Rural enterprises and agro-business development institutions

Africare and the Credit Union National Association (CUNA) will be the primary implementors. A.I.D. capital will increase the financial viability and lending ability of the Investment and Development Fund (INDEFUND) and the Malawian Union for Savings and Credit Cooperatives (MUSCCO). INDEFUND will receive $1.2 million for onlending to small and medium-sized entrepreneurs; MUSCCO will receive $300,000 for onlending to credit unions and their members. The project will also upgrade the operational and service capabilities of the two entities. Africare will help INDEFUND establish an in-house business and accounting advisory service and will participate in providing both on-the-job training for the new service"s staff and management training and TA for INDEFUND"s general staff; some offshore training for senior INDEFUND staff is planned. CUNA will provide TA to MUSCCO management, and the project will finance an expansion of MUSCCO"s field staff, who will largely be trained by PCV"s. The project will also build a simple, national-level office for use by MUSCCO and other participating entities. In the project"s second component, Africare will work with INDEFUND, MUSCCO, and other entities such as the Development of Malawian Traders Trust (DEMATT) to prepare investment and business feasibility studies; as part of this effort, Africare will advise small entrepreneurs on appropriate technology, while DEMATT will prepare a guide to financing wholesale and retail stores. Africare will also provide informal training and TA, respectively, to potential and actual participants in the project"s credit program. A revolving fund to finance individual training programs for entrepreneurs may be created. Africare will also participate with INDEFUND, MUSCCO, and DEMATT in conducting studies to identify the types of support services needed by small-scale entrepreneurs and to assess credit and related service needs. Amendment of 5/19/89 increases funding, extends PACD 1 year to 12/90, and modifies activities in response to a 8/88 evaluation. Key changes are to: add additional short-term TA through Volunteers in Overseas Cooperative Assistance, a U.S. PVO; conclude Africare activities as of 12/89; increase promotional activities; and improve the administrative capacities of INDEFUND, DEMATT, and MUSCCO. The project will also receive additional funding from local currency generations of the Malawi Enterprise Development Program (6120233). (PD-BBQ-342)