A Microcredit Project In Lebanon

A high level Grameen Trust delegation led by Professor H. I. Latifee, Managing Director of Grameen Trust, visited Lebanon from May 11 to 15, 2007, at the invitation of the Hariri Development Group and DMI Sarl of Lebanon. During the visit Mr. Fadi F. Fawaz, in charge of Hariri Group Microfinance Project, formally requested a partnership between the two organizations in the following two areas: establishment of a Microfinance Project in Lebanon and that of a Middle East Center for Microfinance Excellence.

The Grameen Trust delegation met with H. E. Mr. Sami Haddad, the Honorable Minister for Ministry of Economy and Trade of the Government of Lebanon. The minister extended his warm greetings to Professor Yunus and congratulated him for being awarded the Nobel Peace Prize for 2006. The Grameen Trust delegation also met Mr. Ibrahim Chahrour, Director of Planning and Programming Division, Council for Development and Reconstruction (CDR), to discuss the various on going government microfinance programs designed to rebuild the economic activities following the recent armed conflicts in Lebanon. DMI Sarl had arranged three focus group discussions in various poverty pockets in Lebanon to familiarise the Grameen Trust delegation with the poverty situation and the opportunity for microfinance in Lebanon.

The delegation took part in a focus group discussion in the northern port city of Tripoli at the office of the Women's Work Association, with more than 25 members participating in the discussion. Tripoli, as a port city, had been prosperous in the past, but now suffers decadence. There is a great demand for microcredit. Many women were curious about the solidarity group structure of the Grameen model. The participants also said that the traditional banks were not eager to serve them. Many in the community indicated a preference for financial services that conformed to the Islamic principles, but were eager to pay any necessary service fees for access to loans. A lady mentioned that she had gone to a traditional bank for a US$6,000 loan and requested that she would pay a fee of US$500, but would not pay any interest. The bank refused to give her a loan based on her conditions.

After learning of the Grameen microcredit system many in the gathering expressed an immediate interest to join the program.

The delegation met with more than 20 farmers at another focus group discussion at the Lebanon Agricultural Research Institute, north of Tripoli. The farmers indicated a preference for a more flexible microcredit system, where they could repay their loan seasonally, at the time of harvest. The women in the group were more eager than men to gain access to microcredit.

In the third focus group discussion there ware 12 male farmers who met at the Center for Memorizing Qur'an in Bekka Valley in Anjar region, near the Syrian border in Eastern Lebanon. The group indicated their interest for microcredit with a preference for repayment at the time of harvest. While there were more than 11 banks within a very short distance, commercial banks were not able to meet the farmers' needs.

Dr. Fares El-Zein made a detailed presentation to the Grameen Trust delegation about the Hariri Development Group's social development and microfinance initiative. Mr. Fadi F. Fawaz also explained an ambitious plan for creation of a Middle East Microfinance Center for Excellence in Lebanon that the Hariri Group can set up with support from Grameen Trust. Soon after the visit, Grameen Trust presented a draft Memorandum of Understanding highlighting the scope and responsibilities of the two partner organizations in setting up a sustainable microfinance program in Lebanon as well as the proposed Microfinance Center for Excellence.

Report by Tamim Islam, Grameen Trust