Press Release

International Finance Corporation plans to ramp up its annual US$500 million investment in Mena companies with the potential to expand their footprint internationally, says its regional vice president.

The private sector investment arm of the World Bank is seeking to bolster its partnerships with companies it is already invested in within the region, while seeking out new companies ripe for investment, said Dimitris Tsitsiragos, IFC’s vice president for Europe, Central Asia and Mena.

“We want to make companies become regional champions and contribute to economic stability. It is important that each region has globally competitive companies and this includes Mena,” he said.

“As we get more confidence in Mena, the amount we invest will be much larger.”

IFC has already been active in helping companies extend their reach outside their borders within the region and farther afield. It is a shareholder in Metito, the Dubai-based utilities company invested in Mena, Africa and Asia, and has also provided hundreds of millions of dollars in financial support to companies expanding abroad including Gulftainer, a UAE-based ports operator, and Acwa Power International, a Saudi Arabian company that builds power plants.

Despite the progress made by some trailblazers in the region, it still remains one of the least globally and regionally integrated parts of the world. Excluding oil and gas, Mena accounts for only 2 per cent of world exports and captures only 4 per cent of global inflows of foreign direct investment.

Foreign ownership restrictions on companies, political instability and red tape are among the varied factors commonly cited by investors as barriers for doing business in the region.

IFC is looking to overcome these challenges by focusing on four areas ripe for investment. They include initiatives that create jobs, improve infrastructure, ease access to finance for SMEs, and develop manufacturing and services.

Last year, it made about $500m in inter and intra-regional investments, concentrated in infrastructure and primarily with GCC companies. IFC’s investment focus this year will include investing in new companies, as well as strengthening existing partnerships, said Mr Tsitsiragos.

“We are looking at making repeat investments with them,” he said. “We don’t see it as a one-time transaction, we see it as a partnership in investing in what be difficult places,” he said.

Last year, it provided a $30m loan to Gulftainer to help the company with its expansion into Iraq, as well as $50m in loans to Metito. It also supported Taqa, the Abu Dhabi-based energy company, with its $133m investment in a gas-fired power plant in Ghana.

Mr Tsitsiragos said IFC was looking for further investments with Taqa in other locations.