The history of aid effectiveness from the Millennium Summit to Busan - 1st part

In September 2000, after a decade of conferences and summits, the UN Member States adopted in the Headquarters in New York the United Nations Millennium Declaration which involved all the Nations to a global partnership to halve, by the year 2015, the proportion of world’s people suffering for extreme poverty.
Decades of development demonstrated the need for a more systemic approach.  Only bringing in local perspectives and participation it is possible to provide tangible benefits to poor communities and produce sustained impact. The new global challenge to promote widespread and sustainable development demands a new agreed strategy, not merely based on the amounts of aid given, but mainly concerned with effective criteria and methods of aid delivery. For this purpose, the political engagement is essential to move the agenda forward.

The 8 Millennium Development Goals

The Millennium Summit of 2000 represented a historical turning point for setting the aspirations, defining the results and strengthening accountability in the development cooperation sector.

Hidden charges, financial literacy, quasi-monopoly market demand more regulations in microfinance

Main issues requiring government regulations in the microcredit sector:

1 - Quasi monopolistic market: microcredit organizations do not operate in free and competitive markets but operate business in often quasi-monopolies. Furthermore, according to specialists: competition is only on non-price terms (Nimal Fernando, Asian Bank for Development).

2 - Low Financial Literacy: Wrong assumption that microcredit clients are rational economic actors. On the contrary, as demonstrated by the recent global financial crisis, also developed countries need to increase consumer protection legislation. In the United States, for instance, the Obama administration, enforced The Credit Card Accountability Responsability and Disclosure Act of 2009 and in 2010 established the Consumer Financial Protection Bureau to protect consumers of financial services from abusive, deceptive and unfair practices.

3 - Lack of Transparency: Transparency is another key point. Consumers should be put in the conditions to choose the right product after comparing effective interest rates and loan terms. Malpractices such the ones below transform loans from opportunities  to obligations:
up-front fees, compulsory savings, insurance premium subscription; distorted calculation of  the interest rates (usually based on the original loan and not on the residual amount of debt). Professor Subrata Mitra from the Indian Institute of Management in Calcutta, describes in his article Exploitative Microfinance Interest Rates how these tricks litteraly blow up the effective rates.

for more information on these issues you can read the article by Prof. Aneel Karnani published on the Stanford Social Innovation Review entitled Microfinance needs regulation

A book on the ruling of the European Court of Human Rights

The Council of Europe has just released a new book on the European Court of Human Rights. For over 50 years the Court's rulings have resulted in numerous changes to domestic legislation and helped to strengthen the rule of law throughout the wider Europe.

The book European Court of Human Rights: facts and figures retraces the Court's activities and case-law since its foundation in 1959. The presentation of several hundred of the cases the Court has examined, together with statistics for each State, paints an overall picture of the Court's work and the impact its judgments have had in the member States.

The book reviews the law cases of the Court by theme and by article of the European Convention on Human Rights. This work shows the full extent of the rights and freedoms the States Parties to the Convention have undertaken to secure to everyone within their jurisdiction. In addition,  It also takes a country-by-country look at the cases the Court has been called on to examine, and at the impact its judgments have had in the States it has condemned for violating the Convention. A resume of the ruling of the Court is also available in the following summary.