development impact report 2015

IN PARTNERSHIP WITH

IFC ADVISORY SOLUTIONS IN SUB-SAHARAN AFRICA

Advancing Innovation in Africa

Development Impact Report 2015ii

Copyright © IFC, 2016.

All rights reserved

IFC 14 Fricker Road, Johannesburg, South Africa

Website: www.ifc.org

DISCLAIMER

IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing private capital, and providing advisory and risk mitigation solutions to businesses and governments. This report was commissioned by IFC through its Sub-Saharan Africa department.

The conclusions and judgments contained in this report should not be attributed to, and do not necessarily represent the views of, IFC, its partner, or its Board of Directors or the World Bank or its Executive Directors, or the countries they represent. IFC and the World Bank do not guarantee the accuracy of the data in this publication and accept no responsibility for any consequences of their use.

Extracts from this report may be freely reproduced for non-profit purposes, with acknowledgment to IFC. Users who wish to further adapt this report should contact IFC.

IFC advisory solutions in Sub-Saharan Africa 1

IFC ADVISORY SOLUTIONS IN SUB-SAHARAN AFRICA

Advancing Innovation in Africa

Development Impact Report 20152

ForewordSub-Saharan Africa is home to some of the world’s fastest-growing economies. This remains true even

as global growth rates have slowed. Governments are investing in large-scale infrastructure development

and engaging with the private sector to mobilize capital and capacity to enable the region to progress

towards its development goals. IFC has played an important role in supporting this growth by employing

its global expertise, on-the-ground knowledge, and strategic partnerships within the World Bank Group

and other partners.

This fourth edition of IFC’s Africa Impact Report highlights our advisory work in the countries in which

we operate. Our previous report emphasized IFC’s commitment to collaboration and transformative

action, which has enabled us to deepen our engagement. This report focuses on the lessons learned

through our work and the resultant innovations that we have developed to deepen and broaden our

impact. These innovations, which include new distribution models for selling index insurance, and pre-

emptive market research and marketing, have helped us to deliver on our strategic priorities. These

priorities – supporting the growth of small and medium enterprises (SMEs), increasing financial inclusion,

supporting the development of enabling infrastructure, helping small-scale farmers to enter value chains,

and expanding market opportunities – are covered in the chapters of this report.

Some innovations have helped to bring about significant market transformation; others have helped

to increase private sector investment, such as the development of the Niger Dry Port; and several have

provided insights and workable models for IFC to replicate in other parts of the world. We continue to

work in fragile and conflict-affected states to help businesses supply vital goods and services, maintain

or increase employment levels, and stabilize economies. Using due diligence processes to identify and

market viable business opportunities in these countries has resulted in tangible benefits, as has adopting

a private sector-focused fragility and conflict lens, which allows us to tailor interventions to each context

and work to reduce or eliminate the drivers of fragility and conflict.

IFC collaborates with governments, enterprises of all sizes, public and donor organizations, and

individuals, with an increasing focus on client needs. The increasing emphasis on integration between

divisions and units within the World Bank Group has strengthened our ability to bring about real

change. This approach has increased our impact in each country and across the region. It has also had

demonstrable results at the legislative and regulatory level; with those involved in micro, small, and

medium enterprises; and in agriculture and other sectors. Our use of quality data and on-the-ground

market information to inform strategic programming and projects – alongside incorporating lessons

learned into program design – ensures that our financial support and advisory solutions are relevant. We

are therefore able to make an impact where it is needed most.


CONTENTS

Foreword 2

Partnering for Impact 8

Measuring Our Impact 9

Our New Delivery Model: Advice to Clients 11

Promoting Sustainable Agribusiness 12

Case study: Warehouse Receipt Financing Program 13

Case study: Index Insurance 14

Financial Inclusion 16

Case study: Airtel Money Uganda 17

Case study: Supporting greenfield microfinance institutions 18

Case study: Liberia collateral registry 19

Closing the Infrastructure Gap 20

Case study: Building a public-private water partnership in Benin 21

Case study: Niger Port 22

Developing SMEs 24

Case study: Rwanda Enterprise Development Program 25

Case study: Catalyzing access to finance for small businesses 26

Creating More Competitive Markets 28

Case study: Ethiopia Private Sector Development Initiative 29

Case study: Health in Africa 30

Fragile and Conflict-Affected Situations 32Case study: Africa Leasing Facility II 33

Case study: Post-Ebola response 34

Case study: Irrigation in the Sahel 35

Annex 36

2014 Client Satisfaction Survey 36

List of Indicators 37

Acknowledgements & Credits 37


2015 Overview

$62.7m

Total value of our advisory solutions expenditure in Sub-Saharan Africa

Expenditure $62.7 million

PROJECT-RELATED EXPEDITURE IN 2014

$60.3m

$11.2m

$19.8m

$11m

$6.5m

Africa’s poorest countries

Infrastructure

Fragile & conflict-affected situations

Climate change

Agriculture

Active client

engagements119


Total number of projects in the

Sub-Saharan Africa portfolio

179Top 5 portfolio

countries

Ethiopia$14.7 million

Kenya$21.0 million

Nigeria$14.7 million

Ghana$10.6 million

Uganda $10.8 million


2014 Development Impact

77PEOPLE TRAINED

We trained about 77,000 people in areas such as business management, loan application processes and better farming practices.

thousand

14.8FINANCING FACILITATION

We facilitated loans worth about $14.8 billion to households and micro, small, and medium-sized enterprises through financial institutions and improved financial infrastructure.

billion

5.4PEOPLE REACHED

We worked with our clients and partners to reach more than 5.4 million people.

million

120SAVED BY THE PRIVATE SECTOR

We helped save the private sector more than $120 million by simplifying regulatory compliance requirements.

million


256REGULATIONS ENACTED

We helped African governments enact about 256 laws, regulations and amendments to improve the investment climate and access to finance.

72REFORMS SUPPORTED

We supported more than 72 reforms in such areas as starting a business, licensing, construction permits, and alternative dispute resolution.

14ENTITIES ADVISED

We advised nearly 14,000 companies and public entities on ways to improve their services and implement new products.

thousand

19ACCOUNTS LINKED

We worked with financial intermediaries to link more than 1.9 million accounts to mobile banking services.

million

400PEOPLE ACCESSED IMPROVED SERVICES

We helped nearly 400,000 people access improved non-financial services.

thousand

at a glance


Who are IFC’s partners?

We collaborate with a range of entities, from national governments to nongovernmental organizations and private companies. Our financial partners include bilateral and multilateral donor partners and development institutions, charitable organizations and foundations, and other members of the World Bank Group. Our implementing partners are private companies, government entities, and civil society groups, which often play a role in informing IFC’s approach. Our development partners operate in traditional areas of advisory solutions, as well as blending grant (from public and philanthropic organizations) and non-grant financing (from private capital) to ensure the financial viability of projects and generate returnable capital.

