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Publication Detail
FDC 2005-01: Beyond Economic Benefits: The Contribution of Microfinance to Post-Conflict Recovery in Asia and the Pacific

Microfinance in a post-conflict context is often described as a powerful tool to boost local economic development and to support post-conflict rehabilitation assistance. However, little research has been undertaken to look beyond microfinance’s economic benefits, at social mobilization, empowerment, stabilisation, peacebuilding and solidarity, through social capital enhancement. This paper describes microfinance’s intangible benefits, by reviewing the literature and exploring and synthesising lessons from conflicts in nine countries in Asia and the Pacific, with emphasis on microfinance experiments in Afghanistan, Papua New Guinea (Bougainville), Sri Lanka and Timor Leste. This paper demonstrates that microfinance promotes conflict resolution, for example by empowering members to establish their own organisation. It encourages democratic procedures that help people surmount conflicts, while providing a way to bring people together, focusing on economic activities and cooperation rather than differences. Microfinance provided to different ethnic groups can also contribute to social and political reconciliation, as it provides a forum for a unified voice for peace, with people cooperating and working towards a shared future. Moreover, microfinance also encourages reintegration of refugees and demobilised soldiers by providing finance to mixed groups linked by joint liability. Finally, microfinance is also a tool to empower people by regaining trust and confidence in each other.

PinoyME Foundation
Authors Keywords
Marino, Pascal; microfinance; impact evaluation; post-conflict recovery; social mobilization;
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Published in 2005 and available in the FDC or can be downloaded as full text Downloaded 728 times since November 25, 2011