Northern Uganda Microfinance Initiative - Project Proposal
Authors
Location
Northern Uganda - Acholi internally displaced person (IDP) camps; re-inhabited rural Acholi villages
Time & Duration
Summer/Fall 2008 - Initiate research, establish relationship with partner organization
Summer 2009 - Travel to Uganda (on-site surveying, implementation)
Summer 2009-Fall/Spring 2010 - Wrap-up work, publication/distribution of study
Potential Project Partner(s)*
COVOL Uganda, BRAC Uganda, Life in Africa
*Though we believe in the potential for reliable relationships with these organizations (only a few from a long list of possibilities), we should point out that we do not have any contacts with them (Jyotsna?)
Type of Project
WDA will travel to northern Uganda to research the financial service needs of the rural poor, either in Acholi villages being reinhabited and rebuilt after a twelve year exodus, or in one of the clusters of internally displaced person (IDP) camps in the region. We will most likely be working in either the Gulu, Kitgum, Pader, or Lira districts of northern Uganda. This month or so of research will help us to adjust/perfect our approach toward ultimately collaborating with our partner organization to provide two types of microfinance services to the Acholi people: individual microcredit loans and solidarity group revolving loan funds (RLFs)*. Ideally, WDA will provide the impetus and initial groundwork for this organization to open a sustainable microfinance center in the chosen location.
The question remains: What can we, as Whitman College students, uniquely offer? John and I have just been struggling over this. It seems that the project outlined above is a strong one, but could be performed by almost any service organization with proper funding. We’ve thought of the following element that might make our efforts particularly meaningful: In addition to an appraisal of the financial service needs of the rural poor, we will provide an intimate look at the human rights issues involved and an academic assessment of the cultural, political, religious, and social inhibitors to this type of aid in the region to be distributed among NGOs (we realize this idea sounds SHOCKINGLY similar to the study currently being compiled for the SCWP, but we think it might be equally appropriate here). We recognize this piece of the project to be most in need of deliberation.
*About Revolving Loan Funds (RLFs):
The Process of establishing a Solidarity RLF Group
Introducing the RLF Idea
This is gathering support and educating / training the community about what the group is and how it would operate. Usually this is done through meetings that inform the community about what an RLF is, how it works, and the long-term benefits to the community.
Forming a group of participants
This group forms voluntarily out of interested and willing members of the community. The advisors do not pick the group, they encourage its organic formation by individuals.
Loan Applications
After the group is constructed, a few members are chosen by the group or advisors, who then fill out the loan application, most likely with assistance from the advisors. The group then selects one or two applicants to receive the first loan(s).
Training
?
Amount
The amount is extremely dependent on the current financial situation of the applicant, as well as the amount of funds we have raised and number of loans we are giving out.
Interest Rates
The interest rates on the loans is usually set at or above local levels of commercial banks.
Loan Repayment
Repayment plans are dependent on many variables: the economic situation of the loan recipients, the type of business and time frame (the agricultural cycle, for instance), and the recipient’s current income.
New Loans
New loans applications are reviewed and funds dispersed by the group only after all outstanding loans have been repaid.
More details will be added to the Establishing RLFs section above over the next few days.
Established Need For Project (Background)
Uganda was a British colony until 1962. During the period of colonial rule, the British focused heavily on political and economic development among the southern Baganda people and used the northern Acholi people primarily for manual labor and the armed services. When Uganda was granted independence, a large chasm existed between the northern and southern peoples, and there were coups and counter-coups for a decade, with no group able to establish an effective government.
In 1971, Idi Amin seized power through a military coup and ruled Uganda with an iron fist. He is known for political repression, expulsion of Indians from the country, ethnic killings and persecution (especially of the Acholi and Lango peoples), torture, and numerous other human rights abuses; estimates of the dead range from 100,000 to 500,000. He was deposed in 1979 and the first Ugandan president, Milton Obote, was restored. He ruled until 1985 when Tito Okello took power in a coup and ruled for six months, until Yoweri Museveni and the National Resistance Army took power.
