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IFC Invests $124 Million in Medgulf to Expand Insurance Coverage in MENA


In Cairo:
Riham Mustafa
Tel: +20 22 461 4230
E-mail:
RMustafa@ifc.org


Beirut, Lebanon, February 6, 2012—IFC, a member of the World Bank Group, is investing up to $124 million in the Mediterranean and Gulf Insurance and Reinsurance Company (Medgulf) to help the firm extend its health and commercial risk insurance services across the Middle East and North Africa, where low coverage rates hinder economic development.

IFC’s acquisition of up to a 15 percent equity stake in Medgulf, a leading regional insurer, will support the company as it looks to expand into Egypt, Iraq and Turkey, where many people lack insurance coverage.

“The partnership with IFC will help Medgulf grow its operational capabilities to extend security to people who would otherwise have limited means of coping with calamities,” said Lutfi El Zein, chairman of Medgulf. "While the shortage of insurance coverage in the Middle East remains severe, Medgulf has a strong strategic vision and the capacity to meet rising demand."

The Middle East has the lowest rates of insurance coverage in the world, with gross premiums around 1 percent of regional GDP, which breeds uncertainty within households, hindering investment and job creation. In the Middle East and North Africa, the share of the population aged 65 years and older is expected to more than triple by 2050, demanding an increase in health, life, and pension insurance services.

“IFC’s investment in Medgulf supports our strategy to help extend essential services to underserved parts of the population by encouraging cross-border investments within the region,” said Dimitris Tsitsiragos, IFC Vice President for Eastern and Southern Europe, Central Asia, Middle East and North Africa. "Addressing insurance needs in the region will make it easier for people to access healthcare, while an increased sense of security will help businesses grow."

This investment will also help institutionalize best practices in the insurance sector, where Medgulf is a model of sound corporate governance and transparency. It is part of IFC’s efforts in the Middle East and North Africa to promote economic development by supporting private enterprise. In the last year, IFC has invested over $2 billion in the region, including mobilization.

About IFC

IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. We help developing countries achieve sustainable growth by financing investment, providing advisory services to businesses and governments, and mobilizing capital in the international financial markets. In fiscal 2011, amid economic uncertainty across the globe, we helped our clients create jobs, strengthen environmental performance, and contribute to their local communities—all while driving our investments to an all-time high of nearly $19 billion. For more information, visit
www.ifc.org

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