Working together for greater impact

IFC’s strategic collaborations focus on sectors relevant to Africa’s development goals, such as affordable housing, access to finance, and increased agricultural productivity. An example is IFC’s partnership with CITICC Africa Holdings Ltd (CAHL), a multinational construction and engineering company, to demonstrate the viability of large-scale housing delivery. CAHL will support up to 30 housing developments across the region and enable us to complement other direct investments

in housing development and mortgage finance more systematically. The project will also create a significant number of jobs, boost demand for local construction materials, and transfer knowledge. We continue to work with development partners to enhance the impact of strategic programs and projects by providing flexible funding, thought leadership, and knowledge sharing.

Partnering for change in conflict-affected countries

IFC’s goals have been more closely aligned and integrated with the World Bank Group approach in key areas, with a focus on expanding strategic partnerships. Nowhere is this more important than in Africa’s fragile and conflict-affected countries. In 2008, IFC, in partnership with Ireland, the Netherlands, and Norway, established the Conflict-Affected States in Africa (CASA) Initiative to address private sector development challenges in these countries. Denmark has provided additional support to the initiative in Somalia, South Sudan, and Zimbabwe, and Sweden in Liberia.

CASA is active in Burundi, the Central African Republic, Côte d’Ivoire, the Democratic Republic of the Congo, Guinea, Liberia, Malawi, Mali, Sierra Leone, Somalia, and South Sudan.

IFC’s current development partners in Sub-Saharan Africa

Austria • Austrian Development Bank • Bill & Melinda Gates Foundation • Canada • Denmark • European Union • Financial Sector Deepening Trust * Flanders and Wallonia regions of Belgium •

France • Ireland * Italy • Japan • The MasterCard Foundation • Netherlands • Norway • Portugal • South Africa • Sweden * Switzerland • TradeMark East Africa • United Kingdom • United States

IFC is exploring innovative and strategic ways of working to leverage its leadership position within the development finance sector. We recognize that multi-level collaborations enable us to mobilize resources,

ideas, and expertise, and direct capital flows to where they are needed. This approach facilitates the integration of comparative business strengths and a common problem-solving approach.

Partnering for impact


Measuring our impact

How we measure success

IFC sets measurable internal development targets that align with its development strategy, which then sets corporate development goals. These internal targets are set at each project design phase and reviewed if necessary. A monitoring system tracks progress and multiple methods are used to evaluate the longer-term impact of interventions. This systematic approach allows us to track a project’s progress throughout its life cycle and

incorporate lessons learned into operations, which enables us to improve project design and goal setting. The process ensures that we are more focused on achieving results. It also improves the transparency of our work, as well as our accountability to our stakeholders. Our approach in fragile and conflict-affected states is based on the understanding that there are multiple causes and manifestations of conflict and fragility. We use a conflict and fragility lens to identify these causes, which informs our program design in these countries.

Our overarching goals

IFC works towards the World Bank Group’s overarching goal of ending extreme poverty by 2030 and stimulating shared prosperity in every developing nation.

IFC development goals

IFC has identified the following overarching development goals:

INCREASE ACCESS TO FINANCIAL SERVICES

FOR MICROFINANCE AND INDIVIDUAL CLIENTS,

AND SMES

IMPROVE HEALTH AND EDUCATION

SERVICES

INCREASE OR IMPROVE SUSTAINABLE

FARMING

REDUCE GREENHOUSE-GAS EMISSIONS

CONTRIBUTE TO ECONOMIC GROWTH

EXPAND OR IMPROVE

INFRASTRUCTURE SERVICES


Each goal is linked to a numerical target. IFC works towards these targets, which are based on a project’s expected contribution at the time of investment or an advisory solutions agreement. Our projects are often large, implemented over a number of years, and at varying stages of maturity. The results measurement framework accounts for this by tailoring performance milestones for each project. The three-year (financial years 2014–2106) joint development targets for IFC’s advisory solutions and investment in Sub-Saharan Africa are:

of our work on people and businesses. The evaluation process includes validating project results and using this information to inform future projects. The methods used for evaluation are adapted according to context.

In Africa, we use methodologies ranging from rigorous experimental evaluations (randomized control trials) through theory-based strategic or thematic evaluations to qualitative evaluations of ethnographic and financial diaries.

Increasing our impact

In line with the World Bank Group’s strategy of engaging in activities that increase our collective impact and result in fundamental improvements to economic and living conditions in our target countries, we aim to dedicate significant resources to transformational activities. Current transformational initiatives include our involvement in the Sahel Irrigation Initiative, as well as our work in the Horn of Africa. We work to build and link innovations across the World Bank Group. For example, our use of the World Bank’s Poverty Global Practice tool, SWIFT, allows us to estimate consumption patterns at the household level to determine if targeted households are coming out of poverty. This is a low-cost and effective tool which IFC first used in Africa. This, along with other monitoring and evaluation tools, helps us to understand our development impact better.

This report, however, notes results for projects active during the period to December 31, 2014, which are not measurable against the financial year development targets.

IFC’s priority areas for Sub-Saharan Africa include bridging the infrastructure gap, helping to build productive industries, and fostering inclusive finance and business approaches. We work directly with small and medium businesses to help improve their skill levels and with financial institutions to enable inclusive access to finance. We facilitate public-private partnerships that strive to fill the infrastructure gap, and help to create more competitive and inclusive markets, particularly in fragile and conflict-affected states, which have the greatest needs.

Monitoring

The monitoring system tracks project performance against the internal development targets throughout a project’s life cycle. This allows feedback to be incorporated into operations in real time. The project outputs, outcomes, and impacts determine the overall effectiveness of the advisory solutions. The actual results are compared to the targets once the project is complete. If feasible or needed, monitoring continues after project completion to track subsequent impacts.

Evaluation

Evaluating the monitoring results helps us to address gaps in knowledge, learn lessons from successful and unsuccessful interventions, and measure the impact

Increase or improve sustainable farming

opportunities for 1.3 million people.

Increase access to financial services for

at least 27 million microfinance clients.

Increase access to financial services for 680,000 small and medium business

clients.

Increase or improve transport,

utilities, and telecommunications

infrastructure for at least 22 million

people.

Reduce greenhouse-gas emissions by 760,000 tonnes

of carbon dioxide equivalent per year.

1.3 million 27 million 680,000 22 million 760,000


IFC advisory solutions with a new delivery modelIn mid-2014 the World Bank Group re-organized its structure to encourage the sharing of knowledge and best practices among its different divisions and units. This improves its ability to achieve its development objectives and bring about greater impact through its programs and interventions.

The new structure has 14 practices of technical expertise grouped into three broader categories. The 14 practices are agriculture; education; energy and extractives; environment and natural resources; finance and markets; governance; health, nutrition, and population; macroeconomics and

fiscal management; poverty; social protection and labor; trade and competitiveness; transport and information technology; urban, rural, and social development; and water. There are also five cross-cutting solution areas focused on World Bank Group-wide strategic goals and direction: climate change; fragility, conflict, and violence; gender; jobs; and public-private partnerships.

