Master's in Suriname by Sarah M. Bergin

Blog Moved

2007-11-13T15:59:00.000-03:00

This blog has been moved to http://mastersinsuriname.wordpress.com .

VSLP Begins! - Week 8

2007-10-22T13:12:00.000-03:00

For months now I have been trying to implement a Village Savings and Loan Program (VSLP) in an interior village in Suriname. Various obstacles have impeded its implementation but my persistence has finally started to pay off. On Tuesday of this past week, I took my first concrete step toward realizing my goal of starting the VSLP.

A few months ago I had explained the program to a fellow Peace Corps volunteer (PCV) who is living in an Amerindian village made up of about 1500 people. The village is located in a semi-remote part of Suriname and has limited accessibility to financial institutions due in part to its location as well as the financial status of the villagers. The village’s size and location appeared ideal to serve as a pilot for the program. Consequently, I was excited that the PCV was interested in possibly brining it to the people in his village.

While back in his village the PCV kept his ears open and waited for the appropriate time to present the idea of VSLP to the community. One of the most important facets of bringing sustainability to a community project is to have the project idea come from the community itself and not from an outside source pushing for the project. It was, therefore, very important that the PCV deliver the information about VSLP when he knew that the community would be receptive to the idea.

After hearing grumblings from the villagers in passing about the desire to institute a similar program, the PCV presented the idea of VSLP to some of his community members. The villagers were intrigued by what he had to say and wanted to learn more about the program. Once he knew that the village was interested in the program, the PCV contacted me and we decided to hold a meeting with the community leaders and officials.

The VSLP manual carefully details the necessary steps to take in order to implement a successful village bank. The promotion and training involved in the program are implemented in four phases. With this meeting, my colleague and I initiated what is called the “Preparatory Phase.” This three-week phase provides general information to local leaders and prospective VSLA members.

Five community members including the Capitan, a winkel (store) owner, a man working in communications and a well-known and respected man and his wife attended the meeting. For over an hour, the seven of us discussed the program and the perceived advantages and disadvantages of it for the community. At the end of the meeting it was decided that we would move forward with the implementation process and scheduled our next meeting.

The next meeting will consist of the same core group of people. I am currently translating the VSLP manual into the local language of Dutch. Translation of this document is imperative if we want the village to adopt the program as its own and not that of Peace Corps. At this next meeting, which is scheduled for Saturday, we will delve further into the details of the program. We will make an action plan based on the VSLP manual. Finally we will outline a schedule for meetings to follow and the topics to be discussed at those meetings.

Village Banking Model Comparison - Week 7

2007-10-15T12:52:00.000-03:00

After contacting the Director of the NGO about village banking last week, I realized that the organization she is working with has implemented a program in Suriname that blends conventional financial relief from donors with the concepts of both microfinance and village banking. This NGO is using money donated from an outside source to start banks in villages where women’s groups are already established. The funds that are donated are kept in a traditional financial institution such as a bank or credit union. However, the administration of the bank such as loan distribution takes place within the village. In this version of village banking, savings is not a component. Women are only allowed to take out loans and repay those loans with 10% interest added.

This form of village banking is much different from the type that Village Savings and Loan Associates (VSLA) and other groups implement in developing countries around the world. VSLA’s version calls for members to save a certain amount of money each month whereas in the NGO’s version savings is not a component. VSLA also requires the banking funds to come from the participating group collectively and not from an outside source. In some cases though, funds from Microfinance Institutions are allowed. Those funds then remain under lock and key within the village rather than in a bank or credit union. In villages where village banks are implemented by groups such as VSLA, financial institutions are not readily available. This is why the money remains in the village. Travel to a financial institution for day to day operations of the bank would be too costly.

There are some similarities among these forms of village banking. For instance, both types require that participants be responsible for managing the funds and the administration of the loans, not a bank. In addition, they both require that a consensus be reached amongst members concerning the operations of the bank such as the interest rate for loans.

