From the Balkans, to the Pacific

In August, the International Finance Corporation (IFC) held two very public events in Fiji which signaled a new proactive approach in their work in Fiji. One was the launch of a new study it produced, funded by the Government of Australia, titled: From Farm to Tourist Table and the other was the launch of a new project to promote employersupported childcare in Fiji.

The events were officially launched in Suva by one of IFC’s Vice President for Asia and the Pacific, Nena Stoiljkovic, who took up the role in January, after working in the IFC and its sister organisation the World Bank for over 25 years.

IB’s Dionisia Tabureguci caught up with Stoiljkovic during her stay in Suva where she shared a bit about the work IFC will be doing in the Pacific region.

IB: Tell us a bit about your background experience and how you expect to apply that in your work in the Pacific region?

Stoiljkovic: I am from Serbia, a country in the Balkans. That by itself is fragile and is a conflict affected country because of the civil war. I left the country in 1995 and have worked for IFC for almost 25 years now. Being from a developing country has helped me understand development problems and development challenges in countries where IFC works across the globe. So I could always relate to issues of gender, infrastructure, issues of fragility and it has brought me to the Pacific, with some ideas of how we can  help Pacific countries develop further. And the second thing I want to point out from my background is the value of having worked across the business lines of IFC. Most of us come from the investment backgrounds, which teaches us how to structure transactions, how to identify profitable projects with the private sector. I myself had the privilege to work on advisory services. I was running all of IFC’s advisory services. I also had the opportunity to work for the World Bank to understand how the public sector works. As a vice president, I was running their global practices. And then also some innovative financial instruments to de-risk the private sector. So with a spectrum of financial tools and with my origin from a developing country, I believe that I can now use all of that to implement some innovative solutions here in the Pacific.

IB: Your background includes promoting development finance. What is it and its relevance in the Pacific?

Stoiljkovic: Normally IFC finances private sector companies. And as you know when private sector invests, private sector wants profits, wants to make money, wants to make their businesses profitable. What we have realised is that in some countries, including in the Pacific, not all the projects can be immediately profitable and viable. So the innovative financial instruments that we now have allow us to provide blended finance, which is priced below market rates or commercial rates, to encourage private sector to invest. In a first of its kind project in a particular sector, once we bring private sector to such a project using those de-risking instruments, we actually can develop a sector further, we actually can develop a pipeline of projects in the sector and bring more private sector to participate. We actually have a range of experiences like this in Africa where we worked on the first of its kind PPP solar project in one country and we are now scaling it across other countries and we are now trying to implement some of those solutions here in the Pacific. That’s work in progress but we have instruments and tools that we can use already in the Pacific.

IB: That hasn’t been done in the Pacific?

Stoiljkovic: Not much. We had a first facility of that nature with the ANZ Bank where we are trying to develop smaller renewable energy projects across 8 countries in the Pacific and for that facility which is US$50 million, we’re using blended finance to de-risk the projects. And if this solution works for renewable energy, we can use it for different sector, we can structure some similar facilities with small and medium businesses, in agriculture or any other sectors.

IB: Why renewable energy?

Stoiljkovic: We as the World Bank Group and IFC in particular are focusing on cleaner sources of energy and helping countries either increase access to power – because some countries in the Pacific, unlike Fiji, Fiji almost has full access to energy, but in the
other countries, we don’t have that, so we’re trying to help them with alternative sources of energy, to increase their access to power and in some countries we’re simply trying to increase the energy mix so that we have more clean energy. And when you have a lot of sun, a lot of water in some countries, we’re trying to pursue both solar and hydro projects. Wind as well.

IB: You have also had extensive experience in the gender area.

Stoiljkovic: Well, gender has always been with me somehow. When I was Vice President for Advisory Services (at the World Bank), I was home to our gender secretariat. When I ran IFC operations, I was also focusing on gender and in the last year, before I assumed this position, I was running IFC’s cross cutting advisory services which hosts the gender secretariat, so I was in charge for developing the strategy for gender for IFC. I promoted tackling childcare study globally, supported many of the gender efforts and solutions that IFC has been engaged in. We’ve worked now in the Pacific, in Solomon Islands on 16 companies, helping them to train their women workers to become leaders, to help them address some gender issues including violence, so I’m very proud of that work and hopefully we can do more of that across the Pacific.

IB: Is this why IFC has launched a gender initiative in Fiji? Because you came in or was it always in the works?

Stoiljkovic: Well, it is one piece of it. Because we have already done one childcare study globally, it’s an opportunity for us where we could look at the solutions around childcare for all reasons that we’ve mentioned, here in Fiji. But to me, when I look at women, I look at women as employees, so childcare is going to help women as employees to be more present and less absent, and that will help the employers. I also look at women as business owners, entrepreneurs and we also have a range of ways of supporting women entrepreneurs, teaching them and sharing experience with them and of course we have women as leaders. When you look at the world’s population, 50 per cent is women. In many countries 50 per cent of women also go to school and what is happening is they drop out somehow from the productive workforce, they obviously get stagnant, they cannot progress in their workplaces and at the IFC, we’re trying to address that.

IB: A lot is said about Private Sector Development – is this an area that the IFC will also tackle here?

Stoiljkovic: Yes, a strong focus of the IFC is the private sector. We work exclusively with the private sector but what we have learnt with this approach of creating markets and working on sectors is that they’re not fully developed or the private sector is not fully
engaged. We have learnt that there is a lot of project preparation, a lot of upstream work, a lot of advisory services that have to be put in for some of those sectors to open up. And that also means that we will work more closely with public sector. Some of the constraints to private sector development will have to be addressed by the government. Our colleagues from the World Bank will work from the public sector to help us address them. So we’re trying to be a little more proactive and not just to look at ready projects for us to finance but to work more on developing then preparing them for financing. And then as I mentioned de-risking and only then coming in with more commercial financial instruments and mobilisation. We believe that approach will get us to maximising finance for development. And that will come mostly from the private sector because as you know, the private sector has those millions and trillions to be invested in many economies.

IB: The signing of a Cooperation Agreement between IFC and the Ministry of Industry, Trade and Tourism Fiji signals a new partnership. What will that involve?

Stoiljkovic: I’m very excited about the signing of that agreement. The report is called “From Farm to Tourist Table.” Given the importance of tourism to Fiji and Fijian economy, given the fact that tourism is a large employer of the Fijian people, we are hoping to increase the benefits of tourism to the local economy. When you look at food consumed or purchased by hotels, more than 50 per cent of it is imported. And that puts pressure on foreign exchange currency, it also means that the money doesn’t stay here in Fiji and the Fijian economy. So the study helped us address the issues or constraints of why chefs and hotels are not buying local produce. Some of the key constraints identified were around quality, reliability of supply, standards. We will work together with the Ministry with the support of the Australian Government who has financed our work on the study, to remove some of those constraints. We’ll find some pilot hotel projects and we’ll work with them to create better links to the local produce in agriculture. And of course being who we are, the next step for us would be to support some of those producers – the local farmers – and finance their operations and allow them to grow, to become more reliable and to produce more quality products.

IB: When will this work begin?

Stoiljkovic: Well the partnership has just been launched so the study is already there identifying those constraints. We will now start piloting some of the works with specific hotel companies and chefs. And that will lead us to the next stage, which will be some financing.