IFC’s advisory solutions are increasingly integrated and are delivered through IFC’s industry, cross-cutting advisory solutions and transactional risk solutions units, as well as the two joint global practices.

IFC ADVISORY SOLUTIONS

FINANCIAL INSTITUTIONS

GROUP

INFRASTRUCTURE & NATURAL RESOURCES MANUFACTURING,

AGRICULTURE & SERVICES

TRA

DE

&

CO

MP

ETIT

IVEN

ESS

FINA

NC

E & M

AR

KETS

Cross-cutting advisory solutionsPPPS • ENERGY • WATER • SMES • GENDER

Transactional risk solutions

IFC sector-specific advisory solutions

Advisory solutions through joint IFC/World Bank global practices

IFC advisory solutions across sectors


01 Promoting Sustainable Agribusiness

About 70 percent of Sub-Saharan African households rely on agricultural activities for survival. Agribusiness contributes an average of 25 percent to most countries’ gross domestic product (GDP) and up to 50 percent for some. African farmers struggle to access the modern technology and inputs (including improved seed and fertilizer), markets, and credit they need to feed a growing population. Farmers will need to double food production by 2025 to meet demand, particularly from an increasingly urbanized middle-class population. Lack of agricultural inputs, infrastructure, and financing are the main constraints, compounded by political instability in some countries, regulatory challenges, and issues of access to land and water.

Sixty percent of arable land in Africa is uncultivated. Farmers could close the yield gap if they were able to access improved technologies, irrigation, logistical support, financing, and good management practices. IFC can help lessen the financing gap of an estimated $20 billion a year to make a significant impact on the continent.

IFC works to help farmers increase their production quantity and quality, and reduce their losses to support food security objectives. We emphasize the inclusion of small-scale producers, particularly women, in our programs and we support the sustainability of social and ecological systems. IFC helps governments create the necessary conditions for agribusiness investments and addresses infrastructure gaps, such as the provision of electricity and water. We aim to help create a sustainable, growing sector that can meet domestic demand and supply the export market, while mitigating the effects of climate change and promoting responsible water usage.

IFC makes strategic interventions across the value chain of input producers and distributors, primary producers, supply-chain management, distribution, and wholesalers. We reached 1.2 million farmers in 2014 and aim to reach a further one million farmers by 2018 through increased investments worth $2 billion.

We are involved in health and food safety standards, SME productivity, and strategic community

investments. We help improve local governance and enable government to provide long-term income-generating projects and small-scale infrastructure for rural communities. Most projects focus on coffee, cocoa, tea, grains and beans, plantation forests, dairy products, and palm oil.

IFC provides investment and advisory solutions in countries with significant agri-potential and supportive governments. These countries include Burkina Faso, Côte d’Ivoire, Ghana, Mozambique, Nigeria, Senegal, Tanzania, and Zambia. IFC follows a partnership approach, aligning with the work of the World Bank Group, governments, development finance institutions, and nongovernmental organizations. It uses the Multilateral Investment Guarantee Agency (MIGA) and World Bank partial risk guarantees to manage risk and the Global Agriculture and Food Security Program for blended financing.

The approach also aligns with the ‘one IFC’ approach to scaling up agribusiness investments – the Agribusiness for Africa Special Initiative supports innovative and high-impact client solutions by partnering across investment and advisory solutions throughout the World Bank Group.


The challenge

The warehouse receipt system allows farmers, traders, and processors to store farm produce in an accredited warehouse and receive written proof of (or a warehouse receipt for) the quality and quantity of produce stored. This enables them to access short-term credit from participating financial institutions using the receipt as collateral. However, IFC’s cross-country analysis found that markets and financial institutions lacked faith in this system, especially where there are no legislative frameworks to support it.

Our response

The Warehouse Receipt Financing Program aims to support improved financing for this system and contribute to legislative reforms to help farmers, traders, and processors access credit. IFC also builds the capacities of financial institutions on warehouse receipt financing and among warehouse receipt system stakeholders on how it works. IFC further provides support for warehouse inspection, registration, and certification, as well as commodity grading and quality certification.

Outcome

In 2014, we launched a pilot project for the rice sector in the Senegal River Valley and have signed an advisory solutions agreement with the Ministry of Finance; a draft bill is awaiting enactment. In Malawi, we developed operational guidelines and a practitioner’s guide for implementers while awaiting Parliament’s approval of the warehouse receipts bill. We also developed warehouse receipts regulations and operational conditions for a

regulatory body. IFC has provided financial support to the East African Grains Council and organized a series of training courses for stakeholders on commodity trade financing. IFC also directly trained financial institutions on warehouse receipt financing. Given the government’s commitment to institutionalize the warehouse receipt system and stakeholders’ resultant momentum, six banks are now financing warehouse receipts, up from only one bank. Total financial exposure has increased from $500,000 to $6 million, benefiting 1,000 farmers and 500 traders.

In Kenya, the Cabinet has endorsed the Warehouse Receipt Bill; 2,000 people are using 14 pilot warehouses and five banks are participating. Lending against receipts is $4 million. Chase Bank, one of the biggest investors in agribusiness in Kenya, has committed more than $10 million to warehouse receipt financing for 2015. IFC has received requests for support from Ghana, Mozambique, Nigeria, and Zambia.

13

CaseStudy 01

Warehouse Receipt Financing Program

Donor partnersThe program is implemented in

partnership with the European Union, the First Initiative, Germany, the

Global Agriculture and Food Security Program, Japan, and the United States.

L E SS O N S L E A R N T

Our experiences in agriculture-related reforms highlight the importance of having a senior government champion and strong coordination between government departments when trying to generate investment in agribusiness.

Equally important is transparency around the availability of land and the security of access to such land. High standards for social and environmental safeguards and clarity on the responsibilities of the various institutions involved are also crucial.

It is important to develop a gender strategy to include women and measure the project’s effect on this group. This is especially true for agricultural development projects, which tend to overlook the important role that women play in agriculture.


CaseStudy 02

Donor partnersThe program is implemented in partnership with the European Union, Japan, and the

Netherlands.

The challenge

Insurance premiums are expensive in Africa due to a lack of long-term, reliable weather and crop data; too few policyholders; and a less than conducive regulatory landscape. Index-based insurance pays out benefits on predetermined parameters, such as certified rainfall levels or livestock mortality rates. But there has been limited uptake because the technical and operational capacity to design and distribute these innovative products remains relatively low among African insurers.

Our response

IFC advises insurers to diversify their portfolios between larger-scale commercial farmers or farmer groups and small-scale farmers. We have also helped create innovative distribution models. For example, in Zambia, Pioneer Seeds uses index-based insurance as a marketing tool, rewarding those who buy 25 kilograms of seed at the start of the season with free insurance.

