The International Finance Corporation (IFC) invested $4 billion over the past decade in Egypt, said IFC Country Manager for Egypt, Libya and Yemen Walid Labadi. He stated that the corporation is committed to invest $300 million more in 2020, adding that the IFC is looking forward to enhance its performance this year.
In interview with Ahram Online on the sidelines of the press conference held on Wednesday after signing an agreement between IFC and Tanmeyah, a micro-finance company, Labadi said Egypt's unemployment in the formal sector is regressing, but that poverty is still a major challenge for Egypt and its economy.
The micro-finance sector plays a key role in attempting to resolve this issue through generating more jobs, combating poverty, and giving people hope.
"Egypt's micro-finance is a huge market with huge potentials. Yet, there are challenges on the ground, including the current regulatories, insufficient private capitals directed towards this sector, and shifting the mindset to focus on people's needs to meet them. The micro-finance sector is serving the majority of the Egyptian people."
Egypt has high unemployment rates, which makes a strong micro, small and medium enterprise (MSME) sector critical to spur job creation and economic growth in the country.
According to IFC data, a third of the population have access to bank accounts, while the formal MSME finance gap was estimated at $46.7 billion in 2017, representing a significant opportunity for financial institutions to increase their outreach to individuals and the sector.
Labadi explained that the IFC delivered more than $19 billion in long-term financing for developing countries in FY 2018/2019, leveraging the power of the private sector to end extreme poverty and boost shared prosperity.
The agreement with Tanmeyah is part of the IFC’s wider strategy that aims to expand access to finance and support financial inclusion in Egypt, he added.
The IFC, a sister organisation of the World Bank and member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets.
It works with more than 2,000 businesses worldwide, using its capital, expertise, and influence to create markets and opportunities where they are needed most.