Final report of the Regional Workshop on Continuing ...unesdoc.unesco.org/images/0012/001251/125148e.pdf · Workshop participants used the Training Manual on Small-Scale Enterprise

Table of Contents

1. Introduction …………………………………………………………………………………. 1

2. Sharing of Country Experiences ………………………………………………………… 8

Bangladesh ………………………………………………………………………………. 13 Bhutan ……………………………………………………………………………………. 14 Cambodia ………………………………………………………………………………… 16 China ……………………………………………………………………………………… 17 Indonesia …………………………………………………………………………………. 18 Lao PDR ………………………………………………………………………………….. 18 Malaysia ………………………………………………………………………………….. 20 Mongolia ………………………………………………………………………………….. 20 Myanmar …………………………………………………………………………………. 21 Nepal ……………………………………………………………………………………… 22 Pakistan ………………………………………………………………………………….. 22 Philippines ……………………………………………………………………………….. 23 Thailand ………………………………………………………………………………….. 24 Uzbekistan ……………………………………………………………………………….. 25 Viet Nam …………………………………………………………………………………. 25

3. Various Types of Economic Activities …………………………………………………. 27

4. Concepts of Entrepreneurship ……………………………………………………...…… 35

5. Advance Planning for an Enterprise ……………………………………………………. 37

6. Market Survey ………………………………………………………………………………. 43

7. Capital and Its Sources …………………………………………………………………… 48

8. Costing and Pricing ……………………………………………………………………….. 78

9. Marketing ……………………………………………………………………………………. 82

10. Field Visits …………………………………………………………………………………... 85

11. Actual Planning of an Enterprise ……………………………………………………….. 95

12. Bookkeeping/Accounting ………………………………………………………………… 106

13. Risks in Business ………………………………………………………………………….. 113

14. Competencies in Business ………………………………………………………………. 115

15. Country Follow-up Action Plan ………………………………………………………….. 118

Table of Contents (cont’d)

Appendices

Appendix 1: Schedule of Activities……………………………………………………..

121

Appendix 2: List of Participants………………………………………………………...

124

Appendix 3: Welcome Remarks…………………………………………………………

130

Enterprise Development: Now Size Does Not Matter by Ramon C. Bacani ………

130

The LCC Mandate along Continuing Education, towards Economic Productivity and Neo-literates by Ramon C. Bacani ……………………………..

132

Welcome Remarks by Darunee Riewpituk ……………………………………………

135

Appendix 4: Members of the Four Group Work………………………………………

137

Appendix 5: Guidelines for Country Reports…………………………………………

138

1 Introduction

BackgroundUNESCO and the Member States are working co-operatively to improve primary education, literacy and continuing education programmes within the framework of the Asia-Pacific Programme of Education for All (APPEAL). With the assistance of Member States, UNESCO APPEAL has developed and published a series of manuals on continuing education titled APPEAL Training Materials for Continuing Education Personnel (ATLP-CE) in eight volumes. During the regional and sub-regional training workshops organized by UNESCO APPEAL, the concept and strategies of the ATLP-CE, Volume V: Income-Generating Programmes (IGP), were presented to and discussed with the participants from various countries in the Asia and Pacific region. The countries and the participants requested us to develop a manual on entrepreneurship as a supplementary manual to the IGP volume. In response to the needs of the Member States of the region and due to the rapid change in the world of work, we have developed and published the Training Manual on Small-Scale Enterprise for Neo-Literates.

UNESCO in co-operation with SEAMEO/INNOTECH, a member of the APPEAL Resource and Training Consortium (ARTC), organized the Regional Training Workshop on Continuing Education Focusing on Small-Scale Enterprise through Community Learning Centres. It was held in Quezon City, Philippines, during 6-12 November 2000. Workshop participants used the Training Manual onSmall-Scale Enterprise for Neo-Literates as the basis for training literacy and non-formal education personnel who are working directly at community learning centres (CLCs) supported by UNESCO PROAP.

ObjectivesThe objectives of the workshop were to:

Review the existing continuing education programmes for income-generating activities focusing on small-scale enterprises in participating countries;

Explore and understand the concept of entrepreneurship;

Develop knowledge, attitudes and skills for setting up small-scale enterprises (for example, market survey, planning, marketing and accounting);

Formulate an action plan for income-generating programmes focusing on small-scale enterprise through CLCs.

The workshop schedule of activities is in Appendix 1.

ParticipantsThere were 29 participants from 15 countries at the workshop. The participants are responsible for CLCs supported by UNESCO APPEAL. For example, one is in charge of training programmes, particularly income-generating activities, through CLCs at the national or state/provincial level and another is in charge of providing skill-training activities at CLCs. The 15 countries are Bangladesh, Bhutan, Cambodia, China, Indonesia, Lao PDR, Malaysia, Mongolia, Myanmar, Nepal, Pakistan,

2 Small-scale Enterprise for Neo-literates through CLCs

Philippines, Thailand, Uzbekistan and Viet Nam (a list of participants and resource persons is in Appendix 2).

Election of Officers The following participants were elected as officers for the duration of the workshop:

Chairperson Mr. Sawat Teechuen (Thailand)

Vice-Chairpersons Ms. Yu Niya (China) Mr. Irfan Ullah Khan (Pakistan)

Rapporteur Ms. Clarita A. Lunas (Philippines)

The participants in the workshop alternated as rapporteurs during the group work sessions. In the plenary session, these rapporteurs presented the results of the groups to which they belonged.

Proceedings of the WorkshopInaugural session: (The two opening speeches are attached in Appendix 3)Mr. Ramon C. Bacani, Undersecretary, Department of Education, Culture and Sports, delivered welcoming remarks. He extended his welcome to the participants and thanked UNESCO PROAP and SEAMEO/INNOTECH for organizing the workshop. He introduced the Philippines Literacy Coordinating Council Blueprint for Action, which recognizes the need to link basic and functional literacy courses with economic and livelihood opportunities as an integral part of the learning process. Thus, neo-literates are able to sharpen their numeracy skills by applying them in entrepreneurial activities. He also shared his thoughts on strategies of small-scale enterprise emphasizing partnership with other businesses in order to maximize linked resources, utilization of information technology, and networking and linkages in credit, production and marketing.

On behalf of UNESCO, Ms Darunee Riewpituk delivered a welcome address. She shared with the participants the findings from the research undertaken by the 16 CLC participating countries. The findings showed that the core activities of all the CLCs are closely linked with the economic life of the people. This linkage with the living conditions of the people and their economic life has ensured that the programmes and activities of the CLCs have a high level of acceptability among the community members. To improve income-generating programmes provided by CLCs in the 16 countries, UNESCO is promoting small-scale enterprise. The participants would develop their skills in organizing training programmes in small-scale enterprise for community people, particularly women, through CLCs. The participants will implement income-generating programmes focusing on small-scale enterprise as a follow-up action to the workshop. Finally, she expressed her gratitude to SEAMEO/INNOTECH for hosting the workshop.

ProceduresThe workshop was organized into a plenary as well as in several working group sessions (see Appendix 4 for a list of work groups):

i Sharing country experiences on continuing education for income-generating programmes focusing on small-scale enterprise

i Presentation and discussion of income-generating programmes focusing on methodology for setting up small-scale enterprise in the community

i Field visits to observe and study the process of setting up small-scale enterprises and their benefits

Introduction 3

i Practice in the development of training programmes for establishment of small-scale enterprise through CLCs

i Development of an action plan for setting up small-scale enterprises

Y Overview of the Asia and Pacific Programme of Education for All (APPEAL)The Asia and Pacific Programme of Education for All (APPEAL) is an inter-country co-operative programme designed to promote education for all in the countries of the region. Its principal aim is to promote primary education, literacy and continuing education for all children, youth and adults as an indispensable foundation for sustainable human development and eradication of poverty.

APPEAL’s programmes are conceived, planned and executed in close consultation and partnership with the relevant governmental, non-governmental and private institutions in the Member States of UNESCO in the region. The three priority programme areas of APPEAL are:

i Reaching the unreached, the underserved and the disadvantaged population groups in rural and urban areas

i Promoting community participation and ownership i Improving relevance and quality of basic education for all children, youth and adults

The major activities of APPEAL include the following:

i Training of personnel in literacy programmes

i Utilization and adaptation of the twelve volumes of APPEAL Training Materials for Literacy Personnel (ATLP) and eight volumes of APPEAL Training Materials for Continuing Education Personnel (ATLP-CE) in regional, sub-regional and national training activities. The materials focus on the specific needs of various levels of personnel involved in the management and implementation of literacy programmes. A series of training workshops have been organized at the regional, sub-regional and national levels using these materials.

i Utilization and adaptation of the four volumes of the APPEAL Manual for Planning and Management of Literacy and Continuing Education (AMPM), in regional, sub-regional and national training activities. These were developed to help practitioners in the Member States strengthen the planning and management of non-formal education.

i Development of literacy materials with reference to specific disadvantaged population groups in the Member Countries. Various kinds of literacy and continuing education materials under the heading “Asia-Pacific Joint Development” (AJP) have been developed for youth and adults in co-operation with the Asia-Pacific Cultural Centre for UNESCO (ACCU). Literacy materials for rural primary schoolchildren have also been developed jointly with Hiroshima University, Japan.

i Development of innovative and effective strategies and approaches for promoting literacy and basic education at the grassroots level. One pilot project is on the promotion of primary education for girls and disadvantaged groups, and another pilot project is on the promotion of literacy for youth and adults.

i Support to the inter-country project on Community Learning Centres, which started in 1998. The aim is for the promotion of literacy through community participation and ownership, especially in countries that have large pockets of illiteracy. Under this project support is provided to participant countries in the development, testing and dissemination of grassroots-based literacy and basic education programmes and activities. These involve co-operative planning, design, execution of programmes and the sharing and exchange of experiences.


Support for APPEAL comes from UNESCO's Regular Programme Budget, the Funds-in-Trust contributions from the Governments of Japan and Norway, grants from UN partners especially UNDP and UNAIDS, and voluntary contributions from Member States. The funds are used as a catalyst for innovative projects; for regional, sub-regional, national and community activities; for inter-country exchange through study visits and publications; and for the strengthening of networks and partnership through the APPEAL Resource and Training Consortium (ARTC) and Literacy Resource Centres (LRC).

Overview of Continuing Education Focusing on Income-generating Programmes (IGPs)

Continuing Education The crisis in education, in particular for adults, in many developing countries has come about largely because the formal education system caters only for a handful of successful students and the rest become alienated and unproductive. The non-formal education movement has achieved a great deal in compensating for the failure to provide universal primary education, to eradicate adult illiteracy or to expand opportunity to proceed to secondary education, although it has some limitations. Continuing education, that is the opportunity to engage in lifelong learning, emerges as a way of compensation for the inadequacies of the formal system by giving people a second chance, and also of ensuring a continual growth and upgrading of human resources throughout the lives of all citizens. Appropriately educated people develop positive attitudes and skills to improve the quality of their work and increase their incomes.

The ultimate goal of lifelong learning is a learning society where all people are given the opportunity to continue the learning process throughout their lives. The idea of a learning society was first advanced by UNESCO almost twenty years ago in its famous report Learning to Be and it was further reiterated through the newly published Learning: The Treasure Within, which is the report of the International Commission on Education for the 21st Century. In a learning society all agencies are educational providers, not just those with primary responsibility for education, such as schools. At the time that this idea was first formulated, it made very little impact on education in developing countries as most of them considered it to be an unattainable ideal, at least in the foreseeable future. They concentrated instead on the development of formal education, especially on the achievement of universal primary education. That attitude has now changed. Many countries with low levels of basic literacy in the 1970s have now attained more than eighty per cent adult literacy. The idea of a learning society does not seem to be an unrealistic ideal, but a real possibility and a goal for planned development in many countries in Asia and the Pacific.

As more people become involved in lifelong learning and improve their educational standards and way of life, more will be involved in social decision making at all levels. Development plans will come to reflect what people want and need based on their reasoned understanding of potentials and limitations. In this way, a truly sustainable development is likely to emerge. It is recognized that Human Resource Development (HRD) and lifelong learning are the same thing.

When communities are literate, continuing education (CE) emerges as a way to reach the goals of a learning society.

Continuing education is, by definition, a broad concept that includes all of the learning opportunities all people want or need outside of basic literacy education and primary education.

Introduction 5

Challenges in CE:

To offer more diversified programmes to cater to a wide range of needs of specific population groups of youth and adults

To make CE more workplace and community based

To link CE more closely to economic, social and cultural development

To make CE an integral part of continuous learning throughout life

To give special attention to meeting the learning needs of disadvantaged groups

To use information from CD-ROM-based teacher training tools for CE personnel

To create new opportunities for co-operation in CE between GOs and NGOs

Types of CE: Introduction to APPEAL Training Materials for Continuing Education Personnel (ATCP-CE).

Post-Literacy Programmes (PLOs): aim to maintain and enhance basic literacy, numeracy and problem-solving skills, giving individuals sufficient general basic working skills to enable them to function effectively in their societies.

The main objectives of post-literacy programmes are:

Retention of already acquired literacy skills

Improvement of literacy skills

Application of the literacy skills for individual and community development

Equivalency Programmes (EPs): are designed as alternative education programmes equivalent to existing formal general or vocational education. In ATLP-CE, the focus is on secondary EPs. The EP should be designed in a more flexible way than in the formal school system. However, learners are accredited with certificates after graduation or completion of the programme.

Income-Generating Programmes (IGPs: help participants acquire or upgrade vocational skills and enable them to conduct income-generating activities. IGPs are vocational continuing education programmes delivered in a variety of contexts for individuals who are currently not self-sufficient in the modern world, namely those at or below the poverty line. It seems wise to focus on management training as well. In this way people, and in particular women, are being encouraged and trained to set up their own small-scale businesses instead of being employed in factories at low wages.

Individual Interest Promotion Programmes (IIPs): provide opportunities for individuals to participate in and learn about their chosen social, cultural, spiritual, health, physical and artistic interests. IIPs aim at promoting and strengthening learning activities that promote leisure utilization, life improvement and self-actualization. The activities can be categorized into hobbies, cultural activities, self-reliance activities, sports and activities for the promotion of personal development. IIPs are common in more developed countries.

Quality of Life Improvement Programmes (QLIPs): aim to equip learners and the community with the essential knowledge, attitudes, values and skills to enable them to improve quality of life as individuals and as members of the community. Quality of life refers to the level of well being of the society and the degree of satisfaction of a number of human needs. QLIPs are focused on development aspects and have a strong future orientation. The various elements of quality of life can be expressed in the form of indicators. The main indicators are economic and social indicators (which give soft data on individual reactions and perceptions about their quality of life).


Future Oriented Programmes (FOPs): give workers, professionals, regional and national community leaders, villages, businessmen and planners new skills, knowledge and techniques to adapt themselves and their organizations to growing social and technological changes. There are two approaches when it comes to coping with the future. The first is a wait-and-see approach where you act on a given situation or context when it appears. The other approach is to try to foresee elements of the future and then plan and prepare for future action. This second approach is being advocated in ATLP-CE. An essential element in planning for the future is to have an agreed vision of what the future should be like. This vision emerges from the reality of the present society and its environment. The result will be a transformation of the present into the future based on knowledge.

Community Learning Centres (CLCs): have emerged as key institutions for the delivery of continuing education. They are local educational institutions outside the formal education system for villages or urban areas usually set up and managed by local people to provide various learning opportunities for community development and improvement of people's quality of life. Onecharacteristic of learning centres is that they are for every citizen and are adapted to the needs of all people in the community. Their programmes meet the needs of adults as well as youth.

UNESCO's programmes for literacy and continuing education have been well received in Asia and the Pacific. The main factor in the success of the programmes has been their exemplary approach. Systems have been designed and arranged for ready adaptation and implementation by each country according to its needs and circumstances. In essence, UNESCO has offered a blueprint for change without imposing a rigid format for innovative planning in adult education. It is important to note that the ATLP-CE volumes are exemplars only. The volumes provide planning and development frameworks to enable each country and community to develop its appropriate continuing education system according to its particular needs and circumstances.

Income-Generating Programmes (IGPs) A great majority of people in many developing countries lives below the poverty line. In addition, the economic conditions of some sections of society even in developed countries need to be improved. People must have technical, vocational and entrepreneurial skills aimed at income generation in order to solve the problems associated with acute poverty. The objective of income-generation is to develop skills (1) to meet immediate needs, where a productive person produces enough food to feed himself/herself and family, (2) for wage employment and (3) for self-employment.

The central focus of income-generation is to alleviate poverty and contribute to the development of human resources in the following ways:

empowering people to identify their economic needs and explore ways and means of fulfilling them

promoting self-confidence and the ability to undertake income generating activities through appropriate and adequate training and motivation

providing opportunities for continuous upgrading of vocational knowledge and skills for gainful employment

developing a team spirit for working together for sustainable social and economic growth

Introduction 7

There are seven steps for developing income-generation programmes:

Prepare the community for change and development through the mass media

Provide information on marketing demand within and outside the community

Conduct needs assessment including a survey of existing resources available in the community

Mobilize existing intellectual resources available including occupation-specific groups and local savants

Develop basic and higher occupational skills, including entrepreneurial and marketing skills (development of curriculum, programmes, training manual and learning materials)

Organize training courses

Provide follow-up services for self-employment and wage employment through placement, credit facilities, co-operatives and marketing outlets


2 Sharing of Country Experiences

The workshop participants from fifteen countries were divided into four sub-regional groups to discuss their experiences in small-scale enterprise development based on the country reports that were prepared according to the guidelines sent to each participant before the workshop (see Appendix 5). Each group shared their experiences covering the following topics:

Programmes implemented by CLCs

Skills training organized by CLCs

Co-operation and networking with other organizations

Small-scale enterprises implemented by CLCs

Innovative features of savings and micro-credit programmes

After thorough discussion, the rapporteur from each group reported back to the plenary. The presentations were followed by a question and answer session. Highlights of the presentations are as follows:

Group 1 Programmes implemented by CLCs

Literacy programmes

Equivalency programmes

Life improvement programme for the elderly

Literacy/livelihood programme

Continuing education programme

Information/resource centre for news updates

Community assemblies

Seminars/conferences/training

Agro-industrial fair

Computer literacy

Day care centre

Health services

Organization of sub-district committee

Skills training organized by CLCs Tailoring/embroidery/sewing/cosmetology

Handicrafts/rattan ware

Mushroom culture

Food preservation

Sharing of Country Experiences 9

Small agricultural machinery training programme

Animal husbandry

Computer literacy

Co-operation and networking with other organizations Local government unit

Government organizations/non-government organizations

Religious and private organizations

Factories and industries

Sources of local wisdom

Foundations/associations

Small-scale enterprise implemented by CLCs Food processing

Tailoring/sewing

Cosmetology

Handicrafts

Animal husbandry

Soy bean milk processing

Mushroom culture

Fish farms

Innovative features of savings and micro-credit programmes Transition from bureaucracy-oriented approach to community-oriented one

New concept in the provision of lifelong continuing education

Income average benefits the borrower

Agreement/adjustment between borrower and manager

Micro-credit scheme for the poor


Literacy programme

Post literacy programme

Human resource development programme

Income generation programme

Primary health care programme

Child development programme

Environment preservation and protection programme

Child and women trafficking prevention programme

Improved oven promotion

Planting


Water and sanitation

Gender and development

Socio-cultural programme

Child labour education programme

Poverty alleviation programme

Prevention of drug abuse

Outreach programme

Savings group information programme

Group management training programme

Accounts management training programme

Social forestry

Entrepreneurship development

Skills development training

Skills training organized by CLCs Detergent, soap and shampoo manufacture

Storekeeping

Sewing and tailoring

Embroidery and design

Cooking

Computer literacy

Cattle raising

Horticulture

Food processing

Home gardening

Candle making

Jute products

Chalk making

Fish farming

Bamboo and cane products

Herb planting and processing

Screen printing

Mushroom gardening

Small bottle manufacture

Co-operation and networking with other organizations Line government

Local government

Community

Different NGOs


Community leaders

Religious leaders

Private sector

Individuals

Bank

Youth development centre

National women’s association

Media

Small-scale enterprises implemented by CLCs Paper floral decoration

Small bottles and toys

Candles

Soap

Screen printing

Food products

Innovative features of savings and micro-credit programmes Develop habit of savings

Self-employment

Increase family income

Use own savings as capital

Bypass middlemen in loans


a) Education and training

basic literacy training post literacy

IG related skill training

Agriculture based Animal livestock and husbandry Techniques for using farm equipment and machinery Computer use at the country level Food processing Tailoring and knitting Hair care Weaving, sewing Bamboo crafts Motorbike repair


b) Community information

community library information through videos, puppet shows, IEC materials (posters, booklets, etc.)

c) Community development

income-generating programmes cultural activities recreational activities/sports

d) Co-ordination and networking

linkage with GOs, NGOs, IOs, between different CLCs education, agriculture, health, finance department women’s federation

Skills training organized by CLCs (as above)

Co-operation and networking with other organizations(as above)

Small-scale enterprise implemented by CLCs

initial stage (pilot)

- bamboo basket making - bamboo fan making - hand loom weaving

Innovative features of savings and micro-credit programmes

in Myanmar and China not enough CLCs yet, under HDI project/Micro Finance Project – UNDP, UNOPS

- PACT (USA) - GRET (France) - Graven Trust (Bangladesh)

Management training for CLCs training for management committee/organizers

training for village volunteers/trainers (teacher/volunteers)

bookkeeping training for management committee/organizers

quarterly review workshop

NF programme for adults (China)

NFPE programme for adults and out-of-school children. (pilot in Myanmar)

Group 4 Introduction

Funded by UNESCO Technical and financial assistance (material, guideline development)

Programmes implemented by CLSs

post literacy


- New technology transfer (cooking, agriculture, dressmaking) - Business educational programme - Information and library services - Improved qualifications of education - Foreign language teaching - Preparing children to attend school - Drug abuse - HIV - Cultural programmes

Skills training organized by CLCs Dressmaking or sewing (vocational skills) (Mongolia)

Baking or cooking

Handicrafts

Motorcycle repair

Milk processing

Flower arranging

Fruit growing, packing

Food processing

Fur processing

Skills development varies according to traditional customs, economy and lifestyle.

Government, community, NGOs – UNESCO International organization

New laws of production in Uzbekistan and Vietnam

Mass organizations

Small-scale enterprises implemented by CLCs

The summaries of the country reports are as follows:

B a n g l a d e s h

BackgroundThe community learning centre or gonokendra serves neo-literate adults, adolescents and children. Those students who drop out of school are also part of the target population. About 70 per cent of these beneficiaries are women. Each gonokendra serves approximately 75-100 learners.

ActivitiesGonokendra are locally managed institutions and as such each one can be developed according to local needs and expectations. The focus is on perfecting literacy skills and acquiring life skills through the provision of a literacy centre, access to information and community development activities organized through local initiative.


Skills Development Training There are different types of skills development training organized for CLC members. Those who will eventually undertake different employment and income-generating activities of their own will need a variety of skills in order to succeed.

To create a favorable atmosphere, there is an emphasis on learning by means of group discussion, debate, brainstorming, sharing experiences, field visits, simulation and role play.

Skills Development Courses Major skills development training occurs in the areas of livestock raising, fish farming, food processing, nursery cultivation, small trade, poultry, home gardening, small bottle manufacture, dressmaking, tailoring, jute products and others.

