Kigali, Rwanda, August 14, 2012 –
IFC, a member of the World Bank Group, and Rwandan authorities hosted a workshop for senior government and financial market officials, investors, and representatives of financial institutions to support the development of local capital markets in Rwanda.
The workshop, which took place August 9 and 10 and was co-hosted with the National Bank of Rwanda and Rwanda’s Capital Markets Authority, focused on enhancing the skills of key players in Rwanda’s local capital market.
Monish Mahurkar, IFC’s Director of Treasury Client Solutions, said, “Countries with vibrant local bond markets can mobilize long-term local currency funds from local and international investors, and put them to work for the local economy while protecting borrowers from foreign exchange risk. Supporting the development of such markets is a priority for IFC.”
The workshop builds upon work already done by IFC in Rwanda. In 2009, IFC set up a local currency swap facility with the Rwandan Central Bank, marking the first time a multilateral organization entered into a long-term swap agreement with an African central bank to spur long-term lending to the private sector. The swap facility has enabled IFC to commit the equivalent of $26 million in Rwandan francs towards projects that support agribusiness, manufacturing and finance for small businesses.
The local currency swap has also helped attract foreign investors to Rwanda. IFC lent the equivalent of $6 million to Singaporean logistics firm, Portek, to facilitate the privatization of Magerwa Dry Port. IFC also made it easier for KCB, East Africa’s largest bank, to enter Rwanda last year by providing a $5 million local currency loan. KCB will use the loan to provide affordable mortgages and increase credit to small and medium enterprises.
At the workshop, participants discussed bond market development in Rwanda, and Africa as a whole. IFC also shared its experience in structured finance and as a bond issuer in international markets.
“The National Bank of Rwanda has been working with the IFC on the currency swap, which is operating very well,” said Claver Gatete, the Governor of the National Bank of Rwanda. "The Workshop today is a further step in our cooperation and it is a clear manifestation of the excellent working relations between the IFC and the National Bank of Rwanda in particular and the Rwandan government in general.”
The workshop was supported by Efficient Securities Markets Institutional Development (ESMID) Africa, a joint program by IFC, World Bank and Swedish International Development Cooperation Agency (Sida), which develops securities markets to finance priority sectors such as infrastructure, housing and microfinance.
In Africa, the ESMID program operates in Kenya, Uganda, Tanzania, Rwanda, and Nigeria, where it helps simplify procedures for issuing and trading bonds; builds capacity of market participants; and is regionalizing securities markets.
The Rwanda Dealers Association, composed of commercial bank dealers, was also launched during the workshop. The Association will work with IFC to build the capacities of its members, who are key contributors to the domestic financial market.
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