IFC has advised its clients to adopt remote-sensing and satellite products to improve data quality. We have also helped local and regional insurers meet reinsurance requirements through training and awareness-raising workshops with industry stakeholders. IFC helped the regional regulatory body Conférence Interafricaine des Marchés d’Assurances draft regulations to promote the uptake of index insurance.

Outcome

Our support of MicroEnsure’s penetration of the Zambian market has helped several insurers and reinsurers enter the market. Our work in Zambia has changed international reinsurers’ perceptions of African technical capacity. We have supported insurance stakeholders in Burkina Faso, Kenya, Mali, Mozambique, Rwanda, Senegal, and Tanzania. Our client Acre Africa (formerly Syngenta Foundation for Sustainable Agriculture) launched an innovative product in 2014 that covers farmers against drought during the maize germination phase and facilitates quick payouts to enable them to plant again in the same season.

Index Insurance


Two-thirds of adults in Sub-Saharan Africa do not have access to formal financial services, which means the large majority does not have access to a secure and productive means of saving, safe and efficient ways of making payments, or access to regulated credit. Lack of access to finance means SMEs in the region struggle to grow their businesses, create jobs, and contribute to much-needed economic development.

With its global and local expertise, IFC helps African financial intermediaries take advantage of the opportunities offered by new technology and innovative business models to reach previously unbanked populations, such as low-income individuals, small-scale entrepreneurs, and people in rural and more remote areas. We work to help increase access to banking for women-headed businesses and those operating in fragile and conflict-affected states. Our work supports the World Bank Group’s goal of achieving universal financial access by 2020.

We advise governments, regulators, credit bureaus, commercial banks, digital financial services providers, and microfinance organizations to improve access to credit information and credit. We also develop products for marginalized groups and help develop alternative delivery channels, such as mobile banking. IFC introduces environmental and social standards,

02Financial Inclusion

promotes best practice in managing risk, and works with financial intermediaries to increase access to better and safer housing opportunities for low-income households. We also help develop agricultural industries through agri-finance to boost food security. We promote sustainability by facilitating financing for projects that mitigate climate-change effects, and we support economic recovery in fragile and conflict-affected states.

IFC and The MasterCard Foundation’s innovative Partnership for Financial Inclusion works to expand microfinance and advance digital financial services in Sub-Saharan Africa. The initiative’s research and learning component has established IFC as an expert in financial inclusion and a desired industry partner on the continent. Together with Software Group, an IT company focused on end-to-end solutions for the financial sector, IFC published the Alternative Delivery Channels & Technology Handbook in 2015. The handbook advises financial institutions on implementing digital financial services and is a sought-after knowledge tool in the industry worldwide.

In 2014, we helped thousands of small-scale farmers access finance through the IFC Global Index Insurance Facility (see the case study on index insurance) and assisted in drafting landmark credit-reporting legislation for the West African Monetary Union.

.

459101550,000

More than 550,000 new deposit accounts

opened.

101 new financial products launched.

Helped nearly 459 entities access

investment/financing.

$14,8 billion $2 million

Facilitated more than $14,8 billion in

financing.

Nearly two million accounts linked

to mobile banking systems in Nigeria,

Tanzania, and Uganda.


The challenge

Almost half of Uganda’s population transact predominantly in cash, which can be both risky and costly. Although the country has one of the more developed mobile money markets in Africa, only an estimated one in three registered customers uses this service. Airtel Money Uganda wanted to extend its mobile money services by providing affordable and efficient transactions for the unbanked population.

Our response

In 2014, IFC partnered with Airtel Money Uganda to help it increase its number of active mobile money users. We conducted preliminary market research, studied inactive user profiles, and assessed market needs to understand user preferences and how to structure and market new products. We also helped to enhance Airtel Money Uganda’s distribution capability and with the rollout of targeted marketing campaigns. IFC partnered with Cignifi, a big data analytics company, to identify active and potential mobile money users, map underserved regions, and provide a social network analysis of customers to support these efforts.

Outcome

Airtel Money Uganda has increased its customer base and its existing customers are using the service more. It aims to build on this growth by introducing more targeted products and services that address the financial needs of its new customers. Based on customer perceptions, the project study recommended that Airtel Money Uganda extend its network coverage, increase its number of outlets, improve its customer validation processes, ensure that agents have sufficient funds at their disposal to meet claims, increase the maximum limit of transactions to $1,600, and lower its standard charges across agents. In addition, it recommended that Airtel Money Uganda introduce innovative promotions to increase usage. These include interest on savings, loans based on activity, receipts and account statements, and the ability to transact in multiple currencies. The program will run until 2018.

CaseStudy 01

Donor partnersThe program was implemented in

partnership with the Bill & Melinda Gates Foundation.

Airtel Money Uganda


CaseStudy 02

Supporting Greenfield Microfinance Institutions

The challenge

The greenfield microfinance business model expands financial services by creating a group of new local microfinance institutions that are branded by international holding companies, receive international management and backstopping support, and follow standardized policies and procedures. These institutions are often the only source of finance for small businesses in fragile countries in Africa. They often initially struggle to reach financial sustainability, but in some markets have eventually grown into medium-sized banks. The start-up stage generally takes longer and is more costly than anticipated, and key managers sometimes leave before the institution breaks even, disrupting operations. Aggressive expansion can result in serious growing pains and a reversal of early gains.

Our response

IFC works with microfinance institutions to meet start-up costs and help balance operational control and portfolio expansion to reach a monthly break-even point. In Africa, this is typically met with a loan portfolio of $10 million and 10,000 clients. IFC provides equity financing (and sometimes debt financing) and advisory solutions to greenfield projects. It discusses and negotiates shareholder provisions and capacity-building activities, as well as providing operational support. The process can take between 42 and 54 months.

Outcome

Of the 19 projects active in 2014, 15 focused on microfinance and the rest primarily on insurance and mobile banking. Close on 69,000 loans, valued at $121.7 million, are outstanding.


Liberia Collateral RegistryCaseStudy 03

The challenge

In Liberia, many individuals and small-scale businesses are unable to obtain loans because they do not have access to traditional collateral such as land or real estate. The Liberia collateral registry, launched in June 2014, allows them to register movable assets, such as a vehicle or machinery, as collateral. In a conflict-affected country like Liberia, which is also recovering from the Ebola crisis, an initiative like the collateral registry can provide a much-needed boost to the economy.

Our response

We worked with the Central Bank of Liberia to create a modern, user-friendly, online collateral registry that allows individuals and small businesses that do not have access to traditional collateral to register movable assets as collateral in order to access loans from commercial banks. Through the registry, banks can provide secure loans to individuals and small businesses that would not otherwise be able to access financing.

Outcome

Since its launch in June 2014, at the height of the Ebola crisis, the collateral registry has provided access to more than $226 million in loans to registered individuals and to micro, small, and medium enterprises – far exceeding the original project target of $110 million in financing three years after completion. With Liberia declared Ebola-free, the public awareness campaign to inform the public of the collateral registry and financial literacy training can resume, which should result in even greater use of the registry.