Co-operation with Other Organizations To provide skill development training the Dhaka Ahsania Mission can join with other NGOs providing similar training. Saint Mary's (another NGO) already provides skill development training to CLC members.

CLCs and Small-scale Enterprise Dhaka Ahsania Mission (DAM) also provides some training for enterpreneur development. In this connection it has already adapted a UNESCO-PROAP training manual on enterprise development.

Procedure of Micro-credit System After completion of the IGP/skills training courses DAM provides credit to the CLC members. Each member is required to follow rules and regulations of the group. Each member needs to submit an application with the support of any two of the following officers in the group: leader, deputy or treasurer. The loan range is TK. 3,000 to TK. 20,000, which is equivalent to US$1.00-US$342.00.

Finally, DAM has a plan to develop each of the CLCs as a centre for training, production and sales.

B h u t a n

BackgroundThe Non-Formal Education Division, Education Department, Royal Government of Bhutan, with assistance from UNESCO, started the construction of community centres in 1998. So far, four CLCs have been constructed in four rural districts. It plans to complete six more CLCs by 2002. Main functions of CLCs are to:


Provide learning opportunities for the adults where education facilities are not accessible

Provide suitable learning environment in the community

Serve as information service centres for the communities

Facilitate in organizing technical/vocational training courses, cultural and recreational activities

Establish facilities for lifelong learning and sustainability of NFE programmes

Skills Training Activities The following activities are carried out by CLCs:

Skills development training in manufacture of furniture

Tailoring and designing

Furniture MakingTraining Tailoring and Designing

Objective To provide basic knowledge and skills in making classroom furniture To furnish the CLC with furniture

To introduce the learners to basic tailoring practices To help them maintain sewing machines To help them get ideas skills in different designs

Target group Learners who have completed post literacy course

Learn who have completed post literacy course

Duration 35 days (5 weeks) 4 months

Training methodologies

DemonstrationGuided practice Group work

DemonstrationGuided practice Group work

Co-operation with other organizations

Youth Centre NTTA NWAB

Youth Centre NTTA NWAB

Follow-up activities Train other people in the community Maintenance of CLC furniture

Carry out domestic design and stitchingSet up small scale tailoring shopTrain other family members

Impact of skill training

Reduced the purchase and supply of furniture from industriesSchools and other institutions have access to purchase furniture at lower cost

Reduce the expenses in stitching and making clothes The neighbours have more access to tailor shops


Savings Schemes and Micro-credit Programmes The development finance cooperation (BDFC) has been providing rural credit schemes to farmers to enable them to carry out small-scale home industries, farming and livestock improvement.

Future Plans for IGPs to be Conducted by CLCs NFED is planning to introduce group earning schemes in the communities through CLC projects. It is in the process of drawing up a project proposal related to the Partners in Development Programme (PDP) to be submitted to UNDP. The project will provide funds for group earning schemes and income-generating activities through community actions to alleviate poverty. The following areas have been identified as programming priorities for Bhutan:

Diversified farm products

Natural resource based products

Handicraft products

C a m b o d i a

BackgroundAfter the contract between the Ministry of Education, Youth and Sports and UNESCO was signed on February 12, 1999, the Non-Formal Education Department (NFED) established three community learning centres (CLCs), one in Takeo province, one in Kampong Speu province and one in Kampong Thom province.

For the past two years the CLCs have been actively involved in eradicating illiteracy through providing vocational skills to meet the specific needs of local people and general knowledge in the areas of science and culture relating to the daily lives of the poor, especially women, widows and the handicapped.

After learning vocational skills in areas such as barbering and motorbike repair, the trainees are ready to proceed on their own. Some of them work in factories. Others run small shops in their villages. NFED has provided some funds and sewing machines to six associations monitored by community learning centre committees. The community learning centre committee and the associations contract with each other to receive funds. Each association controls its own income and expenditure. Sixty per cent of the total income will be divided amongst the members, twenty per cent is for repaying the community learning centre committee and twenty per cent is for tool repair.


C h i n a

In China, most of the poverty population is concentrated in a few provinces in central and west China, namely Gensu Province and Guanxi Zhuang Autonomous Region.

Entrusted by the Chinese National Commission for UNESCO, the Pilot UNESCO Project of Rural CLCs on Education for Poverty Alleviation has been undertaken in TianZhu, Yongdeng, Jingning and Huining counties of Gansu Province as well as in Longshen, Trandong and Rongshiu counties of Guangxi. In line with the project requirements, the Provincial Report Implementation Groups have been established in each province. At the same time, project implementation plans were formulated at schools, township and county levels according to local situations.

Objectives of Rural CLCs To raise the priority position of education in rural economic construction

To promote the development of literacy education

To upgrade the quality of the labour force in using science and technology

To raise the science and technology content in agricultural production

To increase the income of local farmers

To enhance each farmer’s ability to maintain sustainable development

Main categories of Rural CLCsCentres in villages

Centres at township level

Centres at schools

Functions of Rural CLCsMaking full use of the advantages of rural schools, the CLCs provide useful information and technical training for community members so as to help them solve problems in poverty alleviation. The CLCs will mobilize community members’ involvement in education.

Main projects of Rural CLCsProject implementation with plans at provincial, county, township and school levels.

Various types of project training activities organized for teachers and farmers.

Relevant teaching and learning materials compiled according to the local reality. We compiled several learning materials for CLCs, such as Life Skills for Girls, A Textbook Activity Class for Quality Education at Primary Schools, The Preservation of Cabbage, The Keeping and Storage of Fruit and A Handbook of New Technology in Agriculture.

Beneficial Results The working efficiency and professional capacity of the project management personnel have been upgraded through training

The quality of local education has been improved


Beneficial results have been achieved for local economic development

The universalization of nine-year compulsory education and literacy education has been strengthened

I n d o n e s i a

Currently, there are 851 CLCs in Indonesia with total of around 50,000 learners. The majority of CLCs are established in vacant buildings at the village level such as former primary schools and madrasah ibtidaiyah (religious schools), community health centres (puskesmas) or other buildings. The number of CLCs is scheduled to increase to around 1,000 during the next fiscal year. Government support is substantial with an allocation of around RP30 billion for CLC development but of a total out-of-school budget of 120 billion for the year 1999-2000. Information gathered from the field shows that there are a variety of local initiatives emerging. In Central Java, West Java, East Java, South Kalimantan and Lampung provinces, CLCs are running small financing or micro-credit schemes supported by UNICEF. CLC linkages have been established with profitable production processes. In other places, such as in Lampung province, CLCs are undertaking agricultural activities.

A recent survey of CLCs shows that there are a variety of management models. There are CLCs managed by private institutes, officially registered village-based self-help groups (Kelompok Swadaya Masyarakat), strong national or international NGOs, private enterprises providing learning opportunities for staff, and community education field workers working independently or under guidance of NGOs. Income-generating programmes target both women and men.

There are training activities in areas such as sewing, food production, printing, computers, agriculture and handicrafts.

L a o P D R

BackgroundThe Department of Non-Formal Education, Ministry of Education, with the support of UNESCO PROAP, has implemented a pilot project on the Development and Implementation of Continuing Education and Materials for Income Generation. This project was conducted in Som Xuen Village, Bolikhamxa province, in 1999.

The Non-Formal Education Department provided a grant for a revolving fund in the community.

ObjectivesTo provide basic skills training to interested groups in the community and set up a small revolving fund as a source of credit

To develop and test CE curriculum and learning materials for IGPs


Target Groups Disadvantaged people who are neo-literate, mostly women

Interested youth and adults in the community who need basic skills to raise their families’ incomes

Skills Training Conducted in the CommunityFood processing and cooking

Fruit trees grafting and planting

Chicken raising

Procedures of Skills Training Programme and Dissemination of Revolving Funds

First Step Implementation team from DNFE, provincial and district conducted a needs assessment survey of the community by using questionnaires, interviews and observation

Data analyzed, target priorities and skills identified

Skills training programme planned including financial cost and revolving funds

Second Step Development of IGP curriculum and materials based on existing needs and adapted to the real situation of the community

Identification of trainer requirements

Third Step Conducting training courses in basic skills and management and planning of revolving fund directly in the community in co-operation with local authorities and local agencies concerned

Setting up the skills groups who have been trained as groups to receive funds, and forming a community committee

Fourth Step Individuals or families receiving training submit proposals to the community committee

Individuals or families approved by committee receive funds for their proposed activities

Monitoring and Evaluation Monitoring conducted by the central implementation team twice a year, by the local operation group once a month

The local operation group conducted a midterm evaluation and the central implementation team conducted a final evaluation


M a l a y s i a

Before independence local people were given just enough formal education to enable them to work for the colonial government as lower-rank officials.

After independence in 1957, local governments had to fight illiteracy, which was at a very high rate. It took five years to run the programme.

In 1961, the Government established several programmes for neo-literacy under the Community Development Department through non-formal education held at CLCs.

Family well-being Preschool education/child care centres Vocational skills Functional literacy Islamic / religious classes Information centres Vision Movement

IGP activities at CLCs:

Kitchen gardening Rattan craft Poultry Sewing Embroidery (machine) Food processing Hand embroidery Wood carving Handicrafts

Micro-credit from Government Department:

Amanah Iktiar Malaysia (AIM) special loan scheme for the poor to set up IGP projects TEKUN loan scheme for setting up small-scale enterprises

M o n g o l i a

Small-scale Enterprise Programme through CLCs At present we have not implemented any small-scale enterprise projects through CLCs in Mongolia. We organize skill training in cooking, dressmaking, repairing, tanning and timber processing but during our CLC awareness programme we have received many proposals from local communities. Most proposals are related to making milk products, dressmaking, vegetable and fruit packaging, and timber processing. We can organize small- scale enterprises. But we don’t have enough funding. We are looking for solutions to overcome this problem. It is very important to initiate financial activities for beneficiaries to sustain the CLCs. Thus we are going to organize an interagency, NGO meeting in co-operation with the Mongolian National Commission for UNESCO. We should think of marketing and organization because Mongolia is a country with a vast area and a small population.


Micro-credit Programme In 1998, a micro-credit programme, named the Micro-start Project, started its activities in Mongolia with the support of UNDP. This project covers only 20 per cent of the small-scale enterprises in the country, most of them in urban areas. Thus, 80 per cent remain without financing. Banks cannot give loans to these enterprises because there are no active bank branches in rural areas. Enterprises cannot get loans from small lenders because of the high rate of interest.

M y a n m a r

Education has always enjoyed a significant place in Myanmar with a major role being played by monks in providing education in monasteries. More recently, and following the independence of Myanmar, the state has assumed the major responsibility for education. However, the major cost of education continues to be borne by parents and communities, with the actual contributions of Government declining in real terms.

Many villagers in rural areas have had limited access to education or have been unable to complete primary education to acquire basic literacy and numeracy skills. In addition, there are few opportunities for adults to acquire life skills or technical training. As a consequence, there is a need in rural areas to provide alternative learning opportunities for children, women and men.

It is against this background that the UNDP/UNESCO Education Sector Project was formulated under the Human Development Initiative Programme.

The concept of the Community Learning Centre (CLC) was first introduced in 1994 under MYA/93/028 Education Project, HDI Programme (Phase I). The Education Project MYA/99/0041, “Improving Access of Children, Women and Men of the Poorest Communities to Primary Education for All” project, focuses on the poorest areas of eleven townships.

One CLC was established in each of the seven project townships. The continuation of HDI-1 will increase the number up to 38 CLCs. Thirty additional CLCs will be established in other townships.

Each CLC is managed by a Community Learning Centre Management Committee (CLC MC). One full-time person interested in and committed to community development was appointed as a community learning organizer. She/he is supported by a group of community volunteers. Basic literacy classes and post-literacy classes are conducted in each CLC by trained village literacy trainers who are from the community. Income generating activities have been started in each of the 38 CLCs with initial grants from the project and contributions from the community. To sustain the IGPS, participants have received training in management and simple bookkeeping. In addition, some community members with the support of CLCs have started up small-scale enterprises. Some communities in CLC areas have access to the micro-credit programme implemented by three NGOs: (1) Grameen (Bangladesh), (2) PACT (USA), and (3) GRET (France) under the HDI Programme.


N e p a l

The Government of Nepal has a policy to run literacy and non-formal education programmes through GOs and NGOs and has allocated 12/13 per cent of its national budget to the education sector. The CLCs were set up as a follow-up to literacy campaigns particularly in Banepa municipality in 1995 and in other places. Many CLCs have been set up by NGOs, which are partners of the world Tanakoya Movement. The NRC-NFE in Nepal provides guidance and training to all NGOs supported by UNESCO and NFUAJ under the Tenakoya Movement.

CLCs have active women’s groups, youth groups, and preservation and development committees. Last year, NFEC introduced a pilot programme for income generation activities into one district. This year, they are conducting this programme in two remote districts.

The major achievements are the formulated plans and policies for CLCs. The outcomes of the project include income-generating community mobilization and increased literacy rates. The weaknesses of the project are a lack of post-literacy classes, lack of learning materials, lack of technical equipment, untrained literacy personnel and inadequate co-operation among GOs, NGOs and INGOs.

Some suggested activities to solve the problems are:

Staff training and national networking A high priority to set up CLCs in areas where literacy is low Technical and financial support for the future Community awareness programmes

P a k i s t a n

In Pakistan there are four provinces with clear-cut distinctions in the rate of literacy and other features. The national literacy rate is 47 per cent.

Different income generation programmes are being carried out, especially in Punjab and Balochistan. In Balochistan, a new programme for CLCs is being implemented.

All CLCs are mainly focused on poverty alleviation programmes and other social development activities.

The mode of action for these centres is as follows:

HealthCare

CLC Supported by UNESCO Supervised

by the NGO/GO TeacherTraining

SkillsTraining

Vocational Training

Savings and Credit

CBO Training


Co-operation of CLCs with other organizations CLCs in our country are linked with the relevant line departments of GOs and NGOs, which co-operate with each other in skills training and share experiences and expertise in regard to specific fields.

Future plan Our future plan is to develop a strategy to undertake the activities of IGPs through our CLCs in order to help the poor fight poverty.

There is a real need to have more IGP activities in our country since one third of the population lives below the poverty line, especially women.

P h i l i p p i n e s

During the current economic crisis and the very rapid advances in science and technology, one has to adapt quickly in order not to lag behind.

Realizing the great role which the Community Learning Centres (CLCs) play in this crisis, the Non-formal Education Programme has encouraged CLCs in all parts of the country as a means of improving economic conditions for neo-literates especially in remote areas.

A functional CLC serves as a centre where basic literacy classes and livelihood skills training occur, as well as a place for information and news updates. It is also a place where other activities such as community assemblies, health services, day care, or linkage with other government agencies, take place.

Most of the skills training conducted is related to kitchen gardening, mushroom culture, hog and poultry raising, dressmaking, cosmetology, food processing and other enterprises. To ensure successful skills training, the trainers teach by means of demonstration.

Income-generating projects related to food processing were given priority because of the adequate supplies of fruits and vegetables, and the demand of the people in the community.

To ensure programme success, community organizers and coordinators monitored and evaluated the classes and followed up the activities of participants.

The activities of the CLCs brought about great changes in the people’s lives and in the community as a whole. Specifically, these include the following:

Improved quality of life Self-reliance and additional family income Stronger linkages with other government and non-government agencies Improved use of raw materials in the community Greater community awareness and unity

The CLCs had implemented a small-scale enterprise in the preparation of peanut brittle. This is being undertaken by BALIKATAN, a women’s organization. The finished product is sold to schools, offices, stores and market. The organization manages all financial gains. Any member who needs financial assistance can receive it with minimal interest charges.


We hope that the CLCs can expand their IGP activities into the following areas:

Tailoring/dressmaking HandicraftsCosmetology

T h a i l a n d

1. Pong Sub-district Community Sewing Cooperatives

2. Pong District, Phayao Province

BackgroundThailand was hard hit by an economic crisis in 1997. As a result, a large number of unemployed workers returned to their hometowns. The need for vocational skill training for those unemployed persons was indispensable so that they could find jobs and survive in society.

ObjectiveTo increase the vocational skills of neo-literate women, and establish occupational cooperatives in the community.

ProcedureNeeds assessment for those neo-literate women who wanted to increase their incomes

Vocational skills training in sewing offered through community learning centres, with provincial and district NFE centres providing sewing machines for training

Community sewing cooperatives set up for those receiving sewing skills training. The cooperative members were required to have a savings account at the beginning.

Committees set up at each cooperative, consisting of president, vice-president, treasurer, marketing manager, etc. The committee members were trained to run the cooperative

Production of clothing by cooperative members for sale by export clothing factories

ResultAt present, the cooperatives still exist and have expanded their income-generating activities. Cooperative savings accounts have grown and development appears to be sustainable.


U z b e k i s t a n

In accordance with recommendations of the Ministry of Public Education for the year 1999, the following areas have been identified as sites for CLCs: Syrdarya Region (rural) and Namangan Region (urban). CLCs in Namangan mainly cover educators and representatives of communities (makhallas). CLCs in Syrdarya target girls, women and youth. The CLCs in Namangan served about 2000-2500 children, youth and adults.

The main objectives are to use CLCs to help people to increase their skills in using foreign languages and computers to enhance personal development and to develop analytical and critical thinking.

The functions of CLCs are to provide child care and prepare young children for elementary schooling, to offer basic computer courses and foreign language courses, to assist in the transition process from the Cyrillic to the Latin alphabet, to provide vocational and business education, and to improve health care for all. Training methodologies include some use of information technology and the organization of discussion groups. CLCs co-operate with the Republican Educational Center, the Regional Department of Education, the district offices of education, Women’s Committees, family foundations and others. IGP skill training has resulted in increased computer knowledge, foreign language ability, more effective handicraft production methods, and better general education amongst family members.

V i e t N a m

BackgroundIn spite of the relatively high rate of literacy, there is a need for CLCs in Viet Nam.

CLCs in Viet Nam are ideal places for literacy and continuing education for all, especially for disadvantaged people such as school dropouts and poor rural villagers. These centres can serve as sites for the transfer of science and technology, for information and advice related to nutrition, child care, safe water, the environment, and citizens rights and responsibilities, and for various community activities such as meetings and sports events.

CLC Activities The CLC is a new approach in Viet Nam. In March and June of 2000 two workshops were held at the central level on the establishment of CLCs in Viet Nam. The provinces followed up the workshop by carrying out workshops on CLCs at the provincial level. Now Viet Nam has 46 CLCs, among them 6 supported by UNESCO.

Impact of CLCs CLCs have showed themselves to be the most effective tools for providing continuing education for all villagers in the communities.

CLCs act as general information, cultural and sport centres for improving the people’s quality of life and for community development, for increasing their incomes and changing their attitudes to education (lifelong learning).


CLCs have gradually influenced other areas outside project villages, especially when other development agencies in the locality started to support CLC activities.

The literacy rate in the project areas has been increased gradually since the introduction of CLCs.

Overview of Action Plans for the Coming Years 1. 2000

Strengthening management and operation of 4 CLCs established Review experiences of CLCs National workshop to raise awareness Preparing a plan for expanding CLCs in the country

2. 2000-2001

Encourage each province to establish at least one CLC as a model for expanding CLCs in others (about 63 CLCs in 2003 and 500 CLCs in 2005).

Various Types of Economic Activities 27

3 Various Types of Economic Activities

This initial conceptual activity in the workshop focused on how an entrepreneur can develop self-confidence in an income-generating project. The activity entailed the reading of a case study entitled Malee, after which participants answered four questions about the case study.

1. Country Vignettes A corollary activity was the preparation of a similar case study in each of the countries represented. The participants presented their country-specific cases and after each presentation conducted an open forum. The open forum generated several insights into the processes involved in true-to-life income-generating experiences in the community.

These vignettes are as follows:

B a n g l a d e s h

An example from Bangladesh: Ms. Noorjahan Khatun and her success.

Noorjahan’s family was very poor. She has two daughters and seven sons. Her husband was not active in supporting the family, so the family’s economic condition was not a happy one.

One day, Noorjahan enrolled in a CLC with her neighbours. Earlier she had completed a basic literacy course. Each day she went to the CLC to practice her reading skill. She read a booklet on small bottle and toy making with glass pipe and was interested in establishing a factory for making these things at home. She discussed her interest with the subdistrict youth development officer. The officer responded by inviting her to attend a training course in bottle and toy making. After training, she borrowed from the Dhaka Ahsania Mission and established a small factory with one set of equipment. At present, her factory has five sets of equipment and there are five workers.

She is selling small bottles and toys to the villagers and the homeopathic doctor. Some businessmen from other areas have come to her village to buy small bottles and toys. Now Noorjahan is able to provide some capital to her husband to start up a paper package business. Now they are a happy family.

B h u t a n

Once upon a time, there lived an old man and women who had six children, two sons and four daughters. Mr. Dendup and Mrs. Dema had to work very hard to feed their children. Both of them were very poor and there was nobody to help them in giving support. Mr. Dendup had a small patch of land where he grew vegetables. Both of them were uneducated and had no other assets


other than their vegetables and labour. They could not send any of their children to school. The children had various physical disabilities and were not able to support their father and mother. Their parents tried their best to feed the children, but increasing age prevented them from giving enough food and clothing. Because of many problems, the parents sent their children to other places to work. Five of the children had to work very far away and could not easily come home to help their elderly parents at times of need.

Mr. Dendup and Mrs. Dema kept their youngest child, Pena, at home with them to help in cooking, bringing firewood and other chores. Pena had a problem with her right leg. She tried to help her parents but because of her disability she could not do much.

One day, it so happened that she and her parents had nothing to eat for dinner. Pena could not sleep the whole night because she was crying and thinking of their hard life. She was thinking of some alternative in obtaining income for her family. The horrible night passed by and a new day started. She went to her friend Karma’s house and told her all about her problems. Her friend after hearing her story recommended that she start to raise poultry on a small scale to get some income for the family. So Pena took Karma’s advice and decided to start a small enterprise. In this way, Pena would begin to solve her problems.

C a m b o d i a

So Phia was a handicapped man living in a suburb. He made a living by begging.

One day, he went to beg in a coffee shop and met Mr. Dara there. Mr. Dara told him to learn vocational skills at a programme organized by a local organization. So Phia decided to attend a training course in motorbike repair.

After completing the training, he borrowed some money from his relatives to operate a small shop in that town. From that time his life was better. He could save enough money to buy a small house. Two years later, he married a beautiful girl living nearby.

C h i n a

This story is very popular at the CLCs of Guangxi, China. Liang Fonjiao lived in a small village in Longshon county, which is inhabited by numerous minority groups. Before introducing the illiteracy elimination programme, there was a traditional custom that women were not allowed to go to school in Longshon county for financial reasons, so that most of the local women were illiterate.

After Liang Fonjiao had learned how to read and write she had to seek income to improve her life. She attended CLCs for training. Because of various kinds of training related to science and technology in agriculture, she used her knowledge to cultivate mandarin oranges and was so successful that she earned 4,000 Xan in the first year. More and more local women are learning from her example and are getting beneficial results from attending courses at learning centres.


I n d o n e s i a

CLC Denas was founded in July 1996 at Tretes, located in a district of East Java, Indonesia. This community includes a population of 1,587 prostitutes.

In addition to this long-established tradition of prostitution, alcohol, drugs, and various behaviour problems complicated the lives of the local people.

There have been efforts to break the cycle of prostitution by providing educational opportunities for the children of prostitutes. These include courses related to computers and foreign languages such as English. Another solution has been the introduction and promotion of religious tourism to improve both the moral and the economic life of the community. However, time is needed to implement this programme.

