The private sector and development Book

Through five case studies, this paper reports findings, based on the International Finance Corporation's (IFC) initiatives to determine its development contributions, and impacts. Two case studies examine projects in Benin and Bolivia, both analyzing the development impact of banks, where government mismanagement of the economy had virtually wiped out the banking system, but, recent economic policies allowed banks to play a role, and the "with- and without-banks" contrast, makes these cases particularly instructive. The privatization program in Argentina, allowed for the international consortium Aguas Argentinas (AA), to operate a thirty year concession. Assisted partly by the Bank and IFC, AA engineered an extraordinary turnaround, into a viable water supply private company, and, an ambitious capital expenditure program is underway. In Madagascar, the Aquaculture de Mahajamba, produces and processes shrimp, having had a significant development impact on the regional, and national economy. Finally, the paper examines the development impact of the South Pacific Viscose company, owned by foreign capital, it produces viscose (or rayon) staple fiber, largely with imported raw materials. The management skills, and technology provided by its parent partner, has made the company internationally competitive, allowing Indonesia to capture the value-added component of viscose production that would otherwise be lost to imports, contributing substantially to the country's economy.