CAIRO: The International Finance Corporation's (IFC) advisory services across the region soared, providing more than $17 million during fiscal year 2007, up from $14.7 million in FY06 and $5.7 million in FY05, according to its recently released annual report. As of the end of fiscal year 2007, PEP-MENA - IFC's multi-donor facility for advisory services across the region - had 61 completed and 93 active projects, with another 11 in the pipeline. Algeria, Egypt, and Morocco had the largest number of projects. "IFC Advisory Services are now fully established in the Middle East and North Africa, said Jesper Kjaer, general manager of IFC PEP-MENA. "Together with our partners, we are supporting the development of countries, and results are encouraging. Since its inception in 2004, IFC PEP-MENA has provided about $37.7 million in advisory services projects across the region. Its activities are funded jointly by the IFC and the following donors: Canada, France, the Islamic Development Bank, Japan, Kuwait, the Netherlands, the United Kingdom, and the United States. With its headquarters in Egypt, PEP-MENA covers a total of 19 countries, spanning from Morocco in the west to Pakistan in the east. This year's report reveals that there has also been a steady increase in the number of projects in frontier and conflict-affected countries in the region, namely Afghanistan, Iraq, Lebanon, Pakistan, West Bank and Gaza, and Yemen. Due to the recent conflict in Lebanon, advisory work in the country has substantially increased this year. "One of our strategic priorities has been to focus on frontier markets. We have increased our engagement in these countries, especially in Afghanistan, Iraq, and Lebanon, after recent conflicts, said Kjaer. "The work in such countries is challenging but important, and we have established robust partnerships to support the continued growth of the private sector, which is key to the development of these fragile economies. Based on the report, Egypt and Pakistan are the largest beneficiaries of PEP-MENA's resources, as they are the largest countries in the region with strong private sector reform efforts. Of the region's resource-poor and labor-abundant countries, Egypt has the most PEP-MENA programs, with 75 percent penetration. Expenditures in Egypt, the report states, are also higher than other countries due to larger pilot projects initiated in it and intended to be rolled out in other countries in the region. Advisory assistance in Egypt is across the board in areas such as business start-up procedures, mortgage finance, corporate governance, and public-private partnership transactions. Advisory support for Egypt's one-stop shops has been very active this year, with the facility engaging in supporting reforms to simplify procedures for business registration, tax-card registration, industrial licensing, and building permits though projects with the General Authority for Investment and Free Zones (GAFI). So far, IFC has helped eliminate nine internal administrative procedures as well as reduce the time for industrial licensing in Alexandria's one-stop shop by 50 percent. As a result, the process of registering a business was cut by more than two thirds. In coordination with the World Bank, IFC advisory services have also helped establish the first housing finance liquidity facility in Egypt dubbed the Egyptian Mortgage Refinance Company. It received an LE 214 million loan from the World Bank. Additional capacity building advisory support to the company is ongoing and is expected to boost the residential housing market, the report reads. Additionally, IFC has begun providing advisory assistance for five pilot PPP transactions - particularly in water, sanitation, and education sectors - intended to expand and develop Egypt's infrastructure. Egypt is also undertaking legal, regulatory, and economic reforms to foster sustainable private sector participation in public services and PPP schemes. In fiscal year 2008, the facility is likely to see an increase in PPP project activity as it becomes streamlined and more and more countries focus on building their infrastructure through PPPs. Egypt is expected to see the biggest increase in new activity, mainly in the water and sanitation, transport, and social sectors.