L a o P D R

Keo Ku is one of 135 community learning centres in Lao PDR. During the first year of its operation, Keo Ku CLC carried out literacy and basic skill training programmes, especially weaving for women. Bouasy is one of the target women who participated in the programmes. Mai is her husband. They have five children and are very poor. After finishing the course, she received a loan from a small revolving fund at the centre. She used the money to buy basic weaving equipment and materials. She did business on her own and joined a weaving group in the CLC. She worked very hard day and night. One year later, she increased the number of products and was able to earn more and more money. She could pay back the amount of the loan as well as repair her house and buy a new freezer and television. Their children can now go to school.

M a l a y s i a

Sadawiah was a young lady with a little skill in sewing. She lived in a remote area of the state of Kelantan, Malaysia. She was appointed as a community developer under the Community Development Department in 1980.

She started to set up a community learning centre to train villagers in sewing.

Later she herself went to the Community Development Centre in Kuala Lumpur to broaden her skills in sewing, embroidery and business management.

With her new skills and the demand from the local market, she expanded production at the centre and trained additional people in basic sewing and embroidery.


M o n g o l i a

Dolgar married Bat six years ago. Bat’s family was very poor at that time. Bat lived in a small gerwith his parents. They had no livestock. Bat was the only wage earner in the family. Dolgar and Bat worked as herders day and night, earning a very low wage. They worked under conditions of dire hardship. After a few years they had three children, which increased the living expenses of the family. They had no support from relatives and friends. They worried about the future of their family. One day Dolgar met a CLC trainer. He learned about CLC training courses in tanning, dressmaking, and bag making. Becoming interested she attended several courses. After completing them, she decided to start her own business but she had no capital to do so. She went to a bank to get a loan but the bank’s rate of interest was too high. It was difficult for her to repay the loan. Therefore she went to a poverty alleviation organization which gave small loans. This organization lent money at a lower rate of interest. She was able to make a small profit after her first efforts at production. Nowadays she does not have the problems that she faced six years ago with her family. She has expanded her business with her husband and relatives. The children have entered high school. They live happily.

M y a n m a r

Illiterate Lady

A widow named Daw Than Nyunt lived in a village by the riverside. Her husband passed away five years ago. She had three children, one boy and two girls. The eldest girl was 14 years old and the son was 12; both of them had dropped out of primary school. She could not send her youngest daughter to school either because of poverty.

She was very poor, with no place to stay, so a neighbour kindly allowed her to stay in a buffalo hut at the back of the house. The widow and her son were labourers on a privately owned farm. They could only get a little money, not enough to meet living expenses.

One day, she met a community learning organizer working in that area. The organizer listened to her problems and suggested ways to start up a small business. She replied that she did not know how and moreover had no money.

The organizer encouraged her to attend a skills training course at the CLC. She attended the course on preparing dried fish. There were plenty of fish in that area. She could borrow the money from a micro-credit project without collateral. She could buy fish easily at a low price in that area and sell it back in dried form at a higher price near town.

One year later she was able to return the money that she had borrowed from the micro credit project. She and her children have a chance to attend a basic literacy class conducted by the CLC at night. At present all family members can read and write and are enjoying their life.


N e p a l

Budol is a semi-urban community 27 km. from Kathmandu. Five years ago community members were interested in setting up a community learning centre (CLC). A survey of the community had determined that women had a low status, children were poorly educated, community forests were going to ruin, and small enterprises practically non-existent because of the lack of credit and savings.

The CLC at Budol assisted by UNESCO, local government agencies, and NGOs provided appropriate training for the local people. Four years later there are numerous income-generating programmes and savings and credit groups. The CLC offers a three-year literacy course for women. The result is a literacy rate of 92 per cent. Community people actively participate in the development of Budol.

P a k i s t a n

Zeenat lives in Kanak, a small village about 60 km. from Quetta. Her husband has some cattle and sells milk to earn money. Unfortunately, Kanak was hit by a severe drought. The cattle either died or become sick due to lack of food. People started shifting to bigger towns for their livelihood.

Zeenat was a genius. She approached the women’s credit bank to get a loan for a grocery shop. The private sector helped her to run the shop by supplying the stock in a difficult situation. After one year, Zeenat had saved enough money and asked her husband to buy some cattle, as the drought was over. Her husband returned to his former occupation.

Now they are comfortable and making a good living.


In the small barangay of Balingit in Pamplona, there lived a newly married couple, Joe and Cora. Both of them came from very poor families, so much so that they could hardly eat three square meals a day and meet the immediate basic needs of the family.

After a year of marriage, Cora gave birth to her first baby and every year after another child would arrive. Thus eventually there were seven children in the family. This was no joke for them because feeding this number with no permanent job was indeed a great problem. Joe was an ordinary carpenter and worked on call for a modest daily wage.

Because of this condition, the couple had no peace and would often quarrel. Often they resorted to borrowing money from a usurer at a high rate of interest without knowing where to get the money to pay off their debt later on.

During these critical moments in their life, there were no friends or relatives to turn to for assistance. They were left on their own to survive.


One day, Cora heard of a literacy and livelihood class conducted in their barangay. Without any second thought she went to enroll. She religiously attended her classes and listened attentively to everything. After completing the required number of hours, she and her classmates received certificates during the closing ceremony. Cora also received a medal for being the most active participant.

With the skills she had learned in dressmaking, food preservation, backyard gardening, and poultry and hog raising, she was full of hope that she would be able to do something to improve their living conditions.

To start in business, she borrowed an amount from the rural bank using their little residential lot as collateral. With that amount she bought her own sewing machine which she paid for monthly out of her income.

Today everybody agrees that her sewing services are of quality. She also raises poultry and hogs in their backyard, where there is a small garden for their own consumption, looked after by her husband.

With their income, she was able to put up a very decent house, buy some appliances and send the children to school. The starving De la Cruz family of before is now a family in the barangay who can extend assistance to the needy.

T h a i l a n d

Mai married Prapa more than fifteen years ago and worked on a farm. They have three children. Mai worked with his friends building houses. He was a good carpenter. He could read and write, but Prapa could not. Sometimes Mai taught his wife reading and writing.

One day, while Mai was working on the roof of a new house, he fell down. The workers took him to the hospital. After a time, Mai could not move his legs and his hands. His whole body was paralyzed, except his head. Mai could only sit in a wheelchair, so Prapa had to help her husband do everything he wished.

The CLC provided learning materials to help this family, especially a video about raising animals. From this video Mai could learn about methods of raising animals. He asked the CLC for funding support. The CLC, working with the association of the handicapped, was able to get some funds for him.

Mai started with chickens. He asked his wife to push his wheelchair to the chicken coop so that he could observe the daily activities of the chickens. He told his wife about the appropriate ways to raise chickens. Five months later, his family had many chickens. They had plenty of food and the villagers bought some of the poultry. Mai told his wife to write something about raising chickens based on their own experience.

Mai thought that he could raise ducks, frogs, fish and eels. He and his family learned how to do so with the support of the CLC. He observed each animal closely. After three months, his family had many kinds of animals. The villagers bought the chickens, ducks, eggs, frogs, eels and fish from Mai and Prapa. At present Mai and his wife have become local specialists and are accepted by the community. They have become self-reliant even though he is handicapped.


U z b e k i s t a n

The community learning centre is a new approach in Uzbekistan. CLCs are located in two regions: Syrdarya and Namangan. They provide learning opportunities for everyone in rural and urban areas to gain supplementary education.

Usually the Uzbek family is quite large (the majority in rural areas). Women keep busy by housework, but some of them work for government offices, joint ventures, NGOs, foundations and other employers. The wages they receive (lower than for men) are often not enough for meeting living expenses. Thus they are interested in additional income through business activities.

Women in Uzbekistan augment their incomes through the following activities:

sewing (dressmaking): national dresses, coats, suits, trousers, caps growing flowers, fruits, vegetables for sale cookingphotography carpet weaving teaching foreign languages working as interpreters working as medical assistants

V i e t N a m

Lan teaches in a primary school located in a very poor remote area of southern Viet Nam. She has three children and a disabled husband. After getting married, she has not had any time for rest. She comes to school in the morning. Afternoons and evenings she works to provide for her family. One day, her friend the school principal came to her house and advised her to apply for a loan from the rural poverty programme funded by UNICEF. She didn’t believe she would qualify for the loan, but the principal said that she met the criteria. She would receive training in agriculture skills (fish farming, shrimp farming, gardening, fruit growing, etc.). Eventually she applied for financial support and obtained a loan of US$50 (about 600,000 VNP). She invested in shrimp farming because her family had a small pool. First she registered in a short training course on how to raise shrimp. After training she spent US$20 to buy stock and the remaining US$30 she used for food and technological assistance. Because of favourable water and weather, along with the correct techniques of feeding, six months later she had enough shrimp to make a profit of US$25. After two harvests she was able to repay the loan to the credit programme and has her own capital in the form of a pool stocked with shrimps. Now she can help her family. She has time for her teaching and can help her children study. Now her family has a stable income.

These vignettes stimulated discussion of the various kinds of work that men and women engage in to make money. Aside from the activities listed in the manual, the participants identified other economic activities, as follows:


kitchen/backyard gardening leather tanning managing a small grocery store raising dairy cattle making ladies’ bags dressmakingcarpet weaving fish processing growing oranges hat making making small bottles and toys with glass pipe

2. Wage Earning vis-à-vis Self-employment Participants also discussed the advantages and disadvantages of wage earning and self-employment:

Advantages and disadvantages of working for wages

Advantages

Regular and fixed income Low risk Advice from others not often required

DisadvantagesLess possibility of increase in income Increasing dependency Difficult to find a new job Limited scope to apply one’s own ideas Work may not always be available Always have to obey somebody else No work available in old age Sometimes have to work even when ill

Advantages and disadvantages of self-employment

Advantages

Skills improved day by day Possibility of increased income One can work at one’s own discretion No need to be dependent on others No risk of losing a job

Disadvantages One has to make continuous efforts to improve skills Risk is involved Requires own capital Requires updated knowledge of the market situation One may incur loss

The last session on economic activities as suggested in the manual was integrated into the subsequent session on concepts of entrepreneurship.

Concepts of Entrepreneurship 35

4 Concepts of Entrepreneurship

The workshop participants were introduced to various aspects of entrepreneurship, namely the importance of getting ideas for an enterprise, how to get ideas, identifying the appropriate trade, factors to consider in selecting a business, factors to consider in deciding to initiate an enterprise, and the functions of an enterprise.

The details of the topics discussed during the session are as follows:

1. Importance of Getting Ideas for an Enterprise Basic ideas are required in all cases to perform any work successfully

One should acquire the basic concepts of entrepreneurship before getting involved in running an enterprise

This knowledge helps an entrepreneur to run the enterprise smoothly and also to explore the possibility of taking new initiatives

It also helps in correct decision making

2. How to Get Ideas Consult with those who are currently in the business

Observe other enterprises to identify problems and think about possible solutions

Discuss with friends and neighbours

Get ideas from the existing available merchandise in the market

3. Identifying the Appropriate Trade Be selective in identifying one’s trade.

Select according to the ability and interest of the entrepreneur.

Decide only after getting enough relevant information about a particular trade or business.

It will help to:

run the business smoothly avoid loss from major mistakes

4. Factors to Consider in Selecting a Business Possibilities of success

What risks are involved

Profitability

Attractiveness


5. Factors to Consider when Deciding about Initiating an Enterprise Availability of experienced and knowledgeable persons to consult with

Mobilization of sufficient capital

Adequate demand for the products/goods in the market

Facility for marketing

Facility for storage of goods

Availability of raw materials

Ability to get support from Government

6. Functions of an EnterprisePreparing business plan Surveying the market

Mobilizing capital Analyzing costs

Pricing goods Marketing products

Keeping accounts Identifying risk factors

Looking for ways to become self-reliant

Advance Planning for an Enterprise 37

5 Advance Planning for an Enterprise

In this session, the participants tackled the different concerns in the process of planning an enterprise in advance. The issues discussed were as follows:

1. What is Planning? It is good to think about a task before starting to do it. This thinking helps to accomplish the work smoothly. When thinking is done logically and sequentially, then it is called planning.

A few basic questions always help in thinking logically:

Who will do the work? Why? How will it be done? When will it be done? What materials are required?

The final answers to these questions become your plan.

2. Importance of Planning A good plan helps us in many ways:

To get ideas about the business To facilitate in getting financial support To reduce risk of loss To develop self-confidence To help solve problems To help run the business smoothly To help select an appropriate business

3. Factors to be Considered in Making a Good Business Plan IncomeExpenditure/costCredit/source of investment Amount of credit and rate of interest Marketing channels StorageProfit

4. Factors to be Considered in Business Planning What type of business will it be? Does the entrepreneur have enough experience to run the business? What risks are involved?


What is the demand for the products/goods/services provided by the business? Will it be profitable? How much capital will be required? Are there sources of adequate capital? How will the capital be mobilized? Are the required facilities and infrastructure available?

In addition to the topics discussed in the manual, the participants also discussed some questions to consider in business planning. These questions were based on the article, “How to Locate Your Business,” Philippine Daily Inquirer, October 6, 2000, as follows:

Is there a need for your product or service? A business strategy or feasibility study should be in place to find the needs of the market and how to address these needs.

Will your new or preexisting business be able to fill a need in the place or community? If not, a change must be made – either in the type of business you are considering or in the community.

How many customers are there? Is the number of potential customers large enough to justify locating your business in the place or community? The closer you are to your main market, the easier it will be to serve it.

How strong is the competition? Having determined that there is a market for your product or service, it is important not to overlook the competition. Does any business already have a foothold in the place? How many? What can you offer that will set your business apart from the rest? If yours is to be the first in the place or community, why haven’t others located there? Maybe there is some drawback that others have seen.

Is the community prosperous enough to support your business? To determine the community’s level of prosperity, take a look at its economic structure. Is it based on manufacturing, retail, services or a combination of these? Who are the major employers in the town?

What is the community’s growth potential? Are people moving into the community or leaving it? Some positive indicators of growth are land development projects, the presence of department stores and other major businesses, well-kept homes and storefronts, active citizens’ groups like organizations and clubs, and adequate public services.

What kinds of people live there? In addition to the size of the community’s population, you should be concerned about its makeup. Is the average age 52 or 22? How much does a typical worker earn? What percentage of the community is married? What’s the average number of children? What is their lifestyle?

What are the restrictions on your type of business? Each community has its own unique restrictions. In selecting your location, you should be aware of these restrictions. If not, you could find yourself prohibited from obtaining business licenses, expanding facilities or receiving deliveries.

Will your suppliers have ready access to you? If you are considering settling in a remote locale, your privacy may come at a price. Unless your suppliers have ready access to you, you could end up unable to obtain necessary shipments or paying shipping costs.

Is the local labour force adequate and affordable? Whether labour is available and affordable depends on the type of business. The more specialized or technical the work tasks are, the greater the difficulty in hiring the right people.

Do you like the community enough to live and work in it? Regardless of your answers to the first questions, if you can’t answer this one, keep looking. Relying on personal preferences


alone can be disastrous, but ignoring them altogether can be equally so. The location that is best for your business must also be right for you and your family.

After the presentation of the resource person, the participants were divided into four groups. Each group prepared a preliminary plan.

The suggested format presented in the manual was used to guide them in their planning work.

The outcomes of the participants were as follows:

Group 1: Name of enterprise: kitchen/backyard gardening

How much money required: 500 USD

Amount of own capital: 150 USD

Source of remaining capital required: NGOs/bank

Experience to date:

Little experience of cultivation Calculation skill Local consumption of vegetables

Other types of experience required:

Fertilizer and pest control mechanism Seed selection Seasonal vegetable collection Nutritive values Harvesting Costing Pricing

Number of employees required: 5

Facilities to run the enterprise:

Land (600 square meters) Plough Fertilizer Pesticide Water

Expected volume of production per month: 400 kilograms

Where the products/goods will be marketed:

Local market Residence (own)

Estimated profit per month: 60 USD

Risks involved in running the enterprise:

Storage Transportation Natural disaster Overproduction


Group 2: Name of enterprise: food processing (banana chips)

How much money required: $300

Amount of own capital: $125

Source of remaining capital required: UNESCO project/NGOs/bank

Experience to date:

Processing/preparing Packaging Marketing

Other types of experiences required:

Survey of local needs Market survey Account keeping

Number of employees required: 3 women

Facilities required:

Sunny weather Local needs

Expected volume of production per month: 20,000 packages (300 grams)

Where products/goods will be marketed:

Market Individuals

Estimated profit per month: $440

Risks involved in running the enterprise:

Weather changes Damage to banana crops

Group 3: Name of enterprise: tailoring and designing

How much money required: $2,000

Amount of own capital: $500

Sources of remaining capital required:

Banks

Local government

Experience to date:

Business management (accounting, marketing, networking) Skills (designing, stitching)



Machine maintenance

Number of employees required:

10 tailors 10 designers

Facilities required to run the enterprise:

2 rooms for tailoring and designing

Expected volume of production per month:

900 sets of uniforms 300 designed souvenirs

Where the goods/products will be marketed:

offices markets department stores emporiums schools

Estimated profit per month: $400 Risks involved in running the enterprise:

Cannot meet demand Not being able to sell some products

Group 4: Name of enterprise: handicraft production

How much money required: P 50,000

Amount of own capital: P 20,000

Source of remaining capital required:

P 30,000 from a financial institution

Experience to date:

Basic skills in handicrafts


Marketing Accounting Bookkeeping Sales promotion Management


Number of employees required: 5-10

Facilities required to run the enterprise:

Raw materials Tools Buildings Machines Transportation

Expected volume of production per month: 100-150 pieces

Risks involved in running the enterprise

Marketing Transportation Storage Competition

Market Survey 43

6 Market Survey

A market survey is an important requirement for initiating any successful business. The objective of a market survey is to collect information on various aspects of the business. This survey is a tool through which we can minimize risk. After the market survey, the results must be analyzed in order to finalize a business plan.

The workshop session on market surveys was designed to provide the participants with an understanding of the importance and procedures of such a survey. The session started with a case study on Lokmans Grocery, taken from the training manual. Participants were divided into four groups to study the case and answer the following question:

What happens when an entrepreneur starts her business without conducting a market survey?

The groups came up with the following answers:

She doesn’t know the purchasing power of the customers

She doesn’t know the age group of the customers

She doesn’t know the target market of the customers

She doesn’t know the right place to start her business

She can’t get enough profit

Difficulty in sales

She cannot decide which product should be produced

She cannot decide the production capacity

No market for product

Plan would become a failure

Customers’ availability

People don't need the product

Accessibility of the product

Cannot sell the product

Customers may go to another shop

Without market survey, no customer, no benefit

Difficult to sell because they don’t know about standard price so that they will sell cheaper or higher

She has risks – gets little profit or it’s too late to develop the enterprise; doesn’t have buyers

Goods not needed in the market

The session also included a presentation by the resource person on the concept of a market survey. The presentation included the following points:

A market survey is a systematic collection, recording, analysis and interpretation of data relating to the existing or potential market for a product or services


A market survey is a useful tool for contact with the market

The systematic and intelligent use of this tool can reduce risks of decision making under conditions of uncertainty

Through a market survey we can obtain information in the following areas:

size of market pattern of demand buying habits and motives past and present trends for this or other products

The following five steps in doing a market survey were also discussed in the session:

Step1: Define objectives and specify information to be collected

Identifying sources of information Assessing time and costs required for the survey Selecting methodology Preparing an action plan

Step 2: Select a sample Determining where to conduct the survey Determining when to conduct the survey

Step 3: Prepare a questionnaire for the survey

Step 4: Collect data and analyze the information obtained

Step 5: Prepare a report based on data analyzed

In the session, participants discussed the following ten broad areas for information collection:

MarketBuyers/ customers Raw materials Machinery, equipment CompetitorsFurniture Manpower Capital and risks Rules and regulations Marketing

After the discussion, participants were divided into four groups to identify questions to be asked in the above-mentioned areas while conducting a market survey.

The major points of the group reports are as follows:

Market Survey 45

Group 1 Area: Market

What to Know How to Know From Whom to Know

How many sellers in this marketSize of demand Possibility of increasing demand

Present prices Seasonal demand Demand creation What types of problems facing sellers, what are the probable solutions Areas of market

discussion/data collection

discussion/data collection data analysis/discussion

questionnairediscussion/data collection discussionquestionnaire

local shopkeepers

local authorities local shopkeepers EPBconsumersEPBcustomers association local shopkeepers consumerslocal shopkeepers

Area: Customer/Buyer


Who are the customers - age group - sex - economic status

Consumer buying behaviourConsumer choice

Where they purchase their commodity and why What types of facilities customers get from local shopkeepers

discussion/interview

interview

discussion

discussion

discussion

local shopkeepers

seller consumerseller producerconsumerconsumer

consumer

Area: Raw Materials


what types of raw materials are the raw materials available here prices of raw materials

are there any transport facilitieswhat types of storage facilities required to preserve raw materials is there any risk to handle raw materials; (if yes)how it may be overcome

discussion/interview discussion/interview


interview/discussion


discussion

local producers/shopkeepers local producers/shopkeepers

local producers/shopkeepers





Group 2 Area: Machinery/Equipment


What kinds of machinery What price Where the machinery is availableWho is the cheapest supplier Maintenance after sales service Power supplies How long it should be used GuaranteeQualified machine DimensionBuying/selling procedure

Individual contact Advertising Web pages

UsersExhibition/demo

Rumor/jokes Chatting

TVRadioDaily papers

Computer

Posters and signboards

Area: Furniture


What types of furniture are neededWhere the furniture is available at a reasonable rate What types of furniture attract the consumer Prices

Observation of the enterprisesData collection

Discussion

Competitors

Shopkeepers

Consumers

Media

Area: Competitors


Who are they Where are they Quality of their goods Size of their market/where What are the incentives given by the competitors (quality and quantity) How many competitors What is their best production Where is their monopoly area Who are their consumers Where do they collect raw materialsWhat types of equipment do they use What is special about their productWhat kinds of media do they use for advertising What are the weaknesses of products and competitors What types of incentive do they offer What is the quality

Individual contact Advertising Web pages UsersExhibition/demoRumor/jokes ChattingMarket survey Individual contact QuestionnairesField visit DiscussionData collection Personal relationships

TVRadioDaily papers ComputerPosters and signboards ConsumersShopkeepersMaterials supplier Business associations

Market Survey 47

Group 3 Area: Manpower


Types of employees

No. of employees Experience of employees Responsibilities of employees Wages for employees Facilities for employees Demand of employees Recruitment/hiring of employees How much money required Source of credit

Rules of credit

Mode of loan recovery

Establishment cost

Risks:- Types? - When? - How do they

overcome?

Interview (oral and written) Survey Collect information

Collect information

Initial capital Additional requirement Initial capital Additional requirement Initial capital Additional requirement Initial capital Additional requirement Initial capital Additional requirement

From people

EntrepreneurEmployment exchange

Media

EntrepreneursDocumentsBanks

Laws

Laws

Laws

Group 4

Area: Marketing


Rules and regulations

MarketingSize of market Location of market Market demand

Interviews

interviews

Officials

competent individuals

At the end of the session, participants also discussed techniques for preparing a questionnaire.


