
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 22USC2151f]

 
               TITLE 22--FOREIGN RELATIONS AND INTERCOURSE
 
                     CHAPTER 32--FOREIGN ASSISTANCE
 
                 SUBCHAPTER I--INTERNATIONAL DEVELOPMENT
 
  Part I--Declaration of Policy; Development Assistance Authorizations
 
Sec. 2151f. Micro- and small enterprise development credits


(a) Findings and policy

    Congress finds and declares that--
        (1) the development of micro- and small enterprises 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; and
        (2) it is, therefore, in the best interests of the United States 
    to assist the development of the enterprises of the poor in 
    developing countries and to engage the United States private sector 
    in that process.

(b) Program

    To carry out the policy set forth in subsection (a) of this section, 
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 microentrepreneurs; and
        (3) training programs for microentrepreneurs in order to enable 
    them to make better use of credit and to better manage their 
    enterprises.

(c) Eligibility criteria

    The Administrator of the agency primarily responsible for 
administering subchapter I of this chapter shall establish criteria for 
determining which credit institutions described in subsection (b)(1) of 
this section are eligible to carry out activities, with respect to 
micro- and small enterprises, assisted under this section. Such criteria 
may include the following:
        (1) The extent to which the recipients of credit from the entity 
    do not have access to the local formal financial sector.
        (2) The extent to which the recipients of credit from the entity 
    are among the poorest people in the country.
        (3) The extent to which the entity is oriented toward working 
    directly with poor women.
        (4) The extent to which the entity recovers its cost of lending.
        (5) The extent to which the entity implements a plan to become 
    financially sustainable.

(d) Additional requirement

    Assistance provided under this section may only be used to support 
micro- and small enterprise programs and may not be used to support 
programs not directly related to the purposes described in subsection 
(b) of this section.

(e) Procurement provision

    Assistance may be provided under this section without regard to 
section 2354(a) of this title.

(f) Availability of funds

                           (1) In general

        Of the amounts authorized to be available to carry out section 
    2152a of this title, there are authorized to be available $1,500,000 
    for each of fiscal years 2001 and 2002 to carry out this section.

                    (2) Coverage of subsidy costs

        Amounts authorized to be available under paragraph (1) shall be 
    made available to cover the subsidy cost, as defined in section 
    661a(5) of title 2, for activities under this section.

(Pub. L. 87-195, pt. I, Sec. 108, as added Pub. L. 98-151, 
Sec. 101(b)(2), Nov. 14, 1983, 97 Stat. 972; amended Pub. L. 99-83, 
title III, Sec. 308, Aug. 8, 1985, 99 Stat. 215; Pub. L. 100-418, title 
II, Sec. 2211, Aug. 23, 1988, 102 Stat. 1335; Pub. L. 106-309, title I, 
Sec. 106, Oct. 17, 2000, 114 Stat. 1085.)


References to Subchapter I Deemed To Include Certain Parts of Subchapter 
                                   II

    References to subchapter I of this chapter are deemed to include 
parts IV (Sec. 2346 et seq.), VI (Sec. 2348 et seq.), and VIII 
(Sec. 2349aa et seq.) of subchapter II of this chapter, and references 
to subchapter II are deemed to exclude such parts. See section 202(b) of 
Pub. L. 92-226 set out as a note under section 2346 of this title, and 
sections 2348c and 2349aa-5 of this title.

                          Codification

    Section 108 of Pub. L. 87-195 is based on section 407 of title IV of 
H.R. 2992, Ninety-eighth Congress, as reported May 17, 1983, and enacted 
into law by Pub. L. 98-151.


                            Prior Provisions

    A prior section 2151f, Pub. L. 87-195, pt. I, Sec. 108, as added 
Pub. L. 93-189, Sec. 2(3), Dec. 17, 1973, 87 Stat. 715, related to 
application of subpart I, II, or X of part II of this subchapter to 
assistance under this part, prior to repeal by Pub. L. 95-424, title I, 
Sec. 102(g)(2)(K)(i), Oct. 6, 1978, 92 Stat. 943, eff. Oct. 1, 1978.


                               Amendments

    2000--Pub. L. 106-309 amended section catchline and text generally, 
substituting provisions promoting micro- and small enterprise 
development credits for provisions relating to the establishment, 
funding and uses of a private sector revolving fund to aid developing 
countries.
    1988--Subsec. (i). Pub. L. 100-418 added subsec. (i).
    1985--Subsec. (b). Pub. L. 99-83 substituted ``each of the fiscal 
years 1986 and 1987, up to $18,000,000'' for ``fiscal year 1984, up to 
$20,000,000''.


