A Case Study of the International Finance Corporation in Nigeria :: Economics Business Case Study Essays

IFC Mission- ‘To promote sustainable private sector investment in developing countries.’ â€Å"The World Bank’s role, in my opinion, is to help improve the business environment in the developing countries so that the private sector can drive growth.†- Mr. Peter Woicke, Executive Vice President of the World Bank Group (WBG) in charge of the International Finance Corporation (IFC) - Lagos, August 2004. At the time Mr. Woicke was speaking, IFC involvement in Nigeria had reached $200million in investment commitments, a figure quickly surpassed in less than a year from that date (as at June 2005, IFC investment in Nigeria was to the tune of $290million). This was in spite of the fact that only five short years before (in 1999), IFC was doing practically no business in Nigeria and merely had a functional working office in Lagos. Mr. Woicke went on to say- â€Å"We have increased our exposure since democracy returned from almost nothing to almost $800 million and an exposure at the IFC of about $200 million. We have made a bigger bet to have the bank (WB) and the IFC work on Nigeria’s problems together. We were quite instrumental in advising the government on reforms in the telecom sector. We have been pushing very hard for privatization of other sectors.† Clearly, the advent of democracy had re-ignited interest in Nigeria. The initiation of a reform agenda by the new government was also playing a part in this renewed interest in Nigeria. Beyond financial commitments however, IFC was beginning to offer a great deal of other services towards developing the economic environment of business in Nigeria. As Mr. Woicke put it- â€Å"I actually think we should increase our presence quite (in Nigeria) dramatically. We don’t necessarily want to lend tons of money to Nigeria, because Nigeria has lots of resources. We can contribute in terms of providing advice, transferring technology, providing technical know-how in social, environmental and corporate governance issues† Indeed, the nature of IFC operations globally and increasingly in Nigeria were such that contribution was becoming greater in terms of technology, advice, social development, environmental assistance, corporate governance and ethical issues, and global competitiveness concerns. IFC had begun to realize that their market, and indeed their business model had reached a pivotal moment wherein clients had begun to expect more than just project finance deals and long term syndications. Governments were asking for help on private sector issues that went far beyond privatization or concession structuring. There had arisen a case for IFC involvement as much in the Economic as in the Social, Environmental, Technological, Global and indeed perhaps ultimately- Political Environment of Business. II. IFC- HISTORY AND EVOLUTION The International Finance Corporation (IFC) was founded in 1956 to