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Small Business Development, Ecuador

Organized by: Lingbo Lu

Lingbo's Photo

THE STORY:

Dear friend:

I am proposing a one-month community service project on small business development in Chillos Valley, Ecuador.
The Small Business Development (SBD) program, which is provided by Manna Project International (MPI), has worked with the help of an Ecuadorian business student to provide free individual consultation and basic accounting services for local small businesses. With this approach, MPI works to develop and implement specific, individualized strategies for each of these businesses.
There is a great need for low-interest micro-loans in Ecuador’s Chillos Valley. As the Oxford Microfinance Initiative reported in their April 2012 market analysis of the region, while there are many existing sources for loans (banks, cooperatives, loan sharks), they all provide credit at exorbitantly high interest rates (on average between 20 and 25%), making it very difficult for loan recipients to pay them back. Manna Project International’s mission includes promoting the sustainable economic and social development of the Chillos Valley. The SBD program proposes to fill the gap in the microfinance market, providing microloans to entrepreneurs and small businesses at an interest rate of 9%.
The current lack of access to affordable credit, indeed, can be an impediment to the entrepreneurial potential of the inhabitants of the Chillos Valley. The SBD program enables the local inhabitants to receive systematic business planning, education related to economics and low-interest loans (as explained below). I hope that by assisting in providing consultation to local small business owners, I can help them to make their businesses more innovative and most importantly, more profitable.
Furthermore, working with the Patronato (the social service branch of the town council), MPI provides a five-week course in agro-business planning and management to community members from the semi-rural barrio of Jatumpungo. At the end of this course, those interested in receiving a loan will receive a low-interest loan by submitting a business plan.
Program Directors of this program personally oversee the execution of practical and sustainable improvements to give local small businesses a better chance at success.
As a summer intern of this program, I will assist Program Directors in providing business consultation, planning classes and instructing lessons. As an Economics and Math major, I will utilize my energy and knowledge to contribute to the on-going development of Ecuador’s Chillos Valley. At the same time, this program is a great opportunity for me to apply what I learned in class and enhance my understanding of that knowledge with some hands-on experience in business consultation and planning. The information I will get from this program can add on to my research, and local participants of SBD can be valuable case studies. In addition, I believe I will understand more deeply about both the economic and social situation of Chillos Valley. This understanding will enable me to have a true and more intact picture of the economic development situation in a developing country such as Ecuador. Thus I will have a more global vision in my further study of economics and later on, in my career.

Thanks!

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Organized by

Lingbo Lu

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