IFC revealed in a statement that it will provide $84 million in financing while MIGA will offer $122 million in financial guarantees. The funds will help Egypt increase its clean energy production capacity, lower costs, and diversify the country’s energy mix.

IFC will also provide a loan up to $26 million while another $58 million will be used from IFC’s innovative syndications platform, the Managed Co-Lending Portfolio Program. Both World Bank members will also provide environmental and social guidance to help protect a migratory bird flyway.

Walid Labadi, IFC country manager in Egypt, Libya, and Yemen told the media that, “The wind farm will help lower the average cost of electricity generation in Egypt and boost private sector participation in this key sector, while sending a strong signal to the market about our commitment to the country’s renewable energy program.”

The West Bakr wind farm located in the Gulf of Suez is expected to produce over 1,000 gigawatt-hours per year which will power more than 350,000 Egyptian homes. The project will also help cut carbon emission by more than 550,000 tonnes annually.

The wind farm is a part of the Egyptian government’s plan to generate 20 percent of its energy demands through renewable energy sources by 2022.

Egypt is also currently building the world’s largest solar power plant. The Benban Solar Park will produce enough electricity to power one million homes in Egypt.

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This is the first Climate Bond certified infrastructure-focused green bond to be publicly listed in Southeast Asia. The five-year green bond is listed on the Singapore Exchange.

The proceeds from the AC Energy green bonds will be used to finance the company’s plans for up to 5GW of renewable energy projects in East Asia and Pacific to 2025, with IFC’s subscription dedicated to selected solar PV and wind projects in Vietnam. This builds on IFC’s investment in the power sector in Vietnam, particularly its equity stake in Gia Lai Electricity Joint Stock Company, the developer of the first operational utility-scale solar PV projects in the country.

The investment will also support AC Energy’s strategy to transform the company into a regional player focused on renewable energy, beyond its home market in the Philippines.

“We are delighted to partner with a global player like IFC as we take a major step to grow our renewable energy investments. IFC’s anchor investment and extensive experience in greenbonds were key in successfully mobilizing substantial international and Philippine investment in AC Energy’s maiden capital market offering,” said Eric T. Francia, AC Energy President and CEO.

AC Energy’s parent company, Ayala Corporation, is a strategic client of IFC in Asia and a regional and global leader in the corporate pursuit of the UN Sustainable Development Goals as a founding member of the UN Global Compact Network in the Philippines.

Vivek Pathak, IFC Director for East Asia and the Pacific, said: “This partnership, leveraging IFC’s extensive global experience in green bonds, demonstrates the tremendous potential of thegreen bond asset class as a tool for mobilizing international institutional capital into infrastructure assets.” He added, “We look forward to expanding our support of such issuances across Asia, advancing the integration of regional power and financial markets.”

The investment is in line with IFC’s commitment to grow green capital markets, including infrastructure-targeted green bonds, essential for funding the region’s massive infrastructure needs.IFC has helped catalyze the green bond market since 2010 and to date has issued 133 green bonds for $8.8 billion in 16 currencies including the Philippine Peso Mabuhay green bond and Indonesian Rupiah Komodo green bond. IFC also helps financial intermediaries issue their own green bonds, as an anchor investor, such as in the Philippines’ BDO Unibank and China Bank, Thailand’s TMB Bank and Indonesia’s Bank OCBC NISP.

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After the collapse of Soviet communism, the region suffered a great recession because of economic restructuring and diversification plans. In 2009, the International Monetary Fund (IMF) survey said the growth in Central Asia was expected to drop 0.9 percent because of the global economic crisis. But over the years, much of the concerns has been addressed: economies in Central Asia reformed their business climate to create new job opportunities and expand growth, observed the 15th edition of the World Bank Group’s annual Doing Business 2018: Reforming to Create Jobs report.

Based on the report’s main findings, Central Asia and Europe are identified to have the highest share of economies to enforce reforms: 79% of them has at least one business regulatory reform implemented, followed by South Asia and Sub-saharan Africa.

