Press Releases
print

IFC Doubles Investment for Business Oxygen to help Nepal’s Small Businesses Improve Climate Resilience


In Colombo:
Lisa Dadlani
Phone: +94 11 5400 106
E-mail:
LDadlani@ifc.org

In City: Washington, DC

Abiola Johnson

Phone: (202) 473-0660

E-mail: aojohnson@ifc.org


Kathmandu, Nepal, June 12, 2017—IFC, a member of the World Bank Group, is investing another $7.3 million into Business Oxygen (BO2), Nepal’s first private equity fund. The investment is being made through two funds managed by IFC, financed by the Climate Investment Funds and United Kingdom’s Department for International Development (DFID). This investment will help BO2 increase its financing for small businesses to help them cope with climate change.

BO2, makes equity investments in Nepal’s high-growth SMEs, helping them achieve their potential and create more jobs. IFC has previously provided $7 million of its own funds to BO2 in 2015. In this fresh round of financing, DFID brings in $3.7 million while the Climate Investment Fund’s Pilot Program for Climate Resilience contributes $3.6 million.


The BO2 investment is part of IFC’s SME Ventures program for low-income countries where such funding is not available because of the risk profile and difficult operating conditions. For instance, only 39 percent of Nepal’s SMEs have access to finance, leaving a gap for funds such as BO2 to bridge.


“IFC’s increased support to Business Oxygen will boost our ability to engage with more small businesses,” said Siddhant Raj Pandey, Chairman and CEO of WLC Ventures, which manages BO2. “It puts us in a position to use innovative products and services to provide opportunities for farmers, create quality jobs, and promote energy efficiency.”

Small and medium enterprises (SMEs) are vital to Nepal’s economy. The country’s 111,442 SMEs employ 1.75 million and account for 22 percent of the gross domestic product.

“Business Oxygen will help demonstrate the viability of climate-resilient investments in Nepal to other investors, helping to boost the market for similar investments here and in other frontier markets,” said Mohammad Rehan Rashid, IFC’s Resident Representative for Nepal. “The fund’s ability to provide risk capital to SMEs in Nepal provides a vital solution for firms too small or too new for traditional commercial bank financing.”

“The fund has the potential to create jobs and support economic growth. We know how important SMEs are in Nepal and we at DFID Nepal are committed to supporting them to achieve their growth potential,” said Gareth Weir, Deputy Head of DFID Nepal.


IFC aims to double its climate-related investments between 2016 and 2021 to 28 percent of its financing. A recent World Bank study showed that climate change could push more than 100 million people back into poverty over the next 15 years.


 
About IFC

IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets. Working with more than 2,000 businesses worldwide, we use our capital, expertise, and influence to create markets and opportunities in the toughest areas of the world. In FY16, we delivered a record $19 billion in long-term financing for developing countries, leveraging the power of the private sector to help end poverty and boost shared prosperity. For more information, visit
www.ifc.org

 
About the Pilot Program for Climate Resilience

The Pilot Program for Climate Resilience (PPCR) is a funding window of the Climate Investment Funds for climate change adaptation and resilience building. Using a strategic programmatic approach, the PPCR assists national governments in integrating climate resilience into development planning across sectors and stakeholder groups. It also provides additional funding to put climate resilience plans into action and pilot innovative public and private sector solutions to pressing climate-related risks. For more information, visit
www-cif.climateinvestmentfunds.org.
 
About DFID

The United Kingdom of Great Britain and Northern Ireland’s Department for International Development (DFID) leads the UK’s work to end extreme poverty. Its objective is tackling the global challenges of our time including poverty and disease, mass migration, insecurity and conflict. Through targeted assistance, DFID is working to build a safer, healthier, more prosperous world for people in developing countries and in the UK too.


Stay Connected

www.ifc.org/southasia  
www.facebook.com/IFCsouthasia
www.twitter.com/IFC_SouthAsia
www.facebook.com/IFCwbg
www.twitter.com/IFC_org
www.youtube.com/IFCvideocasts
www.ifc.org/SocialMediaIndex
www.instagram.com\ifc_org
https://www.linkedin.com/company/ifc-south-asia