After the Tsunami - Grameencredit in Aceh
Professor H. I. Latifee with the members of AGCP in Aceh, Indonesia
On December 26, 2004, the most powerful earthquake in 40 years erupted in the Indian Ocean, near Sumatra. The quake with a magnitude of 9.3 on the Richter scale, triggered a devastating tsunami which killed more than 200,000 people in Indonesia, Thailand, India, the Maldives, Somalia and Sri Lanka. Most of those killed in the tsunami were from the Indonesian province of Aceh.
After the tsunami, Sister Beth Del Fierro got in touch with Grameen and a collaborative arrangement was worked out to implement a microcredit project which was named Aceh-Grameen Credit Project (AGCP). This was a Build, Operate and Transfer (BOT) project undertaken by Grameen Trust and has been operating since July, 2006. The project is sponsored by Grameen Aceh Women's Savings and Loan Cooperative and its aim is to provide financial services to the poorest, especially women who were affected by the tsunami in Aceh, Indonesia.
Language was a barrier, as the local people did not know English. Immigration issues for expatriate staff working on the project, shortage of qualified manpower and lack of income generating activities in the area posed problems. These difficulties were overcome by Md. Nur Islam, the Grameen Trust appointed Project director of AGCP, with the help of other staff at AGCP, who worked hard to make the project a success. Adjusting to a new environment and culture, recruiting people who could also convey messages to the members, training new employees, adjusting salaries and finding new business, were steps taken to cope with the problems faced. Nur Islam was responsible for the implementation of the project including management, staff recruitment and training, capacity building, financial management, field operations etc. The total amount of loan disbursed so far is Rp.1,278 milion (US$ 1= Rp.9605) with 99% repayment and no portfolio at risk.
AGCP has 30 centers with a total of 1080 members till date. The target is to reach 2500 members in the next two years and help the project to acquire a separate institutional identity by achieving financial sustainability.
Project clients have been involved in business activities such as agriculture, poultry farming, catering, tailoring and selling food, newspaper, wood etc. AGCP has provided the women of Aceh who lived in poverty and devastated by the tsunami, with opportunities to utilise credit facilities and rebuild their lives. By being able to take collateral free loans and setting up their own businesses, they are now gradually breaking away from their poverty stricken lives and starting income generating activities to improve their socio-economic conditions after the devastating tsunami.