IFC and Iceland Establish Private Sector Development Trust Fund
Reykjavik, February 3, 2006— The International Finance Corporation, the private sector arm of the World Bank Group has signed an agreement with the Icelandic Ministry for Foreign Affairs to establish a $240,000 trust fund to help promote the private sector in developing countries.
The trust fund, which will finance technical assistance projects using Icelandic consulting expertise, will enable Iceland’s businesses to work more closely with IFC in private sector development. The new funding commitment deepens Iceland’s cooperation with IFC, which started in 2004 when the Icelandic Government, Icelandic companies and IFC jointly sponsored a survey of Russia’s fish industry.
“We are proud to provide funding and expertise to IFC’s technical assistance program. Our Trust Fund will support IFC’s mission of reducing poverty through private sector development while helping Icelandic consultants better cooperate with the World Bank Group. It is a win-win situation for all of us,” said Gunnar Snorri Gunnarsson, the Ministry for Foreign Affairs’ Permanent Secretary of State, who launched the fund today together with Mwaghazi Mwachofi, IFC’s director for Trust Funds.
Mr. Mwachofi noted, “The trust fund marks a new era for IFC’s relationship with Iceland. This partnership will help IFC address the various challenges it faces in strengthening the role of the private sector in development.””
The trust fund may support technical assistance projects in all regions and sectors in which IFC is operating. The fund and other opportunities for cooperation with IFC were presented today at a seminar for Icelandic companies hosted by the Ministry for Foreign Affairs in Reykjavik.
Launched in 1988, IFC’s Technical Assistance Trust Funds Program provides funding mainly for one-time technical assistance projects that help promote private sector development in IFC client countries. In combining grant-funded, complementary services with commercial investments, IFC offers integrated solutions that add value to its projects. Trust fund projects range from company-specific interventions, including feasibility studies and capacity-building training programs, to advisory services to the governments of client countries. Since its inception, the program has supported more then 1,500 technical assistance projects in a broad range of sectors. Currently, the program has funding agreements with 25 donor countries.
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.
About Iceland´s Policy on Development Cooperation
Global development has become a prominent aspect of Iceland’s foreign policy as laid out in a policy document on Icelandic development cooperation for the 2005–2009 period.
The government has set a firm target for increasing official development assistance and recognizes the importance of reducing poverty through private sector development and economic growth. Iceland’s private sector is increasing its cross-border activity, and this provides an opportunity for expanding and deepening business relations between enterprises in Iceland and the developing countries. Iceland aims to cooperate with international agencies like IFC to build on this momentum. For more information on Iceland´s development cooperation, visit www.mfa.is/foreign-policy/development-aid/.
- Contact Information
- Georg Schmidt
- IFC, Washington DC
- International Finance Corporation
- Contact via E-mail
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