The International Finance Corporation (IFC), the private sector arm of the World Bank Group, has announced that Banco Patagonia of Argentina has joined its Global Trade Finance Program as an issuing bank.

Under the global programme, IFC has approved a trade line for Banco Patagonia, a mid-sized bank focused mainly on small and medium enterprises.

James Scriven, IFC’s associate director for Global Financial Markets, Latin America, says, “IFC’s Global Trade Finance Program will allow Banco Patagonia to increase its trade finance business worldwide, expand its portfolio to include larger deals and potentially new clients, and meet the demand from clients importing from or exporting to countries where the bank does not have correspondent bank relationships.”

Through the programme, IFC provides guarantees covering bank risk related to underlying trade transactions for the private sector in emerging markets.

The programme is aimed at supporting trade with emerging markets worldwide and promoting flows of goods and services between developing countries.

Yolande Duhem, IFC’s senior country manager for Argentina, says, “A key objective of IFC in Argentina is to support export-oriented companies and the growth of small and medium enterprises. The Global Trade Finance Program helps us implement this strategy.”

Mariano Antonovich, Banco Patagonia’s head of finance, says, “We are delighted to begin a relationship with IFC through the Global Trade Finance Program. This will allow us to continue supporting our SME clients “growth and development while enhancing international trade companies in Argentina.”

Antonovich adds that this agreement represents the first step in a very ambitious project for both organisations and that they are very excited in exploring more business opportunities together in the near future.

From July 1, 2005 to March 2006 IFC committed US$233mn for IFC’s own account and an additional US$383mn in syndications in private sector projects in Argentina. IFC’s total portfolio in the country as of December 2005 is US$1.029bn.

In Argentina IFC has been shifting its focus from short-term lines to long-term financing.  IFC’s priorities for its direct investments will be to provide long-term financing and structured finance products to companies and projects in strategic sectors with a focus on groups expanding on a south-south basis and export-oriented or export facilitating projects.

Strategic focus sectors are oil, gas and mining, agribusiness and forestry products and the financial sector with a focus on high impact projects such as housing and support of export-oriented SMEs.