IFC, a member of the World Bank Group, has committed to expand support for initiatives in South Africa that help address persistent challenges in job creation, especially for young people and women.
In a speech to government officials and business leaders in Johannesburg, IFC CEO Philippe Le Houérou said IFC is ready to deliver expertise and new ideas that support policies aimed at addressing record high levels of poverty and inequality in the country.
Le Houérou spoke at an event “Engaging the Private Sector to Boost Shared Prosperity in South Africa and Sub-Saharan Africa.” It was organized by the Association for Savings and Investment South Africa in partnership with the World Bank Group Executive Director’s office representing South Africa, the National Treasury, and IFC.
“We want to help you put together inclusive business practices and we want to help you create jobs, especially for young South Africans,” Le Houérou said, drawing attention to the rate of youth unemployment at 54 percent. He also emphasized the importance of supporting women in business, “The record is clear around the world – when women entrepreneurs receive more access to finance they become economic change agents for society. We need to support more of South Africa’s women business owners and entrepreneurs.”
Unemployment reached a 14-year peak of 28 percent in 2017, with more than half of the country’s youth unemployed. The job creation needs are substantial: 8.4 million to absorb the unemployed and discouraged and another 2.7 million to keep up with demographics over the next 10 years.
IFC recently launched the SME Push program to spur economic growth with small and medium-sized businesses. Through the program IFC has begun channeling more than R30 billion over seven years into South Africa’s SMEs.
The program is implemented through partner financial institutions that offer financial access to promising small and medium-sized businesses previously considered too risky.
IFC provides investment and advisory across a range of sectors that support South Africa’s growth agenda by supporting skills and encouraging domestic enterprises. Le Houérou recently visited two projects associated with IFC investments in South Africa.
He visited educators and students Rosebank College, a tertiary educational institution operated by JSE-listed AdvTech that helps young people develop skills and training needed in today’s job market. He also visited South African automotive manufacturers that are part of BMW South Africa’s supply chain.
In other areas, IFC aims to offer subnational finance, global expertise, and advisory that can help tackle big issues associated with growing cities to help them to absorb and develop an increasingly young population.
IFC dedicated cities team is collaborating with World Bank, which is engaged in Cities Support Program covering the eight metropolitan areas in South Africa.
IFC is providing advisory and investment services to creditworthy municipalities in line with long term infrastructure support. The World Bank and IFC engage regularly with National Treasury to align services along strategic objectives of government and the World Bank Group.