Washington DC, November 5, 2001—Peter
Woicke, Head of the International Finance Corporation (IFC) and Managing
Director of the World Bank Group, will visit Mexico City on November 6
and 7 to meet representatives of the Mexican government and business community
in order to reaffirm IFC’s continued commitment to private sector development
IFC, the private sector arm of the World Bank Group, has worked actively
to support the development of a strong and vibrant private sector in Mexico
since it became a member in 1956. Since then and as of June 30, 2001,
IFC has committed financing in Mexico for 104 projects representing a total
project cost of US$12.2 billion, with IFC providing $4.2 billion — $2.3
billion for IFC’s own account, and $1.9 billion for the account of participant
banks. As of September 2001, Mexico is IFC’s third largest country
portfolio with 64 projects (49 companies) representing $730 million. The
outstanding loan for participant banks stood at $451 million.
During his visit, Peter Woicke will meet with the President of Mexico Vicente
Fox, as well as with Central Bank Director Guillermo Ortíz, Secretary
of Economy Luis Ernesto Derbéz, Secretary of Finance Francisco Gil Díaz
and Secretary of Energy, Ernesto Martens, to exchange views on how IFC
can help Mexico reach its development goals. Mr. Woicke will also
meet IFC clients and members of the Mexican business community to exchange
ideas on how IFC can support their further development.
In the last few years, IFC has focused on helping the Mexican private sector
gain greater access to external private financing, supported the development
of domestic financial markets and helped private firms grow and improve
their international competitiveness.
A few examples include the $200 million credit facility - $100 million
for IFC’s own account- to Banorte to finance long-term leases of
industrial facilities for export-oriented firms in the northern states
of Mexico; Hipotecaria Su Casita, a $11 million investment that
will help make housing finance available to low-income Mexican families,
with a possibility of a further $2.4 million investment; Financiera
Compartamos, a $1.66 million investment that will help expand the reach
of this leading microfinance institution beyond its existing 82,000 borrowers,
mostly women, in 12 states of Mexico, including Chiapas and Oaxaca.
Other IFC priorities include support for competitive firms that lack access
to long-term credit as well as finance for agribusiness and private infrastructure,
such as railways, water and sanitation. Gas distribution and power are
also priority investment targets in the future.
IFC’s strategy also emphasizes support for sectors recently opened to
further private participation, including health and education. One
example is IFC’s recent $44 million investment in Hospital ABC
(including $14 million for participations) to help build a new hospital
in Santa Fe, Mexico City.
The Corporation has broadened and expanded its approach to development
through the Sustainability Initiative. This initiative looks to increasing
the environmental and social benefits of investments. A clear example
is Ecomex, a Mexican company recently supported by IFC, which converts
vehicles in the metropolitan area of Mexico City to the use of compressed
natural gas, a cleaner, more environmentally friendly fuel. Ecomex
has already converted more than 800 microbuses to natural gas, and IFC’s
$6.5 million investment (with a possibility of an additional $3.5 million
investment) will help them expand to convert taxis, buses and official
The US economic slowdown, aggravated by the tragic events of September
11, is expected to weaken the flow of private capital to emerging markets
in Latin America. Investors are more cautious, and this situation
might create a potential negative effect in the ability of the Mexican
private sector to continue its modernization and maintain its competitiveness.
IFC is preparing to respond to a surging demand for financing. The
Corporation will help address the needs of the Mexican private sector to
come to terms with the new reality of slower private capital flows, and
will support competitive companies that play a major role in the Mexican
IFC's mission (www.ifc.org)
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, and provides technical assistance
and advice to governments and businesses.
Since its founding in 1956, IFC has committed more than $31 billion of
its own funds and arranged $20 billion in syndications for 2,636 companies
in 140 developing countries. IFC's committed portfolio at the end
of FY01 was $14.3 billion.