USAID grant to Salvadoran Foundation for Economic and Social Development for development of a small and microenterprise program

This project will finance training, operating expenses, and equipment costs in support of the program, which was established with grant funds from Project 5190177. A new SME office will be established and staffed by at least 14 persons (directors, managers, and technical and administrative personnel), including six field service extension officers who will be trained under the project to reach the thousands of small employment-generating businesses of San Salvador, help them with their accounting, administrative, marketing, and production skills, and arrange credit from a project-financed revolving fund. These small and microbusinesses are presently unserved by the banking system; they will be encouraged to open accounts and practice fiscal responsibility enabling them soon to apply to commercial banks for future credit. It is expected that some 2,375 businesses will be assisted; each will create at least one new job and about 10% of these firms will graduate to the commercial banking system by the end of the project. Employment generated under the project will especially benefit lower income people. FUSADES will develop a credit manual for the program. Data processing, office, and communications equipment will be provided for the SME office. Amendment of 9/29/88 authorizes a 9-month no-cost PACD extension, through 6/89, to allow the project to approach meeting its original objectives, and to provide a linkage to a small business project planned for obligation in FY89. (PD-AAY-471)