The International Finance Corporation is expected to make 85 million US dollars available in financing to private businesses in Ethiopia according to Adamou Labara, IFC Resident Representative in Ethiopia.

The IFC Ethiopia office has already provided 85 million US dollars to businesses over the past two and a half years.

The 85 million in the IFC portfolio is minimal in comparison to the size and potential of the Ethiopian economy said Labara.

IFC in Ethiopia provides 30 to 35 percent of the total cost for a project and solicits additional financing for the project from other sources to make up the difference he explained.

IFC Ethiopia offers three types of financing to private enterprises. In the first instance the corporation provides loans in a form of long term funding which requires at least five years to mature said Labara. The IFC can also become shareholders with financing in the form of equity or it can provide a guarantee to a local financial source ready to offer loans to a business he noted.

The IFC particularly targets agro-businesses, export oriented companies, and hotel and tourism due to restrictions associated in financing domestic oriented businesses said Labara.

A company requiring IFC financing needs to be a commercially oriented private sector project with more that 51% of the project in private hands.

Source: The Reporter