WASHINGTON, D.C. February 20, 2003—
The International Finance Corporation (IFC), the private sector development arm of the World Bank Group, announced today an investment of approximately $155,000 to subscribe to 25 percent of the shares of the newly created FINADEV SA, Chad's first private and commercial microfinance institution. Other shareholders include Financial Bank Tchad; Lafayette Participations, a Paris-based investment fund; and Groupe Vilgrain through both C.S.T. (Compagnie Sucrière du Tchad) and SOMDIAA (Société de Management des Industries Alimentaires et Agricoles).
With IFC's technical support, FINADEV started operations in July 2001 as a pilot window in Financial Bank Tchad, and has so far disbursed over 3,500 loans to artisans and traders in N'djamena. It recently opened a branch in Moundou to better serve SMEs in the country's petroleum zone. IFC continues to provide ongoing advice on strategy development, business planning, and linkage to other private companies and NGOs in Chad.
FINADEV is part of a linkage project launched by IFC following its investment in the $3.7 billion Chad-Cameroon Pipeline Project. IFC and the World Bank worked closely with project sponsors to put in place features to ensure that economic benefits of the project accrue to local businesses. To date, the project has generated employment for more than 12,000 people, over $410 million in local procurement, and approximately $400 million of infrastructure improvements directly benefiting SMEs.
Harold Rosen, Director of the World Bank Group SME Department said, “FINADEV is an important component of our Chad SME Initiative, which was designed to complement the sponsors’ work and increase the participation of local enterprises in the economic activity generated by the pipeline project. The investment in FINADEV supports our capacity building initiatives, which will contribute to the development of Chad’s private sector and allow it to better participate in the new economy the project will create. FINADEV is allowing access to credit to the poor, creating employment, distributing revenue, and strengthening the local economy. In addition, as a commercial venture it does not rely on donor funding."
Haydée Celaya, IFC's Director for Sub-Saharan Africa, added, “The investment is a key step in IFC's work with Chad's financial sector. Although the challenges are significant, we encourage and support initiatives that deliver on the World Bank Group's goal to reduce poverty and promote sustainable development."
The mission of IFC 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. Since its founding in 1956 through FY02, IFC has committed more than $34 billion of its own funds and arranged $21 billion in syndications for 2,825 companies in 140 developing countries. IFC's worldwide committed portfolio as of FY02 was $15.1 billion for its own account and $6.5 billion held for participants in loan syndications.