                    Effective Date of 1985 Amendment

    Amendment by Pub. L. 99-83 effective Oct. 1, 1985, see section 1301 
of Pub. L. 99-83, set out as a note under section 2151-1 of this title.

                         Delegation of Functions

    For delegation of functions of President under this section, see Ex. 
Ord. No. 12163, Sept. 29, 1979, 44 F.R. 56673, as amended, set out as a 
note under section 2381 of this title.


          Findings and Declarations of Policy of 2000 Amendment

    Pub. L. 106-309, title I, Sec. 102, Oct. 17, 2000, 114 Stat. 1079, 
provided that: ``Congress makes the following findings and declarations:
        ``(1) According to the World Bank, more than 1,200,000,000 
    people in the developing world, or one-fifth of the world's 
    population, subsist on less than $1 a day.
        ``(2) Over 32,000 of their children die each day from largely 
    preventable malnutrition and disease.
        ``(3)(A) Women in poverty generally have larger work loads and 
    less access to educational and economic opportunities than their 
    male counterparts.
        ``(B) Directly aiding the poorest of the poor, especially women, 
    in the developing world has a positive effect not only on family 
    incomes, but also on child nutrition, health and education, as women 
    in particular reinvest income in their families.
        ``(4)(A) The poor in the developing world, particularly women, 
    generally lack stable employment and social safety nets.
        ``(B) Many turn to self-employment to generate a substantial 
    portion of their livelihood. In Africa, over 80 percent of 
    employment is generated in the informal sector of the self-employed 
    poor.
        ``(C) These poor entrepreneurs are often trapped in poverty 
    because they cannot obtain credit at reasonable rates to build their 
    asset base or expand their otherwise viable self-employment 
    activities.
        ``(D) Many of the poor are forced to pay interest rates as high 
    as 10 percent per day to money lenders.
        ``(5)(A) The poor are able to expand their incomes and their 
    businesses dramatically when they can access loans at reasonable 
    interest rates.
        ``(B) Through the development of self-sustaining microfinance 
    programs, poor people themselves can lead the fight against hunger 
    and poverty.
        ``(6)(A) On February 2-4, 1997, a global Microcredit Summit was 
    held in Washington, District of Columbia, to launch a plan to expand 
    access to credit for self-employment and other financial and 
    business services to 100,000,000 of the world's poorest families, 
    especially the women of those families, by 2005. While this scale of 
    outreach may not be achievable in this short time-period, the 
    realization of this goal could dramatically alter the face of global 
    poverty.
        ``(B) With an average family size of five, achieving this goal 
    will mean that the benefits of microfinance will thereby reach 
    nearly half of the world's more than 1,000,000,000 absolute poor 
    people.
        ``(7)(A) Nongovernmental organizations, such as those that 
    comprise the Microenterprise Coalition (such as the Grameen Bank 
    (Bangladesh), K-REP (Kenya), and networks such as Accion 
    International, the Foundation for International Community Assistance 
    (FINCA), and the credit union movement) are successful in lending 
    directly to the very poor.
        ``(B) Microfinance institutions such as BRAC (Bangladesh), 
    BancoSol (Bolivia), SEWA Bank (India), and ACEP (Senegal) are 
    regulated financial institutions that can raise funds directly from 
    the local and international capital markets.
        ``(8)(A) Microenterprise institutions not only reduce poverty, 
    but also reduce the dependency on foreign assistance.
        ``(B) Interest income on the credit portfolio is used to pay 
    recurring institutional costs, assuring the long-term sustainability 
    of development assistance.
        ``(9) Microfinance institutions leverage foreign assistance 
    resources because loans are recycled, generating new benefits to 
    program participants.
        ``(10)(A) The development of sustainable microfinance 
    institutions that provide credit and training, and mobilize domestic 
    savings, is a critical component to a global strategy of poverty 
    reduction and broad-based economic development.
        ``(B) In the efforts of the United States to lead the 
    development of a new global financial architecture, microenterprise 
    should play a vital role. The recent shocks to international 
    financial markets demonstrate how the financial sector can shape the 
    destiny of nations. Microfinance can serve as a powerful tool for 
    building a more inclusive financial sector which serves the broad 
    majority of the world's population including the very poor and women 
    and thus generate more social stability and prosperity.
        ``(C) Over the last two decades, the United States has been a 
    global leader in promoting the global microenterprise sector, 
    primarily through its development assistance programs at the United 
    States Agency for International Development. Additionally, the 
    Department of the Treasury and the Department of State have used 
    their authority to promote microenterprise in the development 
    programs of international financial institutions and the United 
    Nations.
        ``(11)(A) In 1994, the United States Agency for International 
    Development launched the `Microenterprise Initiative' in partnership 
    with the Congress.
        ``(B) The initiative committed to expanding funding for the 
    microenterprise programs of the Agency, and set a goal that, by the 
    end of fiscal year 1996, one-half of all microenterprise resources 
    would support programs and institutions that provide credit to the 
    poorest, with loans under $300.
        ``(C) In order to achieve the goal of the microcredit summit, 
    increased investment in microfinance institutions serving the 
    poorest will be critical.
        ``(12) Providing the United States share of the global 
    investment needed to achieve the goal of the microcredit summit will 
    require only a small increase in United States funding for 
    international microcredit programs, with an increased focus on 
    institutions serving the poorest.
        ``(13)(A) In order to reach tens of millions of the poorest with 
    microcredit, it is crucial to expand and replicate successful 
    microfinance institutions.
        ``(B) These institutions need assistance in developing their 
    institutional capacity to expand their services and tap commercial 
    sources of capital.
        ``(14) Nongovernmental organizations have demonstrated 
    competence in developing networks of local microfinance institutions 
    and other assistance delivery mechanisms so that they reach large 
    numbers of the very poor, and achieve financial sustainability.
        ``(15) Recognizing that the United States Agency for 
    International Development has developed very effective partnerships 
    with nongovernmental organizations, and that the Agency will have 
    fewer missions overseas to carry out its work, the Agency should 
    place priority on investing in those nongovernmental network 
    institutions that meet performance criteria through the central 
    funding mechanisms of the Agency.
        ``(16) By expanding and replicating successful microfinance 
    institutions, it should be possible to create a global 
    infrastructure to provide financial services to the world's poorest 
    families.
        ``(17)(A) The United States can provide leadership to other 
    bilateral and multilateral development agencies as such agencies 
    expand their support to the microenterprise sector.
        ``(B) The United States should seek to improve coordination 
    among G-7 countries in the support of the microenterprise sector in 
    order to leverage the investment of the United States with that of 
    other donor nations.
        ``(18) Through increased support for microenterprise, especially 
    credit for the poorest, the United States can continue to play a 
    leadership role in the global effort to expand financial services 
    and opportunity to 100,000,000 of the poorest families on the 
    planet.''