7 Capital and Its Sources

This session started with gallery presentations. All fifteen participating countries prepared their presentations based on the following guidelines for micro-financial services at the community level:

Procedures for generating financial resources at the grassroots level Micro-financial service providers Criteria for obtaining loans Loan procedures Average loan size Maximum loan amount Duration of loan Rate of interest Mode of repayment

During the gallery presentations each country visited other countries’ galleries to get an idea of existing micro-financial services at the community level now available in different countries. The following are summaries of the country presentations:

B a n g l a d e s h

Procedures for generating financial resources:

savingsloans from relatives profit from other income-generating activities

Micro-financial service providers

NGOsbanksgovernment agencies, e.g.,

- rural development board - directorate of youth development - directorate of women’s development

Criteria for obtaining loans

rural women 15-49 years of age

household income level not more than TK 1,500 per month

working class background and willingness to be a group member and participate in a savings and credit scheme

previous knowledge and experience in income generation activities

mental and physical fitness to handle savings and credit

Capital and Its Sources 49

Loan procedures

each member needs to submit application recommended by any two of the following officers of the group (group leader, sub-group leader, treasurer)

Average loan size

TK 3,000 to 6,000

Maximum loan amount

TK 20,000

Duration of loan

52 weeks

Rate of interest

12.5 per cent (simple interest)

Mode of repayment

weekly installment (50 weeks)

B h u t a n

In Bhutan, we have just completed basic and post-literacy programmes.to provide continuing education, with 4 CLCs established so far. We plan to start IGPs soon.

However, micro-financial services at the community level exist already.

Micro-financial service providers:

BDFCBank of Bhutan RICB (Royal Insurance Corporation of Bhutan) BNB (Bhutan National Bank)

Criteria for obtaining loans:

plansubmit the proposal obtain approval from the Government apply for loan

Average loan size: Nu. 5,000-50,000 (for farmers to engage in small-scale home industries, farming and improving livestock) or 75 per cent of the proposed total investment

Maximum loan amount : 75 per cent of the total investment

Duration of loan: 3 to 15 years

Rate of interest: 13 to 16 per cent

Mode of repayment: monthly, quarterly, half yearly and annually


C a m b o d i a

In Cambodia, we have completed the second basic literacy programme in 3 CLCs and are providing continuing education through libraries.


HI, ACELIDA, banks Amount of maximum loan = 1,200,000 riel (US$350)

Loan procedures

Lending – savings – recovering

Average loan size – 80 per cent

Duration of loan – 2-4 years

Rate of interest – 3-4 per cent

Mode of repayment – yearly

Criteria for obtaining loans - project proposal

C h i n a

Bank of Agriculture

Women who start small enterprises

Apply to Bank of Agriculture with sponsorship of local women’s federation

Pilot project in some counties

2,000 yan (US$200)

One or two years

Bank loan without interest (only for this project)

Repay by installments


I n d o n e s i a


L a o P D R

Case: revolving fund:

Micro-financial service providers:

UNESCO PROAP, UNICEF ESCAPNGO (ESF)


applicant has some facility/potential (money, equipment, materials, skills)

Loan procedures

participation in literacy or post-literacy programmes

trained in basic skills trained in managing and planning of revolving fund micro activities plan proposal has organized interest groups/professional groups (weaving, sewing, food processing, animal raising, agriculture, etc.) contract between receiver and CLC leading CLC committee selected

M a l a y s i a

Micro-financial service provider

AMANAH/KHTIAR Malaysia (AIM) (The Endeavor Trust of Malaysia, established on 17th September 1987)


poor household monthly income not exceeding

- RM 285 (RM 57 per capita) – Peninsula Malaysia - RM 344 (RM 69 per capita) – Sarawak - RM 401 (RM 80 per capita) – Sabah

Loan procedures

Loans are given without collateral/guarantor Eligible members identified by AIM field asst. and branch manager will:

- form a group of 5 persons (not related), living in the same neighbourhood, same sex - undergo compulsory group training – 7 days (1 hour/day) - pass oral group recognition test


Loan scheme – 2 types

Economic loan

- IKHTIAR loan scheme 1 (SPI 1) - IKHTIAR loan scheme 2 (SPI 2) - IKHTIAR loan scheme 3 (SPI 3)

Special loan (SPP)

educational loan housing loan (SPR)

New types under economic loan:

SPIN – economic loan for fisheries activities SKIT – economic loan for single mothers in urban areas

Group fund

all members save at least RM 1/week (depending on their loan size) donate 5 per cent of their economic loan to the group fund

Scheme Amount Repayment Period

(weekly) Terms and Conditions

1. IKHTIAR loan Scheme 1 (SPI 1)

RM 1,000 RM 2,000 RM 3,000 RM 4,000 RM 4,000

50 weeks 50 weeks 50.75.100 weeks 50.75.100 weeks 50.75.100 weeks

Monthly household income not exceeding RM 285 or per capita RM, for Pen. Malaysia, RM 344 or per capita RM 69RM401 or per capita RM 80 for Sasawakal


RM 5,000 RM 9,900

Option 50.75.100.125 and 150 weeks

Monthly income exceeding Rm 600 perfect repayment record for the previous two loans


RM 10,000 (US$ 2,600)

Option 50-150 weeks Monthly income exceeding 1,000 perfect repayment record for at least 2 times (SPI 1) or (SPI 2) over at least 25 per cent asset value/saving from previous project

4. Educational Loan (SPP)

RM 1,000 50 weeks Perfect repayment record for the first economic loan

5. Housing loan (SPR) RM 5,000 50-100 weeks Perfect repayment for the first three economic loans, the centre should consist of at least six groups


M o n g o l i a

Company supported by UNDP. The shareholders are NGOs and private companies

individuals and small business units business plan required

Business plan based on decision by company

required local government recommendation

average loan size (cash): $100 - $2,000

maximum loan amount: $3,000

duration of loan: 1- to 10 months

rate of interest: 3- to 5 per cent per month

mode of repayment (cash) – according to the agreed-upon schedule

M y a n m a r

Government

Agricultural and Rural Development Bank Giving seasonal loans to farmers (who have their own land) Industrial Development Bank (semi-government bank) Myama Economic Bank Annual short-term loans to private business/enterprise (with collateral)

Cooperative Credit Society (under the Myanmar Cooperative Law)

Credit Society - in department - at township level

- at village level

UN Agencies/NGOs

Micro Finance Project – (UNDP/UNOPS) under HDI (Human Development Initiative Programme)

3 models in Myanmar for 11 townships

Grameen Trust: in Delta Zone (3 townships) PACT (USA): in Dry Zone (3 townships) GRET (France): in Shan State (5 townships) (loans to poor communities without collateral)

Micro-financial services at the community level:

3 NGOs (implementing partners) subcontracted by UNOPS Criteria for obtaining loans


- beneficiaries must be poor women - poor (identified by UNDP/PACT/Village elder authorities) - landless/casual labourers

- household heads - with good character

Loan procedures

Sensitization Group Formation Training/Saving

Collection of Loan (P + In)

ImplementationBusiness

LoanDisbursement

Weekly or bi-weekly

Monitoring/Evaluation Additional Loan Seasonal Loan

Next Cycle Loan

Average Loan Size (different size)

Maximum Loan

First Loan 5000K-6,000K (15-20 US$) Seasonal Loan (family business) Max: 10,000-15,000 (40-50 US$) Next Cycle Loan 30,000 (75-100 US$)

Duration of Loan

- one year (for normal loan); six months (for seasonal loan)

Rate of interest

- 20 per cent-30 per cent

Mode of repayment

- Weekly - Bi-weekly


N e p a l

Micro-financial providers: CLC savings and credit groups, NGOs


rotation loan system priorities for disadvantaged groups

Loan procedures

groups submit application with scheme for income generation group meetings

Average loan size

50 per cent of total amount

Maximum loan amount

80 per cent of total amount

Duration of loan

normal loan one year seasonal loan six months rate of interest 15 per cent to17 per cent (long-term) (short-term) mode of repayment 3 months x 4 times


Adult groups (saving/credit)

Women group CLC Children

groups

Farmer groups

Income generating activities: - Raising buffalo - Raising chickens - Raising pig - Raising goats - Growing vegetables - Bee keeping

P a k i s t a n

Procedures for generating financial resources

equity financing only


NRSP PRSP SUDHAR BUNYAD D.L.N.F.E. BRSP AKRSP S.W.D (UNICEF) (GOB) (GOB)


rural women’s savings groups (five members each) N.F.E (compulsory)

Loan procedures

personal guarantee of CLC facilitator/head of the committee application form - promissory note

Average loan size

Rs 3,000 to 15,000

Maximum loan size

Rs 3,000 to Rs 25,000


Duration of loans

Rs 3,000 (1 year) Rs 15,000 (1 year) Rs 15,000 and above (2 years)

Rate of interest

15-18 per cent

Mode of repayment

Monthly installment after 2/3 months grace period


Criteria

must be duly registered with proper government agency must be endorsed by the church and community leader or institutional linkage must have a small office to conduct official business and at least one collector and a bookkeepermust have the capability to put up the required 10 per cent equity must have experience in any economic activity, preferably relending must be willing to conform to the KAKAYAHAN operating system

Loan procedure/purpose

relending to individual beneficiaries

Average loan size

minimum (P20,000) maximum (P500,000)

Duration of loan/repayment terms

maximum of 5 years inclusive of 1-2 years grace period on principal; interest paid quarterly based on diminishing balance, quarterly amortization of principal and interest after the grace period

Interest rate – 12 per cent per annum

Maximum pass-on rate to beneficiaries

For NGOs – 16 per cent per annum For cooperatives – 24 per cent per annum


T h a i l a n d

Micro-financial service provider:

community cooperative fund managed by the Department of Community Development


MemberSavings account – monthly, at least 6 months Proposed income-generating project Project approved by fund committee

Loan procedures

Propose the project to the committee Committee reviews and approves the project Release funds, repay funds

Average loan size: 20,000 Baht (US$500)

Maximum loan amount: 30,000 Baht (US$750)

Duration of loan: 2-3 years

Rate of interest: 2 per cent per month

Mode of repayment:

Repay after one year Interest begins at the first month Amount of repayment depends on the benefit, larger amounts borrowed must be repaid sooner than smaller amounts

U z b e k i s t a n

Micro-financial services at the community level:


local banks business fund foreign aid organization


intention to start business permission for enterprise activity business plan materials, equipment, skills, building account in local bank seal/stamp


Loan procedures

approval of local authority filling out loan application presentation of business plan

Average loan size

short-term loan average-term loan long-term loan

Maximum loan amount

10 million sum (Uzbekistan currency)

Duration of loan

3 to 6 months 1 to 1.5 months 2 to 5 years

Rate of loan

3 per cent 7 per cent 15 per cent 20 per cent

Mode of repayment

half-monthly monthly half year year

V i e t N a m

Service provider

Women’s union in community

Criteria

Illiterate, poor women

Loan procedures

Submit application (situation, reasons, how much, how to use)

Loan size: 400,000 VND 50 USD

Maximum: 60 USD


Duration: 2 years

Rate: 1 per cent

Mode of repayment:

original loan + interest after 2 years

Commnity Learning Centres TE-RA-KO-VA in northern Viet Nam

Literacy

Agriculture skill training

Book reading

Forum CLC Sport activities

Family

planning Cultural

activities

After the gallery presentations, workshop participants watched a video about the Grameen Bank in order to understand and appreciate the micro-financial services provided by this institution. The video was followed by a discussion of the procedures and criteria for different micro-financial institutions in Bangladesh.

Participants also had an opportunity to learn about and discuss the various micro-financial institutions in the Philippines and the services they offer.

The session concluded with a presentation on credit assistance provided to small-scale businesses and income-generating programmes in the Philippines.


Table 1. Summary of rules of mandatory savings

Indicators ASA BRAC BAROI-Tangail Grameen Bank Proshika

Minimumweekly savings

Taka 10; equal for all members of the group

Taka 2 Taka 5 Taka 2, equal throughout the bank (the bank has increased the rate toTaka 5)

Taka 5

Ceiling of savings

No ceiling Taka 20 No ceiling Taka 5 (a member may open separate savingsaccount)

Taka 20

Withdrawal of savings

Allowed; minimumbalance of 10 per cent of loan must be maintained

Allowed only in the events of resignation or cancellation of membership or retirement from BRAC

Allowed; Taka 10 only as minimumbalance

Allowed after 10 years

Allowed only for medical treatment and emergency purposes

Rate of interest on savings

8% 6% 7.5% 8.5% 5%

Net amount of savingsmobilized (Taka in million)

816.36 1,484.66 27.01 4,320 Not available

Savings as per cent of loan outstanding

36.8%(December

1998)

28.58%(December

1998)

15.65%(December

1998)

35.74%(December

1998)

Not available

Source: Respective MFIs, 1999.

Table 2. Comparison of outreach and terms and conditions of basic microcreditof Grameen Bank and large MFIs/Ngos in Bangladesh

Indicators ASA BRAC Grameen Bank Proshika

Members 833,119 (general) 2,760,051 2,368,347 1,124,560

Borrowers 734,684 2,027,720 739,118

Cumulative Disbursement (Taka in million)

11,967.43(up to Dec’98)

25,601**(up to June’ 98)

100,899.8(up to Dec’ 98)

6,674**(up to June 98)

Disbursement in 1998 (Taka in million)

4,862.88(general

members)

8,340.15 19,119.4 2,774

Outstanding loan (Dec. 1998) (Taka in million)

2,101.14(general

members)

5,194.33 12,088.6 2,679

Average loan size (Taka)* 5,720 3,972 8,400 7,249

Duration of loan One year One year One year One year

# Installments 45 45 46 12

Rate of interest 25% 30% 20% 18%

Maximum loan amount (Taka) 9,000 N.A. 15,000 N.A.

Source: Respective organizations * estimated by the author ** CDF, 1998


Table 3. Sector-wise distribution of loans of 369 NGOs including ASA, BRAC, and Proshika

SectorPercentage of disbursement

(up to June 1998)

Agriculture 12.19

Fisheries 4.33

Food processing 10.17

Small business 42.13

Cottage industries 2.83

Transpot 3.39

Housing 1.49

Health 0.51

Education 0.04

Livestock 17.94

Others 4.81

Total 100.00

Source: CDF, 1998.

Table 4. Activities financed by first and present loan of 6,057 borrowers

First loan Present loan No. Activities

Number (#) Per cent Number (#) Per cent

1. Agriculture/vegetables and fruit growing/nursery

554 9.14 542 9.11

2. Poultry, duck, goat and livestock rearing

857 14.15 364 6.12

3. Milch cow rearing 867 14.31 1,098 18.45

4. Fish farming 132 2.18 221 3.71

5. Weaving 69 1.14 87 1.46

6. Rice husking 279 4.61 200 3.36

7. Petty trade/shops 2,047 33.80 2,126 35.73

8. Tailoring/nakshi katha sewing/ purchase of sewing machine

87 1.44 131 2.20

9. Handicrafts/bamboo, cane and jute products making

306 5.05 193 3.24

10. Carpentry/plumbing/mechanic/ barber/washing

103 1.70 180 3.02

11. Rickshaw/van purchase 325 5.37 396 6.66

12. Puffed and fried rice 31 0.51 34 0.57

13. Maintenance works 68 1.12 71 1.19

14. Lease of land. Ghat etc. 205 3.38 137 2.30

15. Others 138 2.27 170 2.86

Total 6,057 100 5,950 100

Source: Survey of 20 MFIs (Alamgir, 1998a).


Table 5. Terms and conditions of loan under MIDI

Description Terms and conditions

Legal status of borrower Proprietorship PartnershipPrivate Limited Company

Loan size Taka 50,000 – Taka 500,000

Total project cost Taka 15 million (maximum)

Debt-equity ratio 80:20 (maximum)

Interest rate 14% per annum (simple)

Rebate on interest @ 10% of interest for timely repayment of loan

Loan repayment period 1 to 3 years

Security of loan - Personal guarantee of the sponsor

- Personal Guarantee in favour of the sponsor from an acceptable person

- Equitable mortgage and hypothecation of project assets

Project implementation period 3 months (maximum)

Source: MIDAS, 1998

Table 6. Terms and conditions of MELA loans

Ownership pattern Single ownership – no partnership

Loan size Taka 20,000 to Taka 200,000

Use of loan Fixed assets or working capital

Maximum debt – Equity ratio 80:20 (closer to 50:50 preferred)

Rate of interest 15% (flat)

Maximum repayment period 2 years (12 months, 18 months and 24 months)

Mode of repayment Equal monthly installments

Implementation (grace) period 3 months (maximum)

Legal security of loan - Personal Gurantee Bond to borrower - Personal Gurantee of another person in favour of the

borrower - Memorandum of deposite of title deeds (equitable

mortgage)- Hypothecation of project assets

Collateral requirement Specific collateral of property on loans exceeding Taka 50,000 for past BRAC village organization members and on all loans for new borrowers.

Loan application fee Taka 2

Loan application servicing fee Taka 100

Appraisal fee 1% of loan amount

Source: BRAC, 1998.


Credit Assistance to Small-scale Businessand Income-generating Programmes:

Some Lending Patterns in the Philippines*

A. Introduction: The Need for Credit Assistance to Small Business Credit assistance is an important component in livelihood and income-generating programmes. In the Philippines, businessmen and entrepreneurs need to familiarize themselves with a number of information on credit assistance so that they can make a wise decision on credit availment. Useful information on credit assistance include: getting acquainted with the credit institutions, groups and individuals; the types of credit assistance they provide to small businessmen; and, the lending patterns they adopt in providing credit to various clients.

B. Types of Lending Institutions 1. Formal Banking and Non-Banking Sector

The formal sector consists of institutions, banking and non-banking, which are under the supervision of the Bangko Sentral ng Pilipinas and the insurance companies which are under the supervision of the Insurance Commission. The Philippine banking and non-banking financial system has grown in size from 5,858 in 1984 to 12,266 in 1995. This reflects an improved efficiency in the utilization of capital investments as well as branching out of financial institutions. From 1981 to 1990, banking institutions outnumbered non-bank financial and thrift institutions but in 1991 to 1995, non-bank institutions exceeded banking institutions.

a) Banks are further classified into four (4) types i.e., commercial banks, thrift banks, rural banks, and specialized government banks.

Commercial Banks. The major function of a commercial bank is its being a depository and a safekeeping institution. Aside from the Bangko Sentral ng Pilipinas, commercial banks are the only institutions which have demand deposit function, i.e., they can create money by means of issuing a new demand deposit in the process of granting loans.

Thrift Banks. The thrift banking system is composed of Savings and Mortgage Banks (SMBs), Stock Savings and Loan Associations (SSLAs), and private development banks (PDBs).

SMBs or savings and mortgage banks are organized for the purpose of accumulating the savings of depositors and investing them in marketable bonds and securities, commercial papers, and accounts receivables, drafts of exchange, acceptances of notes arising from loans, whether secured or unsecured, mortgages on real estate, financing for housing loans and other investments and loans authorized by the Monetary Board. SSLAs are involved in similar activities but are limited to their members and stockholders only.

_______________________________* From Department of Trade and Industry, Bureau of Small and Medium Business Development, Lending

and Borrowing Patterns of Micro, Small and Medium Enterprises (A Research Study), July 1998.


PDBs or private development banks cater to the capital needs and demand for investment credit or medium to long term loans for the promotion and growth of industry and agriculture at reasonable costs. These banks are also authorized to generate deposits from public and other government institutions as the source of funds for the loans and financing services they provide.

Rural Banks. Rural banks are community-oriented banks organized as a stock corporation with five to 15 incorporators residing within the area of operation of the bank. They also have savings and credit function and may also open current or checking accounts or NOW accounts upon the approval of the Monetary Board. It may also act as the official depository of municipal, city, and provincial funds in the locality where it is operating.

Specialized Banks. At present there are three specialized government banks operating, these are Land Bank of the Philippines, the Development Bank of the Philippines, and the Al-Amanah Islamic Investment Bank of the Philippines.

b) Non-Banking Institutions. Nonbank Financial Institutions (NBFIs) are non-monetary financial institutions, classified into private and government, with or without quasibanking functions. They are primarily engaged in long-term financing short-term placements in other financial institutions.

The three major classification of NBFIs are private nonblank financial intermediaries, non-bank thrift institutions and government non-bank institutions. Investment houses, financing companies, securities dealers/ brokers, investment companies, venture capital corporations, pawnshops, fund managers, and lending investors comprise the private nonbank financial intermediaries while private nonbank thrift institutions are composed of mutual building and loan associations and the non-stick savings and loan associations.

2. Semi-Formal Sector

Cooperatives, credit unions, and NGOs form part of the semi-formal segment of the financial market. They are considered as such since they are registered and in the case of cooperatives, regulated by the Cooperative Development Authority. As of March 1997, there were a total of 37,699 registered cooperatives but the number of operating cooperatives was only 4,516.

3. Informal Sector

Borrowing from informal lenders is more prevalent in the rural areas, however, in Metro Manila and other urban areas, about 60% of the total borrowers rely on informal lenders.

The following are some of the more prominent forms of non-formal financial intermediaries:

Paluwagan or rotating savings and credit associations (ROSCAS) friends/relativesself-help groups/solidarity groups landlord-lenderstraders/input suppliers trader/miller lenders farmer-lendersprofessional money lenders


C. Formal Sources of Credit for MSMEs There are three types of special lending schemes for MSMEs in the Philippines according to the Institute for Small Scale Industries (IISI), University of the Philippines.

1. Direct Loans. These are short-term and long-term credit provided directly by the financial institution to small enterprises to meet their fixed and working capital requirements. This can be availed for as well as expansion and sometimes, start-up purposes.

a) Government Non-Financial Institutions. There are various government non-financial institutions that provide loans to small entrepreneurs for their working capital requirements and sometimes to finance the acquisition of machinery and equipment. Most of the loans offered by these special programmes are interest-bearing, but at rates usually below those prevailing in the commercial market. Likewise, most of the loans need to be secured.

b) Banks. Banks have their own direct lending programmes. They vary according to the particular market segment they cater to. Larger banks have separate departments specializing in different types of loans. Smaller banks are likely to reflect the nature of business in the areas where they operate.

c) Non-Bank Financial Institutions. There are also non-bank financial institutions that provide credit to small entrepreneurs. The loan could be used for acquisition of machinery and equipments and working capital. The eligible borrowers are non-government organizations (NGOs).

d) Private Sector/Non-Government Organizations. There are also non-government organizations that provide direct loans to SMEs. As an example, the Kabuhayan Programme targets the ultra poor. It has adopted the essential features of the Grameen Bank credit delivery approach. The interest rate TSPI charges for this programme is 30 per cent per annum although there is no collateral requirement. The ILAP programme targets what they call as “non-bankable” entrepreneurs. The loanable amount is from P400,000 to 500,000 with an interest rate of 18-25 per cent p.a. Collateral is required.

2. Indirect Loans. These are short and long-term credit which financial institutions provide to small enterprises not directly but through other institutions like banks, cooperatives, non-government organizations and industry associations. The institutions through which the fund is channeled are called “financial intermediaries.” Some lending programmes call these intermediaries “participating financial institutions (PFI).” Institutions which extend loans in this manner are said to be engaged in “wholesale lending” while those which lend directly are said to be engaged in “retail lending.”

3. Credit Guarantees. A credit guarantee is a promise by an institution to another to make good on the failure of a borrower to repay a loan. Through credit guarantee programmes, small enterprises with no or inadequate collateral can borrow from banks and other financial institutions who might otherwise refuse to take the risk of lending without sufficient security. Three (3) types of guarantee arrangements are available: clear loan guarantee for loans completely unsecured by any hard collateral; collateral-short guarantee for loans partially secured by collateral; and straight credit risk guarantee for start-up projects of those without sufficient tract record.

