IFC, Rabobank launch $500m facility to finance developing countries’ import, export trade

The International Finance Corporation (IFC) and Dutch-based Rabobank have announced a $500 million commodity-trade-finance facility that will enable banks and companies in developing countries to finance more imports and exports, propelling economic growth and job creation.

Both institutions will each contribute $250 million to expand funding for trade flows of agricultural and refined energy commodities through Rabobank’s global client network, the IFC said in a statement June 13, 2012.

The three-year risk-sharing facility is the second under the IFC Critical Commodities Finance Programme.

The World Bank Group member said the facility will help sustain and expand commodity trade finance for over 200 emerging-market financial institutions and corporates, including agribusinesses.

“This partnership between IFC and Rabobank will help channel additional working capital to emerging-market firms to expand their commodities production and trade and foster economic growth in many of the world’s poorest countries,” said Rashad Kaldany, the IFC’s Vice President for Global Industries.

Launched in 2012, the Critical Commodities Finance Programme helps reduce the risk of food and energy shortages in emerging markets, improving food security for the world’s poorest—who tend to be hit hardest by rising food and energy prices. The programme uses a risk-sharing approach to extend financing to banks and corporate clients of banks such as commodity traders. It is expected to mobilize about $18 billion in funding through 2014.

By Ekow Quandzie