Surging South-South Foreign Direct Investment Key Theme of IFC-Financial Times Conference, Mumbai, November 9-10
Washington, D.C./Mumbai, India, November 7, 2005—“South-South” foreign direct investment—investment from one developing nation into another—is growing at a rate five times faster than the growth of traditional North-South investment from industrialized to developing countries; today “South-South” flows represent almost a third of all foreign direct investment. This phenomenon will be discussed at an international conference in Mumbai on November 9-10, 2005; the event is being sponsored by the International Finance Corporation, the private sector arm of the World Bank Group, and the Financial Times.
Joseph Battat and Dilek Aykut of the World Bank found in a recent study that South-South FDI had increased from $15 billion in 1995 to $46 billion in 2003, accounting for about 35 percent of total FDI flows in developing countries. At the same time, high-income OECD countries also received $16 billion in FDI from developing countries in 2001, up from $1 billion in 1995. Recent figures suggest that Southern multinationals continue to expand globally.
The conference will look at outward investment by developing country multinationals and bring together top executives from these companies to compare experiences, learn from best practices, and forge new links in cross-border investing—both in emerging market countries and in industrialized countries.
“We’re encouraged by the rapid growth of Southern multinationals, but we recognize that entering a market is just the first step. We want to ensure these companies thrive and make a positive contribution to development, especially on environmental and social issues,” said Assaad Jabre, IFC’s Acting Executive Vice President.
Over the past three years, IFC’s contribution to South-South investments has increased at an impressive 20 percent annually, from $450 million in 2003 to $654 million in 2005, amounting to a cumulative $1.6 billion. IFC has also mobilized $600 million in syndicated loans for such projects.
About 200 speakers and participants are expected to attend the conference, representing companies from Brazil, China, Egypt, India, Indonesia, Mexico, Nigeria, South Africa, Turkey, and other developing countries. Case studies, panel discussions, and presentations by leading analysts and practitioners will provide key strategic information for decision-makers on competing in the global marketplace. Discussions are expected to go beyond selling products regionally or globally; they will also address how emerging market companies can establish themselves more deeply in other markets—both in emerging and industrialized countries—through new projects, joint ventures, or acquisition of existing facilities or companies.
The conference will be chaired by Quentin Peel, International Affairs Editor at the Financial Times. Keynote sessions will feature P. Chidambaram, India’s Minister of Finance; Kemal Dervis, Administrator of the UN Development Programme; and IFC’s acting chief, Assaad Jabre. For the agenda, visit the conference’s Web site: www.ftconferences.com/mini_site/southernmultinationals_2005_main/index.html
Case studies will include Brazil’s Marcopolo, with a presentation by Chief Executive Jose Rubens de la Rosa, and the Tata Group, with a presentation by Executive Director Alan Rosling.
After the conference, IFC will host a series of seminars on investment opportunities in key emerging markets and regions. These will include meetings with prominent business leaders, as well as a one-day seminar on India, in conjunction with the Confederation of Indian Industry, featuring senior executives and government officials.
The International Finance Corporation is the private sector arm of the World Bank Group and is headquartered in Washington, D.C. IFC coordinates its activities with the other institutions of the World Bank Group but is legally and financially independent. Its 178 member countries provide its share capital and collectively determine its policies.
The mission of IFC is to promote sustainable private sector investment in developing and transition countries, helping to reduce poverty and improve people’s lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY05, IFC has committed more than $49 billion of its own funds and arranged $24 billion in syndications for 3,319 companies in 140 developing countries. IFC’s worldwide committed portfolio as of FY05 was $19.3 billion for its own account and $5.3 billion held for participants in loan syndications. For more information, visit www.ifc.org.
The events arm of the Financial Times, FT Global Conferences, organizes high-level strategic events for the international business and financial community. With 35 years of experience, an international reputation for quality, agenda-setting programs, and the ability to attract speakers of the highest caliber, FT Global Conferences offers senior executives proven forums that allow the debate of key market strategies, while providing a unique opportunity to network with corporate colleagues and potential clients. FTGC is an integral part of the Financial Times newspaper – an indispensable business source for decision-makers. The Financial Times has a global circulation of over 450,000 and over 1.6 million readers. For more information, visit www.ft.com/conferences.
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