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IFC Expands Linkages with Local Communities to Strengthen Mozal Aluminum Smelter Investment in Mozambique


Ludwina Joseph                                
Phone:+(202) 473 7700 - Fax:+(202) 974 4384

E-mail:
ljoseph@ifc.org


Washington D.C., April 23, 2003—The International Finance Corporation (IFC), the private sector arm of the World Bank Group, will provide a grant of $305,000 to the Mozal Community Development Trust in Mozambique.  The grant will help expand outreach to existing and new communities around the $2.1 billion Mozal Aluminum Smelter, to which IFC has provided debt financing.
 
The Mozal Community Development Trust was created to improve living conditions in communities within a 10 km radius of the Mozal aluminum smelter. Mozal has a yearly budget of $2 million to fund initiatives through the trust in small business development, education and training, health and environment, culture and sports, and community infrastructure. The trust aligns its development initiatives with the national, provincial, and local government. In carrying out these initiatives, it involves relevant stakeholders from all levels of government, NGOs, community organizations, private sector partners, and Mozal’s own employees.


IFC’s grant will focus on expanding four initiatives:

       
Small business training
       
Agriculture development
       
Education
       
Health  

In small business training, the grant will enable the trust to increase training in carpet making, general business management, chicken broiler production, and cashew tree maintenance to more participants, predominantly poor women.  The goal is to create more opportunities outside the farming sector for a population characterized by subsistence farming.


The trust has already helped farmers in the Mozal area increase their production sixfold through agricultural development assistance. In an effort to assist other farmers, the grant will allow an expansion of training to a cooperative of farmers in a neighboring community.  


To improve health services to local community residents, the grant will upgrade existing health clinic facilities, specifically improving testing for diseases as well as increasing the physical capacity of the facilities to meet the growing numbers of users. This activity builds on the trust’s previous success in reducing malaria by 50 percent in three years as well as AIDS awareness and prevention initiatives, supported in part by IFC.  Further collaboration with the
IFC Against Aids program is planned.

Finally, to enable the local community to gain access to jobs at the smelter, the grant will partially fund the construction of the area’s first secondary school facility. Mozal requires applicants to have a minimum of a tenth grade education and existing facilities offer education only to the seventh grade.  


“IFC’s grant to the Mozal Community Development Trust builds on the success of our previous work with Mozal, in which IFC has invested and with which we have worked through the Africa Project Development Facility since 2001,” said Harold Rosen, the World Bank Group’s Director for Small and Medium Enterprises.


Observing that APDF organized training for over 20 local small businesses resulting in more than $4 million worth of contracts from Mozal, Mr. Rosen added, “We look forward to providing additional assistance to reach a broader range of stakeholders.”


The mission of IFC is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's lives.  IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. Since its founding in 1956 through FY02, IFC has committed more than $34 billion of its own funds and arranged $21 billion in syndications for 2,825 companies in 140 developing countries. IFC's worldwide committed portfolio as of FY02 was $15.1 billion for its own account and $6.5 billion held for participants in loan syndications.


IFC's small business linkages team works closely with the Corporation's clients and partners worldwide to expand their local supply and distribution chains, create more opportunities for smaller businesses, and assist in sustainable community development efforts.



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