从农村金融的角度研究如何加强我国农村减贫工作-指导essay INTERNATIONAL FUND FOR AGRICULTURAL DEVELOPMENTSHANGHAI POVERTY CONFERENCE – SCALING UP POVERTY REDUCTIONCASE STUDYIFAD’S ASSISTANCE TO THE RURAL FINANCE SECTOR REFORMIN CHINADate of submission: March 2004Region: Asia and the PacificCountry: ChinaType: Country caseAuthors:Erik Martens, Officer-in-Charge, Asia and the Pacific Division, IFAD;Thomas Rath, Country Programme Manager, IFAD;Aira Maria Htenas, Consultant, IFADContact details:IFAD, 107 via del Serafico, 00142 Rome, Italy. Tel.: +39 06 54592327. E-mail: [email protected] Up Poverty Reduction Analytical Case StudyiTABLE OF CONTENTSPageEXECUTIVE SUMMARY iiiI. IMPLEMENTATION PROCESS 1II. IMPACT ANALYSIS 3III. DRIVING FACTORS 5Commitment and Political Economy for Change 5Institutional Innovation 6Learning and Experimentation 7External Catalysts 8IV. LESSONS LEARNED 8REFERENCES 9Scaling Up Poverty Reduction Analytical Case StudyiiiEXECUTIVE SUMMARY在中国，正式的农村金融农业是由中国农业银行，农村发展银行和农村信用社（农村信用社）提高。Formal rural finance in China is provided by the Agricultural Bank of China (ABC), theAgricultural Development Bank and the Rural Credit Cooperatives (RCCs). The RCCs wereestablished in the 1950s as legally independent cooperatives. They were set up at the township level,but their presence in villages through branches or representative offices renders them the financialinstitution with the widest outreach among rural populations. http://www.ukassignment.org/dxessay/Their independent nature, however, has not been realized and, with some interruptions, theywere integrated in the ABC and acted as its branches. The ABC also determined the operatingmodalities, and, notably, a high deposit-reserve requirement severely curtailed the profitability of theRCCs. With the separation of the ABC from the RCCs in 1996, the latter were brought under theoversight of the People’s Bank of China (PBC). The newly established China Banking RegulatoryCommission (CBRC) has played this role since 2003.In 1996, after the decision of the Government of China to reform the rural finance sector,IFAD proceeded to identify and use RCCs to provide credit and other financial services to the ruralpoor. Whereas the PBC has welcomed the initiative, local governments have been less enthusiasticpartially due to concerns over the insolvency risk and poor governance structure of the RCCs. Since1996, IFAD has been mainstreaming financial services within the financial system of China andinvolving RCCs in the delivery of financial services for IFAD-funded projects.Following the early experiences of IFAD and a group-lending experience of the DesjardinsInternational Development Society, a pilot microlending scheme was undertaken by PBC in 1999using RCCs as microfinance institutions. Combining these experiences and lessons learned fromIFAD projects, the PBC formulated policy guidelines for microlending by RCCs and issued a revisedset of guidelines in December 2001.The experience with RCCs and the longstanding dialogue with the PBC have resulted in thepreparation of a Rural Finance Sector Programme (RFSP) financed through an IFAD loan of aboutUSD 15 million. The RFSP will be part of the ongoing RCC reform process. It will provide supportopportunities for the introduction of good practices in microfinance, with a special focus on the ruralpoor.实施过程 I. IMPLEMENTATION PROCESS1. Based on earlier experiences and a joint poverty mapping undertaken with the World FoodProgramme (WFP), IFAD prepared a new country strategy during 1998. This was approved inFebruary 1999. Under this strategy, two projects have been approved and are being implemented inthe Qinling mountains and West Guangxi areas, respectively. Appraisal of a third project, in Ningxiaand Shanxi provinces, has been completed. A key aspect of all joint IFAD/WFP-funded projects inChina is credit delivery to poor households, supplemented by advisory support services and socialdevelopment.2.财政援助相结合的互补性，农发基金和粮食计划署的任务和粮食援助，加强了宣传这两个组织的农村贫困人口，和联合运营为贫困者提供一个更可持续的发展方式。The complementary nature of the IFAD and WFP mandates in combining financial assistanceand food aid reinforces the outreach of the two organizations to the rural poor, and the joint operationprovides a more sustainable development approach to the poorest beneficiaries.3. WFP food-for-training and food-for-work programmes provide for meeting the food gapamong the hungry poor and building the productive capacity and increasing the creditworthiness ofthe hungry poor. IFAD loan funds help improve the operational capacity of extension services and therehabilitation of rural infrastructure and health and education facilities. Farmers can use credit forincome-generating activities and build up assets for further development, thus enabling them to meetessential needs and to graduate from the status of beneficiaries to that of creditworthy clients.4. Three official financial services institutions operate in rural China, namely, the AgriculturalBank of China (ABC), the Agricultural Development Bank of China