and social impacts screening for financial institutions in Liberia, as part of Rural Finance Post-Ebola Reconstruction Project supported by the World Bank.
The World Bank recently approved US$ 4.8 million to boost private sector development by empowering Micro, Small, and Medium-Sized Enterprises (MSME).
The money was provided by the World Bank as a grant under ‘Liberia MSME & Rural Finance Post Ebola Reconstruction’ Project.
Under the project, MSMEs are extended credit facility to enhance business development and promote economic resuscitation.
The amount is channeled through selected financial institutions including the Liberia Bank for Development and Investment (LBDI), Afriland First Bank, GN Bank, Diaconia, BRAC, Foundation for Women, and Business Link.
These financial institutions, according to the Ministry of Finance have extended credits to about 1,400 MSMEs over the last one year.
With a deadline for disbursement set at March 2019, micro, small, and medium enterprises will be allowed till 2020 to repay the loan depending on the agreements with the banks and micro-finance intuitions (MFIs).
As proposals are made by MSMEs to gain access to the loan, the financial institutions are required to evaluate and screen each of them for potential environmental and social impacts during execution.
Speaking at the opening of the training, Fredrick Krah, Project Manager extolled World Bank for supporting the government in promoting economic prosperity through direct investment in MSMEs as the bedrock of the Liberian economy especially after the deadly Ebola Virus, which shattered the country’s progress
He noted that while the total portfolio was US$ 4.8 million, the actual amount available to MSMEs is US$4 million, which has already been disbursed to all financial institutions involved in the project.
Krah further told participants that while “we want to grow MSMEs and promote economic development, the government is keen on ensuring that funding received by local businesses meets all requirements under the project including environmental and social impacts mitigation”.
He explained that at the screening face, it is important for the project participating institutions to be mindful of how the loan will impact the local community or the country.
“Women and child rights must be protected; child labor must be abolished in any business ventures which qualify under the project,” the project manager noted.
Under environmental consideration, he explained “while we want to keep growing economically and support our local businesses, we must be mindful of the value and services our environment has provided to us and no activity must be supported which pollutes, degrades and negatively impact our environment.
MSME proposals must be aligned with the project environmental and social management framework (ESMF), Environmental Management and Protection Law of Liberia (EPML), EPA regulations, and the World Bank environmental and social policies,” Krah added.
The one-day training was facilitated by Urias Goll, a local consultant on the project.