Innovation and inclusion drive impactful, record year for IFC in Asia Pacific

The International Finance Corporation (IFC) said yesterday its projects delivered significant impact across Asia Pacific in the last fiscal year, addressing pressing development challenges including climate change, gender inequality, food insecurity, and financial inclusion, while creating jobs and improving services across the region. 

IFC, the largest global development institution focused on the private sector in emerging markets and a member of the World Bank Group, committed a record $ 12.2 billion to 123 projects in Asia Pacific in the fiscal year ending June 30, an 11% year-on-year increase. This comprised $ 6.2 billion in long-term financing from its own account, $ 3.3 billion in mobilisation, and $ 2.7 billion in short-term trade and supply-chain finance to facilitate trade flows.  

36% of long-term financing from IFC’s own account was invested in projects that will help tackle climate change and marine-plastic waste. This included investments in the first blue bond and first local currency sustainability-linked bonds in Viet Nam, the first distributed generation financing through corporate power purchase agreements in India, sustainability-linked loans to finance industrial decarbonisation in India and green buildings in India and the Philippines, a green data centre in Malaysia, as well as the first fund to combine public, private and philanthropic capital with a specialised focus on clean-energy investments in Southeast Asia. 

IFC provided financing and advisory services to financial institutions across the region that are expected to improve access to finance for micro, small and medium-sized enterprises (MSMEs) through the provision of more than two million loans. Projects included the first social bond in Mongolia, the first offshore asset-backed securitisation by an Indian non-bank financial institution, and the first gender and climate financing by a development financial institution in Nepal, all aimed at supporting MSME lending. 

52% of long-term financing projects included a focus on improving gender equality. Projects included an equity investment as a cornerstone investor in an initial public offering of a Thai bank to help develop new products for smaller women-owned or led businesses, and supporting India’s largest private-sector bank to extend microloans under an initiative exclusively focused on women borrowers. 

26% of long-term financing projects were in low-income, fragile, and conflict-affected countries across the region, including an investment in Bangladesh’s first-ever housing bond, intended to improve affordable housing for women in Bangladesh, and a program in Papua New Guinea to help women enter and excel in sectors where they have been historically underrepresented. 

A pivotal outcome of IFC’s work in the region is the creation of economic opportunities, with FY24 investments estimated to create up to 570,000 direct and indirect jobs. 

IFC Asia Pacific Regional Vice President Riccardo Puliti said: “Amid persistent and intertwined global challenges, IFC is resolved to foster innovation and deliver more sustainable private sector solutions across Asia Pacific. The private sector continues to play a key role in addressing urgent development needs of countries in the region. Our projects this last financial year reinforce IFC’s commitment to offering targeted solutions that can be implemented at scale to maximise impact, ultimately improving lives and livelihoods across Asia Pacific.” 

Setting a precedent in innovative financial solutions, IFC also invested in an Indonesian ride-hailing, e-commerce and financial-services company using a mezzanine equity investment structure. The investment will ensure more people can benefit from the digital economy. In Bangladesh, IFC also provided flexible U.S. dollar-denominated working capital funding in the pharmaceutical and food processing sectors to address a critical foreign exchange shortage in the country. 

In the pharmaceutical sector, IFC also made investments to enhance healthcare access and resilience in Bangladesh and Sri Lanka, supporting the growth of pharmaceutical manufacturing capacity and expanding retail footprints to create sustainable supply chains.