IFC and Fransabank Supporting Job Creation in Lebanon

IFC, a member of the World Bank Group, seeks to promote private sector led growth in order to support job creation and inclusive growth. In this context, an important priority of IFC in Lebanon is to support small and medium enterprises (SMEs). In...

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Main Author: International Finance Corporation
Format: Working Paper
Language:English
en_US
Published: International Finance Corporation, Washington, D.C. 2017
Subjects:
Online Access:http://documents.worldbank.org/curated/en/506601489644678513/IFC-and-Fransabank-supporting-job-creation-in-Lebanon-case-study
http://hdl.handle.net/10986/26442
id okr-10986-26442
recordtype oai_dc
spelling okr-10986-264422021-04-23T14:04:36Z IFC and Fransabank Supporting Job Creation in Lebanon International Finance Corporation JOB CREATION SMEs MICROFINANCE LABOR MARKET IFC, a member of the World Bank Group, seeks to promote private sector led growth in order to support job creation and inclusive growth. In this context, an important priority of IFC in Lebanon is to support small and medium enterprises (SMEs). In Lebanon, SMEs represent 97 percent of the total formal enterprises, employ more than 51 percent of the working population, and are mostly family-owned. Supporting Lebanese SMEs is therefore an important mechanism for increasing employment opportunities, and improved access to finance for SMEs is an essential factor allowing SMEs to grow. As part of its activities in Lebanon, IFC partners with local banks and other financial institutions to (i) broaden their networks and facilitate greater outreach to SMEs; and (ii) offer innovative products that expand financing options for SMEs. Fransabank and IFC have had a long-standing relationship dating back to the 1990s. In 2007, IFC supported Fransabank under the Lebanon Rebuild Program with two facilities including a risk-sharing facility to support the bank’s lending to SMEs. IFC’s counter-cyclical support not only provided liquidity but also helped restore investor confidence in Lebanon and its private sector in a post-conflict situation. Measuring the impact of IFC’s investment and advisory activities can be complex. With the idea of quantifying job creation through financial markets investments in Lebanon, IFC and Fransabank have undertaken this in-depth study. The key objectives of the study are: (i) to measure the job impact on SMEs from increased access to finance; and (ii) to understand the broader development outcomes facilitated by engagements in the financial sector. The results are based on a survey implemented in March 2013, which sampled 73 companies that received loans from Fransabank during 2008 and 2011. The enterprises ranged from very small to medium firms in the service, agribusiness, and manufacturing sectors across the five regions of Lebanon. While it is difficult to draw any definitive conclusions from these findings, the results validate that SMEs are vital and have the potential to contribute significantly to job creation. The findings should also encourage financial institutions like Fransabank to continue supporting SMEs through financing and other services to promote sustained job growth in Lebanon. 2017-04-24T21:13:39Z 2017-04-24T21:13:39Z 2014-02 Working Paper http://documents.worldbank.org/curated/en/506601489644678513/IFC-and-Fransabank-supporting-job-creation-in-Lebanon-case-study http://hdl.handle.net/10986/26442 English en_US CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo International Finance Corporation International Finance Corporation, Washington, D.C. Publications & Research Publications & Research :: Working Paper Middle East and North Africa Lebanon
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
en_US
topic JOB CREATION
SMEs
MICROFINANCE
LABOR MARKET
spellingShingle JOB CREATION
SMEs
MICROFINANCE
LABOR MARKET
International Finance Corporation
IFC and Fransabank Supporting Job Creation in Lebanon
geographic_facet Middle East and North Africa
Lebanon
description IFC, a member of the World Bank Group, seeks to promote private sector led growth in order to support job creation and inclusive growth. In this context, an important priority of IFC in Lebanon is to support small and medium enterprises (SMEs). In Lebanon, SMEs represent 97 percent of the total formal enterprises, employ more than 51 percent of the working population, and are mostly family-owned. Supporting Lebanese SMEs is therefore an important mechanism for increasing employment opportunities, and improved access to finance for SMEs is an essential factor allowing SMEs to grow. As part of its activities in Lebanon, IFC partners with local banks and other financial institutions to (i) broaden their networks and facilitate greater outreach to SMEs; and (ii) offer innovative products that expand financing options for SMEs. Fransabank and IFC have had a long-standing relationship dating back to the 1990s. In 2007, IFC supported Fransabank under the Lebanon Rebuild Program with two facilities including a risk-sharing facility to support the bank’s lending to SMEs. IFC’s counter-cyclical support not only provided liquidity but also helped restore investor confidence in Lebanon and its private sector in a post-conflict situation. Measuring the impact of IFC’s investment and advisory activities can be complex. With the idea of quantifying job creation through financial markets investments in Lebanon, IFC and Fransabank have undertaken this in-depth study. The key objectives of the study are: (i) to measure the job impact on SMEs from increased access to finance; and (ii) to understand the broader development outcomes facilitated by engagements in the financial sector. The results are based on a survey implemented in March 2013, which sampled 73 companies that received loans from Fransabank during 2008 and 2011. The enterprises ranged from very small to medium firms in the service, agribusiness, and manufacturing sectors across the five regions of Lebanon. While it is difficult to draw any definitive conclusions from these findings, the results validate that SMEs are vital and have the potential to contribute significantly to job creation. The findings should also encourage financial institutions like Fransabank to continue supporting SMEs through financing and other services to promote sustained job growth in Lebanon.
format Working Paper
author International Finance Corporation
author_facet International Finance Corporation
author_sort International Finance Corporation
title IFC and Fransabank Supporting Job Creation in Lebanon
title_short IFC and Fransabank Supporting Job Creation in Lebanon
title_full IFC and Fransabank Supporting Job Creation in Lebanon
title_fullStr IFC and Fransabank Supporting Job Creation in Lebanon
title_full_unstemmed IFC and Fransabank Supporting Job Creation in Lebanon
title_sort ifc and fransabank supporting job creation in lebanon
publisher International Finance Corporation, Washington, D.C.
publishDate 2017
url http://documents.worldbank.org/curated/en/506601489644678513/IFC-and-Fransabank-supporting-job-creation-in-Lebanon-case-study
http://hdl.handle.net/10986/26442
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