The joint efforts of Central Asian Republics—Kazakhstan, the Kyrgyz Republic, Tajikistan and Uzbekistan implemented 11 reforms over ten business regulatory areas. But Kazakhstan and Uzbekistan remain in the spotlight.

Uzbekistan, a Central Asian nation and a former Soviet Republic, is featured on the global top 10 improved economies for a more responsible business climate. In fact, it has emerged as standing proof to a revived Central Asia, a region poised to do business with Western companies because of its strategic location, natural resources and wide-spread scope for growth.

The World Bank Regional Director for Central Asia, Lilia Buruncuic said: “The economies of Central Asia are demonstrating steady progress on doing business indicators. With continued commitments to improving the business climate, we hope to see a more dynamic private sector which is critical for boosting economic growth in the region.”

Uzbekistan’s business profile is strengthened by its President Shavkat Miromonovich Mirziyoyev, who released a reform decades after the authoritarian control under the late Islam Karimov was over. The country has introduced online tax payment and has reinforced investors protection through corporate transparency requirements. The reforms was largely devoted to freeing the currency and pursuing foreign investors at the United Nations General Assembly last year.

Being the most populous country in the region, there is a lot of investor interest exhibited in its commercial environment. Tashkent economist Shukurullo Mavlonov told Caravanserai: “The opening of borders and removal of customs duties [for foreign investors] in Uzbekistan are the beginning of a completely new era of economic development in Central Asia.”

The country is well located in the sense that all strategic routes pass through it, and investments by global companies build its potential for private sector growth as well. But its not unique in this regard. Uzbekistan and Kazakhstan signed contracts worth US$1.2bn to enhance regional co-operation between countries in Central Asia.

Three years ago, Kazakhstan announced a large-scale privatisation plan, which is expected to lower the number of state-owned enterprises by less than half—from 560 enterprises to simply 200 by 2020. The pivotal reason in doing so is to promote competitiveness through an anti-monopoly agency, stabilise price controls and develop bankruptcy regulations.

Kazakhstan has simplified enforcing business contracts through additional time standards and Tajikistan has raised revenue bar for value added tax registration and even excluded a procedure to ease property registration. The actions taken to meet a higher profile business climate has prevented external shocks from disabling Central Asian economies. For example: Kazakhstan witnessed gradual improvement in the overall business scenario by slashing monopoly and affirming reliance across private sectors and government sectors.

The policy measures have come with a focus to support entrepreneurship. After all, the private sector controls 65% of the economy. Kazakhstan is still the leader of foreign investments in Central Asia. Experts strongly believe the country’s countless activities to create an investor-friendly environment has led to direct investments worth US$15.8bn last year.

All told, the IMF commended the “comprehensive initiatives” on competitiveness and business environment, but still holds adverse views on the lack of state-enterprise privatisation, anti-corruption and foreign investment promotion. There is much risks involved for investors willing to penetrate into these regional markets. A listing of the operational risks relate to cultural and ethnic issues, infrastructure limitations, quality standards and physical threat. But this is to say if the risks are high, the rewards are also gratifying in many ways.

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Globally, 27 percent of banks surveyed noted declines in their correspondent banking relationships (CBRs) – financial institutions that provide services on behalf of other institutions – forcing them to reduce vital services. The challenge is most critical in Sub-Saharan Africa where 35 percent of banks reported a decline in these essential relationships—a major risk for countries’ economies heavily reliant on imports. 

“We are concerned,” said IFC CEO, Philippe Le Houérou. “In emerging markets, the business environment has often been challenging for banks and their customers, but a decline in correspondent banking disrupts the financial connections that countries and businesses need.” 

Restricting the availability of trade finance, wire transfers, deposits and other services could have a severe impact in developing countries, where they are a lifeline to the wider world.  The WTO estimates the existing global trade gap to be $1.4 trillion, and it exceeds $100 billion in Africa alone, a gap the decline in CBRs will exacerbate further.  An IMF study in April 2017 said the decline in these relationships could undermine affected countries’ long term growth and financial inclusion prospects. 

