WASHINGTON, D.C., May 5, 2020 -- IFC, a member
of the World Bank Group, and Proparco, a subsidiary of Agence Française
de Développement (AFD) devoted to private sector financing, have agreed
to collaborate more closely to create markets, mobilize private sector
investment, and support economic recovery in developing countries in the
wake of the COVID-19 global crisis.
Seeking to address the need for increased collective action among development
finance institutions, the Joint Collaboration Framework Agreement (JCFA)
will help leverage the partners’ collective strengths to deliver needed
development impact in some of the world’s most challenging settings.
The agreement addresses a full range of collaboration activities with an
emphasis on three key areas. First, it details the approach for helping
to build a pipeline of bankable and high-impact projects aimed at laying
the groundwork to attract investors into developing countries. Second,
it promotes greater reciprocity in project co-financing arrangements and
allows IFC to join transactions originated by other development partners.
Third, it underscores the importance of the “Blended Concessional Finance
Principles for Private Sector Projects”, a disciplined and targeted approach
to blending funds from concessional donor and commercial sources, as an
integral part of the activities covered by the JCFA.
“This agreement represents another milestone in our collaboration with
Proparco. We have commited to further collaborating on fragile and least
developed countries (LDCs) and are intensifying our knowledge sharing on
impact investing. This agreement will help to further expand our pipeline
of bankable projects in poor countries,” said Philippe le Houérou,
the Chief Executive Officer of IFC.
Gregory Clemente, CEO of Proparco, added: "This agreement will
allow major development finance Institutions to build on one another’s
strengths and to work even more closely together, a necessity in times
of economic and social crisis. It also testifies to the strength
of our partnership with IFC and illustrates our joint commitment to support
the private sector’s fundamental contribution to the Sustainable Development
In March, IFC announced that it would make $8 billion available to support
private companies and their employees hurt by the economic downturn caused
by the spread of COVID-19.The bulk of the IFC financing will go to client
financial institutions to enable them to continue to offer trade financing,
working-capital support and medium-term financing to private companies
struggling with disruptions in supply chains. IFC’s response will also
help existing clients in economic sectors directly affected by the pandemic--such
as tourism and manufacturing—to continue to pay their bills.
Likewise, Proparco is committed to helping alleviate the impact of COVID-19
in developing countries, including through targeted support to its clients
in the health sector as part of France's "Health in Common" initiative.
It is also working with the OECD countries’ Development Finance Institutions
to identify mechanisms designed to bring liquidity to the market, sustain
companies, return them to full production, and restore employment opportunities.
IFC—a sister organization of the World Bank and 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 2019, we delivered more than $19 billion
in long-term financing for developing countries, leveraging the power of
the private sector to end extreme poverty and boost shared prosperity.
For more information, visit www.ifc.org
Proparco is a subsidiary of Agence Française de Développement (AFD) focused
on private sector development. It has been promoting sustainable economic,
social and environmental development practices for over 40 years. Proparco
provides funding and support to both businesses and financial institutions
across Africa, Asia, Latin America and the Middle-East. It seeks
to partner projects in key development sectors – infrastructure (with
a specific focus on renewable energies), agribusiness, financial institutions,
healthcare and education, etc. – and to boost the contribution of the
private sector to achieving the sustainable development goals adopted by
the international community in 2015. As a means to this end, Proparco finances
businesses that are instrumental in creating decent jobs that pay decent
wages, in supplying essential goods and services and in battling climate