There is no one set formula to implement a village bank. Organizations typically adapt their program to the community where it is being put into action. Given the concerns that many people have regarding distrust amongst villagers, the NGO’s version of village banking may prove to be a more successful model for the country of Suriname. Leaving out the savings component and not intermingling villagers personal funds takes away many of the misgivings people may have about each other.

Personally, I believe that funds for this type of project should come from the community collectively. I feel that programs are more sustainable in a community when that community has a financial stake in the program. It is feasible in a village savings and loan program for villagers to operate separate but equally therefore minimizing some of the skepticism. Villagers can manage their own savings and loans independently but work collectively to ensure that all members meet the requirements for membership such as repayment of loans.

I have a meeting this week with a village where I plan on implementing a village bank based mostly on the Village Savings and Loan Associate’s model. I will be meeting with the Director of the NGO toward the end of this month to learn more about the model her organization is using. I hope to find a happy medium between the two models in order for this village bank to be a success.

Interview With NGO Regarding Village Banking - Week 6

2007-09-30T12:08:00.000-03:00

The following is an interview conducted with the Director of a non-government organization in Suriname regarding village banking within the country. The interview took place 9/26/07. Some information has been changed to protect villages where community banking is taking place.

SB: Sarah Bergin
NGO: Non-government Organization

SB: Does village banking exist in Suriname?
NGO: Yes, village banking was introduced by the NGO (organization name removed) in certain districts in Suriname (district names removed).

SB: What villages are being targeted?
NGO: First pilot was launched in the village of Village #1. Preparations being made for villages of Village #2 and Village #3 (village names removed), while 5 more villages have been targeted in the same area on short term.

SB: How long have the programs for village banking been in existence?
NGO: Village banking system Village #1 was established in 2003.

SB: Who are the key players dealing with village banking in Suriname?
NGO: Women’s organization of Village #1 established the system. Special committee has responsibility for the system and reports to the women’s organization.

SB: What role does your organization play with village banking?
NGO: NGO (organization name removed) has assisted the local organization in establishing the system and keep it running through training and guidance.

SB: Is the government of Suriname receptive to village banking?
NGO: Not sure about that.

SB: What obstacles do you see for the success of village banking?
NGO: The need for credit cooperatives to get involved in order to reach up-scaling of the system which is now small and experimental.

SB: Are the funds for village banking coming from the village itself or are NGO’s and other organizations giving grants and loans to operate the village banks?
NGO:First system (Village #1): seed funds provided by donor organization.
Systems of Village #2 and Village #3 being established with savings of participants and small donations of individuals as seed money.

SB: Are villagers required to attend trainings in order to participate in the village bank?
NGO: Only the leadership.

SB: What interest rates are being charged to administer small loans in the village bank?
NGO: 10%. Pay back is flexible, based on arrangements on individual basis and when applicants expects incomes (harvest, sale, donations, etc.)

SB: What are your thoughts for the future of village banking?
NGO: Seek cooperation with credit cooperative (credit union name removed), in order to expand the system which works good in practice.

SB: Would your organization be willing to promote village banking in the interior as a complementary service to Microfinance?
NGO: Certainly.

Microfinance and Maslow's Hierarchy of Needs - Week 5

2007-09-24T12:49:00.000-03:00

After interviewing the CEO of the credit union last week, I began thinking about the concerns that many people have expressed regarding microfinance and the likelihood for interior communities in Suriname to default on loans. Although I have no statistical data to support these presumptions and am not even sure that I agree, it is definitely the initial reaction of most people I have spoken to.

