IFC Delivers Record Financing in Support for Private Sector Development in East Asia and the Pacific as New Regional VP Sets to Work
Singapore —Amid overlapping global crises, IFC committed just over $5 billion between July 1, 2021, and June 30, 2022—the highest ever in the East Asia and the Pacific region—including $3 billion in long-term finance, and just over $2 billion in mobilization to help sustain and create jobs, improve services, and protect small and medium sized companies.
The announcement came as Ruth Horowitz assumes the role of IFC’s Regional Vice President for Asia and the Pacific – covering both East and South Asia – taking over from Alfonso Garcia Mora, who is now IFC’s Regional Vice President for Europe, Latin America, and the Caribbean.
“I am very excited to join the region and to work closely with its fantastic staff, clients and stakeholders, and look forward to building on the region’s strong history of impactful private sector engagements,” said Ruth Horowitz, IFC’s Vice President for Asia and the Pacific.
Horowitz is a global investment professional with over 30 years of experience. Most recently, she served as the Vice President of IFC’s Equity Mobilization Division – IFC Asset Management Company (AMC), which has raised over $10 billion from investors across 13 funds. Prior to joining IFC as the Chief Operating Officer and Director of AMC, Horowitz worked for Lehman Brothers.
IFC’s record financing for the East Asia and the Pacific region included $2.34 billion in equity, loans and bonds, including social bonds for financial institutions to support the region’s micro, small and medium sized (MSMEs) enterprises. MSMEs—collectively EAP’s largest employer—are the region’s growth engine.
Supporting the region’s businesses suffering the impacts of the pandemic, IFC delivered $600 million in long-term finance in COVID-response deals, combined with $100 million in short-term finance to help local exporters and importers increase trade activities, including food and commodities trade during a turbulent global economic period. Overall in the East Asia and the Pacific region, from FY20 to FY22, IFC has committed $2.5 billion in response to COVID-19, including $400 million in short-term finance.
“With unprecedented global challenges, IFC’s record commitments helped the region weather the impacts of the COVID-19 pandemic, preserve jobs, and focus on a green, resilient, and inclusive recovery path,” said Kim-See Lim, IFC Regional Director for East Asia and the Pacific. “The past financial year saw many firsts in the climate space, including blue bond issuances to help address marine pollution and support countries’ climate goals. IFC’s first ever sustainability-linked bond was in the Asia and the Pacific region.”
IFC’s commitments included $1.2 billion to support climate projects across the East Asia and the Pacific region, including funding for innovative green and blue transactions and also for renewable energy and climate-smart urban infrastructure projects.
In taking on her new role as Regional Vice President, Ruth Horowitz said climate would remain a top priority for the East Asia and the Pacific region.
“Asia is critical in determining whether the climate battle will be won or lost, so IFC will continue to work with the private sector to catalyze finance in the region, helping countries achieve their climate targets while pursuing broader development goals,” said Horowitz. “With new challenges such as rising global inflation, and the on-going impacts of COVID-19 stretching public finances, it is imperative for IFC to continue to work with the private sector to deliver solutions to these development challenges, so people can have access to the services and jobs they need. I look forward to strengthening and developing new partnerships in taking on this exciting role across the Asia and the Pacific region.”
Examples of IFC’s work across the region in FY22 included:
IFC made its first investment in a sustainability-linked bond globally, anchoring $110 million in Sembcorp Industries’ first sustainability-linked bond along with $350 million in mobilization.
A pioneer investor in blue bonds, IFC’s $100 million investment in BDO Unibank’s maiden blue bond was a first for the Philippines. IFC also invested $50 million in TMBThanachart Bank’s blue bond, a first for a commercial bank in Thailand.
A landmark US$700 million financing package to Goertek for a modern electronics production plant in one of Vietnam’s poorest regions will help the country transition to higher value-added manufacturing and create 40,000 permanent and skilled jobs.
IFC invested US$100 million in the first social bond by Ayala Corporation in the healthcare sector to help increase availability of much needed affordable healthcare in Philippines.
IFC committed debt financing of $300 million to PT Bank KB Bukopin Tbk as part of the issuance of the first ever social bond by a private bank in Indonesia. The bond is dedicated to addressing the socioeconomic consequences of COVID-19 and supporting MSMEs, affordable housing, healthcare, education and basic infrastructure.
To protect farmers, micro-retailers, and micro, small, and medium enterprises (MSMEs), that are especially vulnerable to economic shocks, IFC partnered with e-commerce start-up Growsari in the Philippines to boost digital transformation of MSMEs.
In Indonesia, investments in Sayurbox and AwanTunai improved supply chain linkages, increasing growth opportunities for farmers and micro-retailers including women.
IFC’s support to develop Lao PDR’s first international standard dry port will allow the land-locked nation to become the region’s new export base in manufacturing and agriculture, creating jobs.
In Cambodia, IFC’s teams are supporting the National Bank of Cambodia to create a green financing market, looking to introduce green or sustainability-linked loans/bonds.
In the Pacific, IFC moved ahead on public-private partnership agenda, to help preserve public resources even more scarce in the wake of COVID-19, with mandates signed for a tuna processing facility in Solomon Islands, and renewable energy mandates signed for Samoa and Papua New Guinea.
In Mongolia, IFC helped formulate Mongolia’s Green Bond Regulation and Guideline documents, to enable the issuance of green bonds in the local market.