Monday, May 9, 2016

USA Africa Dialogue Series - Microfinance in post-disaster/post-conflict areas and fragile states

This year's edition of the European Dialogue recognizes excellence in microfinance in post-disaster/post-conflict areas and fragile states. It presents a summary of the particular challenges that MFIs face in post-crisis contexts, how those challenges vary depending on whether the crisis is acute or protracted, and the particular opportunities for MFIs to make a positive impact, increasing the resilience of clients and the institutions themselves in the face of extreme vulnerability. It also provides case examples from among the European Microfinance Award semi-finalists of how institutions can match these factors to a range of contexts -from sudden natural disasters, to on-going civil conflict- and includes organizations profiles.

A post-disaster or post-conflict context has many effects. It increases the risk of poverty traps over the short and long term. Poor households' incomes decrease, productivity of economic activities decreases, investments are impaired, market opportunities are reduced, trust and social relations are weakened, and health, housing and shelter conditions are worsened. That is, poverty is not just a household-level consequence of a crisis; but the whole community and economic value chain is affected; the re-establishment of normal socio-economic conditions is undermined. A negative feedback loop of poverty traps can emerge: incomes fall and become more volatile; productivity decreases; markets worsen; infrastructure decays; movement of goods deteriorates; and social cohesion suffers.

Link:http://www.e-mfp.eu/sites/default/files/resources/2016/04/9th%20Dialogue_2015_European%20Microfinanc...


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