The following would be indicators of the extent to which they are able to provide access to small entrepreneurs:


Loans which are small in size; Simplified loan procedures; Rapidity of loan approval and release; Maturity and loan purpose which is flexible, and able to meet divergent needs; Collection systems that are in tune with the earnings flow of its clientele; and Interest rates sufficient to cover their transaction cost, the risk related to their particular clientele, and their cost of funds.

D. Some Present Lending Patterns in the Philippines 1. Majority of the Lending Schemes for small and medium enterprises (those with assets of Pl.5

to 60 million) course their funds through banks. Guarantee institutions, which cover SMEs also course their guarantee coverage through banks. Lending Schemes for Micro-enterprises (those with assets of less than P1.5 million) usually course their funds through Rural Banks, Cooperatives and NGOs.

2. To intermediary financial institutions, the main incentive for acting as conduits of the various lending programmes is that they are able to provide a wider range of services thus strengthening their image of accessibility. The financial incentive to conduits for lending is perceived by some institutions to be insufficient.

3. Loans are more accessible to: a) registered enterprises, b) single proprietorships, partnerships and corporations, c) small and medium industries, d) those with majority Filipino ownership, and e) enterprises with DE ratios of 80:20 and below.

4. An enterprise usually has to submit many documents in order to get loan approval or guarantee coverage from the different programmes and institutions studies.

5. There are many lending schemes that offer loans with interest rates that are below commercial rates.

6. Most loans need to be secured with collateral.

7. The most common reason for the disapproval of loans is the insufficiency of acceptable collateral.

8. In the past, more loans have been granted to enterprises in urban areas, and those based in the NCR, and regions III, IV and VII. This was due to greater accessibility and relatively lower processing costs.

9. The repayment rates of the different loans programmes are relatively high. The effect of default may be more pronounced on small banks.

10. There appears to be a lack of information dissemination on the different credit programmes.

E. Some Present Borrowing Patterns in the Philippines 1. NGOs/Cooperatives had the highest perception rating on all attributes on which they were

rated. Banks had high ratings as far as attributes of honesty, trustworthiness, and stability are concerned but got low ratings in the areas of number of requirements and leniency. Lending investors were perceived to charge higher interest rates than the two institutions. Likewise, lending investors were rated the lowest in almost all areas.

2. Five major factors were identified by respondents in choosing where to borrow, namely: low interest rate, sufficient loanable amount, quick processing, friendly service, and familiarity.


3. Based on the survey, what matters most is the low interest rate being provided on loans. It does not matter whether the institution requires a long process, has so many requirements, or that it requires collateral, as long as it provides a low interest rate.

4. There are more entrepreneurs who were able to borrow from the formal sector – banks, lending investors, and government financial institutions – than those who were able to borrow from the semi-formal and informal sectors.

5. As for borrowing from banks, the important consideration in selecting the bank are low interest rate, fast processing, few requirements, and sufficient loanable amount.

6. Collateral and capacity to pay are preserved as the most important considerations of the bank in approving loans. The common reasons for disapproval are no or lack of collateral and insufficiency of capital.

7. A number of factors influence the perception of entrepreneurs with regard to banks, NGOs/Cooperatives, and lending investors. These are:

a) Experience in borrowing. Entrepreneurs who have had experience in borrowing are more likely to give a high rating to banks while those who have not had any experience are more likely to give a high rating to NGOs/Cooperatives. This is shown in the relationship between the number of times an entrepreneur has availed of loans and their perception of banks and NGOs/Cooperatives.

Also, those who have availed of loans recently are more likely to give a high rating to banks while those who have not availed of loans recently are more like to give a high rating to NGOs/Cooperatives.

The perception of banks seem to change as one gets to avail of loans from them. While banks may not be able to provide a low interest rate, they are able to provide a sufficient loanable amount that entrepreneurs need. The professional and legal transactions with banks are viewed positively.

b) Socio-economic class. Those who rated themselves as belonging to the middle class are more likely to rate the banks high. This factor has to do with access to loans. Those belonging to the upper class have sources other than banks (because of connections) and they are more stable while those belonging to the lower class would have a hard time accessing loans from banks and convincing them that they are capable of paying their loans. Those in the middle class can very well be able to access loans from banks.

c) New businessmen and entrepreneurs (aged 30 and below) have the tendency to borrow from lending investors. The lending investors seem to attract the riskier (as manifested by the age) type of entrepreneurs.

d) Financial stability. Those who belong to a family with three or more income earners are more likely to rate lending investors high. The high interest rate imposed by lending investors would not be too difficult for the family to bear. This indicates that those who access loans from lending investors have other sources of income aside from the business.

e) Business stability. Those who have a high revolving capital need are more likely to give a high rating to NGO/s/Cooperatives. Also, those who have indicated a negative grown in income for the past two years have the tendency to give a high rating to NGOs/Cooperatives. Because of their business situation, entrepreneurs are attracted to the low interest rates being imposed by NGOs/Cooperatives.


Small Scale Enterprises in the Philippines*

It is generally observed that micro, small and medium enterprises are the backbone of economic development in the Philippines. Collectively, they constitute 99 per cent of all business establishments and employ 55 per cent of the country’s total labour force. The national government puts high premium on this sector and sees the importance of the networking between government institutions, non-government organizations and other stakeholders in the community the undertaking productive enterprise activities in the country.

This paper presents emerging profiles, trends and practices in the planning and operations of small-scale enterprises in the Philippines. The data presented are based mainly on a 1998 study on lending and borrowing patterns of micro, small and medium enterprises carried out by the Department of Trade and Industry.

A. Context of Small-scale Enterprises in the Philippines 1. Some Definitions

The 1997 Republic Act 8289 of the Philippines defines micro, small and medium enterprises as business activities covering industry, agribusiness or services whether they are single proprietorships, partnerships, cooperatives or corporations whose asset sizes correspond to the following:

Micro : Less than PhP1,500,001 Smal : PhP1,500,001 to Ph15,000,000 Medium : PhP15,000,000 to PhP60,000,000

The assets of these enterprises do not include the land where the firm’s office, plant and equipment are situated. The foregoing definition undergoes continuing review and assessment in the light of socio-economic developments of the country.

A 1991 Philippine Institute of Development Studies paper describes micro-enterprises as unincorated income-generating activities undertaken by individuals, households and small operations in the urban and rural areas. These activities include: manufacturing, commerce and services. A distinguishing feature of micro-enterprises is that they are often family-based and sometimes with very small resource base or assets and are not registered with any government institution. In sum, they are generally very small enterprises owned and managed by families or individuals which employ very few people, if any, and from which they derive their livelihood.

2. Significant Role of Small-scale Enterprises in the Country Small firms can be productive outlets for the talents and energies of enterprising independent people;

Small enterprises provide a seedbed for entrepreunerial talent and a testing ground for new industries;

They catalyze innovations and dynamism and enhance competition within the economy. They can also promote community stability;


They do less harm to the physical environment than some large corporations; They stimulate personal savings;

They promote agro-industrial linkages; and

They improve rural welfare and generally raise the level of popular participation in the economy.

3. Policies and Guidelines on Small-Scale Enterprises

The following principles guide the policy directions on small-scale enterprises in the country:

Enhance the the global competitiveness of Philippine products and services;

Raise and sustain productivity in the economy;

Improve and increase infrastructure and other facilities necessary for the speedy movements of goods and services; and

Alleviate poverty particularly in the countryside.

4. General Considerations in the National Planning on Small-scale Enterprises

Viability and competitiveness Private-sector led initiatives Market-driven responses

5. Present-day Needs of Small-Scale Enterprises in the country

Access to information and sourcing of appropriate technologies;

Training on the optimal use of technologies;

Technology dissemination;

Technology evaluation and assessment services;

Technical skills upgrading; common service facilities;

Ample supply of good quality raw materials; and

Availability of basic support industries such as machineries, components, parts repair and fabrication.

B. Patterns and Processes in Small-scale Enterprises in the Country1. Looking at the Over-all Enterprise Environment

Small-scale entrepreneurs in the Philippines generally look at the prevailing enterprise environment which covers: technological advancements, economics and industrial policies, business laws and regulations, commerciable technologies and business ventures, investment plans of the country, assistance programs for small firms and other incentive packages.

In the Philippines, the investment priorities plan of the country is prepared by the Department of Trade and Industry (DTI) and it covers a description of the array of agricultural ventures such as food crops that receive priority attention by the government. Also identified are other business activities that entrepreneurs may consider in planning what business they may want to focus on. Some of these are:


Agribusiness: seaweeds, processed food, shrimps, prawns

Industry: electronics, components and electrical products, metal components

Services: construction seminar, compture software, hotel and restaurant seminar

Consumer products: ceramics, furniture, garments, gifts and houseware

At present, there are numerous government agencies and non-government organizations from which entrepreneurs may source information about the possible small-scale enterprises, including:

The Department of Trade and Industry (DTI)

The Department of Science and Technology (DOST)

National Livelihood Support Fund (NLSF)

Social Security System (SSS)

People’s Credit and Finance Corporation (PCFC)

Development Bank of the Philippines (DBP)

Land Bank of the Philippines (LBP)

Philippine Business for Social Progress (PBSP)

Small Business Guarantee and Finance Corporation (SBGFC)

Trade and Investment Development Corporation of the Philippines (TIDCORP),

Formerly Philippine Export and Foreign Loan Guarantee Corporation (PhilGuarantee)

NGOs involved in small business development

Cooperatives

These government agencies, private groups, and non-government organizations use various means in disseminating information on their programs and projects, including:

Television (TLRC)

Radio (TLRC, Planters Bank)

Press releases (SBGFC)

Fora and conferences (TLRC, DTI, DBP, PBSP, SBGFC)

Briefing sessions for banks and for exporters (TIDCORP)

Marketing efforts and advertisements of the conduit institutions (TIDCORP, PBSP, SBGFC) such as posters in the bank premises (Banco Davao)

Personal marketing efforts of the field staff (DTI) or account officers (Planters Bank)

Personally informing regular borrowers about special programs (CAVALCO)

Visits to prospective clients by the marketing department (FEBTC)

Meetings with various industry borrowers (Planters Bank)

Most new businesses are not started on the basis of totally new products or ideas. Most of them sprang from old ideas that have been updated or from current ideas that have been repackaged to meet new markets. And it does not take a genius to come up with a suitable business or product idea. Here are some sources of ideas:


Job environment

Successful entrepreneurs

Trade associations

Trade shows and publications

Research reports

Published market statistics/surveys

Business newspapers

Management consultants

Idea brokers and patent brokers

Venture capital firms

Business and credit services

Technology transfer agencies

Small business bureaus

Patent office

As an example, ecological entrepreneuring (Ecopreneuring) was born out of ecological awareness and the need for livelihood. In the Philippines, scrap buying and recycling have become a major industry. Junkshops are almost everywhere. The sight of junkbuyers with their carts is part of the common street life. The scrap materials they buy from houses are being sold to different junkshops which is turn will be sold in big volumes to recycling companies. Wastes have become a source of livelihood for thousands. Ecopreneuring is a noble business with bright prospects ahead. Although the business may look “dirty” it is actually a goldmine or waste materials.

In this business, the entrepreneur does not need an attractive site to put up his shop. The shop usually looks like a warehouse of sorts. Appliances and equipment are not necessary. A single weighing scale is sufficient if you want to start small. Entrepreneurs can even buy the scraps from scavengers. But the most important thing is human relation. They have to know how to deal with people. The business will prosper as soon as they familiarize yourself with the “ins and outs” of the business. From there, the entrepreneur will start to build contacts whom he can depend on for supply and who will buy the scraps in bulk.

Unknown to many, most of the paper used every day are recycled paper. Even bottles, metals, plastics, styrofoam, polystyrene, tetrapacks, batteries, cans, glasses, newspapers and other materials are recycled products. Recycled paper and cartons which are made into beautiful handicrafts are selling like hotcakes in the market. Stationeries, fans, intricate and artistic boxes, bags, and other cute little things like display articles have made the likes of PAPEMELROTI famous and profitable.

2. Fund Sourcing

There are three general types of funding for small-scale business: formal, semi-formal and informal sources.

Formal banking and non-banking sector: banking institutions and non-bank finance institutions

Semi-formal sector: cooperatives, credit unions and NGOs

Informal sector: friends/relatives, self-help groups and professional money lenders


Loans are generally extended for the acquisition or construction of capital assets including land, building, machinery and equipment; expansion of existing businesses; or working capital financing. The amount of loans depends upon the needs of the business, paying capacity of the borrower and loan value of collateral offered.

3. Availing of Incentive Packages

The Board of Investments (BOI) of the Philippines has several incentives to small-scale business, such as:

Exemption from income taxes for six years from commercial operation for pioneer firms and four years for non-pioneer firms.

Additional deduction from taxable income of 50 per cent of wages corresponding to direct labour.

Tax and duty-free importation of machinery, equipment and accompanying spare parts.

Tax credit on domestic capital equipment.

Exemption from contractor’s tax, whether national or local.

Exemption from all taxes and duties on the importation of breeding stocks and genetic materials with 10 years from registration.

Tax credit on domestic breeding stocks and genetic materials.

Tax credit for taxes and duties on raw materials used in the manufacture, processing and production of export products.

4. Training

Small-scale business believes that training programs improve the competence of small business entrepreneurs, managers, supervisors and technicians. They also develop consultants and industrial extension workers who can formulate as well as manage innovative responses to problems of small industries.

Skills training provides complementary competencies to entrepreneurs and managers. It enhances both the entrepreneurial and managerial capability of the small businessman. Training likewise facilitates the transfer of technology and improvement of productivity among workers. At the same time, it is one of the most efficient schemes to increase the supply of skilled manpower and competent entrepreneurs in the countryside.

There are several training institutions for training small industry entrepreneurs, managers and technicians as well as trainers, consultants and extension officers. In the provinces, there are small business institutes attached to the schools of business of various universities which offer small enterprises training.

C. Other Business Concerns as One’s Business Venture Improves 1. Registering the Small Business Enterprise

There are basically three legal forms which a business venture can take. Depending on the size and scope of the business, they will decide on the most applicable to your needs.

Sole Proprietorship. A single proprietorship is a business unit owned and managed by only one person. It is the simplest and most common form. Most small businesses start as sole proprietorships.


Partnership. When two or more people own the business, it is called a partnership. Partnerships are formed for several reasons. The most common is to pool funds. Another would be to share responsibilities where the business owned is more than one person can handle. Equal partners share the initial investment equally and each has the same amount of control over the business as the other.

Corporation. A corporation is a “legal person” as opposed to a natural person. It is called a legal person because it can do most business acts that a natural person can do. As a separate legal person, the corporation may enter into contracts, may sue and be sued and buy shares in other corporations.

Other Registration requirements include:

Registering with the Department of Trade and Industry

The Department of Trade and Industry (DTI), through its Bureau of Trade Regulation and Consumer Protection (BTRCP) administers the registration of business names.

Registering with the Securities ad Exchange Commission (SEC)

The SEC is the government agency that “gives birth” to the legal or juridical person that is the business enterprise – which has many of the attributes of a natural person. This is the essence of registering with the SEC. Only partnerships and corporations need to register with the SEC. Single proprietorships are not required to register.

Registering with the Local Government

All businesses, whatever the legal form, are required to secure a mayor’s permit or municipal license from the municipality or city where they will operate. Different cities and municipalities vary in registration procedures.

Registering with the Bureau of Internal Revenue

Every business enterprise has to register with the Bureau of Internation Revenue (BIR) for taxation purposes.

Registering with the Social Security System

Employees of private firms are covered by social security benefits in the event of sickness, disability, retirement or death. Thus it is the duty of the employer to register his workers with the Social Security System (SSS).

Other Registering Agencies

There are firms, depending on the type of products they manufacture or handle and on their market orientation, which are required by law to register with other government agencies, aside from the ones mentioned above. Generally speaking, these agencies exercise regulatory and control functions on industry sectors under their jurisdiction. The following is a partial list of these regulatory bodies and the industries/businesses they regulate:

The Food and Drug Administration, for those engaged in the manufacture of drugs, cosmetics and food products.

The Philippine Coconut Administration, for those engaged in the export of coconuts and coconut by-products.

The Central Bank, for export-oriented firms.


The Garment Trade Exports Board, for all manufacturers of garment and textile for exports.

The National Food Authority, for rice, corn and flour dealers.

The Fiber Development Authority, for processors and traders of fiber and fiber products.

The Bureau of Fisheries and Aquatic Resources, for those engaged in the export of fish and fish products and other aquatic products.

The Bureau of Animal Industry, for exporters of animals and animal products and by-products.

They Bureau of Plant Industry, for those engaged in the export of plant and plant products.

The Bureau of Forest Development, for exporters of forest products (e.g., logs, lumber products, plywood, etc.)

The Philippine Virginia Tobacco Administration, for those engaged in the production or export of flue-cured Virginia-type tobacco, Burley tobacco and Turkish/Oriental tobacco products.

Bureau of Food and Drugs, for exporters of food, drugs and cosmetics.

The Product Standards Agency, for commodity clearance for producers, manufacturers or exporters, whose product quality – after due inspection, sampling and testing – is found to meet established standard.

Philippine Patent Office, for firms who want to register their patents and trademarks.

National Subcontractors Exchange, Department of Trade and Industry which registers business interested to tie up with export-oriented firms as sub-contractors/suppliers, under any of the following sectors: garments and handwoven fabrics, gifts and housewares, furniture and fixtures, footwear and leather goods, fresh and processed foods and jewelry.

Trade and Regulation Division, Department of Trade and Industry, which accredits enterprises engaged directly or indirectly in the service, repair and/or maintenance of vehicles, engines and engineering works, electrical, electronics, airconditioning and refrigeration, office machines and data processing equipment, medical and dental equipment, including the technical personnel like mechanics or technicians employed by such firms.

2. Accounting and Bookkeeping Matters

A part from registration papers and permits, the businessman must also deal with internal accounting and bookkeeping documents. He must establish a filing and record-keeping system so all documents made by him or for his company are in proper order.

For very small businesses where the rate of production and sales are easily traced, the owner can record the figures himself without much trouble.

3. Paying Taxes

Taxes come in various forms. In a given year, the businessman must pay any number of the following taxes:

National taxes are those imposed under the National Internal Code and other laws particularly the Tariff and Customs Code. They include income tax, estate and donor’s tax, excise taxes on certain articles, taxes on business, documentary stamp taxes, mining taxes, miscellaneous taxes, fees and charges imposed by the Tax Code (tax


on banks, finance and insurance companies; franchise tax; amusement tax; charges on forest products; tobacco inspection fees; overseas communications tax; miscellaneous taxes imposed and collected by the BIR). They also cover taxes imposed by special laws, such as, customs duties, residence tax, sugar adjustment tax, tax on narcotic drugs, special education fund taxes, science fund tax, travel tax and energy taxes. Local taxes are those imposed by local governments to meet particular needs such as the taxes under the Local Tax Code and those which refer to the local governments’ share from national taxes collected locally from residence taxes imposed under the Local Tax Code and property taxes imposed under the Real Property Tax Code and the Special Education Fund Act. The power to levy and collect occupation tax, amusement tax on admission, and fees for sealing and licensing weights and measures have also been transferred to the provinces and cities under the Local Tax Code.

The tax a businessman is required to pay depends on many factors, including the kind of business he is in. Single proprietorships, for example, pay a yearly fee for the municipal license (payable every January). They are also expected to pay a quarterly percentage tax, either under the VAT (for businesses with quarterly gross sales exceeding P200,000) or non-VAT system (for businesses with quarterly gross sales of P200,000) or less). A business registered as non-VAT pays a 2% tax rate on income.

4. Insuring One’s Business

Insurance, traditionally defined as “a device to handle risk,” is a natural consequence of man’s desire to protect himself from economic losses arising from events that are beyond his control. It aims to substitute certainty for uncertainty. Business needs insurance. “Insurance has something to do with the financial well-being of the individual and his livelihood,”

What are the small businessman’s options?

First, he can be selective and pick only those policies that he really needs. If he is left with only one choice, he should opt for fire insurance which, in its most basic form, covers destruction of or damage to property by fire or lightning.

Then he chooses his insurer. It should not be a difficult task, once he knows what he is looking for. Motus reckons that one of the more than 100 non-life insurance companies on the market, only a handful, certainly less than 20 are really financially stable. But despite such odds, picking one reliable company is not impossible. The bottom line is he must insure only with companies that are financially sound and can show an excellent track record in claims payment.


8 Costing and Pricing

Costing and pricing are two very important areas of any business. In small–scale enterprise women very often price their products without undertaking costing. The session started with a group exercise. Participants were divided into four groups. Each group calculated the costs of products based on an exercise on page 57 of the manual.

Each group also identified areas to be considered in costing items. In any business there are two types of expenses: fixed expenses and variable expenses. In general, fixed expenses never change, while variable or recurring expenses change along with the changes in the volume of transactions.

The concepts of fixed and variable expenses were discussed in the plenary. Then participants were asked to read Handout 8.1 for getting more insight into how to set prices for goods. After reading Handout 8.1 participants were divided into groups to set prices for their products. During the group discussion each group identified fixed expenses and variable expenses for their product and set prices for their product as per expenditure (considering fixed expenses). In the plenary each group presented its findings, which are as follows:

Group 1

Variable Cost ($) Fixed Cost ($)

Seed cost 30.00 Land rent 60.00 Pesticides 15.00 Power tiller 30.00 Fertilizer 10.00 Mat/mini equipment 10.00 Labour cost 200.00 Training 20.00 POL cost 21.00 120.00 Transportation 22.00 Sales tax 7.00 Interest 21.00 @ 6% Power and water 5.00 Adver. sale production and packing 19.00 Unforseen (misc.) 19.00 380.00

Variable cost + Fixed cost + profit = price $ 380 + 120 + 8 y = @ 16.8 % 0.090 per kg. 0.03 per kg + 0.02 = 0.14 $

Costing and Pricing 79

Expenses:

1 day buying 1 x 2 = $ 2 1 day boiling and drying 1 x 2 = $ 2 1 day husking 1 x 2 = $ 2 5 days selling 5 x 2 = $ 10 paddy rice $ 10 transport $ 10 porter $ 1 tax $ 2 firewood $ 1 husking $ 4 38 + 1 = 39

Total cost = $ 39 Cost per kg. = $ 0.278

Group 2 A. Fxed Cost ($) B. Vairable Cost ($)

Bananas (100 kg) 15 Advertising 8 Sugar 2 Transportation 3 Oil 2 Storage 3 Spices 1 Survey 3 Equipment 10 Porter 2 Gas 5 Tax 1 Labour 6 Interest 1Package 1 Sub total 21 Rent 1 45

Total A + B = $ 66 $ 66 : 200 package = $ 0.33 – fixed price 300 grm = $ 330 1 grm – $ 1.1 1 kg. - $ 1.10 Package price : $ 0.50 Total Profit = $ 34.00

Cost of Rice

Paddy $ 10 (200 kg.) Transport $ 1 Porter $ 2 Tax $ 1 Wood $ 4 Husking $ 4 Labour/wage $ 16 (8 days x $ 2)

Interest $ 1.06 ($ 4/30 days)200 kg Paddy = 140 rice $ 39.06

(rice) 1kg = $ 0.28/kg

$ 16


Group 3Expenses : 200 kg. Paddy = 140 kg.

