MOU on Cooperation between NEXI and IFC

Nippon Export Investment Insurance (NEXI; Chairman and CEO: Atsuo Kuroda) has concluded a memorandum of understanding (MOU) with the International Finance Corporation (IFC; CEO: Philippe Le Houérou), an international financial institution. The MOU signing ceremony was held online.

IFC, a member of the World Bank Group, promotes sustainable private sector investment in developing countries. This agreement will enable cooperation between the two parties in promoting projects in which IFC participates, and supporting Japanese companies’ overseas business. NEXI will support such projects by providing insurance for project-related Japanese bank loans.

This MOU aims to establish a framework for cooperation between the two parties in order to create new business opportunities for Japanese companies in developing countries while increasing complementarities in the partnership with IFC’s unique expertise as an international financial institution, and NEXI’s accumulated know-how of financial support for Japanese entities.

Massive infrastructure demand is now anticipated in developing countries that have achieved an　amazing economic growth. However, realizing infrastructure projects in such countries has been considered “high risk”, and it can be quite challenging to obtain sufficient funding from private banks. It is also difficult to satisfy capital-raising needs by public funds. It is said, therefore, that a funding gap of trillions of dollars exists on a yearly basis.

Amid such circumstances, signing an MOU with IFC, which has played an important role in private-sector development in emerging markets while mobilizing private capital is expected to contribute to fostering Japanese companies’ investment and finance into developing countries.

Also, this MOU meets the purpose of the Japan’s Infrastructure System Export Strategy because it aims to encourage private investments, and create an investment-friendly environment for Japanese companies.

Furthermore, it is in line with NEXI’s efforts to strengthen international cooperation with related organizations under the worst economic crisis since the Second World War, which is caused by a massive outbreak of COVID-19 across the world. By working directly with IFC, a financial institution providing support for developing countries that have been facing unprecedented economic damage from the COVID-19 crisis, NEXI is able to expand its scope of assistance for Japanese companies operating in such countries, including in Africa.

NEXI will continue to actively support Japanese companies’ business development overseas including their exports, investments and lending into developing countries by strengthening ties with international financial institutions.

Focus Areas for Partnership

1. 1. Exchange of information on both management policies and support programs.
2. 2. Exchange of information on the economy and financial markets in the countries/regions in which both parties are interested.
3. 3. Exchange of information on power/natural resources/ infrastructure sectors and Green technology in which both parties are interested.
4. 4. Exchange of information on potential business opportunities for Japanese companies.
5. 5. Provision of financial assistance for business projects in which Japanese companies participate in the countries receiving support from IFC.

About IFC

IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. It works in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2020, we invested $22 billion in private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity. Established in 1956, IFC is headquartered in Washington D.C. For more information, visit www.ifc.org.

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