The International Finance Corporation (IFC) and Japan just signed a deal to set up the Tokyo Business Development Hub, a new way to get Japanese companies involved in development projects around the world, according to a the latest release. The hub will work on food security, energy projects, and development in Africa – areas where Japanese know-how can really help. Both sides want to pull in more private money to tackle big global problems.
Japan is IFC’s second-biggest shareholder and has backed the organization for years. Tokyo made sense as a location because Japan has cutting-edge industries and mature financial markets. The country also has development agencies like JICA, JBIC, and NEXI that already team up with IFC on projects worldwide.
“We’re facing multiple global crises right now, so getting private sector development moving faster is critical,” said Riccardo Puliti, IFC’s regional vice president for Asia and the Pacific.
Japan’s one of the world’s biggest economies with leading-edge industries, so their help matters a lot. Former Deputy Finance Minister Daiho Fujii thinks the Tokyo Hub will help IFC deliver bigger, better projects by connecting with Japan’s business world.
This builds on what’s already working well. Japanese development banks have put about $4 billion into IFC projects globally. Private Japanese companies have kicked in around $10 billion since 2005. Japan also funds IFC’s advisory work through the Comprehensive Japan Trust Fund, which just turned 30.
The Tokyo Hub makes sense – use Japan’s money and technical skills for development work. With so many crises hitting at once, getting private capital from big economies like Japan could make all the difference in scaling up real solutions.
