IFC Records Year of Strong Reach and Volume to Promote Development in Africa

Nairobi, Kenya, August 16, 2011—IFC,a member of the World Bank Group, today announced its results for the fiscalyear ending June 30, 2011, demonstrating robust volume and reach of investmentsand advisory services.  IFC’s strong business and development resultsextended across sub-Saharan Africa, supporting regional growth despiteturbulence in the global economy. During the previous calendar year, IFC’sactivities:

•        Generated power for an additional 6.6 millionpeople

•        Connected about 59 million telephone users

•        Supported nearly 500,000 students.  

•        Provided loans to 241,000 small businessesand 261,000 farmers

•        Created about 217,000 jobs

IFC’s new investments in the whole of sub-Saharan Africa totaled $2.2billion and reached 31 countries. Of the 95 new investments made duringthe last fiscal year, 87 were in the world’s lowest income economies,where IFC’s development impact is especially pronounced. IFC also mobilizedan additional $589 million from other investors.

IFC advisory services was active in 31 countries in Africa, with 133 projectsvalued at $189 million through June 2011. Of these projects, 121 were activein the region’s lowest income economies. IFC expanded initiatives to supportthe growth and development of the private sector in economies affectedby conflicts, especially South Sudan and Liberia.

Yolande Duhem, IFC Director for West and Central Africa, said, “IFC madesignificant progress in supporting Africa’s development last year.  Ourinvestments in West and Central Africa and other parts of the continentgrew, we saw important reforms to improve the investment climate in theregion, innovative projects in priority sectors, and we have a large portfolioof investment and advisory projects that are improving people’s livesthrough better services and opportunities.”  

Jean Philippe Prosper, IFC Director for Eastern and Southern Africa, said,"Our increasing activities in Africa reflect IFC’s commitment tomobilize resources for entrepreneurial activity and projects driving forwardthe region’s private sector. IFC’s investments and advisory servicesare creating jobs, improving infrastructure, securing access to financefor small and medium enterprises, and raising health, education and livingstandards for Africans.”

West and Central Africa

In West and Central Africa, IFC provided $1.3 billion in new financingcommitments, an 8.5 percent increase over last year. IFC supported privatesector involvement in novel infrastructure projects, such as the DakarToll Road, which will improve transport and trade in Senegal. The roadis being built on concession, the first experience of its kind on the continent,outside of South Africa.  

In other projects in Senegal, IFC invested in two microfinance institutionsand launched a rural electrification project in collaboration with ComaselLouga.  

In Ghana, IFC made a push into the telecoms sector by supporting VodafoneGhana in its expansion program.  Vodafone will provide affordable,reliable mobile phone services to previously underserved areas of the country. IFC’s investments in agribusiness included the fast-food restaurantchain, Food Concepts in Nigeria, who aim to integrate SMEs into the foodsupply chain in West Africa.  As the political climate stabilizesin Cote d’Ivoire, IFC was quick to re-engage in the country with an investmentin microfinance bank, Advans.  

In terms of advisory services, IFC worked on improving leasing laws inin Liberia and Sierra Leone and undertook activities to improve investmentclimate in Mali, Burkina Faso and the Central African Republic.  InChad, IFC launched a Village Phone Program in Chad that will bring phonesto rural communities.

Through the Investment Climate Advisory Services of the World Bank Group,IFC supported the effort by 16 West African countries to change their commonbusiness legislation to significantly improve their business climate. TheOHADA project addresses two of the top constraints to enterprise developmentand investment in Africa: access to finance and the quality of the legalframework. The reforms achieved have removed some of the main legal constraintsto entrepreneurship and access to credit in the region and will help countriesbecome more attractive to investors. The project is one of the first ofthis size and duration that works with a regional organization rather thanan individual country government.

IFC continued to promote public-private partnerships, notably, throughan advisory services mandate with the government of Benin in the tenderfor a new public hospital, replicating a former IFC project in Lesotho. IFC and donors also renewed the advisory program for private sectordevelopment in Liberia.  