and the Rural CreditCooperatives (RCCs). Non-official organizations and entities include Rural Credit Foundations,Mutual Savings Associations, the informal sector generally and microcredit projects that have beendeveloped recently and aim at poverty relief.5. It is a longstanding issue of IFAD/WFP-funded projects that they should enable existingfinancial intermediaries to deliver credit and other financial services to the target group. Up until1996, however, the existing financial institutions were not included in the project design andimplementation. The projects designed before 1996 under previous country strategies channeled creditthrough project management offices (PMOs), while the financial offices at the township level wereresponsible for credit delivery.6. From the purely credit disbursement perspective, the PMO model appears efficient where ithas been implemented. It is endowed with relatively good geographical coverage compared to theRCC operations and is effective in targeting the poorer rural households. As a model, however, it is ashort-term measure and is not empowered to deliver sustainable financial services after projectcompletion. Two important weaknesses manifested themselves during project implementation: (a) theinability to mobilize savings and recycle them through investment, and (b) the inability to eliminate apotential moral hazard, since borrowers may perceive that loans from government departments cansimply be written off.7. Gradually, project designs have been shifted so that projects are no longer entirely supplydriven, whereby government offices decide on credit delivery and funds are allocated without dueconsideration of parameters such as loan appraisal, or repayment capacity and client credit history, butinstead seek to use local financial service institutions, the RCCs. In fact, since 1996, when theGovernment of China decided that the RCCs would become the primary rural financial institution atthe township level, IFAD/WFP-funded projects have retreated from the unsustainable financialservices delivered by PMOs.8. The RCCs were established in the 1950s as legally independent cooperatives. Although theywere created at the township level, their presence in villages through branch offices or representativesmeans that, of all financial institutions, they have the widest outreach among rural populations.Scaling Up Poverty Reduction Analytical Case Study2Despite their legal structure as independent entities, however, the RCCs were absorbed by the ABCand assumed the role of branches for it.9. In 1996, the RCCs were separated from the ABC and found themselves in a nationaloversight and policy-making vacuum. They were first brought under the oversight of the People’sBank of China (PBC) and, specifically, of the Rural Finance Reform Office and the Department ofCooperative Finance. In 2003, the China Banking Regulatory Commission (CBRC) took over thisrole. By the end of 2001, over 40 500 RCCs were in operation, with CNY 1 200 billion in loansoutstanding (11% of the total banking sector) and CNY 1 700 billion in deposits (12% of the total).Lending to township and village enterprises constitutes about half of all the loans outstanding, whilehousehold lending amounts to about a quarter, and private loans and loans to household enterprisesaccount for the remainder.10. Since the mid-1990s, RCC Unions (RCCUs) with status as legal persons have also beenestablished at the county level. Township level RCCs are members of the county-level RCCU, whichprovides clearing house facilities, plans and supports staff training for member RCCs and carries outinspections and annual audits of member RCCs.#p#分页标题#e#11. The use of RCCs as a credit-delivery mechanism in IFAD projects has been growing, thougha number of issues have been encountered: (a) The PMOs regarded RCCs as weak and risky in termsof the recovery of the IFAD project resources provided to them. (b) The PMOs were very reluctant totransfer responsibilities to RCCs, as they were afraid of losing control. (c)农村信用社没有得到一个独立的银行的自主权，因为他们大多提出给他们的客户服务PMOS，从而增加自己的风险。The RCCs were not giventhe autonomy of an independent bank as they mostly served clients that were proposed to them by thePMOs, thus increasing their own risk. (d) The aggregate of the transaction commissions and chargesat the provincial, prefecture and county levels rendered IFAD funds unattractive to and expensive forthe RCCs up to the end of 2001, when the Ministry of Finance decided to extend IFAD loan funds tothe province level at concessional terms.12. In 2000, the IFAD Office of Evaluation and Studies undertook a thematic study on ruralfinance that assessed both project managed credit (through PMOs and the Finance Bureaux) and RCCoperations. The conclusions of the study were discussed at a meeting among the Ministry ofAgriculture, the Ministry of Finance, the PBC and IFAD, at which the recommendation was adoptedthat RCCs would be the main channels for the disbursement of IFAD funds allocated as credit andthat IFAD would support the Government in restructuring the RCCs so as to render them costeffective and sustainable instruments, thereby emphasizing their potential in poverty alleviation.13. Subsequently, the Rural Finance Sector Programme (RFSP) was developed by IFAD in closecollaboration with the PBC, the Ministry of Finance and the Ministry of Agriculture. The RFSPproposal was prepared during 2002 for further consideration by the Ministry of Finance and the PBC.14. Two major considerations form the rationale for the RFSP:(a)农村信用社构成了非常重要的在农村地区和拥有最广泛的网络和推广能力的金融服务供应商，通过信贷人员谁提供服务。