Amsterdam, Netherlands, June 13, 2012-IFC, a member of the World Bank Group, and Rabobank have announced a $500 million commodity-trade-finance facility that will enable banks and companies in developing countries to finance more imports and exports, propelling economic growth and job creation.
IFC and Rabobank will each contribute $250 million to expand funding for trade flows of agricultural and refined energy commodities through Rabobank’s global client network. The three-year risk-sharing facility is the second under the IFC Critical Commodities Finance Programme.
The facility will help sustain and expand commodity trade finance for over 200 emerging-market financial institutions and corporates, including agribusinesses, mainly in Asia and Latin America. With easier access to capital, local entrepreneurs can reach new markets, grow their businesses, and hire more employees to spur economic development and strengthen food security.
“Rabobank is delighted to have concluded the Critical Commodities Finance Programme, which we see as an attractive new tool to assist us in financing commodity flows to and from emerging markets for our key corporate clients,” said Sema Zeyneloglu, Global Head of Financial Institutions, Emerging Markets, at Rabobank. “The programme supports not only emerging-market financial institutions, but also directly targets corporations and traders involved in commodity finance. By moving the process further downstream to the end-users of the funds, the programme captures an extended part of the relevant chain, which should make it highly effective in supporting our business.”
“Rabobank is a global leader in food and agribusiness financing and in sustainability-oriented banking,” said Rashad Kaldany, IFC vice President for Global Industries. “This partnership between IFC and Rabobank will help channel additional working capital to emerging-market firms to expand their commodities production and trade and foster economic growth in many of the world’s poorest countries.”
Launched in 2012, the Critical Commodities Finance Programme helps reduce the risk of food and energy shortages in emerging markets, improving food security for the world’s poorest-who tend to be hit hardest by rising food and energy prices. The programme uses a risk-sharing approach to extend financing to banks and corporate clients of banks such as commodity traders. It is expected to mobilise about $18 billion in funding through 2014.
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. We help developing countries achieve sustainable growth by financing investment, providing advisory services to businesses and governments, and mobilising capital in the international financial markets. In fiscal 2011, amid economic uncertainty across the globe, we helped our clients create jobs, strengthen environmental performance, and contribute to their local communities-all while driving our investments to an all-time high of nearly $19 billion. www.ifc.org.