So why would people take out a loan if they were unable to pay it back? The answer may lie somewhere in Abraham Maslow’s Hierarchy of Needs theory. According to Maslow, “people strive for “self-actualization” in order to reach their highest human potential” (Peace Corps Nonformal Education Manual). There are four needs that must be met before “self-actualization” can be achieved. Maslow believes that people’s primary need is for survival or food, water, shelter, and clothing. Once survival needs are attained, safety needs such as protection from threats can be addressed. After realizing the need for safety the focus moves to the need for love or the feeling of membership and acceptance. Ego and esteem needs are then attended to before the person can finally develop to the fullest potential and reach “self-actualization.” Each day a person’s position in the hierarchy may change according to the need that is not being met at that particular time. For instance, “even a wealthy person cannot concentrate on her work if she has had no breakfast” (Peace Corps Nonformal Education Manual).

In the interior many people are struggling to survive. Some of their primary needs such as nutrition and healthcare are not being met. This may be one reason why people would be less likely to pay back a microloan. It is quite possible that interior people would be more concerned with using the money to satisfy the need to survive rather than to generate income which would give them the means to pay back the loans. According to Maslow’s theory, people “concerned so intimately with simple survival cannot devote their energy to inner growth and a greater understanding of their circumstances until their basic needs are satisfied” (Peace Corps Nonformal Education Manual).

In addition to survival, safety in the interior is also a major concern as tensions still linger from the 1986 – 1992 guerrilla war. The need for love and acceptance is also challenged as skepticism and distrust of one another is on the rise in the interior as culture and tradition fall to the wayside. How can one feel accepted if he is not trusted? If one does not feel loved or accepted then his ego and self-esteem are surely damaged. All of these failures to meet Maslow’s Hierarchy of Needs would make it difficult for people in the interior to see beyond their immediate needs that are not being met and anticipate the consequences for failure to repay loans; the most substantial consequence being the inability to receive future loans.

A good starting point for potential microfinance programs in Suriname to address the issues that Maslow’s hierarchy reveals would be to couple loan distribution with mandatory classes addressing return on investment and the importance of using loans for income generating activities. Villagers would then be able to see past their immediate need to survive and see how these small loans could give them a more permanent solution to survival in the future. As a result, these programs would assist the people of the interior in understanding their circumstances and envisioning a way to reach “self-actualization.” Once that end is achieved, I believe that the probability for villagers to default on microloans will be significantly less.

Interview With CEO Regarding Microfinance - Week 4

2007-09-17T15:14:00.000-03:00

The following is an interview conducted with the CEO of a financial institution in Suriname regarding microfinance within the country. The interview took place 9/12/07.

