IFC BOARD
LETTER FROM THE IFC BOARD

Over the past year, the World Bank Group Executive
Directors have engaged with World Bank Group
leadership about persisting global crises and theurgent need for approaches to restore progress
toward the Sustainable Development Goals. Morethan 574 million people are projected to be living in
extreme poverty by 2030, most of them in Africa.
More broadly, nearly half the world — over 3 billion
people — lives on less than $6.85 per day. Spillover
effects from the COVID-19 pandemic, Russia’s invasionof Ukraine, and extreme climate events are among
the major issues on which the Executive Directors led
World Bank Group interventions to support countries,including a focus on opportunities for women andyoung people. From July 2022 to June 2023, support
from the World Bank Group for developing countries
totaled $122.9 billion, including $38.6 billion fromIBRD, $34.2 billion from IDA, $43.7 billion (includingmobilization) from IFC, and $6.4 billion in guarantees
from MIGA.
At the Annual Meetings in October 2022, Development
Committee members asked the World Bank Group toreview its vision, mission, and operating and financial
models to enhance the institution’s capacity torespond to global challenges. In response, the WorldBank Group created the Evolution Roadmap, withthe aim of better addressing the scale of challenges
facing the world today. The Roadmap provides a basis
for World Bank Group management and the Board
to discuss priorities for the institution’s evolution andbegin to implement collective reform.
Led by the Boards of Executive Directors in partnershipwith management, the Evolution Roadmap gained
momentum this year. At the 2023 Spring Meetings,

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Governors at the Development Committee
commended the World Bank Group for identifying
measures to increase financial capacity by roughly $50
billion over the next 10 years and discussed priorities
to further strengthen the institution for the next phaseof the Roadmap process ahead of the October 2023
Annual Meetings in Marrakech.
The important work of the Evolution comes as theWorld Bank Group continues to respond at record
pace, scale, and impact to help countries addresscompounding crises and increasingly complex
development challenges. In April 2022, the World Bank
Group outlined the Global Crisis Response Framework,
which focused on responding to food insecurity,protecting people and preserving jobs, boosting
resilience, and strengthening policies, institutions,and investments to build back better. Between April
2022 and June 2023, the World Bank Group provided
unprecedented crisis financing of $171.6 billion,
including $53.1 billion from IBRD, $51.8 billion from IDA,
$57.6 billion from IFC, and $9.1 billion in guarantees
from MIGA.
In addition to its impact on food security, Russia’s
invasion of Ukraine has exacerbated trends in energy
access, international trade, and other major sectors.
Recognizing the invasion’s potentially long-term
consequences, the Board approved several operations
to help restore and improve access to essential healthcare, provide financial protection for the Ukrainian
people, and repair Ukraine’s energy infrastructure.
To date, the World Bank Group has mobilized over
$37.5 billion in emergency financing for Ukraine,
including IBRD and IDA loans, IBRD loans guaranteedby partners, donor grants, short and long-term IFC
financing, and MIGA guarantees.

Climate action remains a crucial global priority.
The Executive Directors welcome the efforts theWorld Bank Group has made as the world’s largest
multilateral provider of climate finance for developing
countries by mobilizing more public and privatefinance. The Executive Directors are encouraged that,in addition to work combining country diagnostics,
policy advice, financing, and scalable mechanisms tomobilize funding, the World Bank is on track to align100 percent of new operations with the goals of theParis Agreement from July 1, 2023. For IFC and MIGA,
85 percent of new operations will be aligned starting
July 1, 2023, and 100 percent from July 1, 2025.
The world witnessed devastating natural disasters thisyear that caused tragic losses of life and widespread
destruction. The earthquakes in Türkiye are among
the most recent events to which the World Bank
Group has responded. The Executive Directors
continue to recognize the hardships encountered infragile and conflict-affected situations around theworld, including the challenges and complexities ofmigration, as discussed in this year’s World Development
Report. The Executive Directors commend the ongoingand coordinated efforts by the World Bank, IFC,and MIGA to swiftly address fragility and disasters,
including by leveraging the IDA Private Sector Windowand Contingency Emergency Response Components
in operations. The Board also recently approved theestablishment of an IDA Crisis Facility, which will
boost support for the world’s poorest countries intackling urgent development challenges, particularly
food security and climate change.

