For six decades, we have held true to our founding vision—that the private sector is essential to development.
In this series of stories, you’ll learn more about how IFC grew from a small organization to become the largest global development institution focused on the private sector.
Think back to the world of the early 1950s.
In developing countries, poverty was far more widespread than it is today. One of its key solutions—job creation—faced crushing obstacles.
Financial sectors, infrastructure, and the investment climate were all weak, holding back possibilities for private sector-led growth. Investors’ risk perception was high, keeping cross-border capital flows and domestic financing low. The overall effect was limiting—rather than creating—opportunity.
Yet the potential was great. Something had to be done to bring it about. It needed a catalyst.
This was the vision of Robert Garner, a New York financier who had been a World Bank vice president since 1947. He brought a keen sense of the role private business could play in international development—one few others shared at the time.
“It was my firm conviction that the most promising future for the less-developed countries was the establishing of good private industry,” Garner later wrote. It was a big goal—one that he knew would require “a new approach, if we were going to be influential.”
This one, far-reaching thought became the blueprint for a new institution that could finance private enterprise without the World Bank’s requirement for government guarantees. Garner and his colleagues made the case for it persistently for several years, gradually winning over the skeptics. IFC won acceptance from the World Bank’s board of country shareholders in 1955, then opened in 1956 with $100 million in capital, 12 employees, and Garner at the helm.
Garner knew all too well that IFC would never have enough money to make a major difference strictly with its own investments. The goal was always to serve as an honest broker and lead the way in attracting much larger pools of capital from other private investors.
This defining mission remains intact today. It provides the basis for our work in "encouraging the growth of productive private enterprise" in three broad ways:
The first investment came in 1957, helping German equipment manufacturer Siemens build Brazil’s first integrated assembly plant to supply local utilities. It was the starting point of what today is a $52 billion IFC investment portfolio. We now have more than 2,000 clients—leveraging the power of the private sector in development.