Washington, D.C./
Ouagadougou, Burkina Faso, May 24, 2005 —
The International Finance Corporation, the World Bank Group’s private sector financing arm, said today that it will provide a Euro 2.0 million loan for renovation of a landmark hotel in Ouagadougou, the capital of Burkina Faso. The funds will help restore Hôtel Indépendance, which includes 168 rooms, conference facilities, a business center, a health club, and retail and commercial office space.
The loan goes to Société Burkinabé de Promotion Hôtelière, to which the country’s government has leased the hotel for renovations and to manage its operations in preparation for privatization. IFC’s loan will allow the hotel to offer reasonably priced accommodations to business and other travelers who have up to now lacked a quality alternative to more expensive international hotels in Ouagadougou. With this financing, IFC aims to help revive Burkina Faso’s economy and support the country’s privatization efforts.
Richard Ranken, IFC’s director for Sub-Saharan Africa, said,
“IFC is pleased to support this highly visible example of Burkina’s commitment to grow its private sector. Our investment underlines the importance that IFC attaches to facilitating private participation in key business infrastructure in Burkina Faso, and to helping generate a positive investment response in support of the government’s economic reforms.”
As the name suggests, Hôtel Indépendance is emblematic of the country’s history; its symbolic presence in the center of Ouagadougou exceeds that of a typical hotel. Built right after the country’s independence in 1960, it is often used for town hall meetings and serves as a key reference point in the city.
Dimitris Tsitsiragos, IFC’s director for Global Manufacturing and Services, said, “Our involvement in this project promotes south-south investments, giving local businesses an opportunity to grow and diversify into intra-regional companies.”
Société Burkinabé de Promotion Hôtelière is owned by an existing client of IFC, Société Malienne de Promotion Hôtelière, which is an experienced hotel operator from neighboring Mali. The hotel will be run by a manager appointed by the parent company, with European training and extensive experience in establishing hotels managed by international operators. The procurement and marketing functions will be centralized in Mali together with the company’s other hotels.
Mossadeck Bally, majority shareholder of Société Malienne de Promotion Hôtelière, said, “Hôtel Indépendance has strong growth potential because of its size and strategic location near the city’s airport, the business district, and embassies and government offices. Ouagadougou is well placed to tap into trade-connected business visitors from neighboring countries that are members of the Economic Community of West African States.” Mr. Bally added, “We will use our experience in managing hotels to provide excellent service, backed by a focus on the training and retention of quality staff.”
IFC collaborated with Bank of Africa and BOAD to structure the long-term financing package, which would otherwise not have been readily available in the Burkinabé financial sector. In addition, IFC will support the hotel management’s work on training and on creating stronger links with neighboring small businesses. These links will enable more local sourcing of the products and services necessary to operate the Hôtel Indépendance.
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 FY04, IFC has committed more than $44 billion of its own funds and arranged $23 billion in syndications for 3,143 companies in 140 developing countries. IFC’s worldwide committed portfolio as of FY04 was $17.9 billion for its own account and $5.5 billion held for participants in loan syndications.
