IFC sub Saharan Africa 2010 investments up a third

NAIROBI, Aug 31

The World Bank's investment arm on Tuesday said its investments in sub Saharan Africa rose by a third to $2.4 billion in its 2010 fiscal year and forecast further growth this year.

The International Finance Corporation (IFC) noted a "palpable improvement" in the investment climate on the continent rich in natural resources and increasingly eyed by investors, but dogged by corruption and red-tape.

Jean Philippe Prosper, IFC director for Eastern and Southern Africa, said the body's investments in the region during the 2011 fiscal year, from July 1, 2010 - June 30, 2011, would be higher than 2010, but the increase might be more subdued.

"We expect to maintain a strong level of activity this fiscal year. We have a very strong pipeline and have already committed more than $400 million for the first two months of this fiscal year," Prosper told reporters.

"You can only grow exponentially for so long," he said.

Of the $2.4 billion in new investment commitments in 2010, $400 million went to helping micro, small and medium-sized enterprises.

IFC said it also provided a $25 million loan to the Aga Khan Fund for Economic Development for lending to Air Burkina, Air Mali and Air Uganda to help develop Africa's regional aviation networks.

As well as private sector investment, the IFC also helps governments design and implement reforms to improve their investment climate.

"Growth in African countries reforming (their business environments) is about a third higher than in those countries not reforming," said David Bridgman, regional manager of the group's investment climate division.

- Reuters