A project design based on a sound and thorough assessment of institutional constraints and market conditions would have ensured smoother implementation and improved loan performance. In the context of Samoa—where the financial market is relatively underdeveloped, the collateral framework is weak, and institutions have limited capacity—a more simple and focused project design would have been more appropriate. Some of the subcomponents such as the venture capital fund, credit bureau and chattels registry were totally new activities which made the design more complex and difficult to implement. Also, clearly a modest project like this would not be the best vehicle for addressing a fundamental political issue like land ownership. Greater focus should have been placed on creating an enabling environment for the financing and growth of micro and small enterprises. This would have involved developing the policy and legal environment for the sector, which to some extent was achieved by the project, and building institutions to service the sector.
Small Business Development Project