                       Purposes of 2000 Amendment

    Pub. L. 106-309, title I, Sec. 103, Oct. 17, 2000, 114 Stat. 1081, 
provided that: ``The purposes of this title [see Short Title of 2000 
Amendments note set out under section 2151 of this title] are--
        ``(1) to make microenterprise development an important element 
    of United States foreign economic policy and assistance;
        ``(2) to provide for the continuation and expansion of the 
    commitment of the United States Agency for International Development 
    to the development of microenterprise institutions as outlined in 
    its 1994 Microenterprise Initiative;
        ``(3) to support and develop the capacity of United States and 
    indigenous nongovernmental organization intermediaries to provide 
    credit, savings, training, technical assistance, and business 
    development services to microentrepreneurs;
        ``(4) to emphasize financial services and substantially increase 
    the amount of assistance devoted to both financial services and 
    complementary business development services designed to reach the 
    poorest people in developing countries, particularly women; and
        ``(5) to encourage the United States Agency for International 
    Development to coordinate microfinance policy, in consultation with 
    the Department of the Treasury and the Department of State, and to 
    provide global leadership among bilateral and multilateral donors in 
    promoting microenterprise for the poorest of the poor.''


                               Definitions

    Pub. L. 106-309, title I, Sec. 104, Oct. 17, 2000, 114 Stat. 1082, 
provided that: ``In this title [see Short Title of 2000 Amendments note 
set out under section 2151 of this title]:
        ``(1) Business development services.--The term `business 
    development services' means support for the growth of 
    microenterprises through training, technical assistance, marketing 
    assistance, improved production technologies, and other services.
        ``(2) Microenterprise institution.--The term `microenterprise 
    institution' means an institution that provides services, including 
    microfinance, training, or business development services, for 
    microentrepreneurs.
        ``(3) Microfinance institution.--The term `microfinance 
    institution' means an institution that directly provides, or works 
    to expand, the availability of credit, savings, and other financial 
    services to microentrepreneurs.
        ``(4) Practitioner institution.--The term `practitioner 
    institution' means any institution that provides services, including 
    microfinance, training, or business development services, for 
    microentrepreneurs, or provides assistance to microenterprise 
    institutions.''