The survey,  the first extensive survey of banks in emerging markets on the issue, polled 300 banks active in 92 countries. The institutions surveyed have a total of $5 trillion in assets—roughly 10 percent of all emerging-market banking assets. 

Emerging markets banks are having to address multiple sets of new, sometimes conflicting, compliance requirements and are spending large amounts to upgrade their processes, hire staff, and upgrade software. Some 78 percent expected the costs of regulatory compliance to continue to rise, further pressuring their ability to serve their customers with essential services. 

Over the past decade, policymakers have taken much-needed steps to bolster the global financial system with new rules against unnecessary risk-taking, money laundering, and terror funding. These reforms will help safeguard the system from future crises. But increased capital standards, rising compliance costs, and the threat of large fines are also leading financial institutions to rethink their cross-border networks, the survey confirmed. 

Survey participants identified three solutions that could help address the issue, including greater harmonization of regulatory requirements, a centralized registry for due diligence data, and assistance with understanding and adaption to the new standards as measures. A solution will require multiple stakeholders across the international community to formulate a comprehensive response. 

“Trade, economic growth, and the remittances that families depend on are at risk when banking relationships deteriorate,” said Marcos Brujis, Director of IFC’s Financial Institutions Group. “By working together, multilateral institutions, regulators, and banks can help ensure that necessary reforms don’t create unintended costs for the most vulnerable people.”

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Launched at a conference jointly organized by Vietnam’s Ministry of Industry and Trade and the World Bank, with support from Australia, the reports – entitled Vietnam at a Crossroads: Engaging in the next Generation of Global Value Chains Report and Enhancing Enterprises Competitiveness and SME Linkages Study – showcase the growth potential of the country’s industries should policy reforms continue.

“Foreign Direct Investment, or FDI, has brought enormous gains to Vietnam in terms of growth, exports and jobs,” said Mr Vu Thang Hai, Vice Minister of Industry and Trade at the conference. “The discussion today and recommendations from these two reports offer many ideas on how Vietnam can participate in the next generation of global value chains, and promote linkages between domestic and foreign firms.”

Several domestic electronics and automotive companies in Vietnam have successfully integrated into global value chains. But in general, Vietnam has specialized in end-production assembly activities that are largely run by foreign firms with weak domestic linkages.

Vietnam can now choose to diversify, says the report, and foster the growth of innovative local firms that can potentially lead to products ‘invented in Vietnam’. A policy framework that aims to strengthen the capabilities and technology of local enterprises is expected to facilitate linkages with FDI firms, and enable them to enter foreign markets.

“Vietnam has successfully integrated into a few global value chains, which has created jobs, propelled economic growth, and reduced poverty,” said Ousmane Dione, World Bank Country Director for Vietnam. “But the country can move further up and strengthen its value addition with policy reforms and initiatives in areas such as transport, services, border procedures and regional integration.”

According to the reports, some key recommendations that can take Vietnam closer to its goal are to improve inter-ministerial coordination, facilitate information flows and contacts between domestic and foreign-owned firms, and to provide targeted support to strengthen domestic suppliers.

A higher place for Vietnam in global value chains will help attract more large scale foreign investment into the country, which can create more jobs and more opportunities for local suppliers.

But achieving this goal requires a solid package of reforms and initiatives, such as:

• Closing the infrastructure gap through greater mobilization of private financing and a more integrated approach to developing transport corridors;
• Developing competitive services markets and liberalizing regulations on foreign direct investment;
• Streamlining border procedures to make them more transparent and predictable; and
• Leveraging engagements with developed countries to ensure strong demand and technology-related investment.

Lessons from international and national experience presented at the conference outline the common elements of good programs that link domestic and foreign sectors. These include high-level political commitment and ownership, complemented with sound governance and institutional set-up, as well as an evidence-based strategy to foster linkage programs, a good supplier data base and business-to-business match-making services, and demand-driven supplier development programs.