$ 10 for 20 kg. of paddy $ 1 for transportation $ 2 for porter $ 1 for tax $ 4 for firewood $ 4 for husking (200 divided by 50 = $ 4)

$ 16 for cost of labour ($ 2X8 days = $ 16) (1 day for buying and 1 day for husking and $ 38 1 day for boiling and 5 days for selling = 8 days)

Interest = 1.3 3.93

140 kg of rice (28 kg. per 40 kg paddy)

1 kg rice = $0.3

Tailoring and designing ($)

Cost of machines 1,200 Transportation 125 Tax (3%) 75 Rent 100 Electricity 20 Wages (20x20 = 200) 400 Promotion 50 Raw materials 300 Interest (6%) 150 Repairs 50 Miscellaneous 30 2,500

3 per piece of uniform (900) 5 per piece of design (300)

Capital = $ 500

Borrowed = $ 200/(1525 + 975)

Costing and Pricing 81

Group 4Handicraft Production

A. Variable cost

1. raw materials

wood P 1,000.00 nailsshellacsandpaperwax

2. labour P10,000.00 3. packaging 1,500.00 4 transportation 2,500.00 5. electricity/fuel 1,500.00 6. tax 2,000.00 7. sales promotion 3,000.00 8. maintenance 2,000.00

B. Fixed Cost

1. license P 500.00 2. tools/machines 10,000.00 P 45,000.00

C. Contingency Amount P 5,000.00 50,000.00

Product Produced – 150 unit

Unit cost = 30,000 = P200/unit 150

Unit price = P unit cost + (25% Profit Margin) – including depreciation cost = 200 + 50 = P 250

Total income = P 250 x 150 = P 37,500.00

Gross profit = 37,500.00 – 30,000.00 = P 7,500/month

P 2,000.00


9 Marketing

Marketing means making goods or services attractive to customers. Small-scale entrepreneurs need to know information for finalizing marketing strategies. Marketing involves a lot of factors. Without adequate information on the factors that are related to marketing, we cannot take appropriate steps for deciding our strategies for increasing sales.

During the session participants were asked to read the story of Nicha from the manual. Based on their insights from the field visits participants identified the following key factors for marketing:

Needs assessment CustomersCompetitorsLocation and scope PriceTime Grading and quality Transportation Promotion and advertisement StoragePackagingDistribution

After identification of these factors, participants were divided into four groups to identify the areas where entrepreneurs need information. The following are the important points in the group reports:

Group 1 Customers

1. How many customers do you have? 2. What is the main age group and sex of customers? 3. Have you assessed the buying capacity of the customers? 4. What features of the goods attract the customers? 5. Have you evaluated the customers’ buying behaviour? 6. What kind of services do they expect? 7. What colour, size, design do they prefer?

Transportation

1. What kind of transport is required? 2. Is it rented or owned? 3. How much time is required to meet the targeted demand? 4. Is there any risk entailed in the facilities or transportation? 5. How many buses are used for transportation in a month? 6. How much of the product can be carried in a single trip?

Marketing 83

Storage

1. Is it safe and free from pollution? 2. What is the capacity of the required storage? 3. What is the location of the storage? 4. Is it a secure place? 5. What are the means of communication? 6. What are the utility facilities for storage? 7. Is the storage place equipped with a temperature control device? 8. What is the minimum and maximum time to store the goods?

Group 2 Packaging

1. Cost 2. Size 3. Quality 4. Attraction 5. Durability 6. Registration/standard stamp of product 7. Label 8. Time limit 9. Display 10. Design 11. Instruction 12. Introduction 13. Brand name

Grading quality

1. Size of product 2. Quality of product 3. Time limit 4. Price 5. Added value

Distribution

1. Direct and indirect sales 2. Wholesale 3. Retail 4. Who are the distributors? 5. How many distributors are available? 6. Relationship 7. Loyalty 8. Capacity of distributors 9. Guarantee of distributor 10. Commission for distribution


Group 3 Promotion

1. What to promote? 2. When to promote? 3. How to promote? 4. Where to promote?

Needs assessment

1. Quantity of demand and supply 2. Types of demand. How much (quantity)? 3. Quality of supply 4. Seasonal demand 5. Convenience of customers

Price

1. Periodical and up-to-date price details in market (market prices) 2. Comparative study of prevailing prices in market 3. Fluctuation of prices 4. Cost of product 5. Capacity of customers

Group 4 Time

1. Time for purchasing 2. Time for distribution (sale) 3. Time for storage (consider perishable nature of goods)

Location and scope

1. Shops 2. Marketplace 3. Environment 4. Population (targeted customers)

Competition

1. Quality (name) of competitor’s goods 2. Price of competitor’s goods 3. Packaging of competitor’s goods 4. Number of products 5. Number of competitors 6. Customers of competitors 7. Location of competitor’s shop 8. Sale promotion/strategies of competitors 9. Sale service of competitors 10. Distribution mechanism of competitors

Field Visits 85

10 Field Visits

IntroductionOn the fourth day of the workshop, the participants went on site visits to real-world income-generating programmes. The general objective of the site visits was to give participants the opportunity to see Philippine examples of planning, management, product design, production, marketing and sales of products as well as the services of various types of small-scale enterprise.

The IGP projects visited were as follows:

Pampanga:

Handmade paper: Pandacaqui Women’s Multi-Purpose Cooperative, Inc. (PWMPCI)

Toys: Children’s Treasure, Inc. Romar, Inc.

Bauang:

GABAY and its income generation focus for community development

Parian Este crochet products

ORT projects

Santiago

Palugsi-Limmansangan topiary (combined with dressmaking and food processing)

Because there were thirty participants, it was deemed necessary to divide them into four groups so that they could have a chance to interact more closely with the IGP managers and workers.

In order to maximize the information and insights to be obtained during the site visits, the participants received the following guideline questions beforehand:

Management

1. During the start-up phase before you began your business, what activities did you undertake?

Did you do any business planning?

What items did you include in your plan?

Did you determine whether your product is needed by the community members or customers?

Did you identify your customers? How?

Did you identify your competitors? How?

Did you calculate the profitability of your business? How?

How did you get financial support for your initial capital requirement?


2. Present concerns

Is your business profitable?

What problems, if any, do you encounter?

3. What are your plans for the future?

Production

1. Where do you get raw materials?

2. How do you store your raw materials?

3. Do you have enough raw materials and supplies?

4. What equipment do you use?

5. How much does the equipment cost?

6. What are your problems in maintaining your equipment?

7. Do you have workers? How many?

8. Please identify problems that you encounter in producing your products?

Packaging and design

1. Do you package your products?

2. Why do you package your products?

3. Who do you consult/hire for packaging and design of your products?

4. How much do you spend for packaging and design?

5. What are your problems in packaging and design?

Marketing

1. How do you market your products?

2. What kinds of products do your customers like?

3. What marketing problems do you encounter?

4. How do you encourage buyers of your products?

5. How do you promote these products?

6. For sales, how do you price your products?

7. What procedure do you follow for maintaining accounts?

Description of the IGP Project Sites Visited Income-generating projects of Pampanga

Pampanga is a province north of Manila known for its rice and sugar lands. Due to a separate language (Capampangan), the people of Pampanga retain a unique cultural identity distinct from the people in the Tagalog-speaking territories that surround the province.

During the 1990s, an active volcano, Mt. Pinatubo, erupted causing major damage throughout the province. Lahar flows ruined thousands of homes, business centres and farms leaving residents homeless and unemployed. Government and non-government organizations, private firms and

Field Visits 87

agencies from different sectors of the country continue to find ways to help the victims of the calamity through resettlement and evacuation programmes, income-generating projects, and other rehabilitation and livelihood programmes.

a) Pandacaqui Women’s Multi-Purpose Cooperative, Inc. (PCIMPCI)

This project is a hand-made paper facility at the Pandacaqui Resettlement Site in Mexico, Pampanga, owned and managed by the Pandacaqui Women’s Multi-purpose Cooperative, Inc. (PWMPCI). Specifically, it involves the production of raw paper sheets and their conversion into hand-made greeting cards and other products.

This project hopes to provide long-term livelihood for the members of the women’s cooperative in particular and the residents of the Resettlement Site in general. Initially, 51 individuals were employed. It is expected that secondary economic activities will be stimulated in relation to the hand-made paper industry that will directly benefit the majority of the residents in the area.

Consultants from PAPELIPA Arts and Crafts, Inc., a well-established hand-made paper corporation, provide the necessary back-up support in the various stages of project implementation, specifically in the technical, management, and marketing aspects.

The construction of the factory building amounting to P1.1 million was undertaken by the Technology and Livelihood Resource Center (TLRC). This building is leased by TLRC to the project at a rate of P27 per square metre. Machines and equipment amounting to P585,000 needed for the operation are also leased by TLC to the project with the option to purchase.

During the initial year of project operations, PAPELIPA agreed to purchase 600,000 greeting cards amounting to P4.8 million to ensure a ready market for the products made. For its part, PAPELIPA has established its own market niche with international buyers, giving it the confidence to buy all the products of PWMPCI.

b) Children’s Treasure, Inc. and Romar Products, Inc., Pandacaqui

Productivity Center, Mexico, Pampanga:

The Pandacaqui Productivity Center is an industrial facility that serves as an alternative investment location for private investors in support of the Government’s rural industrialization thrust. Support systems for investment generation, technology transfer and job creation are provided to the site under the Productivity Center Programme. The productivity centre aims to accelerate the rehabilitation of the areas affected by Mt. Pinatubo by creating long-term jobs and sustainable sources of income for the settlers in the new community and stimulating economic activities in the resettlement site so as to generate other livelihood and employment.

Children’s Treasure, Inc. (CTI), an outgrowth of Universal Toy Manufacturing, is a 10-year-old firm originally organized to manufacture and export children’s toys. It started penetrating local department stores and later other establishments through the manufacture of promotional items. It started in 1991 when Sam Bang Products, Inc., a Korean firm, engaged in toy manufacturing. CTI’s principal office is located in Quezon City while Building 6 at the Mexico Productivity Center in Pampanga has served as its plant site since 1993. The company employs an average of 200 workers and 25 sub-contractors with about 10 workers each.

In May 1996, CTI etablished Romar Products, Inc. to engage in the manufacture of toy cats made of abaca and sisal fiber for export to Europe, Australia and the USA. Romar now leases Buildings 5 and 8 and employs an average of 150 direct workers and 25 sub-contract workers from the resettlement site and nearby communities.


Income-generating projects in the Municipality of Bauang, Province of La Union

Bauang is a very old Philippine coastal community (established in 1590) located 250 kilometres north of Manila. In 2000 the municipality was recognized as the Most Outstanding Local Government Unit by the Literacy Coordinating Council and Metrobank Foundation.

Thanks to its continuing education programmes, the municipality has one of the highest literacy rates in the country (98.5 per cent).

Income-Generating Projects:

a) Crocheting Project of Parian Este

Brief description

The Department of Labor and Employment (DOLE) initially conducted training related to crocheted garments in collaboration with the Department of Agriculture in the province as an alternative for alleviating the low economic status of this barangay. However, the local government in coordination with the DECS-NFE is responsible for sustaining this project, which is a participatory endeavour managed by the officials and members of the cooperative. Each member’s output is based on a production target set each day in order to meet local suppliers’ demands.

Organizational structure

Project organizer : LGU-Bauang, La UnionOverall coordinator : DECS-BNFEProject manager : Mrs. Lydia C. Gomez, local residentMonitoring and evaluation : MPDC

Target beneficiaries: housewives of all ages

Project linkages and networks: The Sinnaranay Women’s Association of Parian Este has linked with the local government unit of Bauang for assistance in coordination with DECS-NFE.

Market (present): Maarbay, Public City Market, Baguio City

Plans and future directions:

- Export- Future links with other organizations like Manang Biday Ladies Association

(MABILA)- Expansion

b) Income-generating projects of the ORT Community Multi-Purpose Cooperative

The ORT-MPC located at Guerrero Road, Bauang, La Union, is a non-profit community health insurance programme in partnership with Ilocos Training and Regional Medical Center that provides comprehensive health care benefits for the people of La Union.

One section of the ORT-MPC is used for promoting goods produced at the centre, namely candle holders, blankets and other gift items.

Field Visits 89

c) Santiago dressmaking

Brief description

Twenty-five literacy clients are being served by the DECS-Division of La Union in coordination with the Division Association of Non-formal Education Coordinators-La Union, the Non-formal Education Division-ROI, and the Bureau of Non-formal Education - Central Office, Manila. These individuals wanted to receive livelihood training that would enable them to engage in income-generating projects upon completion of the 150 hours required training. They decided on basic dressmaking as the area for their skills training.

Organizational structure:

Project organizer : LGU-Bauang, La UnionOverall coordinator : DECS-NFEProject manager : Mrs. Elizabeth Pulanco, local residentMonitoring and evaluation : MPDC

Target beneficiaries: unemployed barangay residents and other interested parties

Project linkages and networks:

- LGU-Bauang, La Union RIC, TESDA, DECS- Financing: from the members themselves- Santiago Multi-Purpose Cooperative (with RIC)

Market (present): students and teachers


- To enter into contract with schools and other institutions to provide uniforms- To sustain and continue the project- To procure two sewing machines

The women of Santiago, aware of the need to have additional income for the family, have organized themselves into an organization. They have formed the first Rural Improvement Club (RIC) in the community to help every member improve the quality of their lives. The wife of the barangay chairman is the head of this club.

Recognizing the role of men in business enterprise, the club members ventured into backyard gardening, along with hog and poultry raising, with their husbands taking charge of these activities. The women handle the distribution of these products. They are responsible for selling the goods, looking for outlets and establishing linkages with people in the community for a better promotion of the enterprise. It is worth noting that they never met with any marketing problems because they have established very good relationships with their customers in the community and neighbouring communities.

Today they are proud to say that they have saved enough money to use for their credit enterprise. Members of the RIC can borrow from this fund at a minimal rate of interest.

d) Palugsi-Limmansangan topiary

Brief description

The project introduces barangay residents to topiary, or the art of clipping or trimming silkworm cocoons into ornamental shapes. Outputs include artificial flowers and other novelty items. The residents were first trained in how to cultivate cocoons. Mulberry trees were planted in the trainees’ own backyards. These served as food for the silkworms.


Cocoons are harvested before the metamorphosis is completed. The cocoons are then sold to FIDA. The people are now capable of accepting orders like wedding gifts or simple home decorations.


Project manager : Maternidad D. Llarenas, Local residentOrganizers : DECS-NFE, LGUMonitoring and evaluation : MPDC, MSWD

Project linkages and networks

The DECS, through its Non-Formal Education Programme, coordinates with the LGU for the project implementation, monitoring and evaluation. The Fiber Industry Development Agency (FICA) buys the raw product in bulk from the farmers. Finished products, on the other hand, are displayed for sale at the RIC Display Center and at local trade fairs.

Market (present): local

Plans and future directions

The project, with its approximately 25 members, plans to expand locally with the possibility of exporting their products. The barangay has two existing topiary projects. They are both distinct and separate from each other with regard to their organizational structure and networks. However, the members are eyeing a merger.

The participants also visited the dressmaking project at Palugsi-Limmansangan.

Brief description

Training of livelihood skills is based on the results of the survey that showed that dressmaking was among the programmes preferred for livelihood skills training. The programme aims to train people in the technical know-how of basic dressmaking so that they don’t have to leave their barangay or neglect household chores. The project, with the important proviso that all trainees should complete the programme, intends to equip them with livelihood skills and a loan scheme to help put up capital. The project would enable the barangay to generate income through self-employment.


Project manager : Maternidad D. Llarenas, local resident Organizer : LGU-Bauang, DECS-NFE Monitoring and evaluation : MPDC, MSWD

Target beneficiaries: housewives, out-of-school youth

Project linkages and networks

The Municipal Government of Bauang, through the Honourable Mayor, initiated the project. The LGU provided sewing machines. In line with the literacy programme of the municipality, the project was linked with DECS-NFE. Co-operating agencies include the Department of Labor and Employment (DOLE), Department of Health (DOH), and some NGOs.

Market (present): local

Field Visits 91


- Future links with other organizations like MABILA, COOP - Expansion

Insights and Lessons Learned from Site Visits

Group 1 Morning visits

1. Handmade paper products

a) Management

starting capital P30,000 financed by the Government personal training programme cooperative settlement to help community people community support their activities motivation on profit sharing consultant for quality control

b) Marketing/selling

volume of sales depends on orders from trade fair no specific customers main product for export pricing with minimum profit

c) Packaging/design

to prevent damage and quality control suggestions of consultant and seminar

d) Production

15 employees -managers and production workers production process is systematic - 3 machines

Evening visits

1. Crocheting and topiary combined with dress and food

community learning resource center community participation financial support from the Government. incentive/monitoring by the Government excellent management of preschool kindergarten

2. Pet toys factory


Management:

This business enterprise started as a family project more than 10 years ago with P100, 000.

There was no formal work done. The owner recollected the fact that she only wanted to do something different from other stuffed toy manufacturers. Luckily, she met an exporter of stuffed toys to the USA and Europe. Therefore, the market was there, waiting for a supplier.

Up to the present, this company has no competition. It is the only one that manufactures toys for pets in this part of the world.

The owner is creative and active in promoting her products.

She takes care of her workers very well.

Group 2 1. Handmade paper products

a) Management

The enterprise had business planning for six months. Items in the plan included raw materials and financing from the Government (80 per cent) and 20 per cent from the cooperative (1.4 M from the Government to return with 6.9 per cent interest per year). They sell products outside the community with identified customers. Demand is high and the co-op cannot cope. They have competitors in Metro Manila and they get information on other competitive products from a government agency. They calculate the cost of materials, machinery and labour, and take 20 per cent – 30 per cent for profit. Business is profitable. Changes in market needs may be a problem in the future. They plan to produce for the international market.

b) Production

Raw materials (abaca fibre, flowers, newspapers) from different parts of the Philippines are kept in a storeroom. They have enough raw materials (100 kg. abaca fibre a week plus equipment including mixers, pitar, presses, dryer, drum, vat, table - total P700,000. No problem in maintaining equipment because it is new and mostly manual. The mixer and pitar use electricity and their motors can last 2-3 years. They have 10 workers in the production unit. Problems include the weather. If it rains, they have to use the dryer, which takes 10-15 minutes per sheet, while 1 day is needed to dry paper in sunlight.

c) Packaging and design

They package their products to control quality and for promotion. They have their own employees who know how to design. They had a workshop conducted by another producer in Batangas on how to design and package. Packaging costs P2 per package.

d) Marketing

They sell their products at agro-fairs. Customers mostly buy greeting cards, picture frames, bags, photo albums, scrapbooks or Christmas decorations. They attract buyers through the quality of the products sold at reasonable prices. Product promotion is through trade fairs and house-to-house sales. Pricing is based on raw materials, packaging, labour, design and overhead costs.

Field Visits 93

Overall comments:

1. Handmade paper

working capital from cooperative (P1.4M) repayment within 5 years at 6-9% interest high investment per person

2. Pottery factory

medium scale enterprise benefits poor families around the factory good relationship with buyers no competition except from China many sites at community level

3. Project site at community level

very active group leader to motivate the community to start a project has knowledge about marketing and whom to contact

Group 3 Vision and mission

Planning

1. collect data, analyze data

2. estimate: establishment cost costing and pricing

3. identify risk factors

4. resource mobilization

Organization

create management, production, marketing and packaging units

Management

Quality Networking Control HRD

social security services skills training upgrading

Implementation: Monitoring Evaluation Recommendation Review


Factors to consider to carry out marketing

1. information about customers

2. information about competitors

3. availability of materials

4. relationship with customers

5. information about the present status of the market

6. striving towards quality improvement

7. mechanism for distribution

Group 4 1. The site visits gave us a better understanding of the following:

establishing a small-scale enterprisethe role of planning in preparation for IGPsestablishing linkages with Government and NGOs

2. They enriched our knowledge about the scope of economic activities that could be considered for IGPs.

3. They gave us an opportunity to get first-hand information on the management and operation of small-scale enterprises.

4. They provided enough information, knowledge and motivation for us to put into action what we have learned from the seminar workshop to start small-scale enterprises to help the neo-literates in our countries.

5. They showed us that the success of any enterprise depends on a market survey conducted to determine the demands, interests and needs of the people in the community.

6. The love of work and people, commitment and dedication are other factors essential for the success of the enterprise.

7. Transparency in matters related to finance should be observed by the members as much as possible.

8. A good public relationship helps greatly in the smooth management of the enterprise.

9. Unity and co-operation are necessary for the realization of the organization’s mission and vision.

10. Good leaders are needed to bring about change.

Actual Planning of an Enterprise 95

11 Actual Planning of an Enterprise

The participants experienced actual enterprise planning on the basis of the insights gained during the sessions covering various types of economic activities, concepts of entrepreneurship, planning, market surveys, capital and its sources, costing goods, pricing and marketing.

The participants’ groups convened again and each group developed an enterprise plan. The formats for Planning an Enterprise (Handouts 5.6 and 5.7) were used as guides in the planning work of the participants. The results of the four groups are as follows:

Group 1 1. General information

Name of entrepreneur : GROUP #1Name of business : Kitchen Gardening Village : Bauang District : Post Office : Province : San Fernando, La Union Date of birth : 7 November 2000 Educational qualification : neo-literate

2. Reasons for selecting this enterprise

a) What experience do you have for running this enterprise?

Some experience in cultivation, calculation skills, consumption of particular goods, training in kitchen gardening.

b) How would you expand the business?

Advertising, exhibitions, fairs and investing more capital. More input from revolving fund, higher standard of quality control of the product.

c) How would you accumulate resources for the enterprise?

Land (rent), power tiller (hire), seeds, fertilizer and pesticide (purchase from local market), capital (from 2 sources: bank & own), packing materials (from local market)

3. Market report

a) What is the demand for the goods/products?

1400 kgs potatoes for a month.

b) What is likely to be the future demand for these goods?

Demand for potatoes will increase by 500 kg each month (high quality).


c) What is your plan for marketing the goods?

through distributors sometimes retail sale

4. Location of the enterprise

Name of the enterprise : Kitchen Gardening Village : Bauang District:Post Office : Province : San Fernando Location : Road #7, Central Street, Bauang

Why did you choose this location?

already have own land not far to the market transportation is convenient

5. Capital expenditure

Item No. Particulars Cost $

1. Land rent 60.00 2. Power tiller 30.00 3. Equipment/materials 5.00 4. Training 25.00 120.00

6. Manpower requirements

Item No. Type of people (experience/ For what purpose, etc.) Number of people Monthly pay

Planting, cultivating, fertilizing, Harvesting and selling

2 persons $ 33.33

7. Monthly expenses

Calculate monthly expenditures of production (electricity, raw materials, rent, etc.)

Particulars Amount

1. Seed 2. Labour 3. POL 4. Interest 5. Power and water 6. Unforeseen expenses

$ 63.33

8. Total investment (capital, machinery, site, etc.)

Particulars Cost

Fixed costs/capital expenditure $ 20.00 Variable costs for one month 63.33

Total $ 83.33


9. Monthly profit

Particulars Income Expenditure

Sale of 700 kgs.potatoes @ $0.14 = 98.00 $ 83.33 Profit = $ 14.67

10. Time frame for implementation of the plan

Steps Start Date Completion Date

1. Seed purchases 10th August 30th August 2. Labour selection 1st August 30th August

3. Renting land 1st July 30th July 4. Renting power tiller 15th August 15th September 5. Watering and weeding 15th October - - - - - - - 6. Pest control 15th October - - - - - - 7. Harvesting 20th November 31 December 8. Storage 20th November 31 January 9. Selling 20th November 31 January


Name of entrepreneur : Ms. ShidaName of business : “Banana Chips” Corp. Village : Bauang District : Lauang Post Office : Lauang Province : La Union Educational qualification : high school Training : processing, making and marketing banana chips



Basic knowledge how to make banana chips, hard work, good relationships in the community, simple calculation and accounting.


