DID and IDB: Building Sustainable Community Financial Institutions in Haiti

In the aftermath of last fall's Hurricane-induced floods, Développement International Desjardins (DID) is ensuring that a donation made by its parent company helps Haitians rebuild their housing in the most devastated parts of the country. DID isn't a construction company; its business is community finance. The Quebec-based organization has a natural concern for Haiti, where it has been active for almost 20 years. For the last 10, DID has worked with the Canadian International Development Agency (CIDA) to create and develop financial co-operatives. Now, a new, complementary project with the Inter-American Development Bank (IDB) will give Haitians access to even more financial instruments to help them improve – and rebuild – their lives.

Founded in 1970, DID is part of Desjardins Group, the largest co-operative financial group in Canada. DID specializes in community finance, a sector of the finance industry whose mandate is to reach the entire community, including the poorest. As such, DID provides support for the creation and development of sustainable financial institutions that are rooted in the community. The organization, which has 65 employees in its Lévis headquarters, and 30 abroad, is active in some two dozen countries throughout Africa, Latin America, the Caribbean, Asia and Central and Eastern Europe.

Empowering Communities
"We empower communities by setting up local institutions that are locally-owned and operated, not controlled by foreign interests," explains Serge Gosselin, Marketing Director for DID. "As a result of our activities, millions of people in the world's least developed countries can deposit and pool their savings, which can be used to make loans for other members of the community."

Most of DID's work is carried out in conjunction with either CIDA or the multilateral development banks (MDBs), including the World Bank and Asian Development Bank. In Haiti, CIDA has funded three DID projects to work with existing savings and credit co-operatives (Caisses Populaires) and to develop new ones in departments (regions similar to provinces) where there were previously none. As a result of these projects, Haiti has 60 new Caisses Populaires and 13 branches in 10 departments.

The organization's new project with the IDB is its first with that bank, and it comes as a direct result of, and as a complement to, the third CIDA project, still currently underway. Under the four-year US$650,000 IDB project, set to begin in July 2005, DID will work to improve and expand lending and other financial services offered to low-income communities by the Caisses Populaires it created and/or developed under its CIDA projects.

DID will also lay the foundations for the creation of a formal federation of the co-ops. "The existence of a federation, or union, ensures the continuance of the Caisses Populaires after we leave the country," explains Josée St. Hilaire, Program Officer for Haiti, Rwanda and Mauritania. "So as part of both this contract and our CIDA project, we are setting up centralized financial support services. So far we've worked on financing and commercial activities, but we'd also like to offer the people financial services for education, agriculture and housing, and work more in synergy with other Canadian projects in those fields."

Making Contacts in the Global Community
DID knows the importance of community for its own business. In DID's case, however, its community is the whole world. In the competitive MDB market, the organization develops and nourishes contacts both with the MDBs and with governments and companies in other countries.

"It's not easy to be known by the MDBs, and it takes a lot of effort to get the contacts and develop them," says Gosselin. "It's not a one-shot deal; you have to stay in touch, show them results from your support activities, demonstrate your expertise. The most important thing is demonstrating that you're making a difference in the field – that you're helping people improve their life conditions. Maintaining your relationship with the MDBs is an ongoing investment of time and effort."

DID also maintains a relationship with Canada's network of trade officers around the world. "When we go into a new country, the embassy is the first door we knock on to get more information," says Gosselin.

The company makes its presence known at international conferences and seminars, as a way to become known by the right people. It was at such an international meeting that DID met its IDB contact and was subsequently able to show the Bank its work with CIDA in Haiti.

Negotiations, however, weren't easy. As Gosselin explains, the MDBs increasingly have a mandate to contract with national companies, which can then subcontract to international companies. This is the case with the IDB, which wanted the executing agency to be a Haitian company, with DID providing technical support. The problem was that, as DID knew, the precise expertise needed wasn't available locally. DID worked hard to convince the IDB that in this case it was the only organization qualified to act in both capacities. However, as Gosselin points out, one of the outcomes of the project will be the creation of local expertise in Haiti.

"Money Serving People"
Despite the disasters, both natural and political, weathered by Haiti in the last year, DID's work has been largely unaffected. "Even during the worst part of the crisis after President Aristide was deposed, none of our Haitian co-ops suffered any damage," says St. Hilaire. "That's because, in the absence of police, the people themselves protected the co-ops. It was their own institutions and their own money at stake."

It's a telling example of the power of, and behind, community-owned institutions.

In a telling example of its own, DID – whose motto is "money serving people" – is managing a donation of $150,000 being made by its parent company, Desjardins Group, to help Haitians rebuild their housing in the wake of the hurricanes of 2004. Although the organization expects most of the money will be used for housing, it is also looking into strengthening a Caisse Populaire (not one of its own) in Gonaïves, one of the hardest-hit cities, so that residents there will have access to financial services to help them rebuild their lives.

DID has not yet formally measured the results of its work; however, informal feedback indicates that Haitians are indeed benefiting, in tangible ways, from their community-based co-ops: they're able to buy appliances, send their children to school, start up commercial ventures. "That's the kind of feedback we get all the time," says St. Hilaire.

It's that kind of feedback that keeps DID in Haiti – and other countries around the world.

For more information, contact:

International Financing Division
International Trade Canada
Tel.: (613) 995-7251
E-mail: ifinet@dfait-maeci.gc.ca

or

Serge Gosselin, Marketing Director
Développement International Desjardins
Tel.: (418) 835-2400
E-mail: info@did.qc.ca