IFC maintained a leading role in developing the region’s financial sector,providing both investment and targeted advisory services to a number ofbanks in the region.  In Nigeria, IFC’s engagement helped banks recoverfrom the banking and financial crisis.  IFC’s activities in the bankingsector spanned several more countries in West Africa, such as:  Benin,Burkina Faso, Cameroon, Central African Republic, Chad, Cote d’Ivoire,Gambia, Ghana, Liberia, Mali, Mauritania, Niger, Nigeria, Sao Tome andPrincipe, and Togo.  

Eastern and Southern Africa

Fiscal year 2011 marked the highest investment volume ever recorded byIFC for East Africa. IFC’s new investments totaled $327 million in 29projects in the East African Community countries. IFC supported 26 activeadvisory services projects the five countries as of June 30. IFC committednew investments of $247 million in 16 projects in Southern Africa. IFChad 11 active Advisory Services projects in the sub-region at the end ofthe fiscal year supporting activities ranging from climate change initiativesto increased access to finance and basic services.

IFC supported South Sudan’s transition to independence, working with thecountry’s public and private sectors to improve the investment climateand attract investment. IFC’s Advisory Services contributed to a new leasingindustry in Rwanda, where IFC also has an active investment climate program.

For many farmers in developing countries, access to credit is a major constraint.In Ethiopia, IFC has established a partnership with Ethiopia CommodityExchange and commercial banks to develop a program to help coffee producersimprove access to finance through the use of commodity warehouse receipts.

IFC supported infrastructure and South-South investments through Magerwain Rwanda, a trade logistics company with Singaporean owners. IFC alsosupported local currency finance in the region. In Rwanda, for example,IFC provided local currency financing through swaps facilitated throughthe Central Bank. IFC provided financing for telecom operator Leo Burundi,which will expand mobile telephone service in a country that is presentlypoorly served. IFC’s Climate Change Investment Program helped South Africa’sKarsten Farms, a grape producer, increase energy efficiency.

IFC supported infrastructure and South-South investments through Magerwain Rwanda, a trade logistics company with Singaporean owners. IFC alsosupported local currency finance in the region. In Rwanda, for example,IFC provided local currency financing through swaps facilitated throughthe Central Bank. IFC provided financing for telecom operator Leo Burundi,which will expand mobile telephone service in a country that is presentlypoorly served. IFC’s Climate Change Investment Program helped South Africa’sKarsten Farms, a grape producer, increase energy efficiency.

IFC maintained a leading role in developing the region’s financial sector,partnering with a number of banks, including Mercantile Bank in South Africaand Kenya Commercial Bank (KCB), which has subsidiaries in Uganda, Rwandaand Tanzania. IFC's loan to KCB will also be channeled to South Sudan,where KCB is currently the largest bank, with 20 branches nation-wide.

About IFC

IFC, a member of the World Bank Group, is the largest global developmentinstitution focused exclusively on the private sector. We help developingcountries achieve sustainable growth by financing investment, providingadvisory services to businesses and governments, and mobilizing capitalin the international financial markets. In fiscal 2011, amid economic uncertaintyacross the globe, we helped our clients create jobs, strengthen environmentalperformance, and contribute to their local communities—all while drivingour investments to an all-time high of nearly $19 billion, including mobilzations.For more information, visit

www.ifc.org

.

West and Central Africa

·        

IFC provided€22.5 million long-term debt facilities for theDakar Toll Roadproject. The road will run 25 kilometers from Diamniadio to Dakar, creatinga new and efficient gateway to the country’s capital and economic center. Economists estimate that poor road infrastructure costs Senegal about4.6 percent of its annual gross domestic product. To improve transportinfrastructure, IFC and the World Bank, in partnership with Senegal’sgovernment and Eiffage, a construction company, created a public-privatepartnership to build a landmark toll road connecting Dakar to other partsof the country.

