IFC launches commodities initiative
The IFC has launched its critical commodities finance programme (CCFP) – a public-private partnership initiative that is part of the bank’s global financial crisis response.
The CCLP will provide up to US$4bn and will be mobilised and disbursed in phases to support the extension of liquidity to IFC clients globally.
The IFC explains that the programme uses a risk-sharing approach to extend financing, not only to banks but also to corporate clients such as commodity traders. The programme hopes to set an example for other development finance institutions, encouraging them to support agribusiness and energy finance. It is expected to mobilise approximately US$18bn in funding over the next three years.
Georgina Baker, head of the IFC’s trade & supply chain programme, tells GTR: "IFC’s critical commodities finance programme will provide much-needed support at a time when many banks are pulling trade finance due to continued financial uncertainty and will build on the success of our global trade liquidity programme."
Société Générale will be the first bank to benefit from the CCLP programme with a loan of US$250mn. Together with other development and international banks, IFC will raise a proposed total investment of US$1bn for Société Générale’s agricultural and energy trade finance portfolio.
"We are proud to embark on this innovative program with IFC which provides complementary liquidity and risk-sharing for soft commodities and oil product financings to emerging markets,” says Federico Turegano, global head of the natural resources and energy financing group at Société Générale.
“The initiative is aligned with our longstanding presence in emerging countries, an integral part of our comprehensive approach to serving the global commodities markets."
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