OTTAWA, 14 November 2006 — Ottawa will provide $40 million in aid to help microcredit projects in developing countries, Foreign Minister Peter MacKay announced on Sunday. He was speaking in Halifax, Nova Scotia where over 2,000 delegates, including Pakistani Prime Minister Shaukat Aziz and this year’s Nobel Peace Prize winner, Mohammed Yunus of Bangladesh, had gathered for the start of the four-day Global Microcredit Summit.
Yunus has been widely recognized as a microcredit pioneer.
Microcredit is a system of banking in which institutions give small loans to people who do not qualify for bank loans because they have neither credit history or collateral.
MacKay said it was an important tool that helped people lift themselves out of poverty and was especially useful for women in poor countries. With the loans, he added, people living in poverty were able generate income for themselves, their families and their community.
The loans, ranging in value from thousands of dollars to as low as $50, can help entrepreneurs buy computers, sewing machines, a plot of land or even just a chicken which enable them to sell eggs.
MacKay said the Montreal-based Development International Desjardins, the Canadian Cooperative Association and Oxfam-Québec will each receive funding to build on their respective microfinance programs. In turn, they plan to help would-be entrepreneurs in Asia, Africa and Latin America.