In addition to the many operations andcountry engagements the Board discussed andapproved this year, Executive Directors also
visited operations in several client countries. InFebruary and May 2023, Board members traveled
to Belize, Guatemala, Panama, the Republic ofCongo, and São Tomé and Príncipe. During thesemissions, the Executive Directors engaged with
key government entities, the private sector, civilsociety, and donor stakeholders and met withWorld Bank Group staff and the people who havebenefited from these operations.
As the World Bank Group’s leadership andBoards of Directors prepare for the October 2023
Annual Meetings in Marrakech, the Executive
Directors and management are moving forward
on the Evolution Roadmap. The Executive
Directors extend their sincere gratitude toDavid Malpass for his strong and steadfast
leadership of the World Bank Group through ahistorically challenging period. His commitment
to the mission, diversity and inclusion, debt
transparency and sustainability, and countrylevel development outcomes have seen theinstitution deliver record commitments fordevelopment. The Board warmly welcomes hissuccessor, Ajay Banga, as the 14th President of
the World Bank Group. Finally, the Executive
Directors extend their thanks to all staff for
their tireless dedication and hard work in thesechallenging times. Thanks to them, the WorldBank Group continues to make a difference in the
lives of many who deserve a life in dignity.

PHOTO OF IFC EXECUTIVE DIRECTORS
Seated (left to right):Standing (left to right):

Erivaldo Gomes Brazil, Cecilia Nahon Argentina,

Wempi Saputra Indonesia, Parameswaran Iyer

Ayanda Dlodlo South Africa, Dominique Favre

India, Mansour Alshamali Kuwait, Michael Krake

Switzerland, Junhong Chang China — Co-Dean, Koen

Germany, Katharine Rechico Canada, Roman Marshavin

Davidse The Netherlands — Dean, Khalid Bawazier Saudi

Russian Federation, Velavan Gnanendran United Kingdom,Arabia, Adriana Kugler United States, Matteo Bugamelli

Il-Young Park Korea, Hayrettin Demircan Türkiye,Italy, Ernesto Acevedo Mexico, Takashi Miyahara Japan,

Naveed Baloch Pakistan, Abdoul Salam Bello Niger,

Lene Lind Norway

Arnaud Buissé France
Absent: Floribert Ngaruko Burundi

IFC ANNUAL REPORT 2023

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LETTER FROM AJAY BANGA
President of the World Bank Group

Deeply intertwined challenges — poverty,
pandemics, climate change, debt, conflict,food insecurity, and fragility — are eroding
decades of hard-won development progress;
the world is looking to us for solutions.
Fortunately, the World Bank is built to takeon difficult challenges. To truly make adifference, we will need a greater appetite
for risk, meaningful private sector financing,and a sense of urgency.

This urgency motivates us to write a new playbook that will drive impactful
development and lead to a better quality of life for people everywhere.
Pandemics and climate change don’t respect lines on a map. If we fail towork together to address these crises, we all lose. Our approach must beinclusive of everyone, including women, young people, and others too often
left behind. It must be resilient to shocks, including climate and biodiversity
catastrophes, pandemics, and fragility. And it must be sustainable — througheconomic growth, human development, fiscal and debt management,
food security, and access to clean air, water, and affordable energy.
To help countries achieve these goals and address their most urgent development
needs, we offer innovative solutions that can be implemented at scale to maximize
impact. Through our knowledge and research, we help countries make informed,
impactful decisions. Central to these efforts are our partnerships and convening
power, which further extend our reach as we work to realize our shared vision.
Under the umbrella of our Evolution Roadmap, we are working tobecome a better Bank. We will become more efficient and do more in lesstime — incentivizing output, not input. Keeping focus on how many girls
are in school, how many jobs are created, how many tons of carbon dioxide
emissions are avoided, and how many private sector dollars are mobilized.
We are digging deep to boost our lending capacity, finding ways toleverage callable capital, and creating new mechanisms like hybrid capitalthat could unlock untold resources to deliver results. We want to expand
and evolve concessional financing to help more low-income countries
achieve their development goals, while thinking creatively about how toencourage cooperation across borders and tackle shared challenges.
As we face a new era in development, we remain committed
to creating a world free of poverty on a livable planet.
Ajay Banga
President of the World Bank Group andChairman of the Board of Executive Directors

