REMARKS BY OUMAR SEYDI, IFC DIRECTOR FOR EAST AND SOUTHERN AFRICA
Coop Bank Ltd. Signing Ceremony
Nairobi, December 5, 2012
Good morning everyone,
- I would like to thank Co-op Bank for their warm welcome and hosting this event.
- To other guests and members of the press, thank you for attending – it must not have been easy given the current traffic situation!
- As IFC’s new Director for East and Southern Africa, I am delighted to extend this loan to support Coop Bank in
- SME finance
- supporting agriculture projects and
- promoting economic inclusion in East Africa
- Athough SMEs may be small, they have a very large impact on the economy.
- In 2010, 81% of all jobs created in Kenya could be attributed to small and medium enterprises.
- As many of you know, getting access to finance is life line for small businesses. Still, in many countries in Africa, entrepreneurs are excluded from the financial services.
- IFC partners with banks such as Co-op, to help them sustainably and profitably increase business with smaller businesses in Africa.
- To date, IFC has teamed up with ten banks and one microfinance institution in Kenya, Coop being the newest member of our family.
- Before I get into the specifics of our investment in Co-op Bank., let me tell you a little about IFC
- IFC is
- the world’s largest development institution focused on the private sector.
- We encourage sustainable growth by
- Financing private sector investment
- providing advisory services to businesses and governments
- and mobilizing capital in international financial markets.
- In Africa, IFC is active in more than 30 countries, and has been expanding steadily. IFC’s business in sub Saharan Africa has grown from just $140 million in 2003 to $4 billion last year!
- During the last fiscal year alone, IFC’s work with banks helped provide loans of over $ 1 billion to African SMEs.
- By working with banks like Co-op, we hope to provide similar support this year.
- Co-op Bank’s business model is very close to IFC’s heart
- not only because we are both committed to the SME sector
- but also because we share a vision for agriculture as a driving force of Kenya’s economy.
- As many of you know, Co-op Bank has a long history in the agricultural sector
- The bank’s roots lie in Kenya’s co-operative movement
- Co-op is still the preferred bank of the movement
- which now has over 8 million members, most of whom are engaged in micro-enterprise in rural Kenya.
- Agribusiness is also at the core of IFC strategy in Africa. Agriculture provides
- Employment for over 70% of Africa’s population
- over 25% of the continent’s GDP
- Increased agricultural productivity can create food security for the thousands who go hungry
- IFC works in agribusiness projects to help farmers and producers finance seeds, fertilizers, chemicals, and fuel.
- Last year, IFC invested $550 million in agribusiness projects in Africa.
- Over the next 5 years, we hope to increase those investments to $ 2 billion.
- Partners such as Co-op Bank will be crucial for IFC’s efforts to boost agribusiness.
- Along with the $ 60 million loan that IFC is providing for the SME and agriculture sector, we are also extending a $ 5 million trade line to Co-op Bank through our Global Trade Finance Program.
- This program provides banks in emerging markets with guarantees to cover risks associated with trade. We are excited to welcome Co-op Bank to the Program, and hope they will benefit from it.
- In Co-op Bank, IFC has found a valuable partner in this region. Not only is Co-op Kenya’s third largest bank, it is now also looking to provide financial services in South Sudan.
- As a new member of the IFC East Africa team, I am proud of the results that IFC and Co-op Bank have produced for the hard working entrepreneurs of Kenya and their families.
- I look forward to continuing this partnership. Thank you.