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BOLIVIA
>> Regional Overview >> Bolivia Overview Activity Data Sheet
PROGRAM: BOLIVIA
TITLE AND NUMBER: Increased Income for Bolivia's Poor with Emphasis on Targeted Communities, Directly or Indirectly Assisted by USAID, 511-002
PLANNED FY 2001 OBLIGATION AND ACCOUNT: $3,600,000 (DA), $4,121,000 (PL 480)
PROPOSED FY 2002 OBLIGATION AND ACCOUNT: $3,500,000 (DA), $5,000,000 (ESF), $7,915,000 (PL 480)
STATUS: New
INITIAL OBLIGATION: FY 1995 ESTIMATED COMPLETION DATE: FY 2004Summary: The goal of the Economic Opportunities Strategic Objective is to reduce poverty by increasing the income of Bolivia's poor with a particular emphasis on targeted communities directly and indirectly assisted by USAID. The objective is designed to address three key constraints that perpetuate rural and urban poverty: 1) limited access to financial services by the poor in urban and rural areas; 2) the need for enhanced income opportunities for the rural poor through the production and marketing of agricultural commodities; and 3) low levels of primary school enrollment, especially among girls in poverty stricken areas of the country. Ultimate customers are poor rural communities that have a largely indigenous population where women play the central role in the family.
Key Results: Despite a weak economic performance and the adverse impact of a serious and costly civil disturbance, the average annual income of USAID-assisted rural households continued to increase, rising from $950 in 1999 to $1,145 in FY 2000. This significant increase is due to a combination of factors that include expansion in the area under cultivation, excellent growing conditions and high prices for commodities, principally staple crops. The cumulative number of farms and other productive units receiving technological services rose to 9,821 from 6,300 in 1999. This is partly due to the addition of a fourth non-governmental organization (NGO) reporting its data this year. The adoption of new technologies increased significantly, and production and sales of primary (non-livestock) commodities increased by 40%. Outstanding loans (up to 219,184 from 214,687 in 1999) failed to reach the target of 275,000. However, USAID feels the overall performance is excellent given the ongoing micro-finance crisis that continues into a second year. All of the five major private financial funds registered a slight profit. Loan default rates declined from 10% last year to only 8% in 2000 reflecting an improvement in the quality of the overall portfolio. In support of important gender goals, over 65% of the recipients of these loans were women. Despite the economic crisis affecting Bolivia, it is important to note that all Micro Finance Institutions (MFI), while registering a decline in overall profits, nonetheless maintained their profitability. School attendance by girls in primary school slightly exceeded established targets.
Performance and Prospects: Serious factors affecting Bolivia's economic performance coincided with the near saturation of micro credit markets in urban and peri-urban markets. The microcredit Private Financial Funds, in particular, showed their resilience by taking corrective measures to consolidate their portfolios which included stepping up collections, closing problem branches, reducing exposure to individuals and sectors with unsatisfactory repayment. As a result of this, MFI delinquency rates in 2000 were below those of banks and credit unions. During 2000, the number of MFI clients contracted slightly; only one MFI experienced an increase in number of clients. MFI mergers and consolidations are increasingly attractive; four NGOs consolidated in 1999 and others are considering mergers.
Intense competition is beginning to benefit clients as MFIs diversify their products and explore new markets. Solidarity group lending has given way to increased individual lending. MFIs increasingly are using mobile property and mortgages as guarantees. On-lending interest rates have declined in all the MFIs and new savings products have been introduced.
In FY 2000, a total of 9,821 production units (farms, artisans, firms, etc.) received technological services, a major increase over the target of 5,711. The P.L. 480 Title II program, operating in some of Bolivia's poorest communities, resolved productive infrastructure constraints in 357 communities in 2000, an increase of more than 50% from 1999. These significant increases are partially due to an increase in the number of NGOs working in target areas. Community participation in road improvement and micro-irrigation projects in 2000 resulted in placing 683 new hectares under irrigation (22% increase over target) and improving 580 kilometers of farm-to-market roads improved (down 38% from the target primarily due to delay in counterpart funding from participating municipal governments). Title II activities conducted by four U.S. Cooperating Sponsors continues to account for the bulk of these services. It is apparent that Cooperating Sponsors' investment in community training and agriculture extension and marketing is accelerating access and adoption of technological and marketing services. As a result of this, agriculture production of selected crops and net income from agriculture rose an average of almost 40% over target.