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WE OFFER INNOVATIVE
SOLUTIONS THAT CAN BE
IMPLEMENTED AT SCALE TO
MAXIMIZE IMPACT.
THROUGH OUR KNOWLEDGE
AND RESEARCH, WE
HELP COUNTRIES MAKE
INFORMED, IMPACTFULDECISIONS.
Photo: World Bank Group President Ajay Banga visits Jamaica’s
Kirkvine Community Council Greenhouses, June 2023.

IFC ANNUAL REPORT 2023

5LETTER FROM MAKHTAR DIOPIFC MANAGING DIRECTORThis year brought a continued wave ofchallenges with global growth slowing
sharply, extreme poverty increasing,
the climate crisis intensifying, and new
conflicts emerging. As these overlapping
crises continued to intensify, IFC
responded with scale and speed. Most
importantly, we recognized that businessas usual wouldn’t do, and we raised ourambition to meet the moment.

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And in FY23, we delivered. We made over $43 billion
in total investment commitments — the largest
volume in our history. We set a record for climate
commitments, which surpassed $14 billion. We
exceeded our gender targets. And we mobilized over
$15 billion from external partners — another record.
These are impressive numbers, but what they reallyrepresent is jobs created, women entrepreneurs
getting access to financial services, greenhousegas emissions being slashed, and much more. Ourachievements this year also speak to how we arereshaping IFC. We have made several changes to how
we work that cut bureaucracy and empower frontline
staff to take more risks and respond to emerging
needs faster. The result? Bold interventions that
disrupt crises and drive impact.
Across the world, we are deploying our full arsenal oftools to achieve scale: setting standards, developing
innovative financial solutions, using public-private
partnerships to build sustainable infrastructure, andmobilizing capital. We are supporting the ingenuity ofentrepreneurs who form the backbone of economies
around the world — helping small businesses from
Cameroon to the Kyrgyz Republic get access tofinancing. We are focusing on the massive untapped
potential of female entrepreneurs in our efforts toaddress a more than $5 trillion financing gap for micro,
small, and medium enterprises (MSMEs).

To ensure the most vulnerable have access to food,
we launched a $6 billion Global Food Security Platform
and have worked to stabilize volatile food markets andprovide much-needed finance to companies along thefood supply chain.
In tackling global challenges — from food security toclimate change — we must bridge the gap for private
investors to access emerging markets and developing
economies by mitigating the risks of pioneering
investments. That’s why we deployed a record levelof blended concessional finance to de-risk highimpact investments, and we continue to launch new
facilities to address emerging needs in middle-income
countries. IFC now has over 30 different mobilization
vehicles, including MCCP One Planet, the world’s first
portfolio of emerging market loans aligned with theParis Agreement.
The World Bank Evolution Roadmap calls on us to
do more to address intertwined global challenges.
This year we continued retooling IFC to help unlock
innovation and deliver more sustainable private sector
solutions that lift people up. I am especially heartenedby our team, who are behind the projects andinitiatives detailed in this report. With talent, passion,and purpose on our side, I am confident that a morevirtuous cycle — one that ends poverty, protects theplanet, and creates inclusive growth — is within reach.

Photo above: Ildys Karazhieva, in the Chuy region of Kyrgyz
Republic, has relied on micro loans from Elet-Capital tosupport her business raising chickens. IFC’s loan to EletCapital is under IFC’s Base of the Pyramid program, whichhelps financial services providers deliver funding to help
MSMEs, informal enterprises, and low-income households.

Makhtar Diop
Managing Director

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WE ARE CONTINUINGTO RETOOL IFC TO HELPUNLOCK INNOVATION
AND DELIVER MORESUSTAINABLE PRIVATESECTOR SOLUTIONSTHAT LIFT PEOPLE UP.
Photo: Ngo Thi Xuyen harvests peppercorns
on a farm in Vietnam. An IFC partnership with
McCormick & Co. is helping build a more sustainable,
traceable, certified, and quality-compliant pepper
supply chain through capacity development and theempowerment of women farmers.

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