Our projects encourage the transfer of technology from one developing country to another.
For all their economic achievements in recent years, the needs of developing countries remain vast.
Sub-Saharan Africa alone will need investments of over $90 billion per year over the next decade to meet infrastructure demands such as roads, rail networks, power, and water and sanitation projects. The Middle East and North Africa will need up to $100 billion a year to boost economic competitiveness and sustain recent economic growth rates.
These needs represent significant opportunities for private enterprises from other developing countries—which have shown a robust appetite to expand into untapped emerging markets. Developing countries now account for more than a third of foreign direct investment in emerging markets.
Leveraging our global reach, IFC has been an important facilitator of South-South investment—which we see as an important way to stimulate regional integration, job creation, and economic development. In FY13, our investments in such projects climbed to nearly $1.7 billion, accounting for nearly 10 percent of IFC commitments for our own account.
By supporting such projects, we help stimulate the transfer of knowledge and technology from one developing country to another, and expand the availability of previously hard-to-obtain goods and services. We also enable regional companies to develop into transnational corporations that can compete on a global level.
We also mobilize funds from other investors to promote South-South investment. In FY13, our syndications program contributed significantly in this area. Emerging-market financial institutions increased their participation in our loan syndications—doubling their commitments from the previous year and accounting for 29 percent of the $3.1 billion in IFC syndicated loans for the year.
This year, IFC and two funds managed by IFC Asset Management Company bought a $204 million equity stake in Morocco’s Banque Centrale Populaire to help the bank expand across sub-Saharan Africa—where access to finance, especially for smaller firms, remains a challenge.
We also invested $11 million in a subsidiary of India’s Apollo Tyres to help the company expand production at one of its tire factories in South Africa. The company makes tires for cars, buses, and trucks. Our financing will help Apollo Tyres produce about 13,000 tires a day at its factory in the city of Ladysmith—an increase of about a third.