Vienna, Austria, August 25, 2022 - Amid unprecedented challenges in Central and Eastern Europe, IFC supported the region's private sector with over $1 billion in investments in fiscal year (FY) 2022, ending June 30. Climate finance represented a record-high 74 percent of IFC's own account long-term investments in the region.
Russia's invasion of Ukraine, devastating human lives and causing an ongoing humanitarian and refugee crisis, is leading to significant economic losses in Europe. To respond to the private sector's immediate needs, IFC is adapting its approach to meet current challenges. IFC adjusted its services to its clients' needs in Ukraine and in other countries indirectly affected by the war.
Alfonso Garcia Mora, IFC's Vice President for Europe, Latin America and the Caribbean, who took on his new role on July 1, 2022, said: "Throughout the region, we are ramping up efforts to help clients address the impacts of the war in Ukraine while responding to overlapping crises—the pandemic and climate change. As one of Ukraine's largest investors, IFC is providing liquidity support to help preserve private sector operations and jobs during the challenging times of the war. We also stand ready to partner with the government of Ukraine and the private sector to support the country's reconstruction and recovery."
Amid the war, IFC's funding supported Nyva, one of Ukraine's top agricultural producers, to reduce supply chain disruptions in meat production. IFC also helped Galnaftogaz, Ukraine's leading fuel distributor, to procure fuel from Europe, ensuring supply at the company's filling stations. To ensure Ukrainian refugees have access to financial and non-financial services, IFC is also working with credit information providers in Poland, Czech Republic, Georgia, and Latvia.
IFC is preparing a comprehensive response to the impacts of the war for Ukraine and its neighbors. In Ukraine, IFC will continue providing short-term liquidity in the near-term to help preserve businesses, especially in agribusiness and technology, and to ensure supply of critical goods such as food and fuel. It will also seek to support housing solutions for displaced people. In the medium- to longer term, IFC's focus will shift to supporting Ukraine's reconstruction. In the affected neighboring countries, IFC seeks to support capital markets amid increased risk aversion while helping address supply chain bottlenecks though investments in retail and logistics. It also aims to scale up investment in energy security and transition.
In FY 22, IFC continued to help drive the region's transition to clean and renewable energy through its first blue financing loan in Europe—a landmark €100 million to Banca Transilvania SA in Romania—to contribute to the sustainability of oceans and freshwater resources. In Azerbaijan, IFC and the World Bank worked with the Ministry of Energy to release the first-of-its-kind Offshore Wind Roadmap. In Croatia and Poland, IFC supported Erste Bank and Santander Bank Polska, respectively, to boost climate finance.
Furthermore, with the pandemic highlighting the importance of digital transformation and connectivity, IFC provided a $20 million loan to Telecom Armenia—IFC's first investment in this sector in the wider South Caucasus region—to support the growth of a strong digital economy in Armenia.
In addition to its investments in Europe in FY22, IFC provided advisory and upstream services with a portfolio of more than $128 million across 62 projects aimed at improving the investment climate and market creation in the region. Twenty-seven percent of the spending on advisory and upstream projects in FY22 across the region was on projects focused on climate change while 17 percent of all new projects approved supported improvements in gender equality.
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 2021, IFC committed a record $31.5 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 the COVID-19 pandemic. For more information, visit www.ifc.org.
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