IFC has doubled its trade financing program in Pakistan in fiscal year 2022 to support critical imports and foster a resilient post-pandemic recovery, a spokesman of the International Finance Corporation, the member organization of World Bank group said.
That work came alongside other milestone engagements to boost financial inclusion, bolster key sectors, like agriculture and retail, structure groundbreaking public-private partnership projects, and promote gender diversity.
IFC invested and mobilized about $680 million in Pakistan in short- and long-term financing between July 1, 2021, and June 30, 2022. That included a record $485 million in commitments through IFC’s Global Trade Finance Program to enable the import of essential goods and services, more than double the amount of the previous fiscal year. IFC also invested the equivalent of $25 million in Pakistani rupees for an equity stake in leading fashion retailer Khaadi Retail to create jobs, promote gender equality, and support the crucial textiles sector.
Alongside the investments, IFC launched advisory and upstream projects designed to unlock the private sector’s potential and attract funding in key sectors, including two landmark public-private partnership (PPP) projects. IFC signed an agreement with Sindh province to structure a PPP to provide clean drinking water to nearly 1 million people in Karachi, and another with authorities in Khyber Pakhtunkhwa to arrange a PPP to construct a state-of-the-art hospital with up to 500 beds.
In addition, IFC helped roll out a pioneering electronic warehouse receipt financing system to boost the flow of credit to the key agriculture sector – particularly to maize farmers – and launched the country’s Asaan Karobaar program with the government to streamline regulations and enable smaller businesses to grow.
IFC also joined forces with the Pakistan Business Council (PBC) to celebrate private sector employers committed to empowering women at work through gender diversity awards. The awards recognized firms that had not only implemented strong gender diversity policies, but had also publicly disclosed them, encouraging others to do the same. Daraz, Pakistan’s biggest online marketplace, received the highest score using a scorecard of five key gender principles developed by IFC and PBC.
“Accelerating private sector development is essential to foster a resilient, inclusive and green recovery, create more job opportunities, and help reduce poverty,” said Zeeshan Sheikh, IFC’s Country Manager for Pakistan and Afghanistan. “Pakistan is a priority country for IFC and this is reflected in our strong engagement in the country over the last year and our plans going forward. We are aiming to support critical trade flows, address bottlenecks to private investment in key sectors, and enhance shared prosperity. Going forward, we are committed to continue scaling up both our investments and advisory engagements in the country to help spur sustainable economic growth.”
IFC’s strategy in the new fiscal year includes diversifying into newer sectors, such as agri-related value chains, healthcare, digital and urban infrastructure. We also plan to support greater sustainability in industry. IFC will also pursue innovative PPPs through strategic partnerships with government and private sector stakeholders and will aim to increase the role of PPPs in key sectors, ramping up collaboration with other development finance institutions.
Since 1956, IFC has committed $10 billion in Pakistan and its current portfolio stands at $1.2 billion. IFC’s work has helped to support smaller businesses and spur the development of renewable energy projects, including hydro and wind installations, among other priorities