PORT AND LOGISTICS DEVELOPMENT: Working with IFC IFC: A MEMBER OF - PowerPoint PPT Presentation

PORT AND LOGISTICS DEVELOPMENT: Working with IFC

IFC: A MEMBER OF THE WORLD BANK GROUP IBRD IDA IFC MIGA ICSID International Bank for International International Finance Multilateral International Center Reconstruction and Development Corporation Investment and for Settlement of Development Association Guarantee Agency Investment Disputes Est. 1945 Est. 1956 Est. 1988 Est. 1966 Est. 1960 R O To promote To promote To promote To provide dispute To reduce political L institutional, legal and institutional, legal resolution to mitigate private sector investment risk regulatory reform and regulatory reform non-commercial risks development E T Governments of Governments of Private A member countries poorest countries companies in Foreign investors in R International with per capita with per capita member member countries G investors income between income of less than countries E $1,025 and $6,055 $1,025 T P • Equity • • Technical • Political Risk • Tribunals Technical R • Quasi-Equity • Arbitration assistance assistance Insurance • Long-term Loans O • • Interest Free • Dispute Loans • Risk Management D • Policy Advice Loans Resolution • Advisory U • Policy Advice Services C T Shared Mission: To Promote Economic Development and Reduce Poverty 2

IFC: WHAT WE OFFER IFC ASSET ADVISORY MANAGEMENT INVESTMENT SERVICES SERVICES COMPANY  Equity  Firm-level advice  Wholly-owned  Loans  Investment Climate subsidiary of IFC    Syndications PPP transaction advice Private equity fund manager   Trade Finance and In