Kabul, Afghanistan, July 20, 2009–IFC,
a member of the World Bank Group, today announced the expansion to Afghanistan
of a program to support trade with emerging markets worldwide, promoting
the flow of goods and services between Afghanistan and other countries
and supporting its sustainable economic growth.
Afghanistan International Bank is the
first Afghan bank to join IFC’s Global Trade Finance Program. As its first
transactions under the program, the bank executed two trade transactions
supporting the import of goods from Kazakhstan and Thailand.
Khahlil Sediq, Chief Executive Officer
of Afghanistan International Bank, said, “Trade finance is a crucial business
function of our bank. IFC’s Global Trade Finance Program will give
Afghanistan International Bank an opportunity to facilitate international
trade transactions and help expand our network of partner banks globally.”
IFC Director for the Middle East and
North Africa, Michael Essex, said, “Executing our first trade transaction
in Afghanistan and adding Afghanistan International Bank to our Global
Trade Finance Program demonstrates IFC’s commitment to assisting conflict-affected
IFC’s Global Trade Finance Program
provides partial or full guarantees against underlying trade instruments
and covers the payment risk of participating banks, allowing them to expand
their trade finance transactions within an extensive network of countries
and banks to enhance their trade finance coverage.
IFC’s investment portfolio in Afghanistan
totals US$95 million in five companies. IFC Advisory Services complement
its investments by helping build the capacity of financial institutions
to lend to micro and small businesses, and working with the government
to establish regulatory frameworks for leasing and housing sector lending.
Moreover, it is advising the Central Bank set up credit and collateral
registries. IFC is also building practical business skills of local entrepreneurs
and supporting small and medium enterprises in such sectors as agribusiness.
IFC, a member of the World Bank Group,
creates opportunity for people to escape poverty and improve their lives.
We foster sustainable economic growth in developing countries by supporting
private sector development, mobilizing private capital, and providing advisory
and risk mitigation services to businesses and governments. Our new investments
totaled $16.2 billion in fiscal 2008, a 34 percent increase over the previous
year. For more information, please visit www.ifc.org.
About IFC’s Global Trade Finance
Through its US$3 billion Global Trade
Finance Program, IFC is able to play a critical role and respond to the
global credit crisis by supporting trade with emerging markets.
Trade is vitally important in an integrated world, and can be an effective
tool in private sector development. At times of crisis, imports are particularly
critical to a country and exports can generate much-needed foreign exchange.
However, during crises banks tend to reduce their exposure as a defensive
measure, which results in a decrease in short-term trade lines.
The IFC Global Trade Finance Program facilitates trade by providing guarantees
that cover the payment risk in trade transactions with local banks in emerging
markets. This enables the continued flow of trade credit into the market.
In response to the current financial crisis, an additional US$1.5 billion
was added to the existing US$1.5 billion bringing the program's ceiling
to US$3 billion.
Since the inception of the program in September 2005, US$3.2 billion in
trade guarantees have been issued to support 2,600 transactions. Of these
percent were for banks in Africa
percent involved small and medium enterprises
percent supported trade with the world's poorest countries
percent facilitated trade between emerging markets