Sherine Nasr visits USAID projects seeking to empower communities in Upper Egypt Technical and financial support by international donors has often contributed to efforts to develop and empower local communities in some of Egypt's most disadvantaged areas. One of the earliest donors to venture into Upper Egypt has been the United States Agency for International Development (USAID) which, over the past 30 years, has been involved in projects providing access to education, improving health conditions, financing rural infrastructure networks, and developing the private sector. Qena and Luxor amongst all of the Upper Egyptian governorates, have received the lion's share of programmes supported by USAID. Prominent amongst such programmes have been those devoted to developing small and emerging businesses as a means of resolving unemployment and providing income to vulnerable segments of Egyptian society. "Since 1990 USAID has been the largest financier of micro-finance initiatives in Egypt that support more than 70 per cent of all activities in this sector," said Francis Ricciardone, US ambassador to Egypt during a two-day visit to Qena and Luxor last week. Small and micro enterprises (SMEs) play a significant role in Egypt's economic and social development, given that they constitute 99 per cent of all non-agricultural private sector enterprises. SMEs employ approximately 60 per cent of Egypt's total labour force. USAID-supported micro-finance institutions (MFIs) have so far cumulatively extended some LE5 billion worth of micro-credit loans to more than one million small and micro entrepreneurs at a default rate of less than three per cent. According to USAID's Small Business Development Project Manager Magdy Khalil, MFIs currently manage an outstanding loan portfolio of LE565 million serving about 520,000 active borrowers through more than 220 specialised branches operating nationwide. "More than 50 per cent of these borrowers are poor, female heads of households that are located in some of Egypt's most economically disadvantaged areas," said Khalil. He added that USAID is planning to expand its current micro-finance programme so as to serve about 800,000 active borrowers in 2007. The agency has signed a memorandum of understanding with Banque du Caire (BC) which is currently being merged with Banque Misr. By virtue of this memorandum BC will receive the technical assistance and training required for it to establish and operate a nationwide micro-credit programme. "After the merger [is finalised] there will be an excellent opportunity to expand USAID/BC successful micro-credit activities to Banque Misr's 440- branch network," said Khalil. According to Amr Abouesh, advisor to BC chairman, the bank is now managing an outstanding loan portfolio of LE8.3 million serving some 4,000 active borrowers in Qena. In Luxor, BC has cumulatively extended more than 16,500 micro-credit loans valued at LE58 million to some 7,400 low-income entrepreneurs at a default rate of less than two per cent. "The bank is also managing an outstanding loan portfolio of LE8.3 million which serves about 1,000 active borrowers in Luxor," Abouesh said. Qena is also benefiting from the Agricultural Exports and Rural Incomes Project (AERI). Launched in 2003, the project which is to continue until September 2007 is designed to raise incomes in rural areas by promoting their agricultural export potential. AERI's objective is to increase the access by farmers and agri-businesses to the knowledge, technology, markets and institutions that are needed to attain competitiveness in international markets. "Specific assistance activities cooperate with small-scale farmers to help them raise their productivity, become suppliers to exporters and food-processing firms, diversify their crops and win better prices for them. They also assist them in finding new markets and applying best practices in horticulture," said Gary Robbins, AERI's project manager. According to Robbins, the project will benefit 6,000 small holders in Qena. Water distribution is another field which for decades has been cause for concern to Upper Egyptian farmers. According to USAID officials, a "win-win solution" is finally being reached between water users, and those officially engaged in water management. Four major governorates have been selected as the sites of a new project decentralising authority and integrating the management of all water resources. These are Aswan, Qena, Sharqiya and Gharbiya. Together, the four governorates cover some 15 per cent of Egypt's overall agricultural land. In Qena where some 400,000 feddans are irrigated, nine newly-established Integrated Water Management Districts (IWMD) are responsible for the management of irrigation, drainage and ground water. To promote users' participation in all aspects of water-management in these districts, Branch Canal Water User Associations have been formed. These associations empower water-users to assess the needs of their communities and instantly resolve local conflicts. Included in the bargain as well is improving water quality by means of the control of solid and liquid waste disposal. "Before we had an association, water supply was always uncertain and I could only grow fodder. I now grow cucumber and earn much more from the same land," said a farmer from Qena. "This is the first time in Egypt that water- user participation has been introduced at such a large scale over such a short time," commented Ricciardone. He said that the formation of associations involves "a democratic election process", with the participation of all users in a branch canal area. In Luxor there are 31 associations currently covering 43 branch canals, with 659 water- user representatives and 194 elected board members of which eight per cent are women.
