Release number IFAD/45/06

Rome, 8 December 2006 – About 180,000 poor people in rural areas of the Gambia will have better access to savings plans, credit, insurance services and business advice, thanks to a new development project working with the country’s key microfinance institutions.

The International Fund for Agricultural Development (IFAD) will largely finance the US$8.73 million Rural Finance Project with a loan of US$6.12 million and a grant of US$400,000. The agreement for the loan and grant were signed today by Ms Ada Gaye, Deputy Permanent Secretary of the Department of State for Finance and Economic Affairs for the Republic of The Gambia, and IFAD President Lennart Båge at IFAD’s headquarters.

The project will provide skills and technical training to local microfinance institutions in six rural divisions in the Gambia. The training will help project participants identify and develop new financial products, such as business development services for rural clients, as well as improve their information management systems and expand the reach of their services.

Rural finance institutions will plan, carry out and evaluate the project and its impact on clients. There will also be an annual evaluation by village men and women to generate recommendations for further activities. By the end of the six-year project, participating finance institutions are expected to reach over 70,000 new rural customers.

The Gambia is one of the most densely populated countries in Africa. Agricultural production is decreasing due to erratic weather, land degradation and inefficient markets and storage. Almost half the population now lives in urban areas. Rural families are forced to rely on livelihoods that require little or no land but few poor rural people can access credit to finance other activities.

Since starting operations in 1978, IFAD has provided loans totalling more than US$45.57 million for eight programmes and projects in the Gambia.

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IFAD is a specialized agency of the United Nations dedicated to eradicating poverty and hunger in rural areas of developing countries. Through low-interest loans and grants, it develops and finances projects that enable rural poor people to overcome poverty themselves. There are 188 ongoing IFAD-supported rural poverty eradication programmes and projects, totalling US$6.3billion. IFAD has invested more than US$2.9 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 nearly 85 million rural poor women and men to achieve better lives for themselves and their families. Since starting operations in 1978, IFAD has invested US$9.2 billion in 716 programmes and projects that have helped approximately 301 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 participants, have contributed almost US$8.9 billion, and multilateral, bilateral and other donors have provided another US$7.0 billion in cofinancing.