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 (m ) promotes sustainable private
sector investment in developing countries as a way to reduce poverty and
improve people's lives.

IFC is a member of the world bank Group and is headquartered in

washington DC. It shares the primary objective of all World Bank Group
institutions: to improve the quality of the lives of people in its developing
member countries.
psta lis e i 1956, I is t e lar est ltilateral s rce f l a a
e it fi a ci f r ri ate sect r r jects i t e e el i rl . It
r tes s stai a le ri ate sect r e el e t ri aril :

1. i a ci ri ate sect r r jects a c a ies l cate i t e

e el i rl .

2.Hel i ri ate c a ies i t e e el i rl ilize fi a ci i

i ter ati al fi a cial ar ets.

3.Pr i i a ice a tec ical assista ce t si esses a er e ts

 ðhe IFC Articles of Agreement came into force on July 0, , when the
requisite number of at least 0 member countries subscribing at least $7 million to
IFC¶s capital was attained. ðhe initial total authorized capital was $ 00 million.
ðhe first thirty-one member countries as of July 0, were: Iceland, Canada,
Ecuador, United States, Egypt, Australia, Mexico, Costa Rica, Ethiopia, eru,
Dominican Republic, United Kingdom, anama, Ceylon, aiti, Guatemala,
Nicaragua, Bolivia, onduras, India, El Salvador, akistan, Jordan, Sweden,
Norway, Japan, Denmark, Finland, Colombia, Germany and France. On that date
the capital subscriptions amounted to $78, ,000.
] IFC¶s Articles of Agreement enshrined three critical principles. ðhe founders
insisted that IFC adopt a à


, taking on the full commercial risks of
its investments, accepting no government guarantees and earning a profit from its
operations; be an

 à
, using its unique abilities as a corporation owned
by governments to "bring together investment opportunities, domestic and private
capital, and experienced management," and; play a    
, investing only in
projects for which "sufficient private capital is not available on reasonable terms."
] IFC has 8 member countries , which collectively determine its policies
and approve investments. ðo join IFC, a country must first be a member of
the International Bank for Reconstruction and Development (IBRD). IFC's
corporate powers are vested in its Board of Governors, to which member
countries appoint representatives. IFC's share capital, which is paid in, is
provided by its member countries, and voting is in proportion to the
number of shares held. IFC's authorized capital (the sums contributed by its
members over the years) is $ .4 billion; IFC's net worth (which includes
authorized capital and retained earnings) was $ .8 billion as of June 00 .
] ðhe Board of Governors delegates many of its powers to the Board of
Directors, which is composed of the Executive Directors of the IBRD, and
which represents IFC's member countries. ðhe Board of Directors reviews
all projects.
ðhe resident of the World Bank Group, Robert Zoellick, also serves as IFC's
president. IFC's CEO and Executive Vice resident, Lars . ðhunell, is
responsible for the overall management of day-to-day operations.

Although IFC coordinates its activities in many areas with the other institutions
in the World Bank Group, IFC generally operates independently as it is legally
and financially autonomous with its own Articles of Agreement, share capital,
management and staff.
] ðhe IFC's equity and quasi-equity investments are funded out of its paid-in
capital and retained earnings (which comprise its net worth). Strong
shareholder support, triple-A ratings, and a substantial capital base allow
the IFC to raise funds on favorable terms in international capital markets.
As of June 0, 00 , retained earnings represented almost three-quarters of
the IFC's $ .8 billion net worth.
] financing is IFC's main activity, and in this respect is a profit-oriented
financial institution (and has never had an annual loss in its 0-year
history). Like a bank, IFC lends or invests its own funds and borrowed
funds to its customers and expects to make a sufficient risk-adjusted return
on its global portfolio of projects.
] IFC's activities, however, must meet a second test of contributing to a
reduction in poverty in line with its mandate. In practice, this is broadly
interpreted, but considerable time and effort is devoted to both

(i) selecting projects with positive developmental outcomes, and

(ii) improving the developmental outcome of projects by various

means.
 On June 0, 7 IFC reached agreement for a $ million investment in
Siemens do Brasil Companhia de Electricidade. ðhis investment, together
with the equivalent of $8. million being invested by Siemens of Germany,
was to be used to expand the plant facilities and business of Siemens do
Brasil for the manufacture of electric generating equipment, switchgear,
transformers, large motors and accessories for utility and industrial
application as well as telephone equipment. ðhis was the first integrated
plant for manufacture of such a broad range of heavy electrical apparatus in
Brazil.
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