HANOI, VIETNAM, February 4—Japan agreed today to join five other donor countries in providing financial support to the Mekong Project Development Facility (MPDF), an IFC-managed technical assistance facility which promotes small and medium enterprises (SMEs) in Vietnam, Lao PDR, and Cambodia. MPDF began its operations last year in Hanoi and Ho Chi Minh City. The Facility also has a limited office in Phnom Penh, and is in the process of opening a new office in Vientiane.
To mark Japan's new status as an MPDF donor, a ceremony and press conference were held in Hanoi with Mr. Akira Kamitomai, the World Bank's Alternate Executive Director for Japan, and with Mr. Thomas Davenport, Manager of MPDF, in attendance. Japan became the largest single donor to IFC's technical assistance programs in October 1995 when it established the Japan/IFC Comprehensive Technical Assistance Trust Fund, a financing arrangement that serves as the delivery mechanism for Japan's support of several IFC technical assistance programs, including MPDF. Japan has since contributed about US$6 million annually to the Trust Fund. The amount earmarked for MPDF in this financial year is US$511,000.
During the press conference, Mr. Kamitomai said, "It is our great pleasure to express our commitment to MPDF. We believe that IFC's expertise will contribute to the promotion of SMEs, which is one of the highest-priority agenda items for development of the Mekong region." Mr. Davenport, in responding to these remarks, stated, "We are grateful for the strong support that Japan is providing. It will help to broaden MPDF's developmental impact throughout the region, and contribute to building a better environment for local private sector firms."
MPDF's mandate is to support efforts by SMEs to expand, establish new operations, and restructure or privatize by assisting in the development of bankable proposals. It also undertakes training and capacity building. During its five-year term, MPDF anticipates having a total budget of US$25 million. To complement the technical assistance work of MPDF, IFC has also extended a US$5 million pilot financing line to help mobilize additional capital for SMEs.
IFC, a member of the World Bank Group, is the largest multilateral source of equity and loan financing for non-state sector projects in developing countries. Along with other donors, the Corporation has set up similar facilities offering technical assistance and advisory services for small business development in Africa, Eastern Europe, and the Pacific Islands.