SB: Sarah Bergin
CEO: Chief Executive Officer

SB: What is the current state of Microfinance in Suriname?
CEO: In my opinion microfinance is at the starting block. Many people are talking about microfinance even very influential people but it has not really begun yet.
SB: So there is no real program yet? They are talking about it and working towards it but nothing has started?
CEO: It depends on how you look at it. If you look at it from an international perspective then nothing has been done yet. They will find that larger credit unions for decades have been providing what is now called microentrepreneurs under another name. At least in my organization we have been providing loans for small businesses.
SB: Do those loans have more leniencies with collateral requirements? I know that a lot of microfinance companies today don’t focus on collateral.
CEO: That is one difference that is why I wanted to distinguish between looking at from an international perspective because if you look at microfinance the way the Grameen Bank is doing it then it differs 100% from what we are doing here. Of all loans provided and I can only talk about my organization there was some sort of collateral. Sometimes very, very hard, sometimes an easier kind of collateral. What we are trying to do now in Suriname is to implement a microfinance program which will be closer to the well known Grameen Bank system where the focus will not be on collateral but on helping the people freely get loans.
SB: How long has this credit union been open?
CEO: Thirty five years.
SB: Do you recall when you stated hearing about the word microfinance and microentrepreneurs?
CEO: I don’t remember exactly but it has been about at least three years now.
SB: Who in Suriname would you say are the key players in microfinance?
CEO: I don’t know. What I know is that I have noticed a shifting of the private industry providing financial services to small businesses.
SB: When you say in the private industry do you mean private lenders? At high interest rates?
CEO: Well high interest rate that is another topic. Coming back to the question, at this moment I do not know who is playing an important role in microfinance. What I do know is that the government is busy working on projects one of them is the establishment of a microlending institution that will work with agriculture, cattle, and fishery. In two weeks from now they will be tendering a meeting and this credit union is also invited to be a part in order to find a financial institution to manage a 2.3 million € grant to make loans to people with cattle. That’s one thing. What must happen now is that the tendering must take place and then they will decide who is going to manage it. This is not a pure microfinance program. On the other hand there is a new project in development and it is a sole microfinance institution that the government wants to develop. They are calling it MIFIS, Microfinance Institution. MIFIS will start with capital of 6 million €.
SB: Where are they getting that money from?
CEO: The money is coming from the government cooperation between Suriname and Holland. The program will give up to 6,000 SRD on loan to microentrepreneurs and they will do this like the Grameen Bank system. So this microfinance institution will provide microfinance to microentrepreneurs to a maximum of 6,000 SRD. That’s the first time and there will be a possibility to get additional loans for expansion.
SB: Are there requirements for the borrowers such as they have to attend classes?
CEO: They will be trained. Yes, they will be trained. The institution will make sure first that one understands what he or she wants to do.
SB: So they will have to propose what their project is going to be that they are using the money for?
CEO: Correct and they will be screened at the beginning by a review so the fact is that the collateral is there but the collateral will be more social-like.
SB: Do you know the timeframe that they are proposing for this institution to be developed?
CEO: What I have seen is a draft of the project proposal. It has been presented to the Dutch Embassy and recommendations have been made and now the consultant is implementing those recommendations with the Minister who is responsible for this and I think that there is a resolution by the government to approve to assist. I mean politics is involved in this.
SB: That was going to be my next question actually. Is the government going to be very involved in this project?
CEO: They are involved because they have to set up the program. They have to make sure that the project is transparent and everyone who is eligible can have access to the loans and once the institution is founded then the government will pull back.
SB: Will it be based here in Paramaribo and will they have field workers go out to the interior or will everyone have to come into the city?
CEO: They are going to have people to go across the country. What is very important is their partnership with NGO’s across the country.
SB: What obstacles do you see for the success of microfinance in this country?
CEO: It is difficult. I have my own opinions but some of them I will not share with other people. My experience is that when my people get things like money granted I’m not sure that they are sensitive to paying those things back. But in the case of microfinance they have to pay it back but if they can’t…the only consequence is they don’t get more money. I don’t want to be pessimistic. I think based on the way the project proposal is set out, there are some requirements. One needs to meet the criteria in order to get the loan so there will be no collateral but I think the chance of losing money will be managed according to the plans set out in the project proposal.
SB: Will it be a locally run organization or will it be run by someone from Holland?
CEO: It will be locally run.
SB: The interest rates that your credit union charges for small business loans, are they similar to other loans that you are giving? So there is no real benefit like in the traditional microfinance sense where people are given lower interest rates and they don’t have collateral?
CEO: No, not really. We had a project for which we had a special grant issued by a Dutch female organization. But with that type of microfinance loans we did have a special interest rate because the money was guaranteed by the grant.
SB: Was that a successful project?
CEO: The project was not, well, it depends on how you look at it. It was a success if I look at the experience we gained. If I look at the productivity then it was not a success. Too many of the entrepreneurs who received the loans did not develop their, they did not meet the goals that they had. Two of them did not even repay the loans. So looking at that we can say yes it was a success because we gained some experience. Some of the entrepreneurs gained some experience and the local female organization that was involved also learned some lessons. I think we did not earn a lot of money on it. In fact we lost some money and we were supposed to get more members from it but that goal we also did not meet.
SB: Does this credit union have any plans for banking in the interior of Suriname?
CEO: We do not see that happening right now.
SB: Do you plan on any kind of mobile banking system?
CEO: I don’t know. We are planning a workshop to plan what we will do over the next three years. There is a new board and so we have to plan what they want to do over the next three years and who knows maybe there could be some new ideas.
SB: We have discussed the idea of village banking a little bit, do you think it is possible here in Suriname? Do you foresee using village banking as a complementary service to microfinance whereas villages would secure loans from this credit union using collective funds as collateral?
CEO: I believe that it is a possibility. In fact I have already had some talks with people who are busy doing village banking in some villages and I want to assist in that field.

