Moscow, Russia, July 1, 2009—
IFC, a member of the World Bank Group, has successfully concluded its Russia Far East Business Development Project, which extended the developmental impact of IFC investments in the local mining industry to the remote Magadan region.
The multi-faceted project concentrated on assisting small and medium enterprises and the large indigenous community in Magadan, located in Russia’s far northeast. The project created a self-sustainable microfinance fund, which has provided more than $2 million in microfinancing to 281 clients locally. It also helped increase market access for local firms, with 15 contracts totaling $3 million signed with target mining companies, while project advisory services facilitated a $6 million increase in revenues for its small and medium enterprise clients.
“The most important thing is that IFC is leaving behind is a structure for SME support-–the microfinance fund,” said Sergey Grebenyuk, Head of the Special Economic Zone of the Magadan Regional Administration. “That’s a very valuable contribution to Magadan’s further development.” He also noted that IFC has brought to the region a new work culture, which is important not only to project clients, but also to local governmental officials.
With funding from the Canadian International Development Agency, the project helped build local business capacity and supported the local indigenous population by:
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Improving the business practices of local SMEs involved in the mining supply chain and providing training to improve the management skills and efficiency of entrepreneurs in the larger business community
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Offering consultations on basic business development to Magadan’s large indigenous population, including seminars on developing and marketing traditional handcrafts as self-sustaining businesses
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Raising awareness among local government officials of how reducing administrative barriers can improve the business environment
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Working with local banks to increase access to financing for SMEs by introducing alternative financing products catering to smaller businesses
Alexander Avdonin, Chair of the Magadan Union of Tribes and Indigenous People, said: “The project’s biggest achievement is that the expertise, tailored work, and training provided to us by IFC has managed to change our thinking, making us business-oriented.”
About IFC
IFC, a member of the World Bank Group creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing private capital, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $16.2 billion in fiscal 2008, a 34 percent increase over the previous year. For more information, visit
www.ifc.org
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