Local Economic Development
Photo by Arne Hoel, World Bank
When IFC invests in large infrastructure and natural resources projects, we want to ensure that the host communities experience broad-based economic development. It involves the implementation of a wide range of activities including local supplier development, broad-based economic development, and capacity building of key actors and institutions. Our goal is to ensure that the investments in these large infrastructure and natural resource projects activate economic growth across a range of industries and that the benefits have an impact on a wide range of stakeholders.
IFC’s Sustainable Infrastructure Advisory has successfully implemented several approaches to economic development, including:
Local Supplier Development: We established strategic partnerships with a pool of local and national suppliers to supply goods and services to large infrastructure and natural resource projects. These suppliers were also provided with skill-building techniques and access to finance.
Broad-Based Economic Development Projects: We initiated projects in the host communities that could trigger economic growth of the local areas. These projects included agriculture, construction, and civil works, or other businesses that promote the growth of the area.
Institutional Capacity Building: We worked with key government and private sector agencies, especially groups representing women and youth, to increase their capacity to carry out economic development projects.
In Action
Mining & Agriculture in Apurimac, Peru
IFC’s Sustainable Infrastructure Advisory worked in partnership with the Government of Canada, to ensure mining revenues benefit the local population. It included providing them with enhanced access to essential services and infrastructure and supporting small-scale farmers to improve their agricultural and nutrition practices. This would enable them to take advantage of new market opportunities to generate additional income.
Local Supplier Development in Guinea
We worked with Rio Tinto to develop a base of local suppliers for the Simandou mining project in Guinea. We were involved in a wide range of activities such as training and upskilling of local suppliers. We also worked with the government of Guinea on several initiatives centered around creating a one-stop shop for mining licenses, reducing the complexity of setting up new businesses and enacting a new leasing law. These interventions have led to the establishment of a robust business environment that continues to operate even after Rio Tinto exited from the project. This work will continue to support future mining operations in the country.
Canada-IFC Benefit Sharing in Natural Resources
In partnership with the Government of Canada, IFC is implementing a seven-year Local Economic Development Program in the Africa region. The program, which is aimed at improving the economic and social wellbeing of communities hosting oil, gas and mining projects, is being implemented in Côte d’Ivoire, Ghana, Guinea, and Kenya.
