[Congressional Record Volume 142, Number 113 (Monday, July 29, 1996)]
[House]
[Pages H8624-H8626]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                          MICROENTERPRISE ACT

  Mr. BEREUTER. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 3846) to amend the Foreign Assistance Act of 1961 to 
authorize the provision of assistance for microenterprises, and for 
other purposes.
  The Clerk read as follows:

[[Page H8625]]

                               H.R. 3846

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Microenterprise Act''.

     SEC. 2. MICRO- AND SMALL ENTERPRISE DEVELOPMENT CREDITS.

       Section 108 of the Foreign Assistance Act of 1961 (22 
     U.S.C. 2151f) is amended to read as follows:

     ``SEC. 108. MICRO- AND SMALL ENTERPRISE DEVELOPMENT CREDITS.

       ``(a) Findings and Policy.--The Congress finds and declares 
     that--
       ``(1) the development of micro- and small enterprise, 
     including cooperatives, is a vital factor in the stable 
     growth of developing countries and in the development and 
     stability of a free, open, and equitable international 
     economic system;
       ``(2) it is, therefore, in the best interests of the United 
     States to assist the development of the private sector in 
     developing countries and to engage the United States private 
     sector in that process;
       ``(3) the support of private enterprise can be served by 
     programs providing credit, training, and technical assistance 
     for the benefit of micro- and small enterprises; and
       ``(4) programs that provide credit, training, and technical 
     assistance to private institutions can serve as a valuable 
     complement to grant assistance provided for the purpose of 
     benefiting micro- and small private enterprise.
       ``(b) Program.--To carry out the policy set forth in 
     subsection (a), the President is authorized to provide 
     assistance to increase the availability of credit to micro- 
     and small enterprises lacking full access to credit, 
     including through--
       ``(1) loans and guarantees to credit institutions for the 
     purpose of expanding the availability of credit to micro- and 
     small enterprises;
       ``(2) training programs for lenders in order to enable them 
     to better meet the credit needs of micro- and small 
     entrepreneurs; and
       ``(3) training programs for micro- and small entrepreneurs 
     in order to enable them to make better use of credit and to 
     better manage their enterprises.''.

     SEC. 3. MICROENTERPRISE DEVELOPMENT GRANT ASSISTANCE.

       Chapter 1 of part I of the Foreign Assistance Act of 1961 
     (22 U.S.C. 2151 et seq.) is amended by adding at the end the 
     following new section:

     ``SEC. 129. MICROENTERPRISE DEVELOPMENT GRANT ASSISTANCE.

