CAIRO: Pursuing new investment opportunities, expanding advisory services, and supporting private sector-led growth across the region, the International Finance Corporation – private sector arm of the World Bank Group – recently announced new transactions that pushed its annual investments in the Middle East and North Africa region above the $1 billion mark for the first time.
With recent announcements of a $40 million loan and a five percent equity stake in Omar Effendi – Egypt’s recently privatized retail chain – as well as a $70 million loan to the Arabian Yemen Cement Company, IFC’s investments in the region reached $1.2 billion in fiscal 2007, which ended June 30.
“The Middle East and North Africa is a strategic region for IFC. Our investments and advisory services create new jobs, addressing the main challenge in a region with high unemployment. Our projects demonstrate the opportunities that the private sector can provide, said Lars Thunell, IFC executive vice president and CEO. “Moving forward, we will continue to support private sector investments in the region and continue to work with the region’s governments to help create a business environment that attracts further private sector capital.
Egypt, in particular, has enjoyed a good share of IFC investments across both financial and non-financial sectors such as banking, retail, agribusiness, oil and gas, mining, manufacturing and healthcare.
IFC has spurred its support to Egyptian companies, allocating this year alone $300 million to 11 companies, featuring a 3.5 time increase over last year’s support. Among these companies are Egyptian Mortgage Refinance Company, Indo-Egyptian Fertilizer Company, Dar El-Fouad Hospital, and Omar Effendi.
Addressing gaps in the region’s markets, specifically in postwar zones, IFC has increased its regional presence to improve business environment, facilitate access to finance, and encourage private sector involvement in infrastructure. IFC’s strategy also supports the cross-border emergence of “regional champions who invest in less developed countries across the region.
Its priorities include reducing constraints the private sector faces in conflict-affected and frontier countries. Through the Lebanon Reconstruction Program, for example, some 3,000 local companies will receive new loans for operations capital, expansion, and other needs. The program fulfills a pledge IFC made at a Lebanon donor meeting in January 2007.
“IFC [proves] that improvements in the region’s post-conflict countries and other difficult markets can have a significant development impact. This can be done commercially and prudently in collaboration with like-minded partners, said Michael Essex, IFC director for the Middle East and North Africa. “The region’s future growth and its capacity to create meaningful jobs for young people depend on a sustained commitment to improving the business climate and opening sectors to private sector investment.
