Fundación Paraguaya

Published 2009-05-05 11:34:31

New Poverty Eradication Project

We are beginning a new and ambitious project: Poverty Eradication. We aim to take the lessons learned and develop a sustainable methodology that enables endowing the women beneficiaries with the necessary tools to lift themselves definitively out of their situation of poverty. We propose to develop and implement a methodology that eliminates poverty through the implementation of a 100% sustainable and market-based methodology. To this end, we will work with 16,000 women microentrepreneurs of limited resources, members of 1000 Women’s Committees, and initiate a participatory process for the elimination of poverty. Poverty in our country is on the rise: 36% of the population is poor and 16% live in conditions of extreme poverty. The main reason for this high level of poverty is that the formal economy grows very little and poverty does not decrease sufficiently. The flow of investments to massively incorporate the poor into the formal work force is not enough. There is chronic and structural unemployment because the poor are not mainstreamed into this economy due to their lack of knowledge and opportunities.

We have been implementing a Rural Microfinance Program since 2002 seeking to improve the standard of living of small rural farmers who are members of Rural Organizations (RO). This program has achieved its objectives and has not only increased the income levels of the beneficiaries, but also their capacity to organize themselves as a community, access to health and hygiene services, infrastructure (housing, roads and recreational areas), diversified their production and strongly increased their self-esteem. We have also been implementing the Committees of Entrepreneuring Women since 2005; in short order they became massive, self-sustaining, and have had a strong impact on the increase of members' earnings from their microenterprises. Evidence shows that at the end of the first year of participation, their income was up by 56%. The program was expanded to the rural sector later on. This expansion included, in addition to certain methodological adaptations, the incorporation of a technical assistance service on self-sustenance production items leading to the reduction of the home’s cost of living.

Though originally designed as a methodology for granting loans, the program very soon showed even greater potential. Committee member women began to carry out additional activities, not necessarily specific to credit, i.e. savings or training. They began to demonstrate that the program could become a development distribution channel. Consequently, we began to incorporate other elements into the program in 2008: the distribution of eyeglasses for the prevention of short-sightedness (Scojo, today Vision Spring), cataract operations and other ophthalmological treatments, distribution of school supplies, establishment of youth orchestras (jointly with a program called Sonidos de la Tierra, Sounds of the Earth), and children’s savings accounts (Aflatoun), among others. Every one of these new components is self-sustaining and has shown great potential.

At the same time, we are implementing a self-financing educational model at our Agricultural School. This school, where 170 young people study and live in a boarding school setting for next to nothing (they have to pay a symbolic monthly fee of US$12), has 17 microenterprises operating on campus. These productive units not only provide the resources to finance the school, but also enable the educator to work and teach in an environment of an ongoing enterprise, transferring the skills needed to earn money to the students.

The experience with the Rural Small-holder Committees as well as with the Women’s Committees and the Agriculture School have demonstrated that it is possible to eliminate different aspects that have to do with poverty by empowering the beneficiaries and providing goods and services sustainably.

Given this background, we are beginning a new and ambitious project: Poverty Eradication. We aim to take the lessons learned and develop a sustainable methodology that enables endowing the women beneficiaries with the necessary tools to lift themselves definitively out of their situation of poverty. We propose to develop and implement a methodology that eliminates poverty through the implementation of a 100% sustainable and market-based methodology. To this end, we will work with 16,000 women microentrepreneurs of limited resources, members of 1000 Women’s Committees, and initiate a participatory process for the elimination of poverty.

We believe that if we can engender internal motivation in people and develop their abilities to be the protagonists of their own lives, promote organization, and provide them with access to quality goods and services, poverty can be eliminated. In the experience of Fundación Paraguaya (and the Microfinance industry in general), sustainable access to quality goods and services can be provided to those of limited resources.

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