The RCCs constitute very important suppliers of financial services in rural areas andpossess the most extensive network and outreach capacity through credit officers whoprovide services at the farmgate. Previous operations and present policies, however, havejeopardized the sustainability of the RCCs. The Government is therefore considering thedevelopment and implementation of a policy reform programme for the RCCs, and somereforms are already being tested at a pilot scale.(b) IFAD’s 2000 thematic study on rural finance confirmed the Fund’s strategy to provideloans to rural poor through the RCCs. It also recognized that policy changes were neededso that the RCCs could play an important role in future IFAD projects.15. Within the framework of the rural finance reform process guided by the CBRC since 2003,the RFSP aims to support the Government in redefining the policies of RCCs and taking into accounttheir impact on both poverty reduction and institutional sustainability. It also aims to demonstrate theusefulness of microfinance for poverty reduction. In supporting policy reform, the RFSP will focus onlending policies that allow increased access among the rural poor to RCC lending and on institutionaland operational policies that will enhance the efficiency of the cooperative banking system. Hence, itwill contribute to the financial sustainability of these institutions.16. The RFSP thus follows up on the strategy to foster policy dialogue as proposed under IFAD’scountry strategy document of 1999 and is in line with a strategic objective of IFAD, namely, to enablethe rural poor to overcome their poverty by increasing their access to financial services and markets.The RFSP will also enhance IFAD’s catalytic impact by “helping to establish institutional and policyframeworks in support of the poor”. Moreover, it represents the realization of aspects of IFAD’sstrategy for Asia and the Pacific region, which announced a shift in emphasis towards projects andprogrammes that have the strategic potential to influence policies.17. The goal of the RFSP is to render rural financial services capable of contributing effectivelyand in a sustainable manner to poverty reduction. The specific objectives of the RFSP are to ensurethat:(a) rural households, including the poor, have better access to financial services andeffectively make use of them to improve their living standards;(b) RCC policy reforms have been successfully tested and are implemented in ongoingIFAD/WFP-funded projects, as well as in future interventions;(c) improved institutional and operational management capacities in RFSP RCCs are appliedon a larger scale and help enhance cost effectiveness and profitability; and(d) modalities for the solution of the problem of non-performing loans have been tested andare applied on a wider scale.18. The RFSP will support the CBRC at the central level and the RCCUs and RCCs in two pilotprovinces at the county and township levels. It has five components: policy development; institutionaldevelopment; operational development; financing; and programme management.19. The RFSP implementing agency will be the CBRC. The Department of Cooperative Financeat CBRC headquarters will establish a coordination and monitoring unit and appoint a director. Inprogramme activities, the county RCCUs and the provincial RCCUs will ensure that the coordinationof ongoing IFAD/WFP-funded projects with the PMOs is maintained.20. In the support for reforms so as to render the RCCs more sustainable and efficient in thereduction of poverty, IFAD is nearly the sole external donor. In conjunction with the IFAD/WFPWulin Mountains Minority-Areas Development Project, the German Agency for TechnicalCooperation has been providing technical assistance in the training of RCC staff, but this project isbeing terminated. Other interventions of the German Agency for Technical Cooperation, e.g. inJiangxi province, have been of a similar nature. The World Bank is providing technical assistance forthe reform of the financial sector, focusing on state banks.21. The implementation of the RFSP will represent an occasion to involve, as much as possible,national and international expertise from the microfinance sector. Frequent consultations, to whichbilateral and multilateral donors will also be invited, will be held so as to benefit from availableexpertise and disseminate as widely as possible any positive results from the pilot activities supportedthrough the RFSP.Scaling Up Poverty Reduction Analytical Case Study4II. IMPACT ANALYSIS22. Because many RCCs are still weak, the PBC has been implementing a national programmefor RCC capacity-building and restructuring, culminating in the recent publication of definitiveguidelines for RCC operations and management.