EU: Microfinance Facility - Aiding Job Creation
Malta, February, 18 2010 - The European Commission launched the Microfinance facility which was speedily approved by both the Council of Ministers and the European Parliament in the first reading last week.
The recent global economic and financial downturn has led to employment turbulence all over the world, with significant job losses being experienced in all European Union Member States. This crisis has seen unemployment figures creep up to record highs in many countries, with Spain topping the list and expecting an unemployment rate of 22 per cent this year. Plans for decisive action at EU level were therefore expected, in order to aid new job creation across the Member States, targeting in particular citizens considered to be the most vulnerable.
In this context, the European Commission launched the Microfinance facility which was speedily approved by both the Council of Ministers and the European Parliament in the first reading last week.
The Microfinance Facility will specifically be helping vulnerable groups to find an alternative route out of joblessness. It aims at offering unemployed persons the chance of a new start by opening the way for them to explore entrepreneurship. Therefore, through this facility, some of Europe’s most disadvantaged groups, including young people, will be helped out by means of training, mentoring, coaching and capacity building. Furthermore, targeted financial aid will also be given to
new entrepreneurs in the current context of reduced credit supply.
Following the financial crisis, the world experienced reduced levels of lending by commercial banks, thus the European Union and efforts by Member States needed to be further strengthened in order to increase the supply of micro-credits to a sufficient scale and within a reasonable time-frame so as to address the high demand of those who need it most in a time of crisis. Amongst those who need such credits, one finds the unemployed and vulnerable groups who want to develop micro-enterprises, including self-employment, but who do not have access to commercial bank loans.
The approved Microfinance Facility has been assigned to the Progress Programme which covers the period 2007-2013. The programme incorporates four specific Community Action Programmes supporting the implementation of the Social Policy Agenda: antidiscrimination, social inclusion, employment and gender. In order to avoid a dispersed approach, the facility is being offered all across the Union via the Commission itself, thus increasing micro-finance supply in all Member States of the European Union.
The Microfinance Facility proposed by the Commission and approved by both the Council and the European Parliament goes hand in hand with the theme chosen by the Union for 2010, the year combating poverty and social exclusion.
Mr Engerer is Information Executive at the Malta-EU Steering and Action Committee (MEUSAC)Source: www.syminvest.com
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