·        

IFC, throughthe Investment Climate Advisory Services of the World Bank Group, supportedthe effort by 16 West African countries to change their common businesslegislation to significantly improve their business climate. TheOHADAprojectaddresses two of the top constraints to enterprise developmentand investment in Africa: access to finance and the quality of the legalframework. The reforms achieved have removed some of the main legal constraintsto entrepreneurship and access to credit in the region and will help countriesbecome more attractive to investors. Improving the investment climate isa high strategic priority for IFC in the region. The project is one ofthe first of this size and duration that works with a regional organizationrather than an individual country government, and for the first time resultedin the reform of an existing OHADA Law.

·        

As Cote d’Ivoirerebuilds its economy following political strife, IFC was one of the firstmultilateral organizations to re-engage in the country.  IFC providedan equity investment of $1 million inAdvans Cote d’Ivoire, a microfinanceinstitution that will provide quality financial services to entrepreneursand small businesses. Earlier in the fiscal year, IFC had also provideda local currency loan equivalent of $1.1 million to Advans Ghana.  Theinvestments in Advans are part of IFC’s strategy to support SME growththrough microfinance institutions that boost lending to entrepreneurs andcreate employment opportunities.  

·        

IFC signeda ground-breaking healthPublic-Private Partnershipmandate withthe government of Benin to advise in the tender for a new 200-plus bedpublic hospital to be designed, built and managed by a private operatorfor the government. The new hospital will be located in the country’slargest city of Cotonou. It aims to provide access to services for 250,000patients and mobilization of investment of $50-85 million.

·        

IFC mobilizedfinancing from a consortium of international banks extending $115 millionfinancing toVodafone Ghanato improve mobile phone coverage andnetwork quality. Vodafone will expand its network to previously underservedareas in Ghana, providing access to affordable telecom services.  Duringthe last 10 years, IFC has invested over $1.2 billion in 42 mobile phoneprojects spanning 15 countries in Africa.

·        

In SierraLeone, IFC was the lead transaction advisor for the privatization of theCape Sierra Hotel,bringing added value to the tourism investmentpromotion program. Recognizing the difficulty of carrying out public-privatepartnerships and privatizations even in mature markets, IFC’s ConflictAffected States in Africa program helped our PPP Advisory team source theproject, which may be replicated in other countries.

·        

IFC invested$20 million in Nigerian restaurant operator,Food Concepts, to helpit expand operations in Ghana and Nigeria, increasing the availabilityof affordable food. IFC will provide guidance to Food Concepts on bestpractices in corporate governance, environmental and social matters. Thecompany aims to integrate SMEs into its food supply chain in West Africa,supporting the growth of agribusiness in the region.  

·        

In Liberia,IFC and the World Bank set up a one-stop business registry system, whichwill allow entrepreneurs to register their business in 48 hours insteadof 99 days. The new registry added to IFC-led regulatory reforms to makeLiberia a more attractive investment destination. As part of IFC AdvisoryServices Conflict Affected States in Africa program, in June 2011, IFCand other donors agreed to renew the Liberia private sector developmentprogram, managed by IFC. The new phase of the program aims to develop acommercial court to resolve business disputes and establish a credit bureau.Reforms supported by the Liberia program have generated $11-13 millioninvestment; created about 20,000 new jobs, and led to private sector savingsworth $4.7 million.  

·        

IFC has activelypromoted leasing as an innovative way for SMEs to acquire the equipmentand vehicles they need to grow.  In 2011, IFC led workshops to raiseawareness about leasing laws and strategies in Sierra Leone and Mali. Publicand private sector organizations, banks and small entrepreneurs all attendedthe forums.  

Eastern and Southern Africa

·        

KenyaCommercial Bankreceived a loan of $100 million from IFC to expandits lending program to SMEs. KCB will use the loan to increase access tofinance for entrepreneurs in Kenya, Tanzania, Rwanda, Uganda, and the emergingeconomy of South Sudan. IFC provided $5 million of the loan to Rwanda inlocal currency, to help manage risk more effectively by limiting foreigncurrency exposure. KCB will also use part of the loan towards its housingfinance activities, which have a great multiplier effect on economic growthand job creation.  