Village Savings and Loan Associations - Week 3

2007-09-10T14:55:00.000-03:00

Microfinance Institutes (MFIs) provide valuable services to the underserved. However, “in the developing world, they are most successful in economically dynamic urban areas, where investment opportunities abound; the borrowing requirements of small-scale enterprises are high, income streams are regular and diverse, and the cost of reaching clients is low” (VSL Programme Guide – Field Operations Manual).

In Suriname’s capital city of Paramaribo and along the coast where these conditions are met, MFIs could succeed in meeting the microfinance needs of the Hindustani and Creole population who make up the majority of the underserved households in urban areas. (Assessment of the Supply and Demand of Microfinance Services for Very-Low Income Populations in Guyana and Suriname) However, in the rural interior where conditions are not as favorable for MFIs, Maroons, or escaped slaves, who constitute the majority of the underserved households are in need of “financial services that help them manage their household cash-flow and provide useful lump sums for life-cycle events – which may or may not include income generation” (VSL Programme Guide – Field Operations Manual). One viable method of answering this call for financial assistance in rural areas is through Village Savings and Loan Associations (VSLAs).

Much like MFIs, VSLAs are an effective way to provide small capital to those in need of loans. VSLAs are informal associations that promote financial savings and management in rural or remote areas where formal financial institutions are not accessible. A group of self-selected and trusted village members come together to form a financial support group that functions much like a bank. However, the association operates with collective funds accumulated by its members.

Depending on the constitution outlined by the association, regular meetings are held where all members must attend, be on time and attentive or suffer financial penalties. The penalties are added to the collective funds and redistributed amongst members at the end of the time bound cycle of savings and lending. During the meetings, each member is required to save a certain amount of money in the form of shares as well as payback a set percentage of any loan taken from the collective funds with a service charge added. An elected management committee and general assembly manage operations of the association and ensure that all rules and regulations are adhered to. At the end of the cycle of savings and lending which is determined by the association, all loans must be paid in full and savings along with fees and penalties collected are redistributed to members according to share holdings. After the completion of the cycle, if the group agrees, a new cycle may begin.

In Suriname, the Maroon population living in the interior jungle is estimated to make up 30% of potential microentrepreneurs and has a percentage of poor that amounts to 86%. In addition, a small population of Amerindians lives in the interior and has a percentage of poor that amounts to 75% (Assessment of the Supply and Demand of Microfinance Services for Very-Low Income Populations in Guyana and Suriname). Both of these poor communities could benefit greatly from the financial ramifications of VSLAs.

Between the interior of the country and urban areas where lending entities exist, transportation is costly and cumbersome. Microentrepreneurs in need of small loans certainly cannot afford to make costly trips for regular financial transactions such as savings and loan repayment. Likewise, potential MFIs would find it difficult to conduct business in such hard to reach locals as well as depletive of valuable financial resources. Therefore, having community based organizations like VSLAs for Maroons and Amerindians that address financial matters among its members is a more feasible solution than MFIs.

Independently of each other, MFIs and VSLAs are proving useful vehicles for small amounts of financial capital to the world’s undersreved. Some relief organizations are bridging the gap between microfinance and village banking, though, by making the two approaches complementary to one another. One group in particular, FINCA International, is lending individuals small amounts of working capital for their microenterprises, and because they have little to offer for collateral, are using the VSLAs to guarantee the loans (http://www.villagebanking.org/).

Sadly, classic MFIs such as FINCA do not currently exist in Suriname which leaves the development and administration of MFIs and VSLAs to local groups. On a positive note, there are organizations in Suriname such as the National Women’s Movement that do recognize the need for these types of programs and have even begun implementing them.