The Market Access and Poverty Alleviation (MAPA) activity's work with the newly established Foundation for Transfer of Agriculture Technologies in the Valleys is designed to strengthen institutional capacity to provide agriculture and marketing technologies through a private sector foundation. In December 2000, $3.2 million was apportioned for the Competitive Fund for Innovation and will be available to the Valleys Foundation to finance research, production, and marketing activities designed to increase farm and non-farm income.
Progress toward municipal decentralization has been steady as municipalities take greater leadership in implementing the Popular Participation Law in spite of weak GOB support. USAID facilitated the creation of municipal associations in eight of nine departments. Women council members increased from 128 to over 500 due to stronger provisions in the Electoral Code. In contrast, the percentage of women participating in municipal budget meetings declined. USAID funded the creation of an Association of Women Council Members. The departmental associations and the women council members association have in turn formed a Federation of Municipal Associations, which emerged last year as the recognized representative of the municipalities in national policy discussions.
The Title II School Breakfast program remains popular at the municipal level. Since female enrollment rates are generally low in many rural areas, a key goal of the Title II School Breakfast program is to increase the proportion of girls enrolled and remaining in school. Although the drop-out rate indicator is not sufficiently sophisticated to determine the impact of out migration, re-enrollment, or self-interested under-reporting by school administrators, data show that the proportion of girls enrolled in target communities in 2000 reached 181,764 versus 180,291 in 1999.
During FY 2001 and FY 2002 USAID will continue to address the root causes of poverty in Bolivia. The MAPA program ($1,800,000 DA in FY 2001 and $1,750,000 DA in FY 2002) will increase the access of small farmers to technology and markets, and assist the joint GOB-Inter-American Development Bank (IDB) initiative to create a private agricultural development foundation for Bolivia's Valleys Region. The Rural Financial Services Program will increase the access of Bolivia's rural poor to credit, savings and other financial services ($1,800,000 DA in FY 2001 and $1,750,000 DA in FY 2002). USAID will use $5,000,000 in ESF in FY 2002 to develop a rural-based policy reform program intended to reduce rural poverty and create additional employment and investment in rural Bolivia. The policy reform program intends to: reduce high internal transportation costs that affect agricultural productivity; increase the use of improved technologies for production, post-harvesting and packaging; increase financial services in the rural areas; and review and rationalize import duties on agricultural inputs. Title II funding of $4,121,000 in FY 2001 and $7,915,000 in FY 2002 will be used for increasing agricultural productivity and improving marketing links.
Possible Adjustments to Plans: Despite the proven institutional strength of regulated lending institutions, a third year of poor economic growth will seriously affect Bolivia's micro-finance program. A diagnostic study of over-indebtedness is planned for March 2001 to enable policy makers and lending institutions to understand the reasons for multiple lending from the demand (borrower's) perspective. A study of microenterprise and the environment will identify ways of increasing borrower and lender awareness of negative environmental impact mitigation. USAID will extend its MAPA activity into the Yungas region, using Plan Colombia supplemental funding. For 2002, USAID will develop a rural-based policy reform program that reduces rural poverty and creates additional employment and investment in rural Bolivia. The policy reform program will focus on: reducing high internal transportation costs that affect agricultural productivity; increasing the use of improved technologies for production, post-harvesting and packaging; increase financial services in the rural areas; and reviewing and rationalizing import duties on agricultural inputs.
Other Donor Programs: USAID works closely with a donor committee on micro-finance which includes representatives from Germany, Belgium, IDB, Canada, Denmark, Sweden, Switzerland, the Netherlands, Spain, and the European Union. The group meets periodically to coordinate efforts on micro-finance activities and has issued policy papers for GOB consideration. In coordination with the Ministry of Agriculture, USAID also works closely with the IDB, British Development Agency, German Agency for Technical Cooperation, the Dutch Embassy and the Swiss Development Agency in the design and implementation of MAPA and other areas of Bolivian agriculture development strategy. Donor coordination in agriculture marketing as well as financial services continues to be strong, positive and active.
