The International Finance Corporation (IFC) is lifting its investment in the Middle East and North Africa (Mena) region by half to US$6 billion (Dh22bn) over the next three to four years to help to ease post-revolution transitions.
Much of the investment by the private sector arm of the World Bank will be channelled into job creation, improving civil infrastructure and other drivers of economic growth.
"We want to support the region as much as we can and the processes that are going on and that is why we're willing to step up," said Lars Thunell, the chief executive and executive vice president of IFC.
It has approved $1.35bn of investments in the region this year including $600 million to Tunisia and Egypt.
An additional $6.2m has been set aside for technical support in advisory projects. Typically, the IFC jointly commits funds with a private-sector investor in a project or industry that otherwise may struggle to attract finance.
A wave of uprisings spreading across the Middle East this year has destablised governments and caused economies to falter.
The IFC is among multilateral lenders bolstering their focus on the region as a result.
The IFC and the Arab Monetary Fund yesterday announced an agreement to extend a partnership to help to increase access to finance for small businesses in the Arab world.
The project is aimed at helping to create credit bureaus and encourage banks to raise lending to small firms, which form the backbone of most regional economies.
But with as much as 70 per cent of the region's businesses unable to access finance, their ability to supply much-needed jobs is limited. Unemployment is estimated by the International Labour Organization at 10.3 per cent in the Mena region, which it says is the highest in the world and almost double the global average of 6.2 per cent.
The project will in particular focus on developing financial infrastructure in Egypt, Libya and Tunisia, where the need to rekindle economic growth is most urgent.
"Smaller businesses in the region need finance to expand and create jobs and a robust financial infrastructure is essential for that," said Mr Thunell.
