Climate projects, micro, small, and medium-sized enterprises (MSMEs), women and farmers in Asia and the Pacific have benefited from record amounts of funding from IFC. The funds will alleviate poverty and increase prosperity in the face of overlapping crises and challenges, including climate change, gender inequality, food and energy insecurity, and higher inflation.
IFC, the largest global development institution focused on the private sector in emerging markets, committed a record US$11 billion to 108 projects in Asia and the Pacific in the fiscal year ended June 30, a 10 per cent year-on-year increase. This comprised US$4.7 billion in long-term financing from its own account, US$3.4 billion in mobilisation, and US$2.9 billion in short-term trade and supply-chain finance to facilitate trade flows.
Thirty-nine per cent of long-term financing from IFC’s own account was invested in projects that will help tackle climate change and marine-plastic waste, critical issues in a region home to many countries that are most vulnerable to climate change and key contributors of plastic waste. Projects ranged from investments in Mongolia’s first green bond and blue finance in Thailand, to electric vehicles in India and sustainability-linked finance with pricing incentives tied to supporting the energy transition in South and Southeast Asia.
A record US$4.7 billion was committed to financial institutions in the region, which are expected to improve access to finance for MSMEs through the provision of more than 1.6 million loans, with specific targets for women-owned businesses. MSMEs are the backbone of the region’s economy, accounting for more than 97 per cent of its businesses and employing over half its workforce. Improving their access to finance, particularly in a high interest-rate environment and as banks retreat from riskier lending, is critical to creating jobs, spurring economic growth, and fostering more inclusive societies.
IFC’s investments in financial institutions also helped increase access to insurance for underserved people. Other projects are expected to provide more than 500,000 loans for affordable homes, many of which are for green housing, improving financial inclusion across the region.
A record US$2.4 billion of investments and 69 per cent of advisory projects included a focus on improving gender equality, against a target of 45 per cent. Women represent 69 per cent of IFC nominee directors on client company boards in the region, well ahead of the global corporate target of 50 per cent by 2030. At the current rate of progress, it will take another 189 years to close the gender gap in East Asia and the Pacific and 149 years in South Asia, against a global estimate of 131 years[1]. With a diversity of challenges and pressures compounding, and women’s workforce outcomes suffering, investments aimed at improving gender parity are critical.
Converging crises put the region’s already stretched food systems under significant strain, pushing millions of people into poverty and erasing years of development gains. IFC invested in projects to improve food security in the region, including an investment to promote a resilient rice market in Bangladesh. This is IFC’s first investment from its new Global Food Security Platform, a US$6 billion global facility set up to counter the food crisis. IFC projects in the last fiscal year are expected to improve the livelihoods of over 130,000 farmers in the region, with specific targets for women farmers.
“In the face of a multitude of challenges, the vibrant private sector in Asia and the Pacific is playing an increasingly critical role in helping the region to overcome its biggest development issues,” said Riccardo Puliti, IFC’s Regional Vice President for Asia and the Pacific. “This record year cements our regional leadership in supporting the private sector and positions us to deliver on the aspirations of the World Bank Group’s Evolution Roadmap.”
Digitalisation as a driver of connectivity and inclusion in Asia and the Pacific was also a focus of investment this past fiscal year. Projects ranged from investments in the Maldives to help connect it to the internet global superhighway via a state-of-the-art submarine cable system and a social commerce startup dedicated to solving challenges facing MSMEs in Indonesia, to advising the governments of Fiji, Samoa, and Solomon Islands on building digital national payment systems.
Other projects will increase access to healthcare in Indonesia, childcare in Fiji, improve logistics infrastructure in Cambodia, and support Sri Lanka amid an ongoing economic crisis, with a cross-currency swap facility to three of the country’s national banks.
About IFC
IFC — a member of the World Bank Group — is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2023, IFC committed a record US$43.7 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises. For more information, visit www.ifc.org.
Publish your content with EB Premium
It's not about how many you reach. It's about who. Get your news, events, jobs and thought leadership seen by those who matter to you.