Principal Contractors, Grantees, or Agencies: Major U.S. contractors, grantees, and implementers for microenterprise activities include the World Council of Credit Unions, Chemonics International, Development Alternatives International, ACCION International, the Foundation for the Promotion and Development of Microenterprises, and the Center for Economic Initiatives. Four Title II Cooperating Sponsors are: the Adventist Development and Relief Agency, Project Concern International, CARE, and Food for the Hungry International. Four Bolivian organizations are involved in microenterprise activities.
Bolivia 511-002
Performance Measures:
Indicator FY97
(Actual)FY98
(Actual)FY99
(Actual)FY00
(Actual)FY00
(Plan)FY01
(Plan)FY02
(Plan)Indicator 1: Number of outstanding loan clients 163,091 189,055 214,687 219,184 275,000 300,000 325,000 Indicator 2: Average annual income of rural households in USAID assisted communities. 900 665 950 1,145 870 950 998 Indicator 3: Cumulative number of communities with productive infrastructure constraints resolved 297 458 642 999 735 800 870 Indicator 4: Number of production units receiving technological services 5,388 5,541 6,300 9,821 5,711 8,007 9,200 Indicator Information:
Indicator Level (S)or(IR) Unit of Measure Source Indicator Description Indicator 1: IR Persons USAID supported microfinance institutions Number of clients with outstanding credit obligations at the end of every calendar year. Note: Indicator has been changed since the FY 2001 Budget Justification to better measure program performance. Indicator 2: SO US Dollars Title II program, survey data from cooperating sponsors. The indicator includes sales of all agricultural-related goods, services, inputed value of own consumption and gifts. Off-farm remittance and government payments are not included. Note: Indicator has been changed since the FY 2001 Budget Justification to better measure program performance. Indicator 3: IR Number of communities Title II (PCI, FHI, ADRA) Number of communities that benefit from one or more productive infrastructure works that eliminate a critical bottleneck in production and marketing. Infrastructure works include road construction and improvement and micro-irrigation projects. Indicator 4: IR Production Units BOLINVEST, 3 Title II cooperating sponsors and other USAID supported institutions "Receiving technological services" is understood as services provided to production units as requested by them or identified as needed by the organization that provides technical assistance. "Production Units" are farms, artisans, firms and other production units of work. U.S. Financing
(In thousands of dollars)
Obligations Expenditures Unliquidated Through September 30, 1999 57,941 DA 49,788 DA 8,153 DA 0 CSD 0 CSD 0 CSD 0 ESF 0 ESF 0 ESF 0 SEED 0 SEED 0 SEED 0 FSA 0 FSA 0 FSA 0 DFA 0 DFA 0 DFA Fiscal Year 2000 1,850 DA 2,444 DA 0 CSD 0 CSD 0 ESF 0 ESF 0 SEED 0 SEED 0 FSA 0 FSA 0 DFA 0 DFA Through September 30, 2000 59,791 DA 52,232 DA 7,559 DA 0 CSD 0 CSD 0 CSD 0 ESF 0 ESF 0 ESF 0 SEED 0 SEED 0 SEED 0 FSA 0 FSA 0 FSA 0 DFA 0 DFA 0 DFA Prior Year Unobligated Funds* 0 DA 0 CSD 0 ESF 0 SEED 0 FSA 0 DFA Planned Fiscal Year 2001 NOA 3,600 DA 0 CSD 0 ESF 0 SEED 0 FSA 0 DFA Total Planned Fiscal Year 2001 3,600 DA 0 CSD 0 ESF 0 SEED 0 FSA 0 DFA Future Obligations Est. Total Cost Proposed Fiscal Year 2002 NOA 3,500 DA 7,000 DA 73,891 DA 0 CSD 0 CSD 0 CSD 5,000 ESF 10,000 ESF 15,000 ESF 0 SEED 0 SEED 0 SEED 0 FSA 0 FSA 0 FSA 0 DFA 0 DFA 0 DFA
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Last Updated on: May 29, 2002 |