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This scaled-up program for the entire Mindanao will focus on supporting the government’s program to raise agricultural productivity and improve connectivity from farm to market; boost education, skills, and employability of the youth; and help build resilient communities.

World Bank Group support to the conflict-affected region has been significant in recent years, leading to over 682,000 people benefiting from better infrastructure and access to jobs and initiatives that improve literacy.

“Mindanao accounts for 36 percent of all poverty in the Philippines and poverty is highest in areas affected by conflict. The World Bank Group fully supports the government’s focus on developing lagging regions, including in Marawi and surrounding areas,” said Mara K. Warwick, World Bank Country Director for Brunei, Malaysia, Philippines, and Thailand. “The World Bank, together with the Asian Development Bank, will coordinate financial assistance from the development partners for the rehabilitation and reconstruction of Marawi City. Also, the World Bank will provide technical assistance for the early recovery, rehabilitation, and reconstruction planning for Marawi City as requested by government.”

The partnership strategy for the Philippines will continue to work on five engagement areas, aligned with the development priorities of the government:

• Transparent and accountable government
• Empowerment of the poor and vulnerable
•   Rapid, inclusive and sustained economic growth
•   Resilience to climate change, environment, and disaster risk management
•   Peace, institution building, and social and economic opportunity, with focus on conflict-affected areas in Mindanao.

“The strategy is built on our long-term partnership with the Philippine government, development partners, and other sectors of Philippine society,” said Victoria Kwakwa, World Bank Vice President for East Asia and the Pacific. “We are pleased that our strategy shares several areas of priority with the government’s development plan, notably, promoting competitiveness, boosting rural development and strengthening resilience against climate change impacts.”

Sustained growth averaging 4.6 percent between 2010 and 2016, along with well-targeted social sector spending, has contributed to significant recent poverty reduction in the country.

The government more than doubled social services spending during this time, enabling significant allocations for health care and poverty reduction through the Pantawid Pamilyang Pilipino Program (4Ps), the national program providing conditional cash transfer, which is supported by the World Bank.

In the past two years, World Bank support has contributed to the government’s efforts to reduce poverty in the Philippines which include the following:

• Nearly 10,000 new water connections have helped tens of thousands of people.
• Some 300 kilometers of roads and nearly 2,000 meters of bridges have been built, improving connectivity.
• More than 20,000 education officials have received training and are now equipped to train others in early grade reading and mathematics.
• Approximately 2 million people – half of whom are women – benefitted from improved public services, including over 702,000 benefitting from cleaner, safer public markets and/or public terminals.

The midterm review of the strategy provides an opportunity to assess progress and lessons learned, and introduce revisions to its implementation.

Following consultations with various stakeholders in Iloilo, Tuguegarao and Cotabato, the review finds that overall, key elements of the country partnership strategy remain relevant to the government’s Philippine Development Plan.

In 2018, World Bank Group support for the Philippines could reach US$660 million and includes funding for the Metro Manila Flood Management Project, the first project in the Philippines planned for co-financing with the Asian Infrastructure Investment Bank (AIIB).

In 2019, total funding could reach US$750 million, including projects for agriculture and education in Mindanao.

The World Bank Group will also continue to provide analytical and advisory services to address important development issues under its FY18-19 program.

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19th September 2013

A new partnership among the World Bank, the European Union and the African, Caribbean and Pacific Group of States (ACP) Secretariat, along with the governments of Austria and Switzerland, convened for the first time yesterday, offering the governments of developing countries a new approach to creating jobs by strengthening private sector competitiveness.

The Competitive Industries and Innovation Program (CIIP), a five-year global program that intends to mobilize $100 million, aims to inspire broad-scale reform programs that help unlock the potential for firms and industries to compete successfully in the global marketplace. The program’s partners met today in Brussels at their first Steering Committee Meeting.

The World Bank Group and other development partners already provide valuable support to developing countries in helping strengthen private sector growth. Going beyond the traditional approach of broad policy reforms at the macroeconomic level, and beyond individual investment projects at the micro level, the CIIP turns attention to “the missing middle” by helping countries strengthen the competitiveness and innovation of specific industries.