·        

In May 2011,IFC committed $25 million of financing toLeo Burundito make phonesmoreaccessible, promote new technologies, and enable entrepreneurship. Burundi has one of the lowest mobile phone usage rates in Africawith only 19 percent of the population having access to mobile phones.With IFC’s financing, market-leader Leo Burundi will expand its networkcoverage in underserved regions and improve the quality of service. Thecompany is owned by Orascom Telecom, an Egyptian company with operationsacross the Middle East and Africa.  

·        

In November2010, IFC launched a 'Sanitation and Safe Water for All' program in Kenyato support increased private sector investment and participation in thedelivery of water and sanitation services.  During the year, the programprovided advisory services to support a number of local, water-treatmentSMEs to access financing, and established a public-private partnershipproject for urban sanitation.  

·        

IFC and theWorld Bank also encouraged public-private partnerships for health care,through the agenda-setting report,“

Healthy Partnerships: HowGovernments Can Engage the Private Sector to Improve Health in Africa”,published in June 2011. The report was the first to measure the relationshipbetween the public and private healthcare sectors in 45 countries acrossSub-Saharan Africa.

·        

IFC providedan $3 million loan to Singapore based logistics company, Portek, to financethe privatization of Rwanda’s largest warehouse operator,MagasinsGeneraux de Rwanda(Magerwa).  The logistics sector is crucialto economic growth in Rwanda, where goods worth over $1.2 billion, or 25percent of GDP, are imported annually. Portek, a seasoned port operator,will help introduce international best practices, improving efficiencyand reducing costs. Portek and Magerwa also aim to create better linkagesbetween Rwanda and key east African ports of Mombasa and Dar-es-salaam.

·        

IFC receiveda mandate to advise the government of Rwanda to develop and structure aPPP for a new,sustainable bulk water source for the capital city ofKigali. IFC will support an open international competitive tender processfor the selection of the private investor that would finance, design, build,operate and maintain the project.

·        

IFC signeda $50 million loan agreement with Petra Diamonds Limited to support theexpansion of the seventy-year-oldWilliamson diamond minein Tanzania.The financing will help return the mine to profitability, extend its life,and maintain employment for about 1,000. IFC will work with Petra to ensurethat the Williamson expansion is carried out in an environmentally andsocially sustainable manner.

·        

IFC’s educationinvestments and advisory services activities reached over 31,000 studentsin Kenya, 17,000 in Uganda and over 23,000 in Rwanda.  

·        

To supportSME finance in Rwanda IFC provided financing toBusiness Partners SMEFundandUrwego Opportunity Bank, Rwanda’s only microfinancebank. The total investments of more than $4 million will improve accessto finance for SMEs and borrowers in previously unreached areas of thecountry.  IFC is lending to Urwego Opportunity Bank in local currency,under an innovativeswap facility with Rwanda’s National Bankestablishedin 2009. The Rwandan franc financing helps reduce risks related to foreigncurrency, while offering long term financing for local enterprises.

·        

In Ethiopia,IFC is partnering with theEthiopia Commodity Exchangeand commercialbanks to develop an innovative warehouse financing scheme.  Upon depositinggoods in a warehouse, a farmer is provided with a warehouse receipt. Thefarmer deposits and pledges the commodities in favor of a selected bankin a warehouse identified by the borrower and approved by the Bank.  Warehousereceipts thus provide a secure system whereby stored agricultural commoditiesmay serve as collateral, trade, or be used for delivery against financialinstruments. In 2011, three Ethiopian banks,United,CommercialBank of Ethiopia, andNiB, signed a warehouse financing agreementwith the ECX.  IFC is providing financing to participating banks inthe form of guarantees (risk-sharing) or short-term lines of credit ontheir warehouse lending portfolio. IFC initially provided financing ofmore than $9 million for the system, and has also committed advisory servicesto participating banks.  

