The key phrase you leave out is "and leave very little actual productive capital behind". People does not equal human capital, you need educated and experienced

The key phrase you leave out is "and leave very little actual productive capital behind". People does not equal human capital, you need educated and experienced people. The only way the borrowers can repay the USD principal + interest back to the external financiers is to participate in world trade, to export or at least substitute the import of widgets from industrialized nations. Will a micro-loan create the conditions for such competitive production ? Hard to imagine.