IFC al­lo­cated $1.7bn in MENA in FY 2017 to sup­port eco­nomic growth

IFC’s fi­nance in­creased by 30% in FY 2017 com­pared to FY 2016

The Daily News Egypt - - Business - By Shaimaa Al-Aees

IFC, a mem­ber of the World Bank Group, stepped up its in­vest­ments in the Mid­dle East and North Africa (MENA) last fis­cal year (FY), al­lo­cat­ing $1.7bn to sup­port the re­gion’s pri­vate sec­tor, boost in­no­va­tion, drive eco­nomic growth, and cre­ate jobs.

The amount pro­vided in FY 2017 is an in­crease of around 30% com­pared to the pre­vi­ous year, when the IFC com­mit­ted $1.3bn then.

IFC’s fo­cus was on cre­at­ing new mar­kets, sup­port­ing power and re­new­able en­ergy projects, and fos­ter­ing en­trepreneurs, in­clud­ing those who run high­po­ten­tial tech­nol­ogy star­tups.

As part of a bold new strat­egy to sup­port MENA star­tups, IFC in­vested over $11m in two Egyp­tian startup ac­cel­er­a­tors: Al­ge­bra Ven­tures and Flat6Labs.

The IFC also sup­ported Net­work In­ter­na­tional, a lead­ing provider of pay­ment so­lu­tions, to ex­pand the pay­ment in­fra­struc­ture in the MENA re­gion.

Fur­ther­more, the IFC also worked to in­crease eco­nomic op­por­tu­ni­ties in coun­tries like Le­banon and Jor­dan host­ing large refugee pop­u­la­tions.

Mouayed Makhlouf, the IFC di­rec­tor for the Mid­dle East and North Africa, said that MENA is a re­gion full of po­ten­tial, but long-stand­ing prob­lems like power short­ages, youth unem­ploy­ment, and re­stricted ac­cess to fi­nance con­tinue to hold back eco­nomic growth.To over­come these hur­dles, coun­tries need to sup­port the de­vel­op­ment of their pri­vate sec­tors, which are a po­ten­tially boun­ti­ful source of jobs and in­no­va­tion.

More­over, the IFC also runs a large ad­vi­sory ser­vices pro­gramme in the re­gion, which had 94 ac­tive projects val­ued at over $125m by the end of the FY.That work is fo­cused on sup­port­ing refugees, bol­ster­ing in­fra­struc­ture de­vel­op­ment, es­pe­cially in con­flict-af­fected states, re­duc­ing gen­der in­equal­ity, ex­pand­ing ac­cess to fi­nance for smaller busi­nesses and com­bat­ing cli­mate change.

In the com­ing FY,the IFC plans to main­tain its strate­gic fo­cus on cre­at­ing new mar­kets across the MENA re­gion by sup­port­ing the re­gion’s fast-grow­ing re­new­able en­ergy sec­tor and help­ing young en­trepreneurs de­liver in­no­va­tions.

In Au­gust, the IFC de­cided to pro­vide fi­nanc­ing of $100m for oil and gas projects, ac­cord­ing to a state­ment by the Min­istry of In­vest­ment and In­ter­na­tional Co­op­er­a­tion. The fi­nanc­ing comes as part of the ap­proval of the World Bank Group to par­tic­i­pate in the in­jec­tion of di­rect in­vest­ments in Egypt amount­ing to a to­tal of $500m in oil and gas projects.

By the end of June, the IFC agreed to pro­vide $635m in fund­ing to help build, op­er­ate, and main­tain 11 so­lar plants in Egypt with ca­pac­ity of 500 MW.

Among other key projects over the last FY,the IFC in­vested to sup­port the con­struc­tion of a new gas-fired power plant in Jor­dan.The fa­cil­ity will be one of Jor­dan’s most ef­fi­cient and help the coun­try phase out older, more pol­lut­ing plants.

IFC also made its first green bond in­vest­ment in MENA, com­mit­ting 100 mil­lion euro in a bond is­suance by Banque Cen­trale Pop­u­laire (BCP), the first such is­suance in for­eign cur­rency in Morocco.The aim is to help cre­ate a sus­tain­able fi­nanc­ing mech­a­nism for banks to sup­port long-term in­vest­ments in green as­sets.

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