Washington D.C., August 23, 2005
—The International Finance Corporation, the private sector arm of the World Bank Group, is supporting Construtora Norberto Odebrecht -- a leading international engineering and construction company based in Brazil -- as the company provides funding and training to help its suppliers and subcontractors find export markets.
In April 2004, IFC provided $25 million to Odebrecht to finance small and medium enterprise suppliers and subcontractors. As Brazil's largest exporter of services, Odebrecht has a substantial international network, and it has historically brought along smaller companies in its supply chain into such export markets as Angola, Mozambique, and Botswana. As part of its financing to Odebrecht, IFC has helped the company design a program to upgrade the managerial and technical capacity of its suppliers and subcontractors, with emphasis on those that have strong potential to become competitive in markets beyond Brazil.
These capacity building efforts will now be bolstered by a broader partnership. Today Odebrecht is signing an agreement with Banco do Brasil and Sebrae, the Brazilian agency that supports small businesses, to implement a pilot program with selected SMEs in the company’s supply chain. The pilot will start in the state of Rio de Janeiro and expand into other Brazilian states where Odebrecht has strong supplier networks. The capacity building and training will be implemented by Sebrae, and Banco do Brasil will contribute to training modules on how to access credit for exports.
Atul Mehta, IFC’s Director for Latin America and the Caribbean, said, “This project shows IFC’s comprehensive approach to supporting its clients in the private sector in emerging markets. We are helping them not only achieve their business goals but doing it with a vision for development through technical assistance.”
Laurence Carter, IFC’s Director for Small and Medium Enterprises, added, “IFC is providing both funding and technical assistance to Odebrecht as a sign of continued support to its strong sustainable business practices and its commitment to developing the capacity of its network of SME suppliers.”
Carlos Fadigas, Chief Financial Officer for Odebrecht, said, “We appreciate IFC’s long-term partnership and its support for building the capacity of our supply chain. This agreement will definitely help improve our small and medium suppliers’ ability to become more competitive in the global market.”
As of June 30 2004, IFC's portfolio in Brazil was $1.48 billion, including $410 million from participating banks in syndications. IFC’s strategy in Brazil aims to enhance the prospects for competitiveness and growth, and improve social equity through voluntary actions by the private sector. The first objective entails supporting growth-generating firms with a wide network of stakeholders, export-enhancing activities including infrastructure and logistics, and activities improving access to long-term financing. Under the second objective, IFC is supporting the growing momentum towards socially responsible activities within the Brazilian private sector. This will involve support for firms committed to environmental and social sustainability, improving corporate governance practices, micro-finance and socially-oriented entrepreneurship.
The mission of IFC (
www.ifc.org
) is to promote sustainable private sector investment in transition economies, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the emerging markets, 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
About IFC’s Global Linkages Program
IFC delivers commercially focused technical assistance by integrating local small businesses into the supply chain of its clients. Currently this technical assistance is being implemented in more than 30 countries, tied to projects involving more than $1 billion in IFC investment. Programs include helping create new economic opportunities through supplier development, facilitating access to finance, and developing small businesses. These linkages are implemented by IFC’s Global Linkages Unit, Small and Medium Enterprise Department, in close coordination with the Corporation’s regional technical assistance facilities.
About Odebrecht
Founded in 1945 in the northeastern state of Bahia, Odebrecht provides state-of-the-art technical expertise in design and construction of large-scale projects, including highways, railways, bridges, tunnels, subways, buildings, port facilities, dams, and industrial facilities in such sectors as mining, steel, and cement. Odebrecht undertakes projects in all regions of Brazil as well as in most South American countries, Central America, Europe, the United States, and Africa. Construtora Norberto Odebrecht is a subsidiary of Odebrecht S.A., one of the largest Brazilian private sector conglomerates.
