GENEVA (ILO News) - The Director-General of the International Labour Office (ILO) has welcomed the publication of a new report by the Microcredit Summit Campaign 2004, saying the success of microfinance is crucial to job creation and poverty reduction worldwide.
The Campaign, a program of the US based non-governmental organization RESULTS Educational Fund, seeks to reach 100 million of the world's poorest families with microcredit by the end of 2005, the U.N International Year of Microcredit. Organizers said the campaign has already helped an estimated 274 million family members, (a figure equal to the combined populations of the United Kingdom, France, Germany, Italy, Ireland, and Sweden) by extending credit and other financial and business services to the self employed.
"The successes of microfinance institutions around the world - from Bangladesh to Bolivia, from Uganda to the Philippines - testify to the power of microcredit in charting a sustainable route out of poverty" said Juan Somavia, ILO Director General, "it promotes self-employment and helps people expand their economic activities so they can hire others. Microcredit and other microfinancial instruments can also become an important part of the social safety net-helping to create means for savings and insurance so that people have something to fall back on in hard times."
Microfinance often plays a critical role in the ILO's programmes, particularly those aimed at helping countries implement core labour standards such as the elimination of forced labour and child labour.
The ILO's Social Finance Programme, created in 1991, analyses, evaluates and disseminates information on financial sector issues relevant to employment and social justice.
The programme is centred on reducing vulnerability, investing in job creation and making financial policies more employment-focused. The ILO promotes institutions and policies that work for the poor and it is engaged in making markets more inclusive and accessible. Microfinance has an important role to play in realizing the goal of decent work for all as well as in the attainment of the Millennium Development Goals.
Over the past decade, the ILO has pioneered several microfinance applications: linking worker remittances to microfinance, post-conflict microfinance, micro-leasing, micro-insurance and micro-equity. It will be participating in activities relating to the International Year of Microcredit.
State of the Microcredit Summit Campaign,
Report 2004. www.microcreditsummit.org.
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ILO information contact: Social Finance Programme. Tel.: +4122/799-6070. www.ilo.org/socialfinance.