Museveni, a southerner, has been in power since 1986. In 1987, the Acholi guerilla leader, Joseph Kony, founded a group called the Lord’s Resistance Army (LRA) to fight against the Ugandan government with the goal of establishing a theocracy based on the ten commandments and Acholi tradition. It is important to note that the Acholi population of northern Uganda did not support Kony; they wanted peace. This is one of the main reasons Kony and the LRA have abducted around 66,000 children to serve as child soldiers and sex slaves in their ranks, not to mention thousands of adults. The LRA felt it was betrayed by its own people and waged a brutal campaign of terror against the Acholi.
President Museveni, in an attempt to protect the Acholi, forced the population into IDP camps in 1996 in the wake of massive abductions and massacres of Acholi men, women, and children, by the LRA. Another major factor was the Museveni government’s belief that the Acholi might cooperate with the LRA, and wanted to separate civilians from rebels as much as possible. However, the camps have proven anything but safe. LRA massacres and abductions have occured inside the camps, devastating and deadly fires are common due to the grass roofs of the closely spaced huts, disease runs rampant, there is barely enough food, little work, limited educational opportunity, and overall horrid living conditions. Many of the people living in the camps are orphans.
In recent years, the situation has improved due to international aid relief efforts, especially in the areas of food, clothing, medicine, and more educational opportunities. Still, the situation remains dire; many starve to death or die of disease, there are not enough teachers or schools to educate close to all the children, and if there were, most couldn’t afford to pay the school fees. Security has also improved due to the military success of the Ugandan government, and in 2006 the government told the 1.7 million people in IDP camps they could begin returning home to the war-ravaged villages that have been empty for over a decade. While some people have begun to return home and begin the overwhelming task of rebuilding, hundreds of thousands still remain in the squalid camps.
A ceasefire that is the cause of the current peace expired April 10, and Kony has failed yet again to come in and sign a permanent peace accord at the ongoing Juba Peace Talks. The latest deadline was April 15th. Because Museveni refuses to sign the peace accord before Kony does and the ceasefire has expired, the chance of lasting peace weakens each day. In other words, the people that have returned to their homes may not be there long. This means we should leave the option of providing microfinance within the an IDP camp open. The 21 year civil war has most seriously affected those populations least responsible for it. Families are destroyed, a generation is left irreparably scarred, northern Uganda’s environment and economy are devastated, and civilians continue to suffer incredible human rights atrocities.
This is an extremely brief and basic history of post-colonial Uganda and the current situation. If the history of this sadly underreported situation is something that you would like to read more about, please visit resolveuganda.org/history. This is one of the most extensive sites we have found.
Rough Cost Estimate
TBD?
Implementation
Members of WDA will travel to northern Uganda during Summer 2009 to work with a partner organization to survey the specific financial needs of the community, build ground support and interest within the target population, distribute loan applications, and, in addition to awarding individual microcredit loans, construct a solidarity group RLF. We will eventually release funds to both the successful loan applicants and the RLF group, effectively establishing a new microfinance center in the region to be operated by our partner organization.
Expected Impact
While hundreds of thousands of Acholis remain in IDP camps, many are returning to their home villages. These communities, facing daunting reconstruction, are some of the most lucrative settings for microfinancial aid. By providing essential, otherwise unavailable financial services, we hope to assist the Acholi people as they emerge from years of gross abuse and attempt to start anew. We hope to engage with the cultural, political, and social climate of this region in the most conscientious and unique way possible and provide regional/international NGOs with critical insight into this long-ignored crisis.
Things to Consider
- Should we consider providing business training for loan recipients/RLF groups?
- Is this a stable enough environment work in?
- Are we spreading ourselves too thin?
- Is a “study” really something that regional/international NGOs need?
- How can we “engage in the cultural, political, and social climate of this region in the most conscientious and unique way possible”?
Tags: microfinance, project proposal, Uganda