Local Economic Development and Microfinance in NAD Indonesia

This report describes the proposed approach, preliminary operational plan, and the human resources needed to implement the “Economic Recovery and Microfinance” program.

Describing the program, the report outlines that:

• The program has two components:
  1. Continuation of development of the microfinance system, and,
  2. Local Economic Development (LED).

• The objective of the program is to increase the economic power of micro, small and medium enterprises (MSMEs).
• The target group is the poor population of Aceh, particularly, women in rural areas, who demand microfinance and business development services.

The report explains context in which the program ran:

• The disastrous effects of the civil war and the tsunami on the economy of Aceh, especially the insufficient economic dynamics of MSMEs caused by a lack of adequate financial services and limited business skills.

The report defines the German Technical Cooperation role as providing:

• Productive assets to the target group;
• Mission details such as the activities and names of program experts;
• Details of the economy;
• Business Awareness and Information;
• Business Training;
• Business Field Service;
• Business Information Service;
• Business Sector Promotion;
• Business Association Support.