Thousands of micro, small and medium enterprises (MSME) and millions of farmers across Asia and the Pacific region stand to benefit from the first phase of Covid-19 crisis response funding from International Financing Corporation (IFC).
As the pandemic continued to send shockwaves through the global economy, IFC, a member of the World Bank Group, supported 13 companies in the region.
Over 190,000 employees in the manufacturing, agriculture, services and energy sectors have been benefitted from $554 million fund in the fiscal year ending on June 30, 2020, according to a press release of IFC.
The support to companies focused on agriculture — between 15,000 and five million farmers and SMEs in their supply chain networks — will help boost farmers' incomes, strengthening agribusiness and contributing to food security.
Since the outbreak of Covid-19, IFC has made efforts to help both small and large businesses in Bangladesh, Pakistan, Sri Lanka, India and Vietnam.
Besides, IFC deployed $492 million in Covid-19 related trade finance lines in the region. This has helped financial institutions provide liquidity to businesses dependent on trade, especially small and medium enterprises (SMEs).
About 17,500 MSMEs and corporates in the region are also expected to be among the beneficiaries of IFC's $2 billion Working Capital Solutions (WCS) programme in FY 2020.
The aim of the programme is to help emerging-market banks extend credit so that businesses can continue to operate, stemming job losses.
The WCS programme is part of IFC's $8 billion global Covid-19 fast-track financing facility developed to help businesses cope with the ongoing global slowdown, marked by a collapse in tourism, plunging trade, disruptions to supply chains, and diminished foreign direct investment.
Overall, IFC committed $6.7 billion in private sector investments in Asia and the Pacific in the fiscal year ending on June 30, 2020.
This includes the $554 million in IFC financing in response to Covid-19 under the new Covid-19 fast-track facility.
Just under half of this was for countries classified as poor and fragile and conflict affected. In addition, IFC supported around $ 1.1 billion of cross-border trade in the region through its Global Trade Finance Programme (GTFP).
IFC has supported City Bank Limited in Bangladesh with a loan to provide financing for SMEs and companies affected by Covid-19.
IFC's first Covid-19 WCS programme in Asia-Pacific was signed in Sri Lanka with the Commercial Bank of Ceylon to help over 1,200 SMEs — nearly 790 of them women led — deal with the crisis.
"The economic and social impact of Covid-19 will continue to exact a toll on people and businesses, leaving an indelible mark on the region's economies and private sector," said Alfonso Garcia Mora, IFC's newly appointed regional vice president for Asia and the Pacific.
"To address this, we are stepping up efforts to support companies strengthening also our support to the financial sector so that businesses and firms can build resilience on the road to recovery," added Garcia Mora.
IFC was now working on the second phase of its Covid-19 response to help financial institutions and companies in the region on their path to recovery, said Garcia Mora.
"As part of our bid to advance workable development solutions to the challenges posed by Covid-19, IFC will also step up its engagement with the World Bank in the Asia-Pacific region. We will focus on our strategy to create markets by working upstream, tackling barriers to spurring the private sector and creating jobs. This approach is critical to attract investors in the most vulnerable markets," Garcia Mora said.
Some other examples of IFC's support in FY 2020:
India: Over 200,000 farmers expected to benefit from $40 million to DCM Shriram Limited to mitigate supply chain disruptions and boost resilience in markets affected by COVID-19.
Pakistan: IFC's first investment in health care in Shifa International Hospitals to help set up more hospitals and clinics for better access to quality affordable care; IFC's equity investment in Pakistan Mortgage Refinance Company Limited, to help develop affordable housing market.
Vietnam: IFC's financing package to help Phu My Hung Development Corporation extend financial relief to clients, suppliers, and contractors along its property value chain, helping preserve jobs; $70 million to Indo Trans Logistics Corporation of Vietnam to support the logistics sector, helping trade and competitiveness of the country's economy.
Nepal: The Upper Trishuli-1 (UT-1) project, a 216 MW run-of-river hydropower project, one of the largest foreign direct investments in Nepal's history, set to deliver power to millions of people.
Afghanistan: IFC joining partners in signing the debt financing package for the country's first long-term public private partnership, the Mazar-e-Sharif gas-to-power plant, which will boost domestic electricity generation by up to 30 percent.
Sri Lanka and Maldives: $175 million investment in John Keells Holdings (JKH) to expand its supermarket chain in Sri Lanka and help fund expansion or refurbishment of hotels in Sri Lanka and the Maldives, where tourism is vital.
Maldives: IFC's first investment in a decade, supporting Bank of Maldives to provide liquidity to the hard-hit tourism sector and SMEs, backing the sector.
Indonesia: Investment in privately placed gender and green bonds issued by Bank OCBC NISP with proceeds from bonds to boost lending to women entrepreneurs and spur green projects.
Thailand: IFC's subscription to the region's first women entrepreneurs' bond to be issued by Bank of Ayudhya to boost lending to women-owned SMEs.