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ACLEDA Bank Lao Ltd.

 »  Media  »  Our News  »  IFC commits billions of dollars to SME development, job creation

IFC commits billions of dollars to SME development, job creation

October 12, 2018

The International Finance Corporation (IFC) has committed US$3.4 billion in the current fiscal year in East Asia and the Pacific spurring the growth of the private sector in the region. The investment has ensured sustained growth through innovation, job creation and infrastructure development.

The IFC provided US$2 billion from its account and mobilized US$1.4 billion from other investors in the current fiscal year. With the IFC's support businesses can provide over 550,000 jobs, distribute power to 4.4 million people, provide water to 9.6 million people, and improve livelihoods of more than 710,000 farmers.

In Laos, the IFC and Thailand's TMB Bank teamed up to provide US$9.1 million to ACLEDA Bank Lao Ltd to finance the SMEs, especially those owned by women.

ACLEDA Bank Lao reported yesterday that the bank has utilized the money to disburse loans to about 1,470 customers, mainly business women, and most of them own small and family businesses. The demand for funds to bolster SMEs is high and ACLEDA Bank Lao will continue looking for support from other sources to help the SMEs. “Next year, the bank expects to have about US$20 million to disburse loans to SMEs. The money will be from both 'customers' deposit and fund from other lenders," ACLEDA Bank Lao noted. Rapid urbanization and increasing businesses in the East Asia and the Pacific region are meeting massive infrastructure needs, while at the same time, the region is a major contributor to the global greenhouse gas emissions and highly vulnerable to natural disasters and climate impact.

"In the face of countries' limited public resources, the IFC has been actively looking for solutions to crowd in all possible sources of finance, innovation and expertise to help meet their challenges," said Vivek Pathak, IFC's Regional Director for East Asia and the Pacific. "The IFC is unlocking opportunities in emerging markets and creating jobs with the aim of achieving sustainability through lower costs and efficient service delivery in key sectors such as finance, infrastructure, healthcare and education," Mr. Pathak said. The IFC's support to banks across East Asia and the Pacific was estimated to have generated more than 16 million loans to micro, small and medium enterprises totaling at US$209 billion in the calendar year 2017. In addition to financing, the IFC advises governments and the private sector in the region to create a business-enabling environment and improve sustainability standards. At the end of FY18, the IFC's advisory services programmed in East Asia and the Pacific included 108 active projects valued at a combined US$244.1 million.

In FY19, in coordination with other World Bank Group's member organizations, the IFC's strategic focus continues to be on maximizing private finance to address development challenges. By working with governments on a business-friendly environment and mobilizing WBG resources, the IFC is promoting private investments in the power sector in Myanmar, the Philippines, Papua New Guinea, Laos and Vietnam; in tourism in Indonesia, Papua New Guinea, Solomon Islands and Fiji, and in agribusiness in Vietnam, among others.

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