农发基金已经成功地与合作中国人民银行农村信用社提供技术和管理支持，并监督和保证其良好的性能。此外，所有农发基金资副农村信用社贷款管理，以这样一种方式，不好的影响降到最低。IFAD has been successful in collaborating with the PBC to provide technical and managerial support to the RCCs and to supervise and ensure their goodperformance. Moreover, all IFAD-financed sub-loans to RCCs are administered in such a way as tominimize the impact from old, non-performing parts of the RCC portfolio.23. The approach of the RFSP in support of policy reform is to assist in ongoing or alreadyplanned policy adjustments, help in the refinement of modalities of implementation and promote theidea that new policies should have clear gender and poverty dimensions. In this respect, RFSP supportwill focus on the liberalization of the interest rate, microfinance, group lending, and lending towomen. At a later stage, support for the development of other new products will be provided.24. The RFSP will generate important benefits both in terms of improved access of households,especially poor households, to formal rural financial services and in terms of the strengthenedefficiency and sustainability of the RCCs. These two benefits will be closely monitored during RFSPimplementation.25. The RFSP will be implemented at the national level as a programme allowing the CBRC andthe RCCUs/RCCs to test good microfinance practices, with a special emphasis on the facilitation ofthe access of the rural poor. In line with China’s incremental reform strategy, this will initially beundertaken in a selected, limited geographical area at the county level. Once the results areconclusive, the reforms will be translated into policy and institutional reforms for application on alarger scale.26. The main objective of the ongoing credit initiatives under IFAD projects has been to improvethe access of poor households to microfinance, which has also included group lending and specialloan programmes for women. Also, support was provided for capacity-building among RCCs so thatthey become sustainable financing institutions that would benefit mostly the poor for whom the RCCsare the only avenue for formal deposits and loans in rural areas. The RFSP, however, by virtue of its#p#分页标题#e#sectoral nature, will benefit all potential clients of the RCCs and RCCUs by improving the policyenvironment and the institutional and operational modalities of the RCCs and RCCUs in theprogramme area.27. At the household level, credit delivery remains a strong instrument for the improvement ofyear-around food-security and for increasing the income of poor rural households. Individualhouseholds will benefit from the collateral-free loans provided under the new policies. The strategy ofcombining food-for-training with credit for productive on and off-farm activities has exhibitedsignificant positive results. Those households that were not able to access formal credit becameeligible for access through technical and business training. Furthermore, project reports reveal anincrease in agricultural production and the establishment of various off-farm activities, such asgrocery shops and restaurants, as well as an increase in agriculture production-livestock rearing, fruittree plantation and greenhouse-based, intensive vegetable production. According to the thematicstudy, 50-80% of RCC loans drawn by households in 1999 were used for investments in crop andlivestock production. The return on such investments is high, as evidenced in the project impactanalysis, which is presented in each project completion report.28. Considerable progress in credit awareness has been achieved. Especially women havedemonstrated a high degree of confidence in their ability to use externally borrowed fundsproductively. In the Wulin Mountains Minority-Areas Development Project, for instance, about 50%of the credit allocations were explicitly directed to women. In reality, however, 90% of all creditfunds were actually used by women. Most of the loans for productive activities by women aremedium and short-term credit of up to CNY 2 000.29. Nevertheless, as the RFSP is a sectoral programme, the benefits will transcend the RCCs andRCCUs directly involved in implementation as the positive results spread to RCCs and RCCUs in thesame provinces or beyond. Where necessary, ongoing IFAD/WFP-funded project resources will beallocated to implement the new, proven policies.III. DRIVING FACTORS30. A suitable political and economic environment is a critical precondition for the testing andimplementation of innovative approaches. The decision to move away from the PMO-based creditsystem towards private rural financial providers was triggered through the successful tests in the stepwiseapproach embedded