Washington, DC Aug 6, 2015—IFC,
a member of the World Bank Group, today announced its first long-term financial
investment in Sao Tome and Principe, in the form of a risk sharing facility
with Banco Internacional de Sao Tome e Principe (BISTP). The investment
is supported by donor funds from the Government of Japan, helping to address
a large financing gap in the island archipelago where two-thirds of the
population lives on less than $1.50 a day.
Sao Tome and Principe is one of Africa’s
smallest economies, and about half of all its businesses indicate that
lack of access to finance is a barrier to business growth. The $3 million
risk sharing facility with BISTP, including $300,000 from Japan, will help
provide working capital and loans to small businesses, supporting their
expansion and modernization, and driving job growth. IFC and BISTP will
share an equal amount of the lending risk.
“Meeting the twin goals of ending extreme
poverty and boosting shared prosperity, requires new partnerships like
this with BISTP and venturing even into smaller economies – where the
impact can be greater” said IFC Director for Sub-Saharan Africa, Vera
Songwe. “We are grateful to Japan for their contribution and the signal
this sends to investors about the potential of Sao Tome and Principe and
the important role small businesses and banks can play in economic growth.
Mr. Joao Cristovao, CEO of BISTP said “BISTP
is partnering with IFC to create a low-cost line of credit to help SMEs
invest in modernization, the purchase of new equipment and technology,
and expand their activities to help improve their businesses.”
Mr. Acacio Bonfim, an Executive Director
of the Board of BISTP added “ SMEs need to significantly improve
product and service delivery to better serve national and international
market and this line provides an opportunity to do so. Beneficiaries will
also acquire business negotiation skills, making them more competitive
in job creation, economic growth while improving the standard of living
for the people of Sao Tome.”
“This project will help us provide crucial
support to SMEs in Sao Tome and Principe and improve the lives of people
in one of the world’s poorest countries,’’ said Masahiro Kan, World
Bank Executive Director for Japan. “Together with IFC, we can promote
access to finance and create much-needed jobs and growth.’’
BISTP is the largest bank in Sao Tome and
Principe and was founded in 1993. Its main sponsor is the Portuguese bank
Caixa Geral de Depositos, which has helped to modernize its systems and
streamline its operations. BISTP offers universal banking services through
a network of 12 branch, 14 ATMs and 52 Points of Sales through the islands.
The investment is the latest from IFC’s
Global SME Finance Facility, which was set up in April 2012 in response
to the G20’s call from action to bridge the trillion dollar finance gap
faced by SMEs. The first-of-its kind facility mobilizes funding from donors,
international finance institutions and the private sector, to help banks
scale up SME lending.
The Global SME Finance Facility already has
about 70 active investment and advisory projects, in 20 countries. It targets
SMEs that don’t have access to finance, including women-owned SMEs, agriculture
and climate-related businesses and SMEs in fragile states generating jobs
and growth in places that need it the most, such as Sao Tome and Principe.
IFC, a member of the World Bank Group, is
the largest global development institution focused exclusively on the private
sector. Working with private enterprises in about 100 countries, we use
our capital, expertise, and influence to help eliminate extreme poverty
and boost shared prosperity. In FY14, we provided more than $22 billion
in financing to improve lives in developing countries and tackle the most
urgent challenges of development. For more information, visit www.ifc.org.
BISTP is a commercial bank that grew as a
financial intermediary serving the private sector and individuals. Since
its creation in 1993, BISTP has been an indispensable partner in supporting
the development of private sector enterprises, therefore today, 90 percent
of Sao Tome’s companies in are BISTP clients. Our commitment to financing
companies’ efforts to develop the industrial sector helps us realize our
strategic objectives while also stimulating growth and socio-economic development.
In 2014, commercial financing represented more than 40 percent of BISTP’s
activities. BISTP’s objective for the coming years is to increase the
level of financing and attract more companies to the financial system.