Press release number: IFAD 41/05

Rome, November 11, 2005 - Rural poor people, including women, youth and indigenous peoples involved in microenterprises development, will benefit from a new development programme in the Philippines.

The US$23.4 million programme will be financed in part by a US$18.6 million loan and a grant of US$500,000 from the International Fund for Agricultural Development (IFAD). The Government of the Philippines and local participating microfinance institutions will contribute US$4.2 million. Today’s loan agreement was signed at IFAD headquarters by the President of IFAD, Lennart Båge, and the Ambassador of the Philippines, Philippe J. Lhuillier.

The programme will support rural poverty reduction through increased economic development and job creation, and will raise the incomes of 200,000 poor rural households. Its enterprise capacity development activities will focus primarily on 19 of the poorest provinces in five of the poorest regions of the country, the Cordillera Administrative Region, Bicol, Eastern Visayas, SOCCSKARGEN and Caraga. Microcredit and financing operations will be made available to all needy poor rural entrepreneurs. As a result, the programme expects to see increasing numbers of new and existing rural microenterprises expanding and operating profitably and sustainably. It will make a major contribution towards meeting the Philippine Government’s target of creating between six and ten million jobs by 2010.

The programme will establish new rural microenterprises and build the capacity of existing micro and small rural businesses, helping them to expand and become more profitable. Loans will also be made available to microfinance institutions for on-lending to micro and small-entrepreneurs while also strengthening their management and operations capabilities.

“For many rural poor, rural based micro and small enterprises represent the only source of stable income. Therefore, by helping these enterprises to diversify and expand we will contribute towards the creation of new jobs for the poor. This will enable them to overcome their poverty,” said Sana Jatta, IFAD’s Country Programme Manager for the Republic of the Philippines.

With this project, IFAD will have financed 10 projects for a total of US$123 million dollars.

---

IFAD is a specialized agency of the United Nations dedicated to eradicating rural poverty in developing countries. Seventy-five per cent of the world's poorest people - 800 million women, children and men - live in rural areas and depend on agriculture and related activities for their livelihoods. Through low-interest loans and grants, IFAD works with governments to develop and finance programmes and projects that enable rural poor people to overcome poverty themselves.

There are 192 ongoing IFAD-supported rural poverty eradication programmes and projects, totalling US$6.5 billion. IFAD has invested about US$2.8 billion in these initiatives. Cofinancing has been provided by governments, beneficiaries, multilateral and bilateral donors and other partners. At full development, these programmes will help more than 100 million rural poor women and men to achieve better lives for themselves and their families. Since starting operations in 1978, IFAD has invested almost US$8.7 billion in 690 projects and programmes that have helped more than 250 million poor rural men and women achieve better lives for themselves and their families. Governments and other financing sources in the recipient countries, including project beneficiaries, have contributed about US$8.4 billion, and multilateral, bilateral and other donors have provided about US$6.9 billion in cofinancing.