IFC, a member of the World Bank Group, committed $5.6-billion to private sector development in the Middle East and sub-Saharan Africa in fiscal year 2020, supporting businesses across the two regions to launch, grow, provide jobs and fight the impacts of the global Covid-19 pandemic.
IFC is a global development finance institution focused on the private sector in emerging markets.
In addition, IFC committed nearly $2-billion in short-term trade financing to support small and medium-sized enterprises (SMEs).
In sub-Saharan Africa, between July 1, 2019, and June 30, 2020, IFC committed $4.6-billion in investments to private firms across the region. Despite the challenges of delivering during a global health pandemic, IFC exceeded its fiscal year 2019 commitment of $4.1-billion.
Investments focused on sectors including healthcare, agriculture, solar energy, housing finance, infrastructure and financing for SMEs. Additional investments include those into fragile and conflict-affected situations, where IFC committed more than $1.2-billion.
In the Middle East and North Africa, where the Covid-19 pandemic has led to declines in oil production, tourism revenues and remittances, IFC invested more than $1-billion, including to support the construction of hospitals and clinics in Iraq, Jordan, Egypt and Morocco.
In addition to its investments in the Middle East and Africa, IFC provided advisory services totalling a portfolio of more than $590-million, to nearly 376 projects aimed at improving the business environment, investment policy and promotion and creating markets in priority sectors.
Of the advisory projects IFC supported, 45% were focused on improving gender equality.
IFC’s investment and advisory work in the Middle East and Africa supported small businesses to access finance, linked small-holder farmers to markets, facilitated solutions to supply chain disruptions caused by Covid-19, and increased access to electricity and renewable power sources.
IFC Middle East and Africa VP Sérgio Pimenta says countries in the Middle East and Africa were making significant progress before the Covid-19 pandemic struck. “At IFC, our goal was to unlock private investment and create markets and opportunities to support that progress.”
In the wake of the economic crisis brought on by Covid-19, he points out that the IFC increased momentum to help its clients stay in business and maintain jobs, which are critical to economic growth and livelihoods.
“We applaud the perseverance and resilience of the small, medium and large businesses that are the foundation of economies in Africa and the Middle East, and we will continue to support them in the next phase of the crisis and through the recovery.”
Since the Covid-19 outbreak, IFC has focused its efforts on helping the private sector mitigate the impacts and the economic fallout. In March, IFC announced $8-billion in global fast-track financing to help companies affected by the outbreak. Since then, IFC has committed more than $3.5-billion to companies globally.
Of that, IFC has invested $517-million in Africa and the Middle East, with 66% going to countries eligible for financing from the International Development Association – the World Bank Group’s fund for the poorest countries.
Some of the countries the IFC supported include Côte d’Ivoire, where the IFC provided a €25-million loan to NSIA Banque Côte d’Ivoire, while in Egypt, IFC loaned $100-million to Commercial International Bank.
In Kenya, IFC loaned $50-million to Equity Bank Kenya, while in Mauritania, IFC provided $35-million, part of a $200-million credit facility arranged by Société Générale.
In Nigeria, IFC provided a combined $200-million to Access, FCMB and Zenith banks, while in Uganda, IFC provided a $4-million loan, part of a $6.5-million financing package, to the International Medical Group – a subsidiary of Ciel Healthcare.
Since March, IFC has also deployed $886-million through the Global Trade Finance Programme (GTFP) envelope of its Covid-19 Fast Track Facility to support SMEs in the Middle East and Africa involved in global supply chains.
Almost 92% of the GTFP volume deployed was in low-income and fragile countries in the regions.