Showing posts with label UK Government. Show all posts
Showing posts with label UK Government. Show all posts

Thursday, April 2, 2009

New Financial Boost for Businesses in Developing Countries from the UK Government

2 Apr 2009 11:20 Africa/Lagos

New financial boost for businesses in developing countries from the UK Government

London, 2 April/GNN/ --

News Distribution Service on 2 April 2009
Businesses in developing countries are struggling to survive due to the
economic downturn and need urgent financial support, said Secretary of State
for International Development Douglas Alexander.

At the London Summit, world leaders are working to stabilise financial markets
and help families and businesses across the world to get through the recession.

And the UK Government today (THURS) intends to take practical action to
support firms across the globe, helping stimulate trade in developing
countries and ensuring sustainable growth.

This will be done through the World Bank's new initiative called the Global
Trade Liquidity Programme (GTLP) set up to support small and medium businesses
by helping address the trade finance shortage in developing countries through
international banks.

The UK Government, through its development finance institution CDC, intends
to make a contribution of up to £300m to the GTLP.

Secretary of State for International Development Douglas Alexander said:
"Private sector businesses are an essential engine of growth and play a vital
role in stimulating global trade, which provides a lifeline to millions of
people across the globe.

"People in developing countries have been disproportionately hard-hit by the
economic crisis. This money will help firms keep going during the difficult
climate and help to protect and create jobs.

"This is not an initiative to help make commercial banks richer.

Participating banks must all commit to using the money to support trade in
developing countries. In the first phase, this will include Kenya, Angola,
Ghana, Nigeria, Mauritius, Malawi, Mozambique, Seychelles and Zambia." The
proposed sum alone could help fund beween £2bn and £3bn of trade over the next
two years, helping small and medium firms to import and export products. The
UK money will be invested in the GTLP on a loan basis.

The shortage in trade finance, due to the current economic crisis, is a
significant threat to world trade - already projected to decline by about
nine per cent this year. The World Trade Organisation has suggested there
could be a global shortfall of between $100bn and $300bn.

Notes to Editors:

1. The GTLP, which is due to become operational May, will provide capital to
international banks specialising in trade finance in the developing world
over a period of two, may be three years. The programme raises funds from
development finance institutions, governments, and works through global
and regional banks to extend trade finance to importers and exporters in
developing countries.

The GTLP will be based on a commitment of $1bn from IFC, a member of the
World Bank Group. The IFC is seeking a further $3bn to $4bn from donors. It
is expected to support up to $50bn of trade over three years.

2. CDC is the UK Government's development finance institution. CDC's mission
is to generate wealth by providing capital for investment in sustainable and
responsibly managed private sector businesses. It uses its own balance sheet
to invest in private equity funds focused on the emerging markets of south
Asia and sub-Saharan Africa. For further information visit

For more information call the DFID press office on 0207 023 0600.

DFID, the Department for International Development: leading the British
government's fight against world poverty. One in five people in the world
today, over 1 billion people, live in poverty on less than one dollar a
day. Information Department 1 Palace Street, London SW1E 5HE.

Press enquiries 020 7023 0600 (overseas +44 20 7023 0600)
Public enquiries 0845 300 4100 (overseas +44 1355 84 3132)

Source: Department for International Development

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