Maize farmers in Malawi, cement firms in Nigeria, and metals exporters in Mauritius all have something in common.
Like many companies across Africa, IFC and its partners are helping boost their businesses with new finance products that help counter the effects of the global financial crisis on trade, a key driver of development.
IFC is responding to falling global trade volumes with a three-part package—the Global Trade Liquidity Program (GTLP), the Global Trade Finance Program, and an Export Credit Agency initiative —that together will support significant amounts of trade during the crisis.
The GTLP brings together governments, development finance institutions, and leading commercial banks. For every 40 cents IFC and public investors put up, commercial bank partners will add 60 cents.
To support trade growth in Sub-Saharan Africa, IFC’s GTLP has extended a $400 million line of credit to South Africa’s Standard Bank.
Craig Polkinghorne, Standard Bank’s Global Head and Director of Structured Trade and Commodity Finance, said, “This loan will go a long way to stimulating economic growth in the region, especially since many banks have retreated from Africa during the financial crisis. Working with IFC, we will get these funds quickly to market to boost trade.”
The $400 million will largely be distributed in sums between $10 million and $20 million to businesses in energy, mining, commodities, capital goods, and other sectors in many African countries.
IFC provided $100 million, mobilizing the rest from the African Development Bank, Commonwealth Development Corporation, and Japanese Bank for International Cooperation.
“IFC, through its Global Trade Finance Program, is helping restore access to trade finance, which has been negatively affected by the global financial crisis,” said Georgina Baker, IFC Director for Financial Markets. “The program’s training component is vital in helping banks in emerging markets provide trade finance to importers and exporters, particularly small and medium enterprises.”
For more information contact:
Jason Hopps
Communications Officer
Johannesburg, South Africa
Phone: +27 11 731 3120
E-mail: jhopps@ifc.org
