Six years after the global financial crisis erupted the world economy is at last on a more solid footing. However, growth remains subdued and uneven. According to the World Bank 2014 Africa’s Pulse report, global GDP growth is projected to strengthen from 2.4 percent in 2013 to 3 percent in 2014, 3.3 percent in 2015, and 3.4 percent in 2016.
Africa will play a key role in global growth. Sub-Saharan Africa is home to some of the fastest-growing economies in the world. The World Bank’s Africa’s Pulse reports that the region’s economy grew at 4.5 percent per year on average between 1995 and 2013. Its medium-term prospects are positive, with GDP growth projected to rise from 4.7 percent in 2013 to 5.2 percent in 2014, strengthening further to 5.4 percent in both 2015 and 2016.
Economic activity during 2013 was driven by strong domestic demand and increased investment in the region. Net foreign direct investment grew by 16 percent to $43 billion during the year.
Despite this robust performance, economic growth between countries is uneven. Much of Sub-Saharan Africa remains constrained by lack of infrastructure, poor business climate, lack of access to finance, the effects of climate change, and ongoing conflict. To overcome these obstacles, IFC delivers a package of advisory and investment solutions in developing countries. We introduce our clients to new sources of capital and better ways of doing business sustainably. IFC’s rapid expansion in Africa and role in financing across so many countries and sectors provides a unique platform for our advisory services to have a major impact on Africa’s development. Linking our advisory services to our overall business strategy ensures that IFC can achieve more with our development partners and the ultimate beneficiaries of our projects. In particular, IFC provides advice and training to various public and private clients; supports projects to improve the investment climate, strengthen infrastructure, and encourage entrepreneurship; and devotes resources to improve corporate governance and gender equality.
Of the 30 countries in which we work in Sub- Saharan Africa, 12 were fragile and affected by conflict as of December 31, 2013. IFC’s engagements in fragile and conflict-affected situations are of critical importance, as it aims to provide opportunities for the poor to escape poverty. If current trends continue, it is estimated that more than 80 percent of the world’s poorest will be living in fragile and conflict-affected countries by 2025. Fragility and conflict have a devastating effect on development – a civil conflict can cost a developing country about 30 years of GDP growth. In 2014, nearly one in every three dollars IFC’s Advisory Services spends in Africa will be in fragile and conflict-affected countries.
2013 Impact at a Glance
As of December 31, 2013, IFC Advisory Services had achieved the following results in Sub-Saharan Africa for projects active in 2013.
Supporting the creation of jobs is an important aspect of our work in Sub-Saharan Africa. IFC will report on its impact in this area when the results are finalized.
$17 Billion Financing Facilitation We facilitated loans worth about $17 billion to households and micro, small, and medium enterprises through financial institutions and improved financial infrastructure.
$100 Million Saved in the Private Sector We helped save the private sector more than $100 million by simplifying regulatory compliance requirements.
210 Laws, Regulations Enacted We helped African governments enact about 210 laws and regulations and amendments to improve the investment climate and access to finance.
130,000 People Trained We trained about 130,000 people in areas such as business management, loan application processes and better farming practices.
70 Reforms Supported We supported more than 70 reforms in such areas as starting a business, licensing, construction permits, and alternative dispute resolution.
14,750 Entities Advised We advised nearly 14,750 companies and public entities on ways to improve their services and implement new products.
To read the full 2014 Development Impact Report, click here.
IFC is moving to a unified results measurement system which has three mutually reinforcing components namely the IFC Development Goals (IDGs) (which are forward-looking goals); a monitoring and tracking system to measure development results; and a system to evaluate the outcomes and impact of our activities.
To learn more about the IFC Development Goals click here.