Big money for the poor in thinking small

Most of the world's poor believe having more job opportunities is the key to moving up in society.

For many, this means working in micro, small, and medium enterprises (SMEs), a sphere of economic activity accounting for the major share of employment in many developing countries.

The World Bank Group sees support for this fragile sector as a powerful force for poverty reduction. Its approach to doing so is summed up in the just-released 2001 Review of Small Business Activities.

The World Bank Group is involved in SME programmes in many areas, including sub-Saharan Africa, Vietnam, Cambodia, Bosnia and Herzegovina, Albania, Kosovo, Yugoslavia and the Pacific Islands.

The publication says that in the 2001 financial year, the World Bank Group approved spending of roughly $US2.8 billion ($6.4 billion) in support of micro, small and medium enterprises.

The largest share came from the World Bank itself, followed in turn by International Finance Corporation and the Multilateral Investment Guarantee Agency.

These activities included both indirect and direct financing, training, support for improved business environments and corporate governance.

The central challenge, the document says, is to build better businesses - SMEs that create lasting jobs, raise incomes, and hold their own in an era of growing global competition.

"The private sector clearly is a key engine of growth, and one of the best ways to build it is from the bottom up focusing on small scale entrepreneurs," writes bank president James D. Wolfensohn in his opening letter.

"This means listening to their concerns, identifying their biggest obstacles and helping them compete in an increasingly global economy.

"Given the right tools, they can create many of the jobs, and much of the wealth, that their societies so badly require."

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