Moscow, April 29, 2004
—The International Finance Corporation (IFC), the private sector lending arm of the World Bank Group, signed an agreement today to provide $15 million in long-term debt to JSC Russkiy Mir and its subsidiary, JSC SFAT, for the purchase of rail tank cars to expand their fleet. IFC’s investment is aimed at providing long-term financial support for the expansion and modernization of Russia's rail industry and the expansion of Russia's oil transportation capabilities.
JSC Russkiy Mir and JSC SFAT are privately owned Russian rail transport companies and have been active in the oil transportation market for over ten years. The two companies lease rail tank cars to Russia's oil companies, which utilize the cars to transport crude oil and oil products, and provide rail car maintenance services.
Francisco A. Tourreilles, IFC’s Infrastructure Department Director, noted: “IFC’s financing of JSC Russkiy Mir and JSC SFAT is part of the Corporation's financial support of Russia's private rail industry. The Russian rail industry is playing an increasingly important role in oil transportation by removing bottlenecks and increasing oil exports. Over the next five years, private investment in Russia's rail industry will play a critical role in its modernization and expansion.”
“By supporting a leading private Russian rail car leasing company, this investment will contribute to the development of the country’s transportation infrastructure. We look forward to working with JSC Russkiy Mir and JSC SFAT in supporting their future investments,” said Edward Nassim, IFC’s Director for Central and Eastern Europe.
Michal Litwak, General Manager of SFAT, pointed out the importance of having IFC as a partner, “Our group is committed to improve upon the quality of transportation services available to Russia's oil companies and having IFC as an investor is an important part of that commitment.”
Russia became a shareholder and a member of IFC in 1993. Since then IFC has invested over $1.3 billion to finance nearly 70 projects across a variety of sectors. IFC significantly increased its investment program in Russia in the last two years, investing $217 million in FY02 (July 1, 2001 – June 30, 2002) and nearly $500 million in FY03. IFC's increased activity reflects the improving investment climate in Russia, greater opportunities in an increasingly broad range of sectors, and stronger foreign investor interest.
The mission of IFC (
www.ifc.org
) is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY03, IFC has committed more than $37 billion of its own funds and arranged $22 billion in syndications for 2,990 companies in 140 developing countries. IFC's worldwide committed portfolio as of FY03 was $16.8 billion for its own account and $6.6 billion held for participants in loan syndications.
