WB to fund second phase of Gemidiriya

by Gamini Warushamana

The World Bank has agreed to fund the second phase of the Gemidiriya Comprehensive Integrated Community Development Project (GCICP). The CEO of the project Dr. Gamini Batuwitage said that the Bank agreed to provide funds to plan the second phase of the project.

The first phase of the project commenced in 2004 with a $51 million grant from the World Bank. The Bank has agreed to finance the estimated $ 181 million for rhe 12-years implementation of the project on reviewing the successful operation of the model.

The GCICP was recognised as one of the most successful models in poverty reduction and rural development at the Sustainable Development Week (SDW) - 2006 at the World Bank Head Office, Washington DC recently.

The Sri Lanka presentation at the SDW comprised senior researchers, heads of divisions and World Bank officials said Dr. Batuwitage. The presentation was made by Dr. Batuwitage and the Senior Program Officer, Micro Finance, M.P. Karunaratna.

Sri Lanka's former Country Director of the World Bank, Peter Harrold delivered the introductory presentation and gave a brief account on how well the project is recognised to check poverty eradication in the country and its expansion in meeting with principles.

Dr. Batuwitage said that during the last two years the project has shown steady progress and today it covers 535 villages. At the SDW the Gemidiriya Micro Finance Scheme was recognised as one of the most successful MF projects in the world. Gemidiriya villages have saved Rs 53.5 million during these two years and they have earned Rs. 7 million in interest. Members maintain the loan repayment rate at 99% and have invested Rs. 142 million in the village economy, improving their livelihood, he said.

The significant features of the Gemideriya MF scheme are its high repayment rate which is higher than any financial institution. Over 14,000 of the 71,000 membership have obtained loans and 80% of them are women. It provides credit only for livelihood development projects. The Gemideriya MF scheme made all these achievements this within two years.

Dr. Batuwitage said that the Gemediriya Micro Finance Scheme will also help to achieve the government's economic development targets. To achieve the 8% economic growth rate, we have to increase national savings to 30% of the GDP whereas today it is only 17.2%, he said.

According to statistics, we will not be able to achieve the Millennium Development Goal of reducing poverty from 23% to 13% by 2015. The Gemidiriya project was introduced to achieve poverty reduction targets and it is a community participatory approach where decision making, planning and implemention is done by the people, he said.

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