In the coming months I will be exploring the existence of village banks in Suriname more in-depth. I will be talking with financial institutions, NGO’s, as well as Peace Corps volunteers living in interior villages. I hypothesize that VSLAs will prove to be a viable solution to the financial needs of interior communities. Conversely, I foresee many issues such as trust and commitment from village members being detrimental to the development of these institutions.

Poverty and Microfinance in Suriname - Week 2

2007-09-03T15:21:00.000-03:00

In 2004, the individual poverty headcount in the country of Suriname reached an alarming 67% (Assessment of the Supply and Demand of Microfinance Services for Very-Low Income Populations in Guyana and Suriname). Although the causes of poverty are numerous and varied, it is certain that once caught in its vicious cyclical, poverty is often difficult to break free from. Experience has shown that there are two approaches proven to be successful in breaking the cycle: acquiring productive assets and education (A Microenterprise Training Guide for Peace Corps Volunteers). However, each of these approaches require funds to initiate and in most developing countries access to capital to obtain these funds is not readily available.

Land ownership is one of the most common means of capital and in Suriname almost all of the land is state-owned. Land leases ranging from 40 to 75 years are sold to citizens but the government reserves the right to revoke the lease and take back the land at any time. Even though Surinamers hold these long-term leases, they do not own a reliable asset with which to secure a loan from a bank and get the funds necessary to acquire productive assets or to access education.

In 1992 a Peace Accord was written to formally end the hostilities that existed in Suriname from 1986-92. Within this accord a provision which gave hope to the issue of property rights stated that “the government shall endeavor that legal mechanisms be created, by which citizens who live and reside in a tribal setting will be able to secure a real title to land in their respective living areas” (IADB, Governance in Suriname). However, to date, very little progress has been made toward this end and thus the people of Suriname remain without such rights and within the cycle of poverty.

The problem of the world’s poor being caught in the poverty cycle is not uncommon and for decades relief organizations and aid workers have been searching for answers. In 1983, inspired by the works of Dr. Akhtar Hameed Khan who founded the Pakistan Academy for Rural Development, Muhammad Yunus founded the Grameen Bank to address the financial woes of the world’s poor. Yunus’s bank pioneered small scale lending or “microcredit” as a means to eradicate poverty. Through small loans, Yunus was able to lend microentrepreneurs funds to expand existing microenterpriseses and develop other income-generating activities. His work has spawned similar organizations both for-profit and non-profit that are using this “micro” approach as an alternative to charity and a means to gaining access to financing without capital assets.

Along the same lines of the Grameen Bank, thousands of institutions dedicated to financing on a “micro” level have been popping up all over the world. Microfinance Institutions (MFI) are taking it one step further though and are offering other financial services such as insurance and technology education in addition to microcredit to help the poor start self-sustaining businesses to escape poverty. The income generated from the businesses that are developed give the microentrepreneur the freedom to invest in productive assets which help expand the business and lift them out of poverty. In addition, the income is being used to educate the children of the microentreprenuers which has a similar long-term effect of diminishing poverty.

As with most matters that address social issues, skeptics exist and argue that microfinance is doing more harm than good. It is thought that the inflated interest rates MFIs are charging to cover the high cost of administering these small loans is bringing the poor deeper in debt. Cynics speculate that loans are being used “to pay off old debts or to buy consumer goods, not to generate income.” A 2004 study conducted by the aid group CARE Bangladesh substantiated these claims (Time, 4/16/07). According to an international aid expert Thomas Dichter, “Fighting poverty is hard work. It takes institutional reform and cultural change. You can’t fix these things by bringing in a truckload of money” (Newsweek 4/9/07).

Currently, microfinancing in Suriname is in the nascent stages of development. It is murky at best as to how local financial institutions will proceed with plans to administer small scale loans. But it is evident that the people of Suriname need alternative financial resources in order to break the cycle of poverty that exists in the country today. If the government continues to ignore the needs of its people, it will only be hampering national development given that the informal sector, comprised in part by many of these poor microentreprenuers, accounts for nearly 15% of GDP (Suriname Country Profile, 2006 Economist Intelligence Unit).

