In this era of globalization, generating economic growth in developing countries while reducing poverty is a fundamental development challenge. To ensure that the contribution of microenterprises to key subsectors and national economies is maximized, and to ensure that the poor are not left out of market development, micro and small enterprises (MSEs) need access to finance, business services, and improved inputs; they also need a conducive enabling environment that facilitates rather than inhibits their participation in markets.
To address these development challenges, the Microenterprise Development (MD) office provides technical assistance, training, program strategies and designs, and Mission-tailored tools for helping small producers and firms get established, grow, and integrate into markets and value chains. This assistance includes strategies for improving MSEs’ access to sustainable sources of financial, business and other upgrading services needed to meet the demands of new markets, both domestic and export. MD offers technical assistance and training in the areas of microfinance; rural, value-chain, and housing finance; micro-insurance; remittances; microfinance in post-conflict areas; value chain and cluster development; and trade and agribusiness (including backward linkages to small firms and producers).
MD has been developing an approach to enterprise development that focuses on integrating micro and small firms into value chains, while improving their bargaining power and their access to business and financial services, and addressing their needs for a conducive enabling environment. The aim of this work is to enhance these firms’ access to markets and their capacity for taking advantage of market opportunities.
MD’s vision for microenterprise development involves addressing the needs of poor people within the context of globalization, dynamic domestic and global markets, in order to help them harness the resources they need in order to participate meaningfully in markets (often through market linkages to larger firms). Microenterprise-focused activities are best incorporated into broader initiatives to ensure that the poor majority in developing countries benefit from U.S. development assistance.
To read more about microenterprise development at USAID, see the Microenterprise Development at USAID Overview Brochure.
What are "microenterprises"?
In many countries, microenterprises — small, informally organized commercial operations owned and operated mostly by the poor — constitute the majority of businesses. They account for a substantial share of total employment and gross domestic product and they contribute significantly to poverty reduction.
USAID defines “microenterprise” as a firm of 10 or fewer employees, including unpaid workers, which is owned and operated by someone who is poor. They are often the chief economic defense of the most vulnerable households in high-risk environments, such as civil conflict, or during natural disasters. As the predominant source of income and employment for hundreds of millions of people worldwide, the microenterprise sector’s influence on individuals, households, and national economies is clear and profound.
Documents
Foreign Assistance Framework
Microenterprise Development at USAID: An Overview
MD_Foundation_Brochure.pdf
Economic Perspectives Electronic Journal: Microenterprise- Laying the Foundation for Economic Development
Publication Date 02/2004
The USAID Microenterprise Initiative Statement of Renewal June 1997
renewal.pdf Publication Date 6/1/1997
USAID Microenterprise Activity Report 1994-1997
activityreport[1].pdf Publication Date 1/1/1997
Website Link
USAID.GOV Microenterprise page (Go)