Expand in neighbouring village and make contacts with its people. Mobilize family and friends to raise capital.


Information from CLC/research centre Get some capital from family Get loan from IGP (macro financial institution)

3. Market report


20,000 customers (about 1/3 of the population of the village)



After 1 year, 30,000 people


100 packages/per day


Name of the enterprise : Banana Chips Corp. Village : Bauang District : Lauang Post Office : Lauang Province : La Union


Residential area (customers/workers) Access road/transportation for materials and marketing Not far Transportation is convenient


Item No. Particulars Cost

1. Frying pot, boiling pot $ 10.00 2. Heating system/stove 80.00 3. Cleaning & cutting equipment 10.00 4. Furniture 10.00 5. Rent 15.00

Sub-total $ 125.00 Capital expenditure monthly 125: 12 = $ 11


Item No. Type of people (experience/ For what purpose, etc.) Number of People Monthly Pay

1. Processing 2 persons $ 80

2. Management Accounting Marketing

1 person 60

Sub-total $ 140

7. Monthly expenses


Particulars Amount

1. Raw materials $ 260 2. Electricity and water 16 3. Miscellaneous 25 Sub-total $ 301



Particulars Cost

1. Equipment $ 125.00 2. Raw materials & rent 47.33

Total $ 172.00

10. Monthly profit


1. Overhead $ 11.00 2. Salary 140.00 3. Expenses 301.00 4. Income $ 500

$50 x 10 times Profit = $48

Total $ 452.00

10. Duration of investment return

Total Investment = 172 = 4 months Profit 48



1. Selection of goods 01/01/2001 05/01/2001 2. Market survey 01/01/2001 10/01/2001

3. Identification of location 01/01/2001 20/01/2001 4. Contact for credit 16/01/2001 28/02/2001 5. Requirement of workers 15/02/2001 28/02/2001 6. Purchase of furniture 01/03/2001 10/03/2001 7. Purchase of equipment 01/03/2001 15/03/2000 8. Purchase of raw materials 15/03/2001 20/03/2000 9. Start of production 20/03/2001 To be continued

10. Advertising 28/02/2001 15/03/2001 11. Marketing 22/03/2001 To be continued 12. Accounts keeping 28/03/2001 To be continued


Name of entrepreneur : Oh Ounpheng Name of business : tailoring and designing Village : Vientiane District : Post Office : P.O. Box 67, Vientiane, Lao PDR Date of birth : 21.6.1953 Educational qualification : university Training : vocational training (tailoring)




accounting skills managementnetworking marketingdesigning and stitching


introduce shift system bring more machines expand marketing provide training more employees


loan applications (banks, private lending institutions, NGOs, cooperatives contributions from partners

3. Market report


uniforms for schools, colleges souvenirs for tourists, weddings


beginning of school year


contract with schools, offices advertise the goods, give information about the goods


Name of the enterprise : tailoring and designing Village : Vientiane District : Chanthabuly Post Office : P.O. Box 67 Province : Vientiane


big demand possibility of electricity transport accessibility



1. Sewing machines (10) $ 1,200.00



Item No. Type of people (experience/ for what purpose, etc.) Number of people Monthly pay

1. Designers 10 persons $ 300.00 2. Tailors 10 persons 200.00 3. Accountant 1 person 20.00 Total $ 520.00

7. Monthly expenses


Particulars Amount

1. Electricity $ 15.00 2. Raw materials 300.00 3. Water consumption 1.00 4. Rent 50.00 5. Contingency 40.00 6. Tax 150.00 7. Packaging 10.00 8. Interest (6%) 150.00

Total $ 616.00


Particulars Cost

1. Machinery $ 1,200.00 2. Manpower requirement 520.00 3. Monthly expenses 616.00 Total $ 2,336.00

9. Monthly profit


1. Uniforms (900) 2. Souvenirs (300)

$ 1,071 $ 1,550

Total Profit: 2,621/M

$ 1,176

a) Uniforms (900 x fixed price 2.5 = 2,250 – 1,176) = 1,074

Fixed price Total expenses: $ 1,136.00 Recovery of fixed capital (3 yrs/time) + 40.00

Total $ 1,176.00

Cost of uniforms = $ 1,176 = $ 1.97 900

Market price (existing) $ 3.00 Fixed price = 2.5

b) Design (souvenirs) 300 pcs./M


Cost per unit $ 3.92 1.176 = 3.92 300

Existing price in market $ 5.75 Selling price $ 5.00

c) Risks:

We can stitch all 900 uniforms at the beginning of the school year only. Other than that time, demand might be less. We might not be able to sell all the souvenirs throughout the year.

d) Remarks

We have to return $2,000 in 3 years. Therefore, we plan to return $55.56/month (2,000/36 months = 55.56)



1. Market survey December 1 December 10 2. Identification of location December 11 December 15

3. Selection of goods December 16 December 16 4. Contact for credit December 17 December 30 5. Purchase of items January 2 January 7

6. Purchase/rent of Furniture/house January 8 January 10 7. Production January 15 January 15 8. Packaging & dist. Monthly

9. Performance review/ Assessment Monthly 10. Feedback meetings As the need arises


Name of entrepreneur : NORBUName of business : handicraft production Village : Kawang District : Chimphu Post Office : Province : Chimphu Date of birth : 11 November 2000 Educational qualification : neo-literate Training : business management



Basic knowledge/skills in handicrafts; had attended a seminar-workshop on small-scale enterprises. Had the chance to interview the owners of a handicraft shop and some big-time customers.



Produce other kinds of handicrafts depending on the need and demand of the people in the community.

Widen area of distribution.

Improve sales promotions.

Maintain good quality.

Establish linkage with other countries.


Invite investors.

Establish linkage with local government unit, GOs, NGOs and other private individuals who have connections with big enterprises/stores that could assist in the distribution of products.

Look for banks/entities that could extend financial assistance for more additional working capital.

3. Market report


The demand is great since the enterprise is located in an area where tourists often come to relax, so they usually buy souvenirs and other items from the enterprise.


In the future people will see that the products are of good quality and that there are very few ventures in this area. Big department stores will see their value in the world market and more countries will buy the products.


Create/put up a display center/showroom where all our products are on display in the city. Have more advertisements on television, radio, in newspapers. Establish better incentives for employees and relationships with customers. Have more distribution outlets.


Name of the enterprise : handicrafts production Village : Kawang District : Chimphu Post Office : 208 Province : Chimphu Location : Chimphu


There are many possible buyers since this was based on the demands and needs of the community people. It is located in the heart of the city, which is visited frequently by tourists.




1. Raw materials (wood, nails, wax, shells) P 20,000.00 2. Labour and packaging 8,500.00 3. Transportation 3,000.00 4. Electricity and license, tax 8,500.00

Total P 50,000.00


Item No. Type of people (experience/ for what purpose, etc.) Number of People Monthly pay

1. Manager 1 person P1,000.00 2. Accountant/marketing 2 persons 1,500.003. Skilled worker 2 persons 2,000.004. Unskilled worker 5 persons 3,000.00

7. Monthly expenses


Particulars Amount

1. electricity P 1,000.00 2. raw materials 20,000.00 3. labour/packing 8,500.00 4. transportation 3,000.00 5. license/tax 2,500.00 Total P 35,000.00


Particular Cost

1. small machine, drill machine hammer, choril, hand saw, plane P 15,000.00 2. transportation, packing, labour, tax

raw materials P 35,000.00 Total P 50,000.00

9. Monthly profit


150 pcs. wood curving P42,000.00 P35,000.00




1. Selection of goods 1/1/2001 15/1/2001 2. Market survey 1/2/2001 31/2/2001 3. Identification of location 1/3/2001 14/2/2001 4. Contact for credit 15/3/2001 28/3/2001 5. Purchase of items 1/4/2001 14/4/2001 6. Purchase of furniture 15/4/2001 21/4/2001 7. Labour 1/4/2001 15/4/2001 8. Advertising 1/5/2001 31/5/2001 9. License 1/1/2001 15/1/2001


12 Bookkeeping/Accounting

The success of any business largely depends on keeping accounts properly. Before arriving at any decision, we have to know the financial status of the business, which can only be determined if accounts are maintained properly. In any business, a number of transactions are occurring daily. These are usually accountable in terms of money. These transactions are recorded in sequence according to specific methods. This is called keeping accounts.

During this session resource persons explained the importance of keeping accounts. They showed examples of a ledger, a receipt book and a stock register, and discussed their advantages and disadvantages. Participants related their experiences with community-level accounting systems in different countries. Then participants were divided into four groups to prepare simple formats to be used for keeping accounts at the community level.

Group 1 Journal Book

Date Transaction# Particulars Amount Remarks

Stock Book

DatePrevious balance

Receipt Total Delivery Balance Remarks

Bookkeeping/Accounting 107

Credit Sale Book

Date Name Particulars Quantity Amount Remarks

Ledger Book

DateParticu-

larTransac-

tion # Bank Cash Sale Raw Material Furniture

Rec. Pay Rec. Pay Rec. Pay Rec. Pay Rec. Pay


Group 2. Keeping Accounts 1. Capital

a) Equipment b) Raw materials and goods c) Money

a) Inventory list b) Stock register c) Cash and bank

2. Balance

3. Remarks

Inventory List – Equipment

Date Item Unit/

Stock no. No. of receipt

Price/UnitTotalprice

Remarks

11/11/2000

11/11/2000

11/11/2000

11/11/2000

Flying pot

Cutter

Dryer

Bowl

1/03

1/04

1/05

1/06

1205

1206

1207

1208

$20

$35

$80

$20

$20

$35

$20

$20

For banana chips

-

-

-

Stock Register

Date Receipt Previous balance

In Out Balance Remarks

11/11/2000 1216 100 kg 50 kg - - Banana Chips

12/11/2000 150 kg - 80 kg 70 kg

Bo

okke

ep

ing/Ac

co

unting

109

Remarks

Bal.Out

Toal amount

InBalOut

Bank

Il.nBalOut

Hand cash

In

ParticularsReceipt

Cash and Bank Account

Date

11/11

1 Group 3

Date Name of product

..“a.“.“. .“. . .““I”..“., sm.” w-.-Y

Quantity Value Date of l ale Quantity Value Balance

ame of Items:

Stock Register Receipt

Date of

purchase Quantity Rata Total

Date of

Issue Quantity To whom Balance

* Details on purchased and issued raw materials.

Small-scale Enterprise for Neo-literotes through CLCs

Cash Book

Date Particulars

Cash in hand

Debit Credit

T Bal.

Bank fund

Debit Credit Bal.

T Debit

Sale

Credit

T Bal.

Raw material

Debit Credit Bal.

Wages

Debit Credit

T Loan

Debit Credit

0 Group4

Date Particulars

Purchase

Journal No. Debit Credit Purchase

return

1 l/l l/2000 Purchase account to cash

Purchase

P 5,ooo.oo P 5,ooo.oo

1 l/l IMOOO P 5.000.00 P 5,ooo.oo

Date

1 l/12/2000

Particulars

Balance forward

Wood to cash

Purchase wood as

raw material

Cash Book

Journal No. Debit Credit Balance

P 10.000.00

P 2,ooo.oo

P 8,OOO.OO

Date

1111112000

Particulars

Bank account Norbou

Receive from Norbue

Bank Ledger

Check No. Debit Credit Balance

007 P 5,ooo.oo P 5,ooo.oo P 5,ooo.oo

Sales

Date

11/11/2000

Particulars

Cash account to sales

account

Journal No. Debit

P 5,ooo.oo

Credit

P 5,ooo.oo

Sales return

Ledger book and registry of stock will be taken from the manual, pages 74 and 76.

Small-scale Enterprise for Neo-literates through CLCs

Risks in Business 113

13 Risks in Business

As suggested in the manual, the participants were divided into four groups. Each group identified risks and problems involved in the business enterprises that they planned, developed and presented previously during the workshop. They also identified possible solutions and remedies to address these problems.

The results of each group are as follows:

Group 1: Kitchen Gardening Risks Possible Solutions to Nos.1-6

1. Natural disasters

2. Use of fertilizer and pesticide Technical knowledge of using fertilizer and pesticide

3. Overproduction Market information

4. No available transportation

5. Storage Contact cold storage before harvesting

6. Low quality of seeds

Group 2: Food Processing (banana chips) Risks in Business Possible Solutions

1. Storage

2. Natural disasters

3. Fluctuation of demand

4. Low capacity of customers

5. Many competitors

6. Low quality of raw materials

7. Currency exchange

8. Unskilled labour


Group 3: Tailoring and Designing Risks in Business Possible Solutions

1. Not able to sell all products Improve quality/increase market due to poor quality, lack of money, season/weather constraints, etc.

2. Not able to meet the demand Introduce shift system

3. Sometimes less demand Adjust the cost of the product

4. Inflation/unstable currency rates Start emergency saving schemes

5. Natural disasters Commitment

6. Increase in interest (not able to pay interest on time)

Group 4: Handicraft Production Risks

1. Lack of skilled labour

2. Too many sales on credit

3. Sabotage by competitor

4. Theft/fire/flood

5. Shortage of raw materials

6. Shortage of capital

7. Poor quality of finished products

8. Increase in the cost of raw materials

The group results were presented in a plenary session where the groups were able to share their insights as well as gain new information on possible risks in running a small-scale business enterprise.

Competencies in Business 115

14 Competencies in Business

Successful entrepreneurs are observed to possess certain qualities that manifest their competencies in planning and managing their business ventures. The workshop participants learned about business competencies, as identified in the manual. Some of these are:

1. Taking new initiatives

2. Exploring opportunities and taking advantage of them

3. Persevering in accomplishing tasks

4. Always looking for information

5. Improving quality of work and product

6. Keeping commitments

7. Trying to improve capacity at all levels of the enterprise

8. Systematic planning

9. Solving problems quickly

10. Self confidence

11. Ability to influence others

The session on competencies in business was designed to give the workshop participants an in-depth understanding of how they can make their neo-literate programme beneficiaries develop these qualities in order to successfully run their business ventures. Entrepreneurs can follow a five-step approach to acquire and maintain business competencies. These five steps are:

1. Identification

2. Self-evaluation

3. Experiment

4. Reinforcement

5. Application in business

In addition to the competencies listed in the manual, a personal entrepreneurial competencies rating questionnaire was also introduced during the session. This questionnaire helps determine a person’s entrepreneurial qualities. It has 55 brief statements. The entrepreneur is asked to read each statement and decide how well it describes him or her. He or she selects a number that indicates the applicability of the statement, as follows: 5 – always; 4 – usually; 3 – sometimes; 2 – rarely; 1 – never.

The following are the items included in the questionnaire:

1. I look for things that need to be done. ______

2. When faced with a difficult problem, I spend a lot of time trying to find a solution. ______

3. I complete my work on time. ______


4. It bothers me when things are not done very well. ______

5. I prefer situations in which I can control the outcomes as much as possible. ______

6. I like to think about the future. ______

7. When starting a new task or project, I gather a great deal of information before going ahead. ______

8. I plan a large project by breaking it down into smaller tasks. ______

9. I get others to support my recommendation. ______

10. I feel confident that I will succeed at whatever I try to do. ______

11. No matter whom I’m talking to, I’m a good listener. ______

12. I do things that need to be done before being asked to by others. ______

13. I try several times to get people to do what I would like to do. ______

14. I keep the promises I make. ______

15. My own work is better than that of other people I work with. ______

16. I don’t try something new without making sure I will succeed. ______

17. It’s a waste of time to worry about what to do with your life. ______

18. I seek the advice of people who know a lot about the tasks I am working on. ______

19. I think about the advantages and disadvantages of different ways of accomplishing things. ______

20. I do not spend much time thinking about how to influence others. ______

21. I change my mind if others disagree strongly with me. ______

22. I feel resentful when I don’t get my way. ______

23. I like challenges and new opportunities. ______

24. When something gets in the way of what I am trying to do, I keep on trying to accomplish what I want. ______

25. I am happy to do someone else’s work if necessary to get the job done on time. ______

26. It bothers me when my time is wasted. ______

27. I weigh my chances of succeeding or failing before I decide to do something. ______

28. The more specific I can be about what I want out of my life, the more chance I have to succeed. ______

29. I take action without wasting time gathering information. ______

30. I try to think of all the problems I may encounter and plan what to do if each problem occurs. ______

31. I get important people to help me accomplish my goals. ______

Competencies in Business 117

32. When trying something difficult or challenging, I feel confident that I will succeed. ______

33. In the past, I have had failures. ______

34. I prefer activities that I know well and with which I am comfortable. ______

35. When faced with a major difficulty, I quickly go on to other things. ______

36. When I am doing a job for someone, I make a special effort to make sure that person is happy with my work. ______

37. I am never entirely happy with the way in which things are done, I always think there must be a better way. ______

38. I do things that are risky. ______

39. I have a very clear plan for my life. ______

40. When working on a project for someone, I ask many questions to be sure I understand what that person wants. ______

41. I deal with problems as these arise rather than spend time trying to anticipate them. ______

42. In order to reach my goals, I think of solutions that benefit everyone involved in a problem. ______

43. I do very good work. ______

44. There have been occasions when I took advantage of someone. ______

45. I try things that are very new and different from what I have done before. ______

46. I try several ways to overcome things that get in the way of reaching my goals. ______

47. My family and personal life are more important to me than work deadlines I set for myself. ______

48. I find ways to complete tasks faster at work and at home. ______

49. I do things that others consider risky. ______

50. I am as concerned about meeting my weekly goals as I am for my yearly goals. ______

51. I go to several different sources to get information for help with tasks or projects. ______

52. If one approach to a problem does not work, I think of another approach. ______

53. I am able to get people who have strong opinions or ideas to change their minds. ______

54. I stick with my decisions even if others disagree strongly with me. ______

55. When I don’t know something, I don’t mind admitting it. ______


15 Country Follow-up Action Plan

Joint Follow-up Project of CLC Participating Countries on Income-Generating Programmes Focusing on Small-Scale Enterprise

Objectives of the Joint Project To improve the ongoing IGPs focusing on small-scale enterprise

To upgrade the standard of living and quality of life of community people

To undertake action research

To develop a manual on small-scale enterprise for community people

To disseminate the manual

To exchange findings amongst 16 member countries and others in the region

Focal Points of the Project Country Focal Point

Bangladesh Mr. Shahidul Islam

Bhutan Mr. Karchung

Cambodia Mr. Monk Phoeurn

China Ms. Yu Niya

India Mr. Bapat

Indonesia Mr. Joko Cahyono

Lao PDR Mr. Ounpheng

Malaysia Ms. Hanisah

Mongolia Mr. Boldbaatar

Myanmar Mr. Kyaw Thaung

Nepal Mr. Bhairab K.C.

Pakistan Mr. I.U. Khan/Mr. Gilani

Philippines Ms. Clarita Lunas

Thailand Mr. Utit

Uzbekistan Ms. Alimova/Mr. Sharifiy

Viet Nam Mr. Thong/Mr. Huong

Country Follow-up Action Plan 119

Credit Facilities Every country has credit facilities.

CLCs have to help the target group to access credit facilities.

Micro-credit programmes BanksGOsNGOsCommunity cooperatives Savings schemes

Activities and Timeframe (November 2000-August 2001) Activities Timeframe

Adapt manual on small-scale enterprise 16 Jan-15 Feb 2001

Train CLC trainers/committee Nov 2000-15 Jan 2001

Train target group focusing on women 16 Feb-31 Mar 2001

Help the target group to run the enterprise including credit facilities

1 April-30 Jun 2001

Undertake action research Nov 2000-30 Jun 2001

Develop manual on small-scale enterprise April-31 July 2000

Submit the results to UNESCO 15 August 2001

Contents of the Report Background/justification

Name of IGP

Objectives of the project

Expected outputs

Target groups (number and background)

Process of the project including networking and skill training

Actual implementation

Market survey Planning for an enterprise Credit facilities Costing and pricing goods MarketingBookkeeping/accounting

Problems and obstacles

Solutions

Total project cost

Plan for expansion of the business

Lessons learned


ManualBackground

Problems/needs of IGP in community What and why entrepreneurship? Selecting IGPs

Market survey

Planning the enterprise

Access to credit facilities

Costing and pricing goods

Marketing

Bookkeeping/accounting

Problems and obstacles

Solutions

Plan for expansion of the enterprise

One page summary of the whole process

chartdiagram, etc

* Throughout the manual, identify “DO” and “DON’T” for each step.

Outcomes of the Project to be Submitted to UNESCO Report of the study

Manual

Budget Support from UNESCO For undertaking action research

For developing manual

* US$3,000

Purpose of the Outcomes of the Project Share the report of the study and manual during the CLC Review Meeting to be tentatively held in September 2001.

Disseminate the products throughout each participating country.

Present on the UNESCO Web site.

