The International Finance Corporation (IFC), the private sector arm of the World Bank Group, Wednesday welcomed China's approval of its application to issue renminbi-denominated bonds in domestic Chinese capital markets..

"The IFC was pleased to be notified today by the Ministry of Finance that the State Council approved the IFC's application to issue renminbi bonds in accordance with the RMB Bond Issuance Regulations," the company said in a statement.

The proceeds of the IFC's bond issues will be used to finance private sector projects that IFC has already selected and appraised, it said.

IFC Acting Executive Vice President Assaad Jabre said, "The IFC is very grateful for the opportunity to issue bonds in China's domestic capital markets."

The approval by the Chinese government is the result of four years of cooperation with the Ministry of Finance and other relevant authorities, during which IFC provided technical assistance and shared with the authorities its extensive experience in issuing in other domestic markets, said the company.

"The IFC bond, when issued, will contribute to our broader strategy of helping China develop stronger and deeper domestic capital markets," Jabre said.

IFC funds its lending activities by issuing bonds in the international capital markets. The Corporation's securities, which are rated AAA by Moody's and AAA by S&P, have been issued in 33 different currencies. IFC's funding program for fiscal year 2006 is around 2 billion US dollars.

IFC has been among the first non-residents to issue in many currencies, including Colombian pesos, Spanish pesetas, Portuguese escudos, Greek drachmae, Hong Kong dollars, Malaysian ringgit and Singapore dollars in the domestic markets, and in Czech koruna, Philippine pesos and Polish zloty in the eurobond markets.

Since 1985, the IFC has invested more than 2 billion US dollars in 100 private sector companies in China.

The International Finance Corporation, the private sector arm of the World Bank Group, promotes sustainable private sector investment in developing and transition countries, helping to reduce poverty and improve people's lives.

The IFC finances private sector investments, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. Its 178 member countries provide its share capital and collectively determine its policies.

From its founding in 1956 through the 2005 financial year, the IFC has committed more than 49 billion US dollars of its own funds and arranged 24 billion US dollars in syndications for 3,319 companies in 140 developing countries.

IFC's worldwide committed portfolio as of the 2005 financial year was 19.3 billion US dollars for its own account and 5.3 billion held for participants in loan syndications.

Source: Xinhua