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IFAD
in Albania
IFAD has financed five projects in Albania since 1993, investing a total of US$51.9 million in rural development, irrigation rehabilitation and agriculture in the poorest mountainous areas of the country. IFAD’s most recent investment of US$9.2 million in The Mountain to Markets Programme is a package of poverty-reduction measures based on participatory and systematic identification of investment opportunities in poor mountain areas. The goal is to increase the incomes of poor rural people in the northern part of Albania, the most disadvantaged part of the country. The Programme for Sustainable Development in Rural Mountain Areas supports initiatives to increase household income among rural poor people in mountainous areas. One of the programme’s objectives is to convert the Mountain Areas Finance Fund into a fully operational rural commercial bank owned by clients and investors. The Mountain Areas Development Programme, a major development effort initiated by IFAD, focused on 16 of the country’s 21 poor marginal mountain districts. Through its Gender Mainstreaming Programme for the CEN countries, IFAD has provided technical assistance in the form of a US$88,2000 grant to benefit women and youth. The grant supports a project initiated by the Mountain Areas Finance Fund to generate knowledge and develop skills that will enable rural women and young people to increase their incomes and improve their living conditions. Farmers in Albania and other countries in the region are developing stronger links with private traders and agribusiness firms thanks to the Facility for Farmers’ Access to Markets (FFAM), which is managed by IFAD and receives support from the Government of Italy. The FFAM improves production and processing standards, promotes new technologies and strengthens institutional measures to increase access to markets and trade. It also contributes to the harmonization of development aid and fosters relationships between the private sector and small-scale producers and processors. IFAD’s strategy in Albania In Albania IFAD invests in programmes and projects that help poor people undertake economically viable activities that will generate the income they need to improve their standard of living. IFAD loans provide a basis for promoting sustainable increases in economic activity in poorer, mountainous areas so those areas can become more closely integrated into the national economy. Although IFAD-funded programmes and projects will continue to focus on farming and agri-businesses in Albania, the agricultural sector alone cannot represent the only means of economic advancement for poor people in mountain areas. Substantial levels of public and private investment are required to develop businesses, improve the business investment climate and provide the infrastructure needed to revitalize local economies.
Through its recent investments in the country, particularly in improved access to rural financial services and funding sources, IFAD is working to broaden opportunities for economic growth and increased employment for rural poor people. Experience in project implementation in mountain areas has shown the economic potential in livestock, medical herbs, horticulture, agroprocessing and such non-agricultural activities as agrotourism, wood processing and stone carving. IFAD’s ongoing direct support for business and small and medium-size enterprises is evolving to promote expanded opportunities. Even more importantly, the organization acts as a catalyst for resource allocations from other donors. Progress in the transition process is opening up new avenues for support for commercial and economic development, even in mountain areas. IFAD is exploring those avenues in the interests of rural poor people. IFAD’s operations help consolidate the programmatic approach initiated under the Mountain Areas Development Plan, in which the Mountain Areas Development Agency and the Mountain Areas Finance Fund (MAFF) have major roles. Innovations to be explored with commercial banks, and particularly with MAFF, include development of new financial instruments such as leasing, insurance and alternative collateral, and of ways to adjust loan repayment terms and conditions to suit the requirements of poor people in rural areas. The progressive restructuring of MAFF into a self-funding, private rural bank providing a full range of rural financial services is an innovative development that will support economic diversification and growth in mountain areas.
Source: IFAD |
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