       ``(a) Authorization.--(1) In carrying out this part, the 
     Administrator of the United States Agency for International 
     Development is authorized to provide grant assistance for 
     programs of credit and other assistance for 
     microenterprises in developing countries.
       ``(2) Assistance authorized under paragraph (1) shall be 
     provided through organizations that have a capacity to 
     develop and implement microenterprise programs, including 
     particularly--
       ``(A) United States and indigenous private and voluntary 
     organizations;
       ``(B) United States and indigenous credit unions and 
     cooperative organizations; or
       ``(C) other indigenous governmental and nongovernmental 
     organizations.
       ``(3) Approximately one-half of the credit assistance 
     authorized under paragraph (1) shall be used for poverty 
     lending programs, including the poverty lending portion of 
     mixed programs. Such programs--
       ``(A) shall meet the needs of the very poor members of 
     society, particularly poor women; and
       ``(B) should provide loans of $300 or less in 1995 United 
     States dollars to such poor members of society.
       ``(4) The Administrator should continue support for 
     mechanisms that--
       ``(A) provide technical support for field missions;
       ``(B) strengthen the institutional development of the 
     intermediary organizations described in paragraph (2); and
       ``(C) share information relating to the provision of 
     assistance authorized under paragraph (1) between such field 
     missions and intermediary organizations.
       ``(b) Monitoring System.--In order to maximize the 
     sustainable development impact of the assistance authorized 
     under subsection (a)(1), the Administrator should establish a 
     monitoring system that--
       ``(1) establishes performance goals for such assistance and 
     expresses such goals in an objective and quantifiable form, 
     to the extent feasible;
       ``(2) establishes performance indicators to be used in 
     measuring or assessing the achievement of the goals and 
     objectives of such assistance; and
       ``(3) provides a basis for recommendations for adjustments 
     to such assistance to enhance the sustainable development 
     impact of such assistance, particularly the impact of such 
     assistance on the very poor, particularly poor women.''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Nebraska [Mr. Bereuter] and the gentleman from New York [Mr. Engel] 
each will control 20 minutes.
  The Chair recognizes the gentleman from Nebraska [Mr. Bereuter].
  Mr. BEREUTER. Mr. Speaker, I yield myself such time as I may consume.
  (Mr. BEREUTER asked and was given permission to revise and extend his 
remarks.)
  Mr. BEREUTER. Mr. Speaker, we have long recognized the value of the 
microenterprise loans. As chairman of the Subcommittee on Asia and the 
Pacific, I noted the success of the Grameen Bank in Bangladesh. Grameen 
has loaned over $1 billion to over 2 million people with a repayment 
rate of 98 percent. These clearly fit the model of the microenterprise 
loan. I have seen it work very effectively in places like Peru, as 
well.
  This bill provides two new authorities in the Foreign Assistance Act 
to provide microgrants and microloans. I am assured that the bill has 
the support of the minority and the administration. I urge its 
adoption.
  Mr. Speaker, I reserve the balance of my time.
  Mr. ENGEL. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in strong support of this bill. I want to commend 
the work that Chairman Gilman and Mr. Gejdenson have done in putting 
together a bill that helps microenterprise development and a bill which 
we can all support.
  Microenterprise development has proven to be an effective way to help 
the world's poor work their way to a better standard of living for 
themselves and for their country.
  This bill establishes special authorities under the Foreign 
Assistance Act for microenterprise grants and loans. It signals the 
importance of focusing on loans to the poorest of the poor and 
providing such assistance through private voluntary and nongovernmental 
organizations. Again, it is the perfect example of the private sector 
working together with government in a partnership that works and helps 
people.
  This bill should strengthen one part of the U.S. foreign assistance 
program. Again, I commend Chairman Gilman and Mr. Gejdenson for their 
efforts. This bill adopts a balanced and thoughtful approach. I 
strongly urge its adoption.
  Mr. GILMAN. Mr. Speaker, this is a proud day for me. I began my work 
in support of microenterprise development almost 20 years ago as a 
member of the President's Commission on Hunger. I introduced the first 
microenterprise bill in 1986 and supported these programs as strongly 
as possible during my service here in Congress.
  The Microenterprise Act, H.R. 3846, represents a historic alliance 
between the administration, microenterprise groups, and the Congress 
behind the cause of microenterprise development to help the poorest of 
the poor work their way out of poverty.
  We have all heard of Prof. Muhammad Yunus and his successful Grameen 
Bank in Bangladesh. Today, the Grameen Bank is one of the largest banks 
in Bangladesh. It has served over 2 million borrowers and lent over $1 
billion. Most of the loans are small--under $300--and 94 percent of the 
borrowers are women. The bank represents one of he most successful 
foreign assistance programs yet designed to eliminate poverty among the 
poorest of the poor.
  Most importantly, Grameen's borrowers have repaid their loans at a 98 
percent repayment rate.
  The microenterprise movement is not just about Grameen. In Bolivia, 
BancoSol grew from nothing to serve over 40 percent of all banking 
clients in Bolivia. BancoSol and its microenterprise lending program is 
so big and successful that it has graduated part of this program from 
assistance and now borrows funds directly from the New York market to 
continue its service to Bolivia's poor. Other microenterprise 
institutions dot the planet, including hundreds here in the United 
States and especially in my home State of New York.
  This bill breaks new ground. It provides two new tailor-made 
authorities under the Foreign Assistance Act for microenterprise grants 
and microenterprise loans. The bill recommends the administration to 
focus on loans to the poorest of the poor, mainly through private, 
voluntary organizations, nongovernmental organizations and other worthy 
institutions.
  The administration supports this bill along with Mr. Hamilton, Mr. 
Gejdenson, Mr. Houghton, and 24 other cosponsors. I am grateful to them 
and I want to give special thanks to key members of the Microenterprise 
Coalition, Sam Harris of RESULTS, Maria Otero of ACCION International, 
and Lawrence Yanovitch of FINCA along with Brian Atwood and Robert 
Boyer of AID who helped bridge the gap, allowing us in the Congress to 
come together in support of microenterprise.
  I am informed that this bill has the support of Senator Helms and 
Senator Sarbanes. I think this bill is too important to delay in the

[[Page H8626]]

other body. As the debate on the bill and the report that accompany the 
bill shows: One, that we want AID to make at least half of its micro 
credit in amounts below $300, and two, that we want AID to make most 
initial loans at the $150 level to reach the poorest of the poor. 
Following the hoped for enactment of this bill, we can reexamine the 
situation next year to assess how successfully AID is reaching the poor 
with micro credits.
  I commend this bill to the House and urge its adoption.
  Mr. ENGEL. Mr. Speaker, I yield back the balance of my time.
  Mr. BEREUTER. Mr. Speaker, I have no further requests for time, and I 
yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Nebraska [Mr. Bereuter] that the House suspend the rules 
and pass the bill, H.R. 3846.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill was passed.
  A motion to reconsider was laid on the table.

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