Donor partners

The program was implemented in partnership with Ireland, the

Netherlands, Norway, Sweden, and the United Kingdom.


03 Closing the infrastructure gap

Infrastructure plays an important role in maintaining and improving Africa’s economic growth. It will need to play an even greater role if the continent’s development targets are to be reached. Although Sub-Saharan African countries spend about $30 billion a year on infrastructure, an estimated $93 billion is needed to catalyze and support economic growth in the region. African governments cannot fund this alone.

Businesses such as those in the hospitality, manufacturing, and agricultural sectors are limited by a lack of power and deficiencies in transport and information and communications technology (ICT) infrastructure. The Ebola crisis also highlighted the need for improved health systems on the continent. Modern infrastructure spurs economic growth, improves living standards, and presents an opportunity to address development challenges such as rapid urbanization and climate change.

IFC takes a comprehensive approach to infrastructure development, investing in energy, water, housing,

transport, storage, ICT, and sanitation infrastructure. We work with the World Bank and other partners to provide and leverage private financing for high-impact and replicable infrastructure projects. We also advise governments on public-private partnerships.

In 2014, we worked with partners promoting sustainable infrastructure, including Clean Cooking for Africa and the Utility Efficiency Program. As at 31 December 2014, the Lighting Africa project had provided 14.3 million Africans with basic solar lighting and 35 million with improved access to modern solar lighting. We also focus on regional integration to lower the cost of shared infrastructure and work to improve the efficiency of existing resources. We helped Kenya expand its electricity grid by investing $50 million in its national power distributor and helped it improve its operational efficiency. We also supported a joint energy plan for Nigeria to install additional capacity of 1,000 megawatts and supported the reform of the country’s energy sector.

422,000$578 million36,347

Helped prevent the release of more than 36,347 tonnes of

greenhouse gases.

Facilitated $578 million in private investment through public-

private partnerships globally.

Helped reduce water usage by 422,000 cubic meters.


The challenge

One in three of Benin’s 10 million people does not have access to safe drinking water, despite the country’s large and mostly untapped water resources. The country also faces challenges around its sanitation and waste-collection systems, particularly in rural areas, and recurrent floods. In 2010, Benin’s government asked the World Bank Group to help it encourage private sector participation in rural water service delivery. IFC implemented the project as part of its multi-donor Water and Sanitation Program, which falls under the World Bank’s Water Global Practice.

Our response

In 2012, IFC started helping the government set up the necessary legal, institutional, and regulatory frameworks to facilitate these partnerships. IFC designed a pilot project, put in place the necessary commercial arrangements, and spread the risk between municipalities and private operators. Using the ‘One World Bank Group’ approach allowed us to collaboratively plan processes, instruments, and strategies with different operating units. The Water and Sanitation Program’s technical and local knowledge helped us identify pilot sites and access key monitoring and performance information. We held training events and workshops to highlight business opportunities in the water sector, attract suitable candidates, and ensure that tendered bids were transparent and compliant.

Outcome

The project resulted in four public-private partnerships that will provide access to improved water services for about 48,500 people, far exceeding the IFC’s target of 25,000 people. The World Bank and IFC teams instituted a series of bankable, long-term commercial agreements that enabled private operators to raise about 27 percent of the required investment funding from local banks. In addition, we helped build institutional and fiscal capacity in Benin’s private and public sector. The proposed projects also attracted experienced engineering and consulting firms.

Donor partners

This project was implemented in partnership with Austria, Denmark, Japan, the Netherlands, Sweden, and

the United Kingdom.

21

CaseStudy 01

Building a Public-private Water Partnership in Benin


The challenge

Transporting goods through landlocked Niger is expensive, because all imports and exports must go through neighboring country ports. These already-congested ports further delay moving goods inland, and these prohibitive costs and delays hinder Niger’s economic development. Niger’s government asked IFC to help structure and implement a dry port in Niamey Rive Droite (leading to Togo, Ghana, and Côte d’Ivoire) and the city of Dosso (leading to Benin) to speed up the flow of cargo between ships and major land transportation networks, and reduce transportation costs.

Our response

Niger’s government appointed IFC to attract the private sector to invest in developing and operating the greenfield Dosso site and the existing Niamey Rive Droite platform. We helped the government identify and carry out the necessary legislative and regulatory processes, including the creation of a Dry Port Authority in 2014, and structured a 20-year concession to build, develop, and operate both dry ports. Bolloré Africa Logistics won the bid and, as part of the bid conditions, will invest a minimum of $50 million in the project. It has offered an additional social investment of $78 million.

Outcome

The project is expected to contribute $48 million in concession fees to the government of Niger, and will create 130 jobs. It will reduce transportation costs and increase trade efficiency, contributing to Niger’s economic development. The multimodal Dosso site links to the regional railway being built between Niger and Benin, and then on to Burkina Faso and other West African countries, improving regional linkages.

Donor partners

IFC implemented this project in partnership with Austria, Denmark, Japan, the Netherlands, Sweden, and

the United Kingdom.

CaseStudy 02

03 Niger Port


04Developing SMEs

There are an estimated four million formal and 28 million informal SMEs in Sub-Saharan Africa. SMEs create up to 95 percent of jobs in developing and emerging economies, and could generate many of the estimated 120 million jobs needed in Africa by 2020. Such businesses support entrepreneurial growth, promote economic diversification, increase competition, connect microenterprises to the larger economy, widen the tax base, and expand value-added services. But SMEs battle to access finance and markets, operate in challenging regulatory environments, and are often unable to comply with standards, certification requirements, and international quality controls. These small businesses generally lack the necessary technical and business skills, and operate in resource-constrained environments.

As of December 2014, IFC’s cross-cutting advisory solutions manage SME-associated projects worth $9.9 million in Africa and $36 million globally. We provide SMEs with comprehensive skills training and support. We also assess corporate governance practices and provide specialized advice on board effectiveness, the control environment, and governance of family-owned businesses. We improve market access by linking SMEs with our existing or potential investment clients, and by identifying relevant export markets with high growth

potential. IFC focuses on integrating SMEs into regional and international value chains to enable access to new markets, technology, networks, and capital.

We provide sector-specific coaching programs to help SMEs comply with international standards and certification systems, and strengthen internal capabilities. These programs also help SMEs formalize their business processes and operations, improve labor productivity, and forge or extend their trade links. IFC’s SME Ventures Fund provides much-needed equity capital for eligible companies that are unable to take on debt. Our SME Toolkit provides SMEs with free, online access to expert information, interactive tools, and educational resources.

Within the broader World Bank Group’s financial inclusion agenda, IFC focuses on creating a conducive business environment. It aims to help smaller businesses progress to the point where they can benefit from other IFC and World Bank Group initiatives. IFC also manages initiatives that remove the barrier to business growth posed by a lack of reliable energy and water provision. Following the World Bank Group’s restructuring, an SME working group was formed in early 2015 to integrate the support offered to SMEs, find ways to collaborate, and identify knowledge gaps.

