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EIB Microfinance Support: Objectives for the MENA region

Supporting microfinance in the MENA region European Microfinance Week Francesco Consiglio, EIB Luciana Tomozei, EIB. 1. EIB Microfinance Support: Objectives for the MENA region. Support the development of private and financial sector

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EIB Microfinance Support: Objectives for the MENA region

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  1. Supporting microfinance in the MENA regionEuropean Microfinance WeekFrancesco Consiglio, EIBLuciana Tomozei, EIB 1

  2. EIB Microfinance Support: Objectives for the MENA region • Support the development of private and financial sector • Small operations with high value added, leading to well governed MFIs • Integration of MFIs with local financial market • Variety of instruments offered, including capacity building 2

  3. EIB’s activity in the region • Active operations, EUR 27m: 3

  4. Regional context update (I) • Situation in the MENA region: • Not enough or too much funding? • Penetration rate in the region is still low • Most funds concentrate on a few stronger MFIs • Appetite for equity investments but opportunities are scarce • Capacity Building issue, especially for smaller MFIs (governance, staff, transparency, internal organisation) • Legislation issues 4

  5. Regional context update (II) • Impact of the revolutions in the Arab region: • Revolutionin Tunisia, then in Egypt and finally in Libya was a surprise and brought unexpected problems; • New risks (e.g. for Tunisia: reputational, perceived link with Government, insecurity, economic crisis, PAR levels, refugees from Libya …); • Actions taken by MFIs (portfolio monitoring, rescheduling of loans, contact with clients); • Lessons learnt by MFIs: risk management, governance, staff satisfaction, new opportunities. 5

  6. MicroMED • Timely and targeted response to microfinance needs in the region • Aims at contributing to financial inclusion EIB and bilateral support: Expertise (targeted TA, capacity building) Funding EC actions: Regulatory support Knowledge sharing Microfinance needs: Technical assistance, capacity building Funding, etc. 6

  7. MicroMED - TUNISIAEIB and Gov. of Luxembourg envisage joint actions • TA: Immediate support for microfinance regulatory change in Tunisia at the request of the MoF • Capacity building modules for MFIs • Rating activities: rating co-financing • Develop pilot projects (e.g. micro-credit, micro-insurance, mobile finance) Aim: to replication of these tools to other countries in the region

  8. Thank you!consiglio@eib.orgtomozei@eib.org 8

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