“To ensure adequate growth, we need to create 600 million jobs over the next 15 years. Many of our client countries have been asking for new solutions to address this challenge. We set up CIIP to precisely address this issue, by encouraging informed and balanced public interventions at the industry level,” said Janamitra Devan, Vice President for Financial and Private Sector Development at the World Bank.

CIIP provides 75 percent of its resources directly to World Bank Group task teams to help developing countries pursue market opportunities through targeted, multi-year investment and policy reforms. The program will also allocate 25 percent of its resources to global knowledge generation and dissemination.

The program also defines a new way for the Bank Group in collaboration with other development partners to deliver support– for faster and better results. It involves an active dialogue and effective joint action between the private and public sector that allows policymakers to use private industries as a lens through which to optimize, sequence and motivate industrial and innovation policy reform.

“I am glad to see our partnership with the World Bank on the CIIP turning out as a truly collaborative initiative, where our financial support is complemented up by close collaboration on the ground. For our partner countries this means more relevant and better coordinated support to private sector development,” said Klaus Rudischhauser, Deputy Director General, Directorate-General for Development and Cooperation – EuropeAid, European Commission.

The CIIP partners have set ambitious and concrete development targets for the initiative. By joining forces on the ground and by working closely with the private sector, the partnership intends to focus action on clearly identified tangible results. Among the most important are:

• Growth in private investment and productivity
• Creation and growth of new firms
• Job creation and income generation

“The ACP Secretariat is pleased to collaborate with the EU and the World Bank by making 20 Million EUR of resources allocated to the ACP Group available for the CIIP,” says ACP Secretary General Mr Alhaji Muhammad Mumuni.  He continues, “We are anxious to facilitate private sector growth within the ACP Group as one of the primary mechanisms for promoting the economic development of our countries. We therefore look forward to this new partnership and to positive and tangible outcomes form this new model of intervention.”

Through strengthening competitiveness and innovation, the CIIP has the potential to leveraging up to 100 Million new jobs in beneficiary countries by the end of the program.

CIIP’s focus on competitiveness and job creation places it at the forefront of achieving the goals of ending extreme poverty and promoting inclusive and sustainable growth in developing countries. CIIP’s partnership structure allows leveraging each institution’s effort for a better impact.

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31st July,2013

Nearly one-fifth of today’s global population – 1.2 billion people – lives without access to electricity. Their businesses can’t operate after dusk, their schools lack power for technology, their children struggle to study by candlelight. The lack of power limits their opportunities, keeping communities in poverty.

Two-fifths of the population – 2.8 billion people – still relies on solid fuel such as wood, charcoal, dung, and coal for cooking and heating, resulting in three and a half million deaths every year from the effects of indoor air pollution.

Delivering reliable energy services for economic development and providing access to electricity and modern household energy services to these billions living without it is essential to reducing poverty and building shared prosperity. That is why expanding access to energy, along with accelerating energy efficiency and renewable energy, is at the core of the World Bank Group’s future work in the energy sector, as described in a newEnergy Sector Directions Paper discussed by the Bank Group’s Executive Board on July 16. With the Executive Board’s support, the World Bank Group will use the paper to inform its operations going forward.

The paper states that the World Bank Group will make every effort to “minimize the financial and environmental costs of expanding reliable energy supply” while also recognizing that “each country determines its own path for achieving its energy aspirations.” It emphasizes the importance of selecting areas in which the Bank Group can best help countries mobilize energy solutions that reduce poverty sustainably.

World Bank Group President Jim Yong Kim, who led the discussion with the Executive Board, said the paper’s directions are anchored in the World Bank Group’s overarching goals of reducing the global rate of extreme poverty to 3 percent by 2030 and fostering the income growth of the bottom 40 percent in every country.

“We need affordable energy to help end poverty and to build shared prosperity,” Kim said. “We will also scale up efforts to improve energy efficiency and increase renewable energy—according to countries’ needs and opportunities.”

Source : World Bank

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