6.7 million40078,700

78,700 loans disbursed to microenterprises and SMEs for

projects active in 2014.

Nearly 400 new entities, including small businesses,

created for projects active in 2014.

6.7 million people used the SME Toolkit in 2014; 13 percent of users

are African.


The challenge

SMEs in Rwanda struggle to raise working capital, have limited access to financing for business expansion, and have difficulty securing lucrative corporate value-chain contracts. This is exacerbated by a mutual lack of confidence between local banks and SMEs, despite the fast pace of financial reforms implemented since 2005.

Our response

In 2009, IFC, in partnership with a group of donors, set up the Rwanda Enterprise Development Program to expand and strengthen linkages between SMEs and large firms in the hotel and tourism sectors, and enhance SME access to financing by improving their productivity, governance, and operations. The program trained local consultants to mentor, train, and improve SME management and business practices. IFC provided software and internet-based training and capacity-building solutions, delivered through a privately owned business solutions center. We also set up a dedicated SME investment fund. While bank lending remains limited in Rwanda, IFC’s technical support and loan guarantees from the Business Development Fund have helped build relationships between banks and SMEs.

Outcome

The program reached more than 5,000 SMEs in Rwanda. In partnership with the Ministry of Trade and Industry, the program implemented the government of Rwanda’s Hanga Umurimo (‘make your own job’) project, which aimed to create about 3.2 million off-farm jobs by 2020. The program has created or supported almost 2,000 jobs, mostly by boosting individual business capacity; trained more than 4,500 individuals in management, business skills, and corporate governance; contributed significantly to more than $4.8 million in new SME contracts; and enabled about 550 SMEs to access a total of $13 million in funding.

An external evaluation, conducted in 2015, concluded that the program was successful in meeting its objectives and attributed part of its success to its ability to leverage IFC’s partnerships and take advantage of existing sectoral linkages, as well as the specialized and standardized approach to training. Plans are under way to replicate and expand the program to diversify tourism products and support agribusiness linkages. The plans will expand the business solutions center model by merging it with the Business Development Fund’s 32 centers. These centers, previously funded by the European Union, support the development of a $20 million Women’s Fund. The government of Rwanda, Women in Rwanda, and development finance institutions support the Women’s Fund.

CaseStudy 01

Rwanda Enterprise Development Program

Donor partners

IFC implemented the program in partnership with Belgium (Sofinex

and Flanders), the European Union, Japan, and the Netherlands.


The challenge

African financial institutions often lack the experience and capacity to engage with microenterprises and SMEs. In turn, these small businesses often cannot provide the required collateral, backed by clear business plans, financial literacy, and management skills. This makes it difficult to grow, access corporate contracts, or enter the formal value chain.

Our response

The Africa Micro Small Medium Enterprise Finance Program (AMSME) and SME Management Solutions (SMS) Africa program work in tandem to provide support to microenterprises and SMEs. The AMSME program provides financing and advisory solutions to banks wanting to expand into this market. The SMS Africa program helps SMEs in 16 eastern and southern African countries engage in corporate value chains. We also build business and institutional capacity by providing business management information, interactive tools, and training through Business Edge, a classroom-based training course, and the SME Toolkit, which is an online platform. These business development services are provided through local partners, including banks and private business development service providers. Our innovative approach links access to both finance and non-financial services, helping micro, small, and medium enterprises improve both their business and loan performance.

Outcome

Since its launch in 2007, the AMSME program has worked with 31 financial institutions in 18 countries across Africa. In Nigeria, for example, we worked with Diamond Bank, an existing IFC client, to help grow its agri-finance capacity from $67 million to $80 million, increasing the number of farmers accessing credit from 3,000 to 4,000 by December 2014. We helped the bank develop a strategy, products, and risk-management tools for the agricultural sector, as well as a lending model for the agri-SME market. We also developed bank systems and trained staff in risk management, product and

channel development, and data handling. As a result, Diamond Bank offers three new products, has amended its credit policy and procedure manual, and adopted an IFC-designed credit scoring tool and loan monitoring report measure. IFC has identified and documented the elements needed to scale up and replicate this model in other countries.

The SMS Africa program, operating in 12 Sub-Saharan countries, aimed to help microenterprises and SMEs build their management capacity and increase performance. The three-year program, which ended in 2014, reached more than one million SMEs through the SME Toolkit and trained almost 5,000 SMEs through Business Edge, including reaching many clients of financial institutions through dedicated initiatives such as Women in Business.

CaseStudy 02

03Catalyzing Access to Finance for Small Businesses

Donor partners

The programs were implemented in partnership with Denmark, Ireland, the Netherlands, Norway, and the

United Kingdom.


05 Creating more competitive markets

A transparent and predictable business environment encourages growth, investment, and job creation. Political instability and conflict in many Sub-Saharan African countries deter investors. This is compounded by onerous and outdated business regulations and legislation, complex and inflexible tax policy, and deficient trade infrastructure, particularly electricity, transport, and ICT infrastructure.

IFC, in collaboration with other World Bank Group teams, works with governments to identify and reform legal, regulatory, legislative, and institutional constraints to doing business. This requires a deep level of engagement and trust, and IFC ensures that

its approach is supported by verifiable evidence and benchmark data. We use local partnerships and knowledge in our interventions.

IFC has worked with Côte d’Ivoire’s government on its Investment Climate Reform Program and helped the private sector achieve about $8.7 million in savings from simplified regulatory requirements. More than 500 people have been trained at 25 workshops through this program. In the Democratic Republic of the Congo, IFC helped the government declare a special economic zone, making it easier for companies to invest, create jobs, and produce goods and services. This encourages investment and helps grow the economy.

2,86477,237550,177

550,177 firms benefited from reformed licensing

requirements.

77,237 firms benefited

from reformed registration

requirements.

2,864 entities implemented

recommended changes.

1,490 256

1,490 recommended procedures, policies,

practices, and standards were implemented or

eliminated.

256 recommended laws, regulations, amendments, and

codes were enacted or policies adopted.


The challenge

Ethiopia has one of the fastest-growing economies in Africa, but its restrictive, overlapping, and onerous legislative and regulatory framework inhibits the private sector from contributing to growing the economy. This is compounded by low levels of foreign direct investment. As a result, the number of operational investment projects is decreasing, as are related job opportunities.

Our response

To support private sector development, IFC established a multi-donor initiative that aimed to reduce the cost of doing business by 10 percent by 2018, primarily through targeted compliance savings. The program covers six focus areas: business regulation, taxation, investment policy, a business forum, trade logistics, and leasing regulation. The initiative assessed and reviewed the state of income tax, licensing, registration legislation, and leasing in Ethiopia. It also conducted a tax compliance and perception survey with 1,500 businesses.

