WASHINGTON, D.C., July 14—The International Finance Corporation (IFC) has approved its first four investments in the Former Yugoslav Republic (FYR) of Macedonia for a total of US$11.1 million equivalent. IFC, a member of the World Bank Group, is the largest multilateral source of equity and loan financing for private sector projects in developing countries.

FYR Macedonia became a member of IFC in February 1993. IFC's strategy for Macedonia includes providing technical and financial assistance to newly privatized companies and supporting capital markets development, foreign currency earning projects and small business development. Macedonia is also one of 16 countries selected for "Extending IFC's Reach" program, which promotes private sector development through the support of small and medium-sized enterprises (SMEs) in countries where foreign investment has been limited. In addition to the projects listed below, for the past two years, IFC has provided ongoing assistance to the government on the privatization of Stopanska Banka, the country's largest bank.

A range of technical assistance and advisory services required to help develop the four projects as prospective investments was provided through trust funds supported by the governments of Austria, Denmark, Italy, Netherlands, Norway, Sweden, Switzerland and the United Kingdom. This technical preparatory work contributed significantly to IFC's capability to participate in these projects and included feasibility studies, financial audits, management advisory programs, market analyses and a review of Macedonia's legal system with regard to enhancing private sector activities.

"IFC's recently approved investments in Macedonia confirm our continued efforts to support the local private sector and help encourage additional foreign investment in the country," said Mr. Harold Rosen, Director of IFC's Europe I Department. "Moreover, as three of the four investments are in SMEs, IFC is playing a vital role in promoting job creation and distributing the benefits of economic development more fully."

US$5 Million for Grand Hotel

IFC has approved a US$5 million loan for Makedonija Turist A.D., one of Macedonia's largest tourism companies. The financing will contribute to the refurbishment and modernization of the Grand Hotel in Skopje. The hotel will be operated under a franchise agreement with the U.S.-based Holiday Inn. Upon completion, the Grand Hotel will be the first hotel in Skopje offering international-standard quality and services.

US$1.5 Million for Textile Company

IFC is providing a US$1.5 million loan for Teteks A.D., a textile company based in Tetovo. The financing will be used to modernize the company's facilities and diversify production into lighter weight wool fabrics and garments. The project will improve environmental standards and will also include a management training and advisory program designed to expand product development.

US$3.8 Million for Construction Materials Company

IFC has approved a loan of up to US$3.8 million for Nikol-Fert, a construction materials company based in the village of Nikolic. The financing will be used to integrate, diversify and expand Nikol-Fert's steel products. Currently, the company produces steel meshes, trusses and ribbed wire. With IFC's financing, Nikol-Fert will be able to purchase a steel rolling mill to produce its input of steel wires and also to produce steel coils, profiles, and rods, which are currently being imported. The products will be used for both the domestic and regional markets.

US$0.8 Million for Glass Production

An investment of up to US$800,000 in IFC financing has been approved for Masinomont Company, a small producer of standard and specialty machinery for the glass working industry. The financing will be used to relocate the firm's operations to a new manufacturing facility. Masinomont Company, a small family company founded in 1988, produces standard and specialty machinery for the glass working industry and special flat shaped glass.

IFC, a member of the World Bank Group, is the largest multilateral source of equity and loan financing for private sector projects in developing countries.