KABUL/WASHINGTON, D.C., September 24, 2004
— The Private Enterprise Partnership for the Middle East (PEP-ME),
a technical assistance program created, funded, and managed by the International
Finance Corporation, has hosted a roundtable in Kabul on developing the
financial leasing sector in Afghanistan. Decades of successive conflict
left Afghanistan with a rudimentary financial sector, which it is now rebuilding.
A few private sector and state-owned commercial banks have been licensed
or re-licensed recently to assume operations. But lending remains scarce.
Developing new financial instruments such as leasing can help stimulate
lending activity in Afghanistan. It also helps foster economic growth,
and productivity and international competitiveness in key sectors of an
economy such as agriculture, construction, and transportation. Leasing
is also particularly well suited to small and medium enterprises. It gives
them a flexible, timely, and cost-effective way to buy equipment.
Over thirty participants attended the roundtable, drawn from the Afghani
government, business support institutions, the private sector, NGOs, and
international organizations. Representatives of IFC, the private sector
arm of the World Bank Group, presented their research on legislation, accounting,
and taxation issues for the leasing sector. They also provide recommendations
on the way forward to create a more favorable environment for leasing in
Fritz Peter, Honorary Chair of the Lease Europe Association and founder
of the Swiss Leasing Association, also spoke about leasing development
Jesper Kjaer, general manager for PEP-ME, added, “Sharing international
best practices and discussing local constraints with key stakeholders is
a first step in helping Afghanistan design a sound regulatory framework.
This is essential to attract local and international investors in the leasing
The Private Enterprise Partnership for the Middle East (PEP-ME), with start-up
funding of $10 million from IFC, provides technical assistance to Afghanistan,
Iraq, West Bank and Gaza, and Yemen. PEP-ME focuses its technical assistance
in those countries on improving the business and regulatory environment,
strengthening financial institutions and markets, stimulating the growth
of small and medium-sized enterprises, and assisting in the restructuring
and privatization of state-owned enterprises.
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 FY04, IFC has committed more than $44
billion of its own funds and arranged $23 billion in syndications for 3,143
companies in 140 developing countries. IFC’s worldwide committed portfolio
as of FY04 was $17.9 billion for its own account and $5.5 billion held
for participants in loan syndications.