In the coming months I will be exploring the existence of microfinancing in Suriname more in-depth. I will be talking with financial institutions, NGO’s, as well as those in need of loans. I hypothesize that indicators for stagnant development of microfinancing in Suriname will point to institutional dysfunction among lending entities in Suriname as well as a lack of infrastructure and resources to access the interior jungle where the truly poor reside.

Government In Suriname - Week 1

2007-08-27T10:21:00.000-03:00

Since gaining its independence from the Netherlands in 1975, the situation in Suriname has been somewhat of a political tennis match; bouncing between military rule and constitutional democracy. In its current state, Suriname’s government is a presidential system with parliamentary supervision. It is comprised of an Executive branch made up of a president, vice president, and Council of Ministers; a Legislative branch made up of a 51 member-elect National Assembly; and a Judicial branch made up of a Court of Justice (Suriname Country Profile, 2006 Economist Intelligence Unit). In addition, Suriname is divided into 10 administrative districts. Each of the districts is headed by a district commissioner who is appointed by the president.

It is widely known that governance in Suriname is suffering in many areas. Numerous (37 registered) political parties exist and are typically based on ethnicity. Made up of roughly eight different ethnic groups, this diversity is often the cause of poor government performance as each of the political parties has their own agenda influenced by cultural beliefs and practices. This ethnic fragmentation has made it difficult to come to agreement on important issues that affect the day to day operations of the country. In addition to ethnic diversity causing problems with governance, a weak constitution, corruption of officials, mismanagement of employees, and narcotics trafficking are contributing factors as well.

According to the Inter-American Development Bank (IADB), “in recent years, it has become increasingly apparent that development progress and good governance — in a broad sense — are intimately related.” Because Suriname has suffered deficiencies in a number of aspects of governance, the economic and social development of the country have been adversely affected (IADB, Governance In Suriname). There is a high level of poverty in Suriname and these governmental shortcomings have caused the Surinamese to become skeptical of those in power and subsequently of each other making it difficult for economic as well as social development.

A good example of poor governance stifling economic development in Suriname is the natural resource endowment. The Surinamese government has entered into poorly negotiated contracts with private companies who extract most of its natural resources leaving Suriname depleted and unfairly compensated. A country with such a small population (around 450,000) and abundance of natural resources should have a much higher GDP, $2,307 per head (Suriname Country Profile, 2006 Economist Intelligence Unit). Another good example of poor governance having an adverse impact on Suriname is the narcotics trafficking situation. Many government officials, law enforcement officers, and customs agents are being corrupted by enticing incentives made by drug traffickers to “look the other way.” These incentives are usually financial and further increase the rift between the very wealthy and the very poor. As a result, citizens are left even more dubious about the legitimacy of their leaders and protectors.

More and more civic organizations are coming to the aid of Suriname and are working to improve these issues with poor governance in order to avoid hindering development. Private sector organizations, labor unions, and Non-Government Organizations are all reaching out to lend assistance. In a sense, they are trying to pick up where the government is falling short. IADB in particular is lending support to micro-enterprises, credit unions, agricultural groups, and small projects as a means to alleviate some of the poverty within Suriname’s very poor. Many of these organizations are intricately involved in Surinamese government and have proven to be very influential. Although such organizations are helping the situation, they are by no means a solution to the problems within the government. Suriname must take greater strides in addressing internal governmental issues if they want to pull themselves out of poverty. If they fail to do so, development will continue to progress at a snails pace.

micofinance and village banks

2007-08-14T13:00:00.000-03:00

Here's a URL that covers both microfinance and village banks.

http://www.microfinance.ca/en/about/b1_microfinance.cfm

Provide me with feedback on what you think about this URL and how it might, simple as it is, assist you with your project.

Giovanni