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Washington, D.C., April 20, 2012—
IFC, a member of the World Bank Group, today convened leaders of dynamic companies in emerging markets to discuss how the private sector creates employment and growth, even in times of uncertainty.
Across the world, more than 200 million people are unemployed today. Millions more are underemployed or working in low-skilled, dangerous jobs for very low wages. Over 150 million young workers live on less than $1.25 a day.
“After three years of global economic instability and weak global economic growth, unemployment is a serious problem in developed and developing countries alike,” said IFC EVP and CEO Lars Thunell. “To accept such high levels of unemployment is to accept enormous economic, social and political risks. And the costs to society from high unemployment will grow in the years to come.”
The private sector provides about 90 percent of employment in the developing world—and will be essential to addressing the challenge. IFC’s clients are making important contributions to employment in their countries. At the discussion today, which took place in the context of the World Bank-IMF Spring Meetings, top executives from several IFC clients—Ghana’s UT Bank, Mexico’s Optima Energia, and Indonesia’s Bank Tabungan Pensiunan Nasional—joined Thunell and World Bank Group President Robert B. Zoellick.
IFC clients like BTPN are making important contributions to employment in their countries. Four years ago, BTPN had 3000 employees. By the end of this year, the company will have 20,000 employees in cities across Indonesia, said CEO Jerry NG. BTPN also provides access to micro, small and medium enterprises, which are key drivers of job creation. In just four years, BTPN has gone from zero to 250,000 microfinance customers.
Pearl Esua-Mensah
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Deputy Managing Director of Ghana’s UT Bank, emphasized the need to support promising entrepreneurs. “We try to build small companies into big institutions so they can employ more people--we’ve grown companies to become bigger than us,” she said.
In addition to helping business grow, IFC clients are helping them run more efficiently. Enrique Gomez Junco, Optima Energia’s founder and CEO, said that the company is helping municipalities across Mexico realize tremendous savings. “Electricity is the second largest expense after payroll for every municipality in Mexico,” he said, adding that municipalities can achieve 50% savings on electricity alone by replacing lighting with energy-efficient lamps. The company is a leader in energy-efficiency solutions in Latin America.
IFC is working on a study to gain a deeper understanding of how the private sector can be more effective in creating jobs. The study will inform policy-makers, development finance institutions, and private companies about which kind of investments create the most jobs, and how these investments affect women, youth, poor people, and other groups. For more information on the study, visit
ifc.org/jobcreation
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About IFC
IFC, a member of the World Bank Group is the largest global development institution focused exclusively on the private sector. We help developing countries achieve sustainable growth by financing investment, providing advisory services to businesses and governments, and mobilizing capital in the international financial markets. In fiscal 2011, amid economic uncertainty across the globe, we helped our clients create jobs, strengthen environmental performance, and contribute to their local communities—all while driving our investments to an all-time high of nearly $19 billion. For more information, visit
www.ifc.org
.
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