Micro-finance institutions are critical to Africa's quest for solutions to the continent's development challenge. The area of their greatest potential impact, rural Africa, is not only home to the bulk of the continent's population, but also the vast majority of Africa's poor. This paper not only defines MFIs with examples from Zambia, South Africa, Mali and Zimbabwe, it also establishes a clear link between MFIs and both poverty eradication and the empowerment and equality of women, two of the major Millennium Development Goals. The paper concludes with some policy recommendations and a set of "best practices" for the future success of MFIs on the continent, including the need to ensure flexibility and careful government regulation and supervision of MFIs.

Chapter 2 Promoting the Independence of a Financial Services Regulator 19 2.1 Introduction 19 2.2 Independence and the Financial Services Regulator 19 2.3 The Example of Central Bank Independence 22 2.4 Independent but Accountable 25 2.5 Arguments For and Against the Independent Regulator 31 2.6 Conclusion 34 Chapter 3 The Concept of a Unified Financial Services Regulator 37 3.1 Introduction 37 3.2 The Unfolding Debate 38 3.3 Examples of Unified Regulators 45 3.4 Deciding Whether to Unify Financial Services Supervision 47 3.5 A Contingency Approach 48 3.6 Lessons Learned from Experience 49 3.7 Conclusion 55 vi Contents Chapter 4 Frameworks for Unified Financial Services Supervision: Latvia, the Scandinavian Countries, and the United Kingdom 57 4.1 Some Preliminary Issues 58 4.2 The Latvian Model 59 4.3 Structure of the Financial and Capital Market Commission 63 4.4 Strategic Goals of the Commission 71 4.5 Other Aspects of the Regulatory Framework 73 4.6 Unified Financial Services Supervision in the Scandinavian Countries 74 4.7 Unified Financial Services Supervision in the United Kingdom 82 4.8 Recent Regulatory Developments in the United Kingdom 84 4.9 Conclusion 87 Chapter 5 Conclusion 89

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This paper examines recent institutional and structural developments relating to unified supervision of financial services in Germany. The main thrust of the academic debate concerning unified supervision of financial services was started in the UK. More recently, international organizations have taken an interest in the subject. Some of the issues confronting countries the world-over with respect to the unified supervision of financial services are whether to adopt unified supervision and, if so, how to structure the institutional and regulatory framework for unified agencies. At the outset, it must be pointed out that issues of regulatory organization are essentially second order issues. Far more important—and the first order issue— is the implementation of financial regulation, in particular supervisory capacity and its quality and the soundness of the legal framework underlying the regulatory process.

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