Assessment of the Impact of USAID's Ten Years of Assistance in Microlending, Rural Credit, Mortgage, and Equity Investment: Romania's Unique Financial Mechanisms Assisted by USAID
This assessment evaluates the impact of the United States Agency for International Development (USAID)-supported projects and institutions on firms and sub-sectors, the financial sector, and the broader business environment in Romania as USAID prepared to end its activities in the country in 2008. USAID has supported financial sector development and the growth of the private sector in Romania, with a variety of financial mechanisms. The assessment found that, in most cases, the programs and institutions supported by USAID have been successful and effective in reaching their stated goals. Findings include:
- Institutional performance surpassed initial goals to have longer-lasting and broader impact on financial sector development;
- USAID used mechanisms such as investment funds, a guarantee facility, MFIs, small loan programs and a business support project to fuel development;
- Development occurred in the micro, small and medium enterprise sectors, rural enterprises, newly created and privatized firms and mortgage finance.
The assessment team found a number of remaining gaps and challenges to the development of the private sector, particularly the financial sector. The paper states that some of them are products of the free market, yet most could be addressed by policy makers and donors.
