| In 1996, United Nations Development Program (UNDP) started to assist the poverty alleviation in China in the form of micro-credit projects. In the poor areas, MC projects give micro-loans to the poor farmers, especially women, to initiate their production in order to increase their income. The Chinese government at all levels has accepted MC as an effective way of poverty eradication. In fact, UNDP MC projects have covered 48 counties in China, amounted almost US$10,000,000, related with about 70,000 poor households. The projects not only have improved the living standard of the poor people, but also provided opportunities for them to participate in the social activities, especially improved the status of women in family and community.The MC project is different from the non-MC project. Under the non-MC project, there will be nothing left after the projects being completed except non-expandable equipment which would be transferred to China International Center for Economic and Technical Exchanges (CICETE, the counterpart of UNDP in China ) or the project receipt unit according to agreements between Chinese Government and UNDP. After MC project, there will be some amounts of MC funds revolving as loans for the poor, besides the non-expandable equipment. For the management of the MC fund after the project, there has not been any arrangement between CICETE and UNDP. And also, there are no national regulations for these cases in China.UNDP and CICETE have all input a great amount of efforts, materials and fund to set up operational manual and special associations to permanently serve the poor financially. MC projects not only enrich the poor, but also give effective model of PA for the Government. Due to no consensus on post-project the management of the MC revolving fund, there come some problems affecting the projects badly. For instance, the reported repayment rate is above 95%, but some detailed investigation showed that, under some projects, the real rate is only about 75%. The MC projects are on thin ice. In order to sustain the financing for the poor effectively, there is an urgent need of strengthening the management and supervision of the MC revolving fund during and after the projects. The first thing is to determine the legal relationship among the concerned parties of UNDP MC project and the legal nature of the MC revolving fund, on the basis of which to identify the post-project rights and obligations of all the concerned parties. Since August 1999, I have searched many agreements between UNDP and Chinese Government on economic cooperation, some legal documents of UN and UNDP on development affairs. I have also read some books on trust theory and foreign trust act and regulations. This paper is trying to explain the problems under the UNDP MC projects with the theory of trust.In the first part of this paper, the assistance of UNDP to China is briefly introduced, and the problem of post-project management and supervisions of the revolving fund is raised. In the second part, the basic knowledge of trust is discussed, especially the obligations and rights of trust parties and the characters of charitable trust. Finally, the trust system of UN and UNDP is analyzed, and it is proved that UN and UNDP are charitable organizations, UNDP assistance to China is a charitable trust, that is , the relationship between UNDP, Project Receipt Unit and CICETE is a charitable trust relation. Under UNDP projects, CICETE is a trustee of UNDP, the revolving fund of MC projects is charitable trust property. The conclusion is that, CICETE has the right to manage and supervise the revolving fund even after the UNDP MC projects.In this paper, I tried to explain the relationship among all parties and the post-project management of the revolving fund under UNDP projects. At the same time, I had a thought that the trust arrangement of UNDP assistance is a very good reference for the management and legalization of charitable affairs in China, especially for the Trust Act being drafted.I would like to take th... |
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