in the integrated rural development strategy that IFAD has been pursuing inChina.31. The close collaboration and strong support of governmental institutions for an effectiveparticipation in rural financial sector reform culminated in IFAD’s involvement in China’s NationalReform Programme so as to ensure the inclusion of the experience obtained through IFAD/WFPfundedprojects.Commitment and Political Economy for Change32. China has made remarkable strides in the improvement of the standard of living of its peopleand in the realization of sustained economic growth during the past two decades. Especiallypraiseworthy is the sustained economic growth, combined with the sharp reduction in the proportionof the population defined as poor. The rural poor population – based on the official poverty line – fellfrom 250 million in 1978 to 36 million in 1999, or from 30.7 to 4.2% of the total rural population.33. The Baqi (8-7) Poverty Reduction Plan was instituted by the Government in 1994 with theobjective of lifting 80 million rural poor out of poverty by the year 2000. Having missed the deadline,the Government is faced with the urgent question of how to put current unsustainable credit deliverymethods onto a sustainable footing. It has realized the importance of the integration of credit servicesin the services of the local financial infrastructure as practiced in IFAD/WFP-funded projects andviews the reform of the RCCs as critical for the improvement of the delivery of sustainable financialservices to poor and low-income households.34. The ability of the RCCs as a whole to serve rural production, regularize householdconsumption and achieve poverty alleviation has been negatively affected by the deterioratingfinancial situation of the RCCs. Efforts are now afoot slowly and steadily to restructure the RCCs.These efforts depend on the speed with which the restructuring is undertaken of the township andvillage-owned enterprises to which the RCCs have granted substantial loans in the past.35. Some loss-making RCCs in small townships (mainly in poor areas of China) have been closedor merged, putting poorer rural households at a disadvantage. Many RCCs provide loans only to thosewho can provide certificates of deposit as collateral for loans over CNY 1 000 (USD 120). The RCCsare the only financial institutions with the outreach necessary to serve rural households. Improvingtheir performance and incorporating poverty alleviation-oriented financial products into their portfolioremain the key for the development of sustainable rural financial services in China.36.农发基金/粮食计划署资助的项目已整合项目为基础的金融服务输送到农村信用社进行定期活动。The IFAD/WFP-funded projects have been integrating project-based-financial-servicedelivery into the regular activities of RCCs. Despite the favourable environment, however, the use ofRCCs has been hampered by the de facto interest margins imposed by the Ministry of Finance. As aresult, the RCCs have a small margin, and their creditworthiness has suffered.37. The practice of ‘dictating’ interest rates has now been suspended, and these newcircumstances should allow for the widespread introduction of microfinance institutions. This alsooffers the opportunity gradually to change the composition of the RCC portfolios so as to include alarger share of longer term lending, in addition to the seasonal components, which, however, remaindominant.38. In recent years, the Government has repeatedly shown strong signs of a political commitmentto the reform process in the banking sector. A major impetus for reform was given in April 2003,when the banking supervision function of the PBC was handed over officially to a new bankingregulatory body, the CBRC. The CBRC is expected to introduce innovations in the areas of regulatorymethodology, systems and technologies to modernize and upgrade financial supervision to a moreprofessional level, while the PBC will maintain its focus on monetary policy-making.39. The PBC has actually been instrumental in many innovations that are currently being testedon a pilot basis. In the rural finance sector, these include the liberalization of the lending rate, theintroduction of an incentive scheme for staff and the re-examination of the legal status of the RCCs.In addition, the introduction of microlending and joint-liability group lending have been tested on thebasis of the experiences with microcredit in IFAD/WFP-funded projects. For each of theseinnovations, pilot counties have been selected to test these policies. The first outcomes seem to bepositive and are under application on a larger scale.40. The second impetus for reform came in June 2003 when the Government issued the PilotScheme for RCC Reform and then, on 18 August 2003, when it formulated a pilot programme in eightprovinces. Through the relevant governmental institutions, i.e. the Ministry of Finance, the PBC andthe CBRC, the Government has exhibited a strong commitment to the development of the RFSP as aresponse to the challenges posed by the ambitious reform