Outcome

IFC has provided capacity-building support and advice to the Ethiopia Investment Commission and the Prime Minister’s Office in developing a new organizational structure for the commission that will support its efforts to become a word-class, one-stop investment gateway to Ethiopia. Discussions between government

and the private sector have improved and have led to a number of reforms to reduce the cost of doing business in Ethiopia. This includes eliminating the need for shareholders to physically authenticate meeting documents and lowering import bank charges for manufacturing firms.

Based on our strong engagement, the Ministry of Trade issued a directive to address the excessive restrictions and onerous requirements for trade name registration, which has been decentralized in 130 registration points in the capital and in four other regions. The initiative has also supported an automation process and the rollout of an online trade registration and licensing system. We have given input on directives regarding transfer pricing and customs risk management, resulting in a reduction of about 13 percent of cargo requiring physical inspection. In addition, a new customs proclamation, aligned with international best practices, and the associated implementing directives, have been enacted. The initiative has also supported the opening up of the finance leasing sector for foreign direct investment.

29

CaseStudy 01

Ethiopia Private Sector Development Initiative

Donor partners

IFC implements the program in partnership with Canada, Italy,

Sweden, and the United Kingdom.

Development Impact Report 201530 Development Impact Report 201530

CaseStudy 02

Health in Africa

The challenge

The private sector provides about 50 percent of health care in Sub-Saharan Africa, but often struggles to access finance, particularly from formal credit institutions. It also relies on poor public infrastructure, uses outdated paper systems for patient records and inventory control, and faces limited demand for its goods and services.

Our response

In 2008, the World Bank Group and IFC launched the Health in Africa Initiative in Burkina Faso, Ghana, Kenya, Mali, Nigeria, the Republic of the Congo, Senegal, South Sudan, Tanzania, and Uganda. The initiative focused on analyzing the private and public health sectors in each country, helping governments to improve relevant legislative and regulatory frameworks, and facilitating access to credit for private health-care entities. Based on the program’s success, the model has been replicated in other regions.

Outcome

In Kenya, the initiative supported the establishment of a national health-care federation that has since initiated the East African Healthcare Federation, which lobbies governments on sector reform. It has reviewed and suggested reforms in the health insurance sector to help achieve universal health coverage in Kenya. It has helped the Kenyan government to develop its Health Bill , which streamlines registration, licensing, and inspection processes. The initiative also helped the Kenyan

government to develop a joint health inspection checklist and toolkit to minimize financial and administrative burdens on regulatory institutions and health providers.

In Nigeria, the initiative helped the government to scale up its national health insurance program to help realize its goal of ‘saving one million lives’ through increased private sector involvement in the health sector. The program also organized a stakeholder workshop in the fragile and conflict-affected state of South Sudan on private sector participation in the health sector. The World Bank Group subsequently undertook a rapid legal/regulatory gap assessment and a feasibility study for potential public-private partnerships. This intervention was the first of its kind in a fragile and conflict-affected state for IFC. Thirty-five African countries have since requested the initiative’s assistance.

Donor partners

IFC implemented the program in partnership with the Bill & Melinda

Gates Foundation.


06 Fragile and conflict-affected situations

The World Bank Group identified 33 countries and territories as ‘fragile’ or ‘conflict affected’ in 2015. Of these, 22 are in Sub-Saharan Africa, and are among the poorest and least developed in the world. Poverty brings many other challenges, such as a lack of access to education, housing, health care, and food. Endemic poverty often leads to conflict, displacement, and human rights abuses, all of which destroy lives and infrastructure, weaken institutional capacity, and deter investors. The combination of poverty and conflict exacerbate the existing difficulties of doing business, making it impossible for most businesses, both small and large, to flourish.

In these states, it is essential to support the private sector so it can provide much-needed goods and services, create jobs, and contribute to the tax base. A strong private sector is essential in helping a fragile country become stable. Our approach, guided by the understanding that there are multiple causes and manifestations of conflict and fragility, takes into account localized opportunities and challenges. IFC has designed a private sector-focused conflict and fragility lens, which it uses to identify drivers of conflict and inform program design and implementation. Using this innovative framework, we can generate solid conflict analyses and gain a better understanding of contextual challenges. IFC works with governments, private companies, financial institutions, and development partners to reduce the barriers to business growth. We help improve the investment climate, support increased access to finance, and attract investment to fund infrastructure and other essential sectors, such as health care and education.

Conflict-Affected States in Africa

In 2008, IFC, in partnership with Ireland, the Netherlands, and Norway, established the CASA Initiative to provide long-term support to private sector development in conflict-affected countries to promote economic recovery. Denmark and Sweden provided support to IFC’s advisory solutions in Liberia, Somalia, South Sudan, and Zimbabwe. In its second phase, CASA is drawing on lessons learned, first applying the principle of doing no harm, considering peace and state-building goals in its approach, and focusing more on conflict sensitivity, systematic conflict analysis, and gender.

CASA’s in-country operational teams generate market intelligence and build the necessary relationships. This country-level commitment has improved the effectiveness and efficiency of IFC’s operations in these states. The teams use integrity due diligence as a business development tool, allowing CASA to identify potential business opportunities, understand their operational capacity and expansion potential, situate them within a broader industry context, and produce the type of information investors need. The teams’ local presence also facilitates ongoing support and supervision. Working with and expanding value chains help broaden IFC’s impact in these countries. CASA has developed an innovative private sector-focused framework for fragility and conflict assessments. Its use of complexity, conflict, and fragility lenses to frame interventions is central to its effectiveness, as is its flexible funding, knowledge generation and sharing, and ability to link IFC and other partners to maximize the impact of interventions.


CaseStudy 01

Africa Leasing Facility II

The challenge

African banks are often reluctant to supply microenterprises and SMEs with the financial services they need to grow their businesses due to their lack of formal collateral. Access to finance is even more difficult in fragile and conflict-affected states. IFC, with Switzerland’s support, began developing the leasing industry in Africa in 2005, and in 2008 launched the Africa Leasing Facility in 10 countries as an innovative and effective financing tool. During the program’s first phase, completed in 2012, IFC helped create and enhance the legal, tax, regulatory, and accounting environment for leasing. We raised awareness of leasing tools and products, built capacity, and mobilized investment capital in 10 countries in the first phase.

Our response

The second phase aims to increase the volume of leasing transactions by advising and facilitating relevant transactions by banks and leasing companies in the region. IFC is expanding the program to another 15 countries. The program is tailored to each country’s context and market demand. There is a particular focus on working in fragile and conflict-affected states, where the need for access to finance is the greatest and where leasing can have a catalytic impact on recovering economies. Since 2013, we have continued to address legislative and regulatory constraints, implemented broad public education campaigns, built or strengthened local leasing associations, built capacity and advised on business development for lessors, and provided investment capital to fund leasing operations.

