Development Bank status mooted for IPED - Persaud Since 1986 52,002 jobs created By Bebe Buksh Stabroek News October 19, 2000 In the light of its continued robust performance, the Institute of Private Enterprise Development (IPED) is likely to be transformed into a development bank, Chairman Yesu Persaud said at the institute's 14th annual general meeting (AGM) yesterday at Le Meridien Pegasus Hotel. He said IPED was examining a bank modelled on one in the Eastern Caribbean Islands. In 1999 IPED registered a surplus of $80 million, representing an increase of almost 14% over the previous year. IPED funded 5,057 micro and small loans totalling $771 million creating 9,022 jobs and bringing the total number of jobs created since the institute came into being in 1986 to 52,002. Also since its inception, IPED provided 20,101 loans--11,100 for micro-enterprises and 9,001 for small businesses--across the country. To date, IPED is said to have contributed over $2 billion to the economy. Women, mainly single parents, benefit from approximately 80% of all micro sector loans. Persaud said major floods earlier this year "created a stir" for many entrepreneurs and help was being rendered to them. IPED General Manager, Manjula Brijmohan, told Stabroek News that the assistance was being given to those farmers "genuinely affected". She explained that the relief was of two types--IPED giving further loans to farmers in cases where preparation of the land was needed after the water receded and rescheduling loans for those farmers who would require a longer period of recovery. Almost all the farmers who have benefited from IPED loans are from Essequibo, Black Bush Polder and Mahaica, among other coastal regions which were affected by the floods. According to her report at the AGM, many areas considered high-risk have already attracted IPED's attention and a detailed analysis of these areas was under consideration. "Some steps have been taken to test these territories, though at a slow rate. We have extended limited services to Mabura, Kwakwani, Siparuta, Pomeroon River and Mahdia," said Brijmohan. IPED services Regions Two, Three, Four, Five, Six, Nine and Ten. She said Regions Nine and Ten were only "touched marginally". Best manager: This IPED client, Jacob Shamlall of Old Road, Land of Canaan, East Bank Demerara, won the 1999 award for "Best Managed Project" in poultry rearing and a grocery shop. Meanwhile, Persaud said that unlike large businesses "holding back" in the light of upcoming general elections, IPED has been forging ahead. "The demand and capacity of small businesses to take risks in the environment where big businesses are waiting for better enabling conditions or waiting until after the elections, encouraged us to take the initiative to expand our services to this sector in the economy where traditional financial institutions are hesitant to enter." He said IPED has recognised the micro and small enterprise sectors' potential and its "invaluable impact on the overall development of the economy especially at the time when the public sector is shrinking and private investment is not forthcoming at a desired rate." As for his "reasonably good" prospects for this year and the future, Persaud said he was counting in a major way on developing international linkages in software and information technology, but stopped short of saying what surprise he would soon be unveiling in the latter. He would only say that it would make a big impact on Guyana. IPED has already established connections with a research institute in Trinidad, CARIRI and the Indian Technical and Economic Cooperation (ITEC) programme. IPED's performance has even won it international kudos. A Caribbean Development Bank (CDB) consultant based in Washington DC, Damian von Stauffenberg, said IPED was "literally the only micro-finance organisation we [CDB] have seen so far in the English-speaking Caribbean. Moreover, IPED is considerably more efficient than any other MFI [Multilateral Financial Institution] we know--and MICRORATE has looked at over 60 in the last three years. You manage to extend loans and recover them at administrative costs, which are less than half of those of leading institutions such as BancoSol in Bolivia or Financiera Calpis in El Salvador. Nobody else we know has administrative costs as low as yours." Meanwhile, in his feature address to the packed forum of members of the Diplomatic Corps, some government functionaries, IPED staff and clients, and other officials, United Nations Development Programme (UNDP) Resident Representative, Richard Olver, underscored the need for Guyana to attract more private capital flows to attain a developed national economy, thereby eradicating poverty. "Like it or not, a far greater presence of foreign capital is needed to fuel prosperity," said Olver. But he noted that "mobilisation of foreign capital must be matched by the marshalling and deployment of domestic capital, including the most under-utilised capital of all: the human capital of the poor." He referred to the Interim-Poverty Reduction Strategy Paper (I-PRSP) which points to a one-to-one relationship between the percentage growth in GDP and the percentage decline in poverty. Olver spoke on the theme of rolling back poverty based on a "culture of enterprise" rather than on a "culture of entitlement", the first way of helping the poor. The second he suggested was providing an environment in which businesses could flourish, and last, the need for good governance which promotes transparency and accountability. And, in reference to Guyana awaiting debt relief, Olver reiterated the words of many international figures that "we must attack the root causes of indebtedness, not its symptoms." Meanwhile the IPED board of directors, headed by Persaud was re-elected en bloc. The directors are: Leslie Chin, Vickram Oditt, James Morgan, Dr Ian McDonald, Laurence Farley, Amanda Richards and Komal Samaroo. Follow the goings-on in Guyana in Guyana Today