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Cordaid NL
Private Sector Development

Cordaid starts investment in Myanmar

Cordaid has just disbursed its first loan of 900.000 euro in local currency for microfinance programs for farmers in Myanmar. This creates access to small loans for farmers to buy inputs like fertiliser for their farming for the coming rice planting season. The need for investment in Myanmar is high, but foreign investors are still reluctant. Cordaid is one of the very first impact investors stepping into the microfinance sector of Myanmar, which has only recently opened up to international investors.

In Myanmar, Cordaid is working together with Proximity Designs, a Myanmar-based social enterprise. Together with Proximity Designs, Cordaid wants to improve food security in Myanmar by helping thousands of smallholder farmers improve productivity and incomes.

Although the potential risks of investing in Myanmar are considered to be extremely high by the rest of the impact investment community, Cordaid feels that the acute need for investment in the country justifies the risk.


‘To boost the economy in fragile regions is the way forward.’

“To boost the economy in fragile regions is the way forward. Economic stability makes a country less susceptible to political turmoil and instability,” says Laure Wessemius-Chibrac, head of Cordaid Investments.

Seeing the high demand for loans and savings products at the lowest income level, combined with the introduction of new government regulations allowing foreign investments at the end of 2014, local microfinance institutions have started to gear up and invest for growth. However, unexpected regulatory hurdles have slowed down progress.

Recognizing these risks, Cordaid has come to the conclusion that the social impact of an investment at this stage outweighs the potential financial consequences. Financial inclusion is a high priority, which was underlined by the visit of H.M. Queen Maxima to Myanmar recently. Cordaid has mitigated these consequences by providing a short-term loan of 8 months, at expiry of which a new analysis will be made to investigate options for a more long-term solution. As foreign investments are very hard to come by at this moment, the investment decision was warmly welcomed by Proximity.


Proximity Designs is a Myanmar based social enterprise that designs and delivers income boosting products and services that complement the entrepreneurial spirit of rural families. Proximity Designs was founded in 2004, when it started designing, manufacturing and selling low-cost irrigation equipment to eliminate hours of backbreaking labour and improve farmers’ productivity and incomes. Over the past decade, Proximity has remained agile in the face of a quickly changing landscape; in 2008, when Cyclone Nargis caused at least 150,000 casualties in the Myanmar Delta Region, the social enterprise leveraged its rural distribution networks to provide emergency assistance.

Ayarwady Delta (Photo: Cordaid)

Currently, Proximity has a rural reach in over 9,000 villages nationwide, where they offer a range of services including high-quality low-cost irrigation systems, farm advisory services, economic research, and rural finance, through Proximity Finance, their microfinance unit.. After disbursement of the loan from Cordaid, Proximity Finance will immediately lend the money to 4.500 farmers in the Delta region where rice farmers will use the loan to buy inputs for the new crop season, which starts in June/July 2015.

Cordaid creates opportunities for the world’s poorest, most vulnerable and excludes people. Regardless of race or religion. Cordaid is a social investor and invests in microfinance institutions and funds that offer loans, guarantees and capital stock to small- and medium-sized entrepreneurs, farmers, health clinics and other businesses that have limited other options. We focus on fragile contexts that involve a greater risk than other investors are willing to take.

Improving financial inclusion

With a shared commitment to improving financial inclusion in Myanmar, Cordaid and Proximity seek to sustainably expand the MFI’s outreach, as well as its product diversification. As such, Cordaid will be one of the first investors providing a direct financing facility in local currency to the microfinance sector in Myanmar.