Outcome

We improved the leasing environment in 13 countries by supporting legislative and regulatory reform; 16 leasing laws and regulations were enacted. In the second phase, IFC facilitated the drafting of 22 new laws and regulations. The project has also trained about 2,800 microenterprise and SME representatives, and is set to reach its cumulative target of training 4,500 such representatives in 2016. The project also helped establish three leasing associations/committees, and the University of Rwanda validated and adopted the project’s leasing curriculum. The leasing target of $609 million growth in market size was reached, even though the average leasing penetration rate is still low (less than 2.5 percent in fragile and conflict-affected countries). This indicates an increasing need to improve leasing knowledge and increase leasing supply, which would in turn increase the leasing penetration rate. The project aims to track the value of realized investments for leasing markets. For example, $3.5 million has been mobilized in Côte d’Ivoire, with potential funding pipelines for other countries.

Donor partners

The program is implemented in partnership with Ireland, the

Netherlands, Norway, Sweden, Switzerland, the United Kingdom, and

the United States.


The challenge

By late 2015, more than 11,000 people had died in West Africa following the outbreak of the Ebola virus in early 2014. Its rapid spread and containment measures have crippled the economies of those countries worst affected. Businesses have been hard hit by the lack of, or increased cost of, basic goods and raw materials; the loss of domestic and export revenue; decreased investor confidence; and a lack of liquidity and foreign exchange. The resultant shortages, unemployment, and inflation have driven many people deeper into poverty.

Our response

IFC responded quickly, initiating emergency and longer-term recovery programs. Our continued engagement enabled us to help keep businesses operational and to facilitate the supply of essential goods and services. We ran awareness-raising workshops, and designed and deployed health and safety training tools in Guinea, which, along with Liberia and Sierra Leone, were the worst affected. We incorporated our experience in Guinea into our strategy and implementation plans, and replicated the project, adapted to context, in Sierra Leone and Liberia. The longer-term Ebola recovery program will provide finance and advice to medium- to long-term projects that will build energy generation capacity, support water provision, and expand valuable value chains, such as mining, among other objectives.

Outcome

IFC trained about 800 businesses, many of them SMEs, in how to weather the crisis. We provided $75 million for an emergency liquidity fund for banks, $5 million for the Global Trade Finance Program and Global Warehouse Finance Program, and $6 million for the West Africa Venture Fund to support trade flows for basic and essential goods. We increased guarantees by $24 million, offered zero-interest working capital loans to SMEs, and provided $6 million in rescheduling and working capital support .

CaseStudy 02

Post-Ebola response


CaseStudy 03

The challenge

Small-scale and subsistence farmers in the Sahel region struggle to produce enough food to meet their needs, and demand from a growing population in urban areas is increasing. Rainfall patterns are erratic, soils are degraded, and climate change is likely to cause increasingly severe droughts or floods. The 2013 Dakar Declaration on Irrigation calls on Sahel countries to invest in the expansion of the area equipped for irrigation from 400,000 hectares to one million hectares by 2020, with support from their development and private sector partners. This would boost yields and rural incomes and could also help reduce conflict in the region. However, an estimated investment of $7 billion is needed and there are issues around land tenure and a lack of access to the technology and skills required.

Our response

Donors and public and private actors came together to form the Sahel Irrigation Initiative to support the Dakar Declaration and build institutional capacity, ensure an enabling business environment, and help secure and finance investments. The Comité permanent Inter-Etats de Lutte contre la Sécheresse dans le Sahel houses the initiative, which it runs with the World Bank Group and the Water Partnership Program, along with other stakeholders.

Outcome

IFC collaborated with EcoBank and the Bank of Africa, among others, to facilitate regional financing for inputs and equipment. In Burkina Faso, we help farmers adopt improved water-management practices, technologies, and services. In Mali and Niger, we are helping them access affordable and efficient irrigation equipment. In Chad, Mauritania, and Senegal, we have developed national plans to introduce private sector investment in irrigated agriculture via value-chain development. We are also providing weather insurance and supporting the supply chain, as well as helping farmers and equipment manufacturers access finance .

Irrigation in the Sahel


Annex2014 Client satisfaction surveyIFC conducts an annual global survey of its advisory solutions clients to understand its performance and how it can better serve client needs. It commissioned an independent survey firm to administer the surveys to clients whose projects had closed between January 1, 2013, and June 30, 2014, or were active and halfway through implementation, and those who had received at least $25,000 worth of assistance in projects active for at least 1.5 years. The survey is modified for use in the private or government sector and focuses on client perceptions of IFC advisory solutions’ quality, timeliness, and responsiveness, as well as the overall client experience. The 2014 survey had a 90 percent response rate (446 entries from 285 projects).

Satisfaction rate for Sub-Saharan Africa region

Quality of service Timeliness and responsiveness Overall work completed

90% 83% 91%


Annex2014 Client satisfaction survey List of Indicators

Entities receiving advice The number of unique firms and government entities to whom IFC is providing direct advisory solutions. This indicator is the broadest measure of how many entities received some form of assistance from IFC advisory solutions

Number of participants in workshops, training events, seminars, conferences, and so on

We track, through head counts and sign-in sheets, the number of individuals (including trainers) that participate in these event categories. The indicator includes repeat participants and those participating in events run by our clients and project partners, but excludes those run by project-trained entities.

Number of workshops, training events, seminars, conferences, and so on

The number of events that have resulted from our projects, including those run by clients and project partners.

Number of loans outstanding Represents a stock figure at a given point in time that usually measures supply of credit at the end of the period.

Value of outstanding loans ($) Represents a stock figure at a given point in time that measures the value of credit.

Number of recommended laws/regulations/amendments/codes enacted

We count the number of recommended laws/regulations/amendments/codes enacted by the relevant legislative or administrative body.

Number of people receiving access to improved services (real/non-financial sectors)

The number of people served by a private operator, including those benefiting from access or from improvement to the service. Measurements are made during the full operational phase. The count includes annual enrollment for the education sector, annual number of patients for the health sector, and number of connections multiplied by average household size for utility distribution projects. For utilities without distribution networks, it counts the amount in consideration divided by the average consumption level.

Sales revenue ($) Sales revenue is calculated using the incremental difference in sales revenue ($) for project-relevant entities and revenue streams. These include Business Edge training and SME revenues generated through our linkages projects.

Number of reforms as measured by Doing Business and Investment Climate Business Line

Tracks the number of Doing Business and Investment Climate reforms in project jurisdictions.

Value of direct compliance cost savings to the private sector ($)

The savings that resulted from the difference in the pre- and post-reform annual costs (adjusted for taxes and discounted to the baseline year). This indicator provides an indication of the resulting extra resources that private businesses may use, at least in part, to expand their businesses or make new investments.

Acknowledgements & Credits

Edited by Clarity Editorial (www.clarityeditorial.co.za)

Layout and design (www.itldesign.co.za)

Photographs on pages 7,21, 23, 25, 27, 32, 34, 36 © Nyani Quarmyne, Panos PicturesOther photographs © World Bank/International Finance Corporation

development impact report 2015

Documents