process in the country. In light of IFAD’scontinuous and successful support for the RCC system in the past, it is reasonable to assume thatIFAD-funded operations have been instrumental in triggering the Government’s pilot scheme. Aspreviously mentioned, the RFSP will be implemented as part of the pilot scheme in two counties ineach of the eight pilot provinces. It is expected that the successful outcome of these activities willtrigger the scaling up of the experience to the national level.Institutional Innovation41. The first institutional innovation (already mentioned above) has been the establishment of aspecialized regulatory commission, the CBRC. The commission will be responsible for theintroduction of the innovation that are to modernize the financial sector and render it moreprofessional and efficient. The Department of Cooperative Finance, which is formally under the PBC,but has been transferred to the CBRC, continues to play a leading role in the RCC reform and toensure the supervision function of the CBRC for the RCCs. The department will be responsible for allcooperative institutions in rural and urban areas. Its functions include the standardization ofmanagement structures; the drafting of regulations for supervision; risk control; the quality of assets;and the interest rates for loans and savings. It will also carry out investigations and take up anynecessary actions in case of delinquencies. The department will also be the implementation agency ofthe RFSP.42. The RFSP will provide the opportunity to test a number of institutional innovations. Theseinclude the change in the legal structure of the RCCs and RCCUs and in the staff incentive scheme.#p#分页标题#e#43. Legal structure: The RCCs have been isolated entities at the township level and have thusbeen unable to access higher level support for technical issues, product development and stafftraining. Moreover, they lack the benefits of economies of scale that would allow them to continueexpanding their operations and overcome eventual crises. The RFSP will foster the current pilotconsolidation of the RCCs as branches with RCCUs at the county level. National and internationaltechnical expertise will guide the process through the provision of analysis and advice in terms ofstrategy development and the operational and institutional implications inherent in the change in legalstructures. It is expected that the new legal structure will stimulate further development at the RCCUlevel beyond core functions and assist the RCCs so that they can evolve into strong institutions.44. Staff incentive system: As indicated above, the RCCs and RCCUs have recently introduceda staff incentive system that has been applied by the ABC since the mid-1980s. The scheme is simplya distinction in total salary, with about 60% of the income consisting of a fixed, minimum salary andthe remaining 40% of bonuses. Regular staff meetings are used to maintain and improve staffqualifications. The RFSP aims to enhance the effectiveness of the scheme through an analysis of theincentive effects, the impact on cost effectiveness of operations, on overall financial results and onstaff motivation and morale. Further recommendations will be analysed and proposed forimplementation.45. Although the impact of these innovations cannot be predicted at this stage, a positive effect onefficiency and outreach is widely anticipated.Learning and Experimentation46. Microfinance: The learning and experimentation process has been initiated through theinclusion of the RCCs as financial service providers in IFAD/WFP-funded operations. The provisionof technical skills and functional literacy training financed through either IFAD cash funds, or WFPfood-for-training has enhanced the skills of the target group, consisting of poor and very poor ruralhouseholds. In turn, the RCCs have considered the advanced skills of trained project beneficiaries ascollateral for good loan performance and, hence, have provided small loans for productive activities tothose who previously could not access formal credit. This strategy has been tested and graduallyrefined in five projects since 1996.47. The women’s ‘window’: IFAD has supported its projects in such a way as to provide specificassistance for the economic activities of women. Experience elsewhere has demonstrated that womentend to be better than me as quality borrowers and thus represent a lower risk for financinginstitutions. In spite of this, most lending is administered to men, even when the funds are used forinvestments operated by women. Moreover, men, who are traditionally viewed as the heads ofhousehold and are thus responsible for signing any legal document, including loan contracts, aremigrating to urban centres, while their spouses have been left to tend to on and off-farm activities andto the families. Therefore, it is only logical that the RCCs should recognize women as loancontractors.48. In addition to RCC services, the recent IFAD/WFP-funded project included a specialwomen’s ‘window’ (in the sense of a counter at a bank or credit institution) that has been entrusted tothe local branch of the Women’s Federation. The special women’s window provides small loans forproductive activities, in conjunction with functional literacy training, to very poor and disadvantagedrural women. This programme has been successful in helping women achieve access to formal creditchannels like the RCCs.49. Experience shows that women have been successful in establishing microenterprises thatprovide sustainable income to households. Moreover, a recent gender assessment study hasdemonstrated that the creation of successful businesses in rural areas tends to reduce the out-migrationof husbands, which is a significant indication that there has been a positive impact on rural poverty.Building on this positive experience, the women’s window will be further developed under the RFSP.Women will take out individual or group loans from RCCs in their own names. Where required, theRFSP will provide funds for functional literacy training and allow women to sign with their ownseals.50.鉴于疲弱的经济在农村地区的西部省份，农村信用社经营过程中面临难以活的足够的收益的严重困难，同时覆盖他们的风险和他们的运营成本和固定成本。Interest rates: Given the weak economy in rural areas of the Western provinces, the RCCshave been facing serious difficulties in obtaining enough returns from their operations, while coveringtheir risk and their operational and fixed costs. External lines of credit were opened to assist the RCCsin extending loans to poor rural households. When the interest rate ceiling was reduced, however,external lines of credit provided by donors like IFAD became too costly. Only in 1999, when theMinistry of Finance reduced on-lending interest rates, were external lines of credit deemedsufficiently attractive so that RCCs could on-lend to poor rural households.51. The RCCs have been applying a interest rate ceiling determined by the PBC, typically withina 50% margin above the PBC base rate. Recently, on a pilot basis, some RCCs have been given theauthority by the PBC to increase their margin on interest rates to 100% of the PBC rates. Althoughthis flexibility is welcome, it does not address the core challenge in the setting of the interest rates forRCC operations: the need to retreat from administered interest rates towards a system of loan pricingbased on the actual costs for the delivery of services to poor rural households.External Catalysts52. Most of the credit schemes of international donors and non-governmental organizations havebeen project-based and, hence, unsustainable. Some international agencies and donors have recentlybegun to operate pilot projects to explore ways to transform project-based credit support tosustainable institutional capacity-building.53. Following initial experiments of the Chinese Academy of Sciences in 1994, severalinternational institutions, including the Ford Foundation, the German Agency for TechnicalCooperation and OXFAM, and domestic institutions have introduced microfinance models, mostlybased on the Grameen Bank model. Dissatisfied with subsidized poverty lending and eager to meetpoverty alleviation targets, local governments took the initiative to establish microfinanceprogrammes. The striking results include the improved performance of non-governmentalprogrammes in targeting poor households and in achieving high repayment rates.54. In 1994, experimentation in PBC/RCC microcredit in Hebei province led to the formulationof policy guidelines for microlending by the RCCs. In December 2001, these guidelines were issued.They included lessons learned in IFAD/WFP-supported projects.IV. LESSONS LEARNED55. Influencing policy in China is an extremely challenging exercise and a very complicatedprocess. The most practical approach has been to undertake pilot interventions to demonstrate goodpractices and to attempt to trigger the interest of local governments and the central Government ininnovative approaches. Long-term processes require exceptional patience in building up a reiterativeapproach, whereby experiences are accumulated in pilot activities. Lastly, collaboration with likemindedpartners and networking with resource people in the country are critical to the success of anyproject.REFERENCESInternational Fund for Agricultural Development (IFAD). 1990. China: Rural Credit Project:Completion Evaluation Report. IFAD, Rome.___ 2000a. China: Qinling Mountain Area Poverty-Alleviation Project, Hubei Province: AppraisalReport, Main Report. IFAD, Rome.___ 2000b. China: West Guangxi Poverty-Alleviation Project: Appraisal Report, ImplementationEdition, Main Report. IFAD, Rome.___ 2000c. China: Wulin Mountains Minority-Areas Development Project: Appraisal Report. IFAD,Rome.___ 2001. China: Rural Financial Services in China: Thematic Study, Main Report and Annexes.IFAD, Rome.___ 2002. China: Environment Conservation and Poverty-Reduction Programme in Ningxia andShanxi: Appraisal Report. IFAD, Rome.___ 2003. China: Rural Finance Sector Programme: Appraisal Report. IFAD, Rome.