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IFC Chief Peter Woicke Concludes South Africa Visit


In Washington:
Ahmed Badawi-Malik

Phone: (202) 458-7148

Email:
Abadawi@ifc.org


JOHANNESBURG, SOUTH AFRICA, February 12, 2004— IFC Executive Vice President, Peter Woicke, who is also Managing Director of the World Bank for Private Sector Development, concluded a four day visit to South Africa yesterday. “My visit underlined the importance that IFC attaches to its strategy for South Africa, namely supporting private investments that directly or indirectly help the government achieve its goals of reducing poverty and widening opportunities for economic advancement”, Mr. Woicke said.

IFC, which is affiliated to the World Bank (and whose Managing Director Dr Mamphela Ramphele accompanied Mr. Woicke), promotes private sector enterprise in developing countries such as South Africa. IFC invests equity in private sector projects in developing countries, mobilizes finance from global capital markets for new and existing projects and provides investment advisory services to governments.


Mr. Woicke’s program included calls on the ministers of finance, minerals and energy and trade & industry to introduce IFC’s new Africa strategy, discuss priorities for South Africa, and explore with the government how IFC and the World Bank can help further support private sector job and wealth creation to reduce historical inequalities in income distribution and opportunities for economic advancement.


Mr. Woicke also met with young female and male entrepreneurs, NEPAD Secretariat Professor Wiseman Nkhulu, heads of South Africa’s leading industrial and financial companies and visited IFC clients, SASOL, Anglovaal Mining, Spier, First Rand Limited, and Karsten Farms. Mr. Woicke also received an update on the issues and impact of HIV/AIDS in South Africa from Dr. Clive Evian and Rose Smart.


IFC’s strategic priorities for South Africa include supporting empowerment initiatives in the mining sector, supporting financial sector deepening by investing in banks and non-bank financial institutions and supporting the creation of new securities; investing in key export sectors such as tourism, agribusiness, mining and manufacturing; and providing help to micro, small and medium-size enterprises (MSME) in collaboration with financial institutions and technical assistance from other donors.


Note to Editors:
Since its first investment in 1956, IFC has committed financing to projects in South Africa amounting to $180 million as of FY 2003 – the second biggest country portfolio in Africa after Nigeria. IFC investments comprise $75.5 million in equity participations and $104 million in loans, with IFC investments commitments in South Africa amounting to just under $9.5 million in FY 2003 – equal to 5.5 percent of total IFC investment commitments in Sub-Saharan Africa.


Some of IFC’s investments in South Africa in 2003 included a $5 million equity participation in the New Africa Mining Fund, which invests in and promotes mining activities in Southern and Central Africa; a near $1 million quasi-equity investment in Rubico Holding SA (Pty) Ltd, a software solutions company specializing in the financial sector; and three equity participations totaling $3.6 million in South Africa Home Loans – the first originator and securitizer of homes loans in South Africa and Sub-Saharan Africa region.


In addition, IFC works in South Africa and throughout Sub-Saharan Africa via specialized facilities such as the APDF (Africa Project Development Facility)
(
www.apdf.org), which helps African small and medium entrepreneurs organize, diversify and grow their businesses by providing technical assistance throughout the project life cycle; and AMSCO (African Management Service Company), which helps strengthen African firms by providing experienced managers and training local management teams. Both APDF and AMSCO have two regional offices in South Africa, with APDF offices in Johannesburg
(contact
rjaptha@ifc.org) and Cape Town , while AMSCO possesses a local hub in Pretoria (contact Pretoria@amscobv.com), and in Johannesburg too.

APDF takes part in numerous initiatives to help MSMEs, including assisting financial institutions with strategic planning, management, advocacy, capacity building, and the establishment of risk capital. APDF also facilitates linkages between South Africa’s MSMEs and large firms to create an environment in which larger firms will procure services from MSMEs. APDF also gives corporate governance training for the MSME sector. In addition, APDF provides support to savings and credit societies through access to business services, finance and creating a business enabling environment that present the best opportunity for extending financial services to the entire population.


IFC’s partnership with South Africa also stands poised to be deepened through higher focus by the Sustainable Business Assistance Program (SBAP) – (contact
boyewole@ifc.org). SBAP helps reduce developing countries reduce poverty and improve governance through environmentally and socially sustainable private sector development. SBAP centers on three donor-funded facilities: the Sustainable Financial Markets Facility (SFMF) – (contact DSiddy@ifc.org) - that has already funded programs in South Africa.

SFMF works to enhance the environmental and social impact of IFC’s investments in banks, leasing, insurance and microfinance companies and other financial intermediaries. IFC has used SFMF to provide sponsorship to the African Institute of Corporate Citizenship (AICC) for a joint study with the United Nations Environment Programme (UNEP) Finance Initiative’s Africa Task Force to promote socially and environmentally responsible lending in the South African banking system.


SFMF projects in South Africa earmarked for the near term notably include creating a Center for Sustainable Investment under the auspices of AICC, which will act as a local and continent-wide focus point for research, awareness-raising, and networking on sustainability and finance issues.


The Environmental Opportunities Facility (EOF) – contact
Aleite@ifc.org - is another of IFC facilities grouped under the SBAP, and aims to provide technical assistance and flexible investment funding to innovative projects that promote local environmental benefits. Potential projects in South Africa are currently being reviewed to see if they qualify for EOF financing.

The Corporate Citizenship Facility (CCF) – contact
MEckstein@ifc.org completes the menu of IFC facilities grouped under the SBAP. CCF gives technical assistance to SMEs and other IFC clients from the “real” economy who see - and want to realize – opportunities to grow their business through enhanced environmental and social performance. CCF projects in and services to South Africa during the current financial year and beyond will pay special attention to  supply chains, community and local economic development opportunities associated with IFC investments in the country, biodiversity management – especially for the extractive sector, and HIV/AIDS prevention efforts, which will be closely aligned to the IFC against AIDS program
(
http://www.ifc.org/IfcAgainstAids).

The IFC Against AIDS program in South Africa works with companies of various sizes (from multinational corporations to medium-sized firms) and industries (mining, agribusiness, chemicals) to provide technical assistance for the design of HIV/AIDS programs for the workplace, with extension into the communities where the companies operate. IFC Against AIDS will work with those clients to increase awareness of the multiple impacts of HIV/AIDS on their business and to provide guidance to develop new HIV/AIDS initiatives, as well as enhance existing activities.


The mission of IFC (
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, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY03, IFC has committed more than $37 billion of its own funds and arranged $22 billion in syndications for 2,990 companies in 140 developing countries. IFC’s worldwide committed portfolio as of FY03 was $16.8 billion for its own account and $6.6 billion held for participants in loan syndications.