[Photo: Supplied]

The International Finance Corporation (IFC), a key member of the World Bank Group is poised to inject up to US$5 million into HFC Bank.

This strategic investment, structured as a trade finance facility, is geared towards facilitating enhanced financial access for Fijian importers and exporters, with a particular focus on empowering micro, small, and medium-sized enterprises (MSMEs).

The backdrop to this collaboration is the exacerbation of a trade finance gap amidst the challenges posed by the COVID-19 pandemic.

HFC Bank, as Fiji’s locally-owned bank, occupies a role in supporting the country’s importers and exporters.

HFC Bank Chief Executive Rakesh Ram has underlined the institution’s commitment to delivering top-tier solutions and expanding its global footprint, boasting over 300 financial partnerships.

Within the framework of the World Bank’s Global Trade Finance Program (GTFP), this investment aims to tackle the hurdles faced by banks in emerging markets like Fiji, where providing trade financing to customers has been a struggle.

HFC Bank Chief Executive Rakesh Ram [right] with Judith Green [Photo: Supplied]

This ‘Trade Finance Gap’ swelled to an estimated US$1.7 trillion during the pandemic, impacting banks in Fiji, where MSMEs contribute significantly to the GDP at 18 per cent. The GTFP steps in to provide vital trade finance support by leveraging IFC’s guarantees to mitigate risks and facilitate the flow of trade.

IFC Country Manager for Australia, New Zealand, Papua New Guinea, and the Pacific Islands Judith Green has emphasized the critical role of trade finance for businesses to compete on the global stage and expressed enthusiasm about the partnership with HFC Bank.

This investment is in line with the World Bank’s strategic vision for Fiji, which revolves around fostering private sector-led growth and expanding economic opportunities, especially for MSMEs, in accordance with Fiji’s National Development Plan (2017-2036).

Through collaborations like this, IFC’s goal is to bolster economic diversification, create employment opportunities, and elevate the quality of life for Fijian citizens, all while championing sustainable development in emerging markets.

In Fiji, where exports account for 18.9 per cent of GDP and imports for 39.5 per cent, the GTFP is expected to strengthen the flow of essential goods and fortify market resilience.

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