Schedule of Activities 121

Appendix 1 Schedule of Activities

Monday, 6 November 2000 08.30-09.00 Registration

09.00-10.00 Opening programme

10.00-10.30 Tea break

10.30-11.30 Introduction of Workshop Participants and Resource Persons/Leveling of expectations

Election of Workshop Chairperson, Co-chairperson and Rapporteur

11.30-11.45 Aim, objectives and workshop methodologies, approaches and strategies

11.45-12.30 Presentation on APPEAL

12.30-13.30 Lunch break

13.30-14.00 APPEAL presentation on CE and IGP in the region

14.00.15.30 Sharing of country experiences on Income-generating Programmes Focusing on Small Scale Enterprise for Neo-literates through Community Learning Centres

15.30-16.00 Tea break

16.00-17.30 Group report on country experiences

Tuesday, 7 November 2000 08.30-08.45 Review of previous day’s activities

08.45-09.15 Orientation on the Training Manual for Small Scale Enterprise

09.15-10.15 Various types of economic activities

10.15-10.45 Tea break

10.45-12.30 Concepts of enterpreneurship


13.30-15.30 Planning for an enterprise

15.30-16.00 Tea break

16.00-17.30 Market survey

18.30-20.00 Welcome dinner


Wednesday, 8 November 2000 08.30-08.45 Review of previous day’s activities

08.45-10.45 Capital and its sources

10.45-11.15 Tea break

11.15-12.30 Costing/pricing


13.30-15.30 Continuation: costing/pricing

15.30-16.00 Tea break

16.00-17.30 Marketing

17.30-18.00 Orientation on IGP site visits

Thursday, 9 November 2000 08.30-16.30 IGP site visits

Pampanga:

Handmade paper Toy products

Bauang:

Orientation on GABAY and its Income Generation Focus for Community Development

- Food processing - Dressmaking- Store (retailing) - Topiary - Crocheting

Dinner and cultural presentation

Friday, 10 November 2000 08.00-10.00 Reflection: Insights on site visits

10.00-10.30 Tea break

10.30-12.30 Actual planning of an enterprise (group work)


13.30-14.30 Planning (cont’d)

14.30-15.30 Gallery presentation of group work

15.30 Leave for Manila

Schedule of Activities 123

Saturday, 11 November 2000 08.30-10.30 Book keeping/accounting

10.30-11.00 Tea break

11.00-12.30 Risks and competencies


13.30-17.30 Preparation of follow-up action plans (country-specific)

Sunday, 12 November 2000 08.30-10.00 Presentation of follow-up action plans (country-specific)

10.00-10.30 Tea break

10.30-11.30 Course evaluation

11.30-12.30 Closing programme


Appendix 2 List of Participants

Bangladesh Mr. Shyamal Kumar Saha Senior Trainer Training and Materials and Development Division Dhaka Ahsania Mission Road No. 12 (New), House No. 19 Dhanmondi R/A, Dhaka 1209 Tel: 880-2 8119521-22 Fax: 880-2 8113010, 8118522 E-mail: [email protected]

Mr. Md. Shahidul Islam Senior Programme Officer Continuing Educatiion Unit, Programme Division Dhaka Ahsania Mission Road No. 12 (New), House No. 19 Dhanmondi R/A, Dhaka 1209 Tel: 880-2 8119521-22 Fax: 880-2 8113010, 8118522 E-mail: [email protected]

Bhutan Mr. Karchung District Education Officer District Administraion, Zhemgang c/o Bhutan National Commission for UNESCO Thimphu Tel: 00-975-3741164 Fax: 00-975-3741124

Mr. Kesang Norbu Head Teacher Changzamtok Jr. High School Thimphu Tel: 02-322652 Fax: 02-322842

Cambodia Mr. Mok Phoeurn Officer of Non-formal Education Department Vocational Training Office Ministry of Education Youth and Sports 169 Preahnorodom Blvd. Tel: 855-23 219258 Fax: 855-23 217250 E-mail: [email protected]

List of Participants 125

Cambodia (cont’d) Mr. Kry AnChief of Kompong Speu Provincial Non-formal Education Office Tel: 025 987396

China Ms. Yu Niya Deputy Director of Basic Education Division Guangxi Education Department No. 3 Jiao Yu Road Nanning, Guangxi Tel: 86771-5322171 - 2393 Fax: 86771-5318877 E-mail: [email protected]

Mr. Liang Zheng Yi Assistant Professor Basic Education Division No. 3 Jiao Yu Road Nanning, Guangxi Tel: 86771-5322171 - 2155 Fax: 86771-5322171 - 2059 E-mail: [email protected]

Indonesia Mrs. Ida Adviany Tutor, Learning Activities Centre of Bogor Jl. SKB No. 1 Cibinong, Bogor, Regency Tel: 62-251 652977 Fax: 62-252 664591

Mr. Joko Cahyono ChairmanDENAS CLC Community-Based Learning Centre (PKBM) Jln. Pesanggrahan 10 – Tretes Prigen Pasuruan, East Java Tel: 62-343 881237, 62-343 880646 E-mail: [email protected] or [email protected]

Lao PDR Mr. Ounpheng KhammangDeputy Director Administration and Planning Division Department of Non-formal Education Ministry of Education Lane Xang Road, Vientiane Municipality Tel: 856-21 213980 and 223489 Fax: 856-21 223489

Mr. Phengthone Ounthavong Senior Officer Department of Non-formal Education Lane Xang Road, Vientiane Tel: 856-21 213980 Fax: 856-21 223489


Malaysia Ms. Hanisah Yaakub Senior Supervisor Community Department Office Kelantan Poverty Alleviation Foundation Kompleks Yayasan Kemiskinan Kalantan 16400 Melor, Kalantan Tel: 609 7832885 Fax: 609 7834885

Ms. Khalijah Sulong Training Officer Institute for Rural Advancement (INFRA) Ministry of Rural Development Lot 2A, Persiaran Institusi Off Jln. Air Hitan, Bangi, 43000 Kajang SelangorTel: 603-89267068 Fax: 603-89265901/05 E-mail: [email protected]

Mongolia Mr. Gankhuyag OchirkhuyagProgramme Specialist in Education Mongolian National Commission for UNESCO Government Building III Post Office 20A Ulaanbaatar Tel: 976-1 315652 Fax: 986-1 322612 E-mail: [email protected]

Mr. Bat-A,ga;am Bp;dbaatar Member of Board Information, Training and Research Centre NGO ITRC, Zorig Foundation Bld. 205 Peace Avenue-9A UlaanbaatarTel: 976-1 315446 Fax: 976-1 315446 E-mail: [email protected]

Myanmar Mr. Kyaw ThaungCommunity Learning and Development Specialist MYA/99/004 Education Project UNESCO/Myanmar 123, Natmauk Road (DEPT Buildint) YangoonTel: 951-548812 Fax: 951-545647 E-mail: [email protected]


Nepal Mr. Bhairab K.C. CLC Chairman Community Learning (ETRE/NRC-NFE) Banepa Municipality Ward No. 11 KabhreTel: 977-61929

Mr. Rajendra Sijapati Section Officer HMG/MOESNon-formal Education Centre Tel: 977-1-631288 Fax: 977-1-631280

Pakistan Mr. Irfan Ullah KhanDirector Education (A.Lit and NFE) Directorate of Literacy and Non-formal Education Gov’t. of Balochistan 1/2 Zarghoon Road, Quetta Tel: 92-81443764 and 92-81-838183

Mr. Syed Shafaat Gilani Micro Credit Manager Bunyad Literacy Community Council E-105/A-9, Gulgust Colony Main Boulevard, Defence Tel: 667 0887 Fax: 666-1817 E-mail: [email protected].

Philippines Ms. Ma. Nida C. Caramat Education Programme Specialist II Bureau of Non-formal Education Department of Education, Culture and Sports (DECS) 3rd floor, Room 314, Mabini Building DECS Complex, Meralco Avenue, Pasig City Tel: 63-2 6321361/70 loc 2084 and 63-2 635-5189

Mrs. Clarita A. Lunas Education Supervisor I, Non-formal Education DECS Region II - Cagayan Tuguegarao City Tel: 63-78 8441915, 63-78 8467372, 63-78 8463141

Thailand Dr. Sawat Tichuen DirectorPhayao Provincial Non-formal Education Centre 425 Super Highway Road Muang District, Phayao 56000 Tel: 66-54 481833, 66-54 482170 Fax: 66-54 482230


Uzbekistan Ms. Gulandon AlimovaDirector of Educational Centre Republical Educational Centre (REC) Tashlceut 700027 Uzbekistan Street 80 Tel: 7-369 1391140 (998-71) Fax: 7-369 457213 (998-712)

Mr. Sharifiy Jakhongir Mirzo Nasim Director CLC CLC “UNESCO” Namangan Uzbekistan, Namangan City Rayhan St 6 or Girvansay St 4 Tel: 7-369 64260, 7-369 32830 Fax: 7-369 64260

Viet Nam Mr. Tran Quang ThongSenior Expert Continuing Education Department Ministry of Education and Training 49 Dai Co Viet Str., Hanoi Tel: 84-4 8694986

Ms. Tran Thi Xuan Huong Expert of Primary Education Department Ministry of Education and Training 49 Dai Co Viet Str., Hanoi Tel: 84-4 8694795 (264) Fax: 84-4 8682356 E-mail: [email protected]

Resource Persons Dr. Zenaida T. Domingo Training Specialist and Head, Business Development Office SEAMEO INNOTECH U.P. Diliman, Quezon City 1101 PhilippinesTel: 632-924-76-81 to 84 loc 102/632-926-44-35 Fax: 632-921-0224 E-mail: [email protected]

Mr. Shahnewaz Khan DirectorTraining and Materials Development Division Dhaka Ahsannia Mission House No. 19, Road No. 12 (New) Dhanmondi Residential Area Dhaka-1209BangladeshTel: 880-2819521-22 Fax: 880-2 813010, 818522


UNESCO Secretariat Ms. Darunee RiewpitukSpecialist in Continuing Education UNESCO Principal Regional Office for Asia and the Pacific 920 Sukhumvit Road, Bangkok 10110 Thailand Tel: 66-2 3910550 Fax: 66-2 3910866

Opening Programme Speaker Ms. Isabelita Palanca PresidentWomen Business Council of the Philippines and Vice Chairperson Confederation of Women Business Councils in Asia-Pacific Metro Manila PhilippinesTel: 632-890-49-48 Fax: 632-897-76-09

Field Visit Consultant Mr. Gutierrez A. MangansakanKingsville Subd. Antipolo City Tel: 632-677-23-55

SEAMEO INNOTECH Secretariat and Staff Ms. Vanda Marie B. Macion Mr. Mario R. Grimaldo Mrs. Ma. Victoria s. Laguda Mr. Marlene R. Santos Mrs. Evangeline G. Labagnoy Mrs. Ma. Arlene B. Artajo Ms. Michelle S. Peñalver Mr. William s. Cardenas Ms. Ma. Teresita C. Maxilolo Mrs. Monique I. Adalem Mr. Emesto S. Gabriel, Jr. Ms. Leonora D. Cabatian Mr. Rogelio G. Hilario Ms. Ami G. Fontanilla Mr. Rolan M. Mallari Mr. Rolando Amuyot Mr. Nicholas P. Solis Mr. Nestor Laroya Mr. Jasper M. Peteza Mr. Jong Cruz Mr. Ric Panilag Mr. Danny Lopez


Appendix 3 Welcome Remarks

Enterprise Development: Now Size Does Not Matter by Ramon C. Bacani

Chairman, Literacy Coordinating Council Under-Secretary, Department of Education, Culture and Sports

Good morning and Mabubay!. On behalf of the Literacy Coordinating Council (LCC) of the Philippines, I would like to welcome the participants to this Regional Training Workshop on Continuing Education Programmes Focusing on Small Scale Enterprise for Neo-Literates through Community Learning Centres. I would also like to congratulate the sponsors of the forum, UNESCO/PROAP and SEAMEO INNOTECH.

The focus of your workshop which is small scale enterprise comes at the most opportune time not only for our country but also for many countries in the Asia Pacific Region which are now experiencing on economic downturn for various reasons – political stability, difficulties in the transition towards globalization, (impending global recession), among others.

Amidst the emerging global economy, we now realize that for a country to survive, it must be able to build a strong economic base at the village level or what we call the barangays. Such a base is found in upland communities, coastal villages, farming communities, and urban centres.

The theme of our forum also validates the thinking of the Philippine Literacy Coordinating Council (LCC) that empowering our people with socio-economic life skills is as necessary as giving them the basic 3Rs of reading, ‘riting’ and ‘rithmetic’. In 1996, the Council adopted the LCC Blueprint for Action. This strategic plan serves as the overall policy and programme framework of the country toward Eradication of Illiteracy (EOI). The former President Fidel V. Ramos issued Administrative Order 324 which mandates “all concerned government agencies and local government units to adopt the Blueprint for Action as guideline in developing policies and implementing programmes or projects related to literacy”.

Among the salient provisions of the Blueprint is the adoption of the community-based approach in EOI. This strategy provides that literacy programmes must be anchored on the priority needs of the community members play an active role in planning and implementing literacy programmes and not be mere “beneficiaries”. The Blueprint also recognizes the need to link basic and functional literacy courses with economic and livelihood opportunities not as an attraction but as an integral part of the learning process. Thus neo-literates are able to sharpen their numeracy skills by applying them in entrepreneurial activities.

The LCC has adopted its community-based approach and economic literacy focus after pilot testing strategies in two community projects in the early 1990s – the Comprehensive Education and Community Development Programme (CECDP) in Valencia, Negros Oriental, and the Comprehensive Literacy and Socio-economic Programme (CLASP) in Calumpit, Bulacan.

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In 1998, the Council achieved a breakthrough of sorts with the finalization of the expanded definition of functional literacy. Functional Literacy is defined as “A range of skills and competencies – cognitive, effective and behavioural – which enables individuals to: (a) live and work as human persons; (b) develop their potential; (c) make critical and informed decision, and (d) function effectively in society within the context of their environment and that of the wider community in order to improve the quality of their life and that of society”.

This new definition is another major contribution of the Philippines to the global movement to eradicate illiteracy. The creation of the Council itself in 1992 has been cited in various international fore in the past as an organizational model in EOI. It is very clear from the above definition that entrepreneurial and leadership competencies are recognized as important elements of functional literacy. These competencies include providing skills need towards increased productivity and improved economic status of our literacy clients. Also included as an indicator of economic literacy is the concept of sustainable development. It is not enough for our small entrepreneurs to be productive, equally important is for them to understand and practice sustainable development.

Before I end, may I just share with you some thoughts on small scale enterprise development. In this age of global enterprises, perhaps we should give more emphasis on the term enterprise development. How do we make enterprises – whether micro, small, medium or transnational - more efficient, competitive, productive, profitable and of course, sustainable? The size of the enterprise should not be an obstacle in introducing innovations needed to achieve the desired entrepreneurial qualities. Perhaps some of these strategies will be discussed in this forum. Among these are: (1) convergence with other businesses in order to maximize limited resources. Convergence may mean partnership without losing one’s identify; (2) introduction of information technology. Many so-called small enterprises are now able to compete with the operations of large business by using I’I’ which has since become a great leveler; (3) networking and linkages in credit, production, marketing; and (4) sustainable development, emphasizing that environmental management and economic development are reconcilable. Finally, this forum may also be interested in looking into Asian values which can either propel or sustain economic growth and development in the Region.

This regional training, therefore, may yet initiate a paradigm shift among those when promote and practice small entrepreneurship. In today’s knowledge society, we need not be limited to traditional approaches but most now tread even the unknown. I am confident that the organizers of this workshop will be able to challenge us enough to be real entrepreneurs in this regard.

My best wishes to the participants, the organizers and sponsors. Maraming Salamat po!


The LCC Mandate along Continuing Education, towards Economic Productivity and Neo-literates

by Ramon C. Bacani Chairman, Literacy Coordinating Council

Under-Secretary, Department of Education, Culture and Sports

IntroductionI wish to commend the SEAMEO-INNOTECH and the UNESCO PROAP for organizing the Regional Training Workshop on Continuing Education Focusing on Small Scale Enterprise for Neo-literates through Community Learning Centres. The workshop is very timely because it focus on income generating programmes towards economic productivity and development which is a globally urgent issue. The best time is now, when the world faces the monumental challenge of eradicating illiteracy among more than one billion people over the world.

The Philippine Context The Philippines, just like its other Asian neighbours, recognizes the importance of literacy and continuing education as major strategies to help develop a productive and competent human resource, which is responsive to the demands of the economic and social order of the New Millennium.

While the country has 93.9 per cent basic literacy and 83.8 per cent functional, literacy rates, the actual number of persons who are illiterate and who register below literacy levels do not allow us to put the problem of illiteracy to rest.

The Literacy Co-ordinating Council As a proof of the country’s commitment to uplift the economic status of the people, the Philippines has undertaken milestone activities which focus on capability-building, including literacy and continuing education, as the strategic instrumentality to combat illiteracy and poverty in the country. Most notable of these efforts is the creation of the Literacy Coordinating Council (LCC).

The Literacy Coordinating Council (LCC) was created by Republic Act 7165 and acts as the over-all advisory and coordinating body for all literacy endeavours of the country. It is an inter-agency body composed of representatives from various government agencies, non-government organizations and the academe. The following sectors are represented in the LCC: (1) education sector; (2) local government sector; (3) information sector; (4) academic and research institutions; (5) economic and development planning sector; (6) non-government organizations; (7) the House of Representatives; and (8) the Philippine Senate.

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The major functions of the LCC are:

To act as the overall advisory and coordinating body, providing policy and programme directions for all literacy endeavours in the country;

To recommend strategies on the development of a mass movement for the total eradication of illiteracy in the country;

To formulate measures on the establishment and maintenance of a national databank and information exchange and dissemination system to support literacy and continuing education efforts at the national and local levels;

To assist in identifying successful management schemes of literacy/continuing education programmes, and adopt measures to boost research and development work in literacy/continuing education, by government agencies and non-governmental organizations involved in literacy work;

To recommend ways and means of raising funds in order to support the literacy and continuing education programmes, project a nd related activities.

In accordance to its mandates, the LCC has commissioned pioneering and innovative research studies on indigenous literacy strategies, standardization of literacy tests, efficacy test of prototype, post-literacy materials and survey of literacy specialists and institutions. To carry out its avowed objective, LCC has defined among its policies and guidelines “stronger partnership and direct access between the LCC and LGUs” consistent with linkaging.

LCC provided technical assistance to the Comprehensive and Literacy and Socio-Economic Programme (CLASP) for Development in Calumpit, Bulacan.

CLASP’s special focus are women and girls and persons with disabilities. The programme has four major components: Literacy, and livelihood skills training for people with disabilities, literacy, homemaking and livelihood skills for women; entrepreneurship, and marketing. Although initiated by the municipal government, CLASP is now a cooperative project of the LGU, local business sector, and other government agencies.

Participants to the Asia Regional Literacy Forum held in Manila (1997) were able to visit this model literacy programme and noted the following unique features of CLASP: (a) participation of clientele in programme development with local leadership in the forefront; (b) self-held with support from private sector and other government agencies; (c) teamwork between LGU and the business sector; and (d) development of a variety of market-driven skills.

Insights and Lessons on Literacy and Continuing Education A number of insights and lessons may be drawn from the experience of the Philippines in adopting literacy and continuing education as strategies towards productivity and improvement of the economic status of our literacy clients.

The national government’s total commitment to improve the economic status of the people through eradication of illiteracy and human resource development is a key factor in ensuring the achievement of the national development goals. This commitment should be translated into concrete policies and specific directions at the national and local levels.

Holistic interface of multi-sectoral, multi-agency and multi-level efforts from the national to the local levels helps ensure effective planning and implementation of literacy and continuing education programmes.


Expansion of partnership not only among project implementers but also with ultimate beneficiaries and clients.

The critical of role of the local government units and field implementers as focal points within the over-all programme structure have more chances in terms of project sustainability.

I hope that the insight I have shared with you will serve as inputs to your action plan and wishing you all good luck to this regional training workshop.

Thank you very much and a pleasant day to all of you.

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Welcome Remarks by Darunee Riewpituk, Specialist in Continuing Education

Mr. Ramon Bacani Undersecretary, Department of Education, Culture and Sports Mr. David Catanyang Programme Director for Training, SEAMEO/INNOTECH Participants, Ladies and Gentlemen:

It is an honour and privilege for me to be here today for the inauguration of the Regional Training Workshop on Continuing Education for Income-Generating Programmes Focusing on Small-Scale Enterprise through Community Learning Centres. On behalf of UNESCO, I wish to convey greetings and best wishes and welcome you all to this workshop.

First of all, I would like to express my sincere gratitude and appreciation to SEAMEO/INNOTECH for hosting this workshop. As a member of APPEAL Resource and Training Consortium (ARTC), INNOTECH is playing an important role in promoting literacy and continuing education in Asia and the Pacific Region. They worked so hard for the preparation for this workshop to ensure that after the workshop, the participants will acquire enough skill to do the same in their respective countries.

As you know, UNESCO is supporting 18 countries in the Asia-Pacific Region to implement the Community Learning Centres (CLCs) Project. After the review meetings on CLCs held in February 2000 in Bangladesh, China, and Thailand, it was found that the core activities of all the CLCs are closely linked with the economic life of the people the conditions in which they live, the infrastructure and other facilities available, the occupations they have been traditionally pursuing, and the skills they have already acquired through informal learning processes. This linkage with the living conditions of the people and their economic life has ensured that the programmes and activities of the CLCs have a high level of acceptability among the community members.

UNESCO PROAP has been promoting continuing education programmes in this region for more than a decade, utilizing the APPEAL Training Materials for Continuing Education Personnel (ATLP-CE). One of the most popular volumes of these materials is Income-Generating Programmes (IGPs). However, many countries in the region requested UNESCO to develop a manual on entrepreneurship as a supplement to the IGP volume. This is because of the economic crisis in the region. Many labourers who were working in the big city factories lost their jobs and returned to their communities. The unemployment rate is increasing throughout the region. The scope for paid employment has not kept pace with the growing demand. Thus people are turning to self-employment to upgrade their standard of living and eradicate their poverty. To relieve this problem, UNESCO is therefore introducing small-scale enterprise to the countries to implement at the CLCs.

As you may be aware, UNESCO is now required to promote better knowledge and effective application for women’s empowerment. To ensure women’s equal opportunity in participating in the economic life, they should have access to training and to other human resource development programmes. For this small-scale enterprise project, we would like the participating countries to pay more attention to women as the main target group.


We will use the Manual on Small-Scale Enterprise for Neo-Literates as a working document throughout the workshop. It is not the intention of this manual to present a formula that prescribes the exact steps the centres must follow. The aim is to offer users some tools that will enable them to fashion a programme that suits their specific environment best. After the workshop, the participating countries will introduce and implement small-scale enterprise projects at the CLCs. It is therefore very important for all the participants to understand clearly the process of how to set up and manage small-scale enterprise at the CLCs. After returning home, the participants of this workshop will review their curricula and training programmes on IGPs that will include small-scale enterprise. They will be supervisors or trainers of this project. I would like you to please participate actively and carefully in all sessions. Please feel free to ask questions and contribute actively to the workshop.

Finally, I wish you a pleasant stay here and in particular I wish every success of the workshop.

Thank you.

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Appendix 4 Members of the Four Group Work

Group 1 Group 2

1. Mr. Shaymaol Kumar Saha (Bangladesh) 1. Mr. Shahidul Islam (Bangladesh)

2. Ms. Yu Niya (China) 2. Ms. Ida Adviani (Indonesia)

3. Dr. Sawat Tichuen (Thailand) 3. Mr. Bat-Amgalan Boldbaatar (Mongolia)

4. Mr. Mok Phoeurn (Cambodia) 4. Dr. (Ms.) Tran Thi Xuang Huong (Viet Nam)

5. Mr. Phengthone Ounthavong (Lao PDR) 5. Ms. Khalijah Sulong (Malaysia)

6. Mr. Gankhuyag Ochirkhuyag (Mongolia) 6. Mr. Rajendra Kumar Sijapati (Nepal)

7. Mr. Tran Quang Thong (Viet Nam) 7. Mr. Utit Wilaikaeo (Thailand)

8. Mr. Irfan Ullah Khan (Pakistan)

9. Mr. Liang Zhengyi (China)

Group 3 Group 4

1. Mr. Karchung (Bhutan) 1. Mr. Kezang Norbu (Bhutan)

2. Mr. Bhairab K.C. (Nepal) 2. U Kyaw Thaung (Myanmar)

3. Ms. Gulandam Alimova (Uzbekistan) 3. Ms. Clarita A. Lunas (Philippines)

4. Mr. Kry An (Cambodia) 4. Ms. Hanisah bt. Yaacob (Malaysia)

5. Mr. Joko Cahyono (Indonesia) 5. Mr. Syed Shafaat Gillani (Pakistan)

6. Mr. Ounpheng Khammang (Lao PDR) 6. Mr. Jakhongir Mirzo Nasim Sharifiy (Uzbekistan)

7. Ms. Ma. Nida C. Caramat (Philippines)


Appendix 5 Guidelines for Country Reports

1. Background

main functions and programmes implemented by CLCs

2. Skill training activities/income-generating programmes (IGPs) conducted at the CLCs:

objectives

target groups

duration

training methodologies

cooperation with other organizations and among CLCs in the country for implementing skill training/IGPs

follow-up activities after completion of the training courses

impact of skill training/IGP on the target groups and the community as a whole

3. If the CLCs are implementing small-scale enterprise projects, please explain (following the details of no.2).

4. If your country is introducing savings schemes or micro-credit programmes in the communities, please explain the detailed procedures for start-up and implementation, as well as the purpose of these programmes.

5. Future plans of IGPs to be conducted by CLCs.