·        

IFC provideda $24 million loan toRoofings Rollings MillsLtd to help the Ugandansteel products manufacturer expand operations in Uganda and the Great Lakesregion. The company plans to set up a wire galvanizing plant and two rollingmills complexes to increase production of steel construction materialsfor local and export markets. The investment is expected to boost Uganda’sconstruction and housing sectors, while creating job opportunities andlocal economic growth

·        

TheAfrica Micro, Small, and Medium Enterprise Finance Programis amajor pillar of IFC’s strategy to support the growth of smaller businessesin Africa, especially those operating in challenging economic environments.The program provides financial products and advisory services (includinglong-term resident advisors and short-term experts) to participating banksto help them expand lending and other banking services to SMEs, which oftenstruggle to obtain financing.  In fiscal year 2011, the AMSME Financeprogram partnered with Bank of Africa to extend advisory services and loansof $17 million to BOA’s subsidiaries in Kenya, Tanzania and Uganda.  

·        

LightingAfrica, a joint IFC and World Bank program, is mobilizing the privatesector to provide safe, affordable and modern off-grid lighting to Africa’sun-electrified communities. By the end of fiscal year 2011, Lighting Africahad provided cleaner, better sources of energy to 1.5 million consumersacross the continent.  Lighting Africa also opened its first testinglab in East Africa at the University of Nairobi. The lab tests off-gridlighting products as a service to manufacturers, with Lighting Africa meetinghalf the costs for partner companies. To encourage use of clean energy,the program ran a consumer education campaign in rural Ghana and Kenya,reaching 9 million people. Lighting Africa also set up a partnership withKenyan microfinance institution, Faulu, who will provide loans for peoplein rural areas to purchase solar lanterns.  

·        

IFC providedfinancing to South Africa’sMercantile Bankto promote the developmentof the SME sector in South Africa and encourage lending to projects withenvironmental benefits. Mercantile Bank’s main shareholder is Caixa Geralde Depósitos of Portugal. IFC is providing a loan of €50 million equivalent,of which €1.6 million will be financed by the Clean Technology Fund.

·        

IFC provided$9.6 million in financing to support theGateway Mall, the firstretail shopping complex Lilongwe, the capital city of Malawi. With stronginternational anchor tenants and a range of retailers including smallerlocal companies, the shopping mall will bring quality retail services closerto the community, thus minimizing costs to consumers and helping to establisha strong retail destination. It will create jobs during construction andoperational stages, increase business opportunities to local suppliersof goods services, and promote the formalization of the retail sector inMalawi, which is today mostly informal.

·        

IFC providedan ZAR80 million loan to Namibia’sTrustco FinanceLimited to helpthe microlender increase its lending to students and for teacher training,improving access to education and raising education standards in Namibia. IFC’s investment will help Trustco double its student lending programin five years, allowing more students in Namibia to benefit from a post-secondaryeducation. Trustco will also provide more loans to teachers, who will usethe funds to enroll in teaching training courses to improve their skills.IFC’s loan is backed by advisory services support that will help the TrustcoGroup improve its corporate governance.

·        

IFC provideda ZAR75 million loan toApollo Tyres South Africato allow the companyto increase domestic tire supply. It supports the investment by an Indiancompany into South Africa, in line with IFC’s strategy to support south-southinvestments. It continues IFC’s support for Apollo Tyre’s growth intoa global tire company, which began with financing in India.
     

·        

IFC providedfinancing toTeraco Data Environmentsto help it expand its datacenter storage and hosting facilities in South Africa and into other partsof Africa, improving information technology infrastructure in the region.Teraco’s longer-term strategy calls for expansion in Africa outside SouthAfrica. IFC is providing ZAR 35 million South African rand (ZAR, equivalentto approximately $5 million) in equity-type finance, alongside an additionalZAR 80 million in senior debt provided by the Development Bank of SouthernAfrica to support Teraco’s further growth.

·        

South Africangrape producerKarsten Farmswill be able to reduce its energy useand improve its competitiveness through the IFC Cleaner Production LendingFacility, supported through IFC Advisory Services. The CPLF also allowsclients such as Karsten Farms to pilot investments in energy efficiencyand renewable energy that they may roll out more widely in their operations.Karsten Farms will use IFC’s long-term $900,000 loan in local currencyto install efficient lighting and refrigeration systems on its Klein Pellafarm to reduce its operating costs, new technologies for cold storage upgrades,and solar water heaters in approximately 300 farming worker homes on tenfarms