Macro level

The macro approach fosters a conducive enabling environment framework that defines how the government can support the microfinance industry. There is an international consensus that governments should enable the building of inclusive financial systems, and not provide them directly. MFI partners and USAID-Tijara started macro-level work in Iraq in 2009. There will be increased effort on the macro approach in 2010 and beyond, including:

• The Legal and Regulatory Enabling Environment Working Group¹ (LRWG) working on the legal and regulatory framework on getting Iraqi partner MFIs recognized by the CBI and licensed as non-bank financial intermediaries (NBFIs). Possible forms include limited liability companies (LLCs) or joint stock companies. More vigoruous dialogue and action plans will be developed to facilitate Iraqi microfinance industry transformation.
• Dialogue, coordination efforts such as with donors, and action plans are being done with such key stakeholders as the CBI, the NGO Assistance Office, the Registrar of Companies, other donors such as the World Bank and UNDP, as well as all of our 12 partner MFIs and USAID.
• Already in 2010, considerable progress has been made in getting the NGO Asssistance Office in understanding microfinance and its critical role in sustainable economic development. This understanding and resulting cooperation are facilitating the adaptation and legal registration of MFI partners according to the new NGO Law recently promulgated.

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[1] The Legal and Regulatory Enabling Environment Working Group (LRWG) includes staff and officials from the following constituent groups: USAID-Tijara, MFIs, Iraqi and international, USAID/Iraq, and periodically such Iraqi government officials as those from the Central Bank and the Parliament.