In the midst of a difficult year with massive and ongoing social and economic disruptions caused by Covid-19, the International Finance Corporation (IFC), World Bank committed over USD 3.8-billion (B), including mobilization and short-term finance. Since 2003, the IFC has invested USD 15-million (M) in the country.
As of June this year, a record investment volume of over USD 14.9-Bin the last five years in the region,towards a green, inclusive, and resilient recovery was made in South Asia.
IFC’s Vice President for Asia and the Pacific region, Alfonso Garcia Mora said: “The Covid-19 crisis has drastically impacted the region’s private sector, which has severely affected the region’s most vulnerable people.”
Alfonso added that the covid-19 has laid bare the region’s existing vulnerabilities in the financial sector, disrupting businesses—particularly micro, small, and medium enterprises—and leaving so many people exposed. “That’s why we’ve focused our attention on supporting moves to improve resilience on multiple fronts, as all indications are that the road to recovery will be long.”
IFC’s Communication Officer based in Bangladesh, Ahsan Z Khan said that IFC has been working to support the country’s inclusive and sustainable development agenda, with a strong focus on job creation and economic and environmental resilience.
“IFC’s strategy going forward is aimed at using a combination of investments and advisory work to promote financial inclusion, boost investor confidence and help create jobs,” he said.
As the largest global development organization working with the private sector, Ahsan said that IFC works to improve lives by investing in companies, mobilizing new investors and sharing expertise.
“So we are always keen to hear from private companies, as we have a range of products and services. Our financial products help companies manage risk and broaden their access to foreign and domestic capital markets, while our advice can help unlock private sector investment, which is essential for expanding business, creating jobs and growing economies.”
In a bid to protect the most vulnerable people and help companies maintain operations and jobs, the press release from the IFC states that IFC’s focused and sustained investments in South Asia continued to have strong impact in the fiscal year 2021.
In India, IFC’s largest client country globally, total commitments at the end of June stood at USD 1.7-B representing an increase of over 51 percent from last year. Likewise, in Bangladesh, IFC made total commitments of USD 791-M, an increase of almost 33 percent from last year.
Meanwhile, IFC has committed USD 590-M in Covid-response deals in South Asia—with additional deals worth over USD 100-M in the pipeline. IFC’s fast-track financial support has helped clients across sectors at a time when the economic fallouts of the pandemic have severely impacted market sentiment.
Further, IFC committed USD 353-M in climate finance and USD 490-M in International Development Association/Fragile and Conflict-Affected Situations (IDA/FCS) countries in the region.
IFC already provided financing and advisory support for the production of critical pharmaceutical products and medical equipment such as personal protective equipment (PPE) and vaccines. IFC will further focus on providing much needed liquidity to private sector companies in the region so they can maintain operations, preserve, and create jobs, added the press release.
“The impact of the pandemic coupled with the region’s vulnerability to climate change, has highlighted the need for a collaborative, resilient and climate friendly recovery that can withstand future shocks,” said IFC’s new Regional Director for South Asia, Hector Gomez Ang.
“This is especially important for South Asia, which is home to three of the top five countries in terms of vulnerability to climate change globally.”
Meanwhile, to be eligible for IFC funding, a project must meet a number of criteria that includes be located in a developing country that is a member of IFC; be in the private sector; be technically sound; have good prospects of being profitable; benefit the local economy; and be environmentally and socially sound, satisfying our environmental and social standards as well as those of the host country.
IFC does not lend directly to micro, small, and medium enterprises or individual entrepreneurs, but many of our investment clients are financial intermediaries that on-lend to smaller businesses, according to the IFC.