Since 2005, IFC, a member of the World Bank Group, has guaranteed $23 billion in credit to developing countries through its Global Trade Finance Program, and nearly half of the funds have gone to 81 of the poorest nations.
Trade finance has become increasingly important in recent years as global banking regulations and the eurozone financial crisis forced many institutions to reduce trade finance to poorer countries, which could result in slowed job creation.
“Trade fuels the world economy and drives global integration, helping small and medium enterprises grow and create jobs,” IFC Executive Vice President and CEO Jin-Yong Cai said. “But, access to trade finance for SMEs throughout the developing world is limited. IFC is playing a leadership role in supporting global trade flows and is committed to doing more in the world’s most challenging markets.”
IFC has provided $2.4 billion in guarantees to businesses in developing countries this year alone, thereby enabling small and mid-sized businesses to obtain financing to grow and join the global market. Since 2005, $11 billion has been provided to businesses in nations eligible to receive funding from the International Development Association, the World Bank’s fund for the poorest nations. The corporation supports trade in agribusiness, growing businesses and energy.
The program links more than 500 banks across 150 countries, connecting small banks in conflict-ridden and fragile areas with large banks in developed markets. Eighty percent of the company’s guarantees have been for small and mid-sized businesses.
Additionally, the program has helped deliver anti-AIDS medicines for HIV patients in the Congo, energy-efficient machinery for steel production in Armenia, turbines for hydroelectric power in Honduras and cancer-screening equipment for women in Gaza.