IFC provided record financing in fiscal year 2021 in the Middle East and Africa to help thousands of small businesses access finance, connect people and businesses to reliable digital infrastructure, trade and services, and help to meet critical health needs amid the COVID-19 pandemic. The financing reached US$10.4 billion.
IFC’s financing included short-term finance ($2.9 billion) and mobilization ($4.2 billion), with 70 percent of IFC’s own account financing going to low-income and fragile and conflict affected states. Under the Global Trade Finance Program (GTFP), IFC committed $2.7 billion aimed at supporting trade flows between countries and helping to connect small and medium-sized enterprises (SME) to value chains in the Middle East and Africa.
IFC responded quickly to the regions’ health needs providing $1.6 billion in the Middle East and Africa, including $732 million to partners in sub-Saharan Africa from its Global Health Facility. The health response is supporting the expansion of diagnostic and laboratory testing, increased access to critical medical equipment, and partnerships to support leading vaccine manufacturers on the continent.
Among the key initiatives, in April, IFC announced the Africa Medical Equipment Facility, a partnership that so far includes Philips, Co-operative Bank of Kenya, GE Healthcare and NSIA to strengthen medical equipment financing across Africa.
IFC also worked across countries to help improve infrastructure in the Middle East and Africa. In February, IFC invested in a bond issued by Liquid Telecommunications Financing, PLC to help the company expand access to broadband Internet and digital and cloud services across Africa. In June, IFC announced a landmark loan to Iraq’s Basrah Gas Company to help reduce gas flaring, boost energy access and power homes and businesses across Iraq.
Within the financial services sector, IFC invested $26 million in Africa to support financial technology development, and supported projects aimed at increasing climate finance, including a $150 million loan to KCB Kenya to help the bank increase lending for climate-friendly projects.
“IFC is working with partners across the Middle East and Africa to support countries to create stronger, more resilient, and more connected economies. The past 15 months have shown how critical it is to ensure that small businesses can access finance, that homes and businesses are connected to the Internet, and that trade and supply chains remain open to help countries respond to critical food and health needs. We stepped up our efforts in the past year to help our partners and will continue to support them through the COVID-19 pandemic and recovery,” said Sérgio Pimenta, IFC Vice President for the Middle East and Africa.
In addition to its investments in the Middle East and Africa, IFC provided Advisory and Upstream Services with a portfolio of more than $520 million for 338 projects aimed at improving the business environment, investment policy and promotion and creating markets in priority sectors. Of the advisory and Upstream projects IFC supported, 45 percent were focused on improving gender equality and 20 percent supported climate change mitigation and adaptation.
In sub-Saharan Africa, where country leaders have called for greater support for vaccine manufacturing in the region, IFC committed $8.7 billion in investments, the largest ever annual commitment in the region, with the financing going to attract private investment in regional vaccine manufacturers, greater access for small businesses to life-saving medical equipment, and to climate-smart development projects and digital connectivity.
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 $1.8 billion, including $100 million in Egypt’s first private sector green bond to increase lending to businesses seeking to invest in eco-friendly initiatives, including green buildings, renewable energy and energy efficiency. Financing also went to improve healthcare infrastructure, support digital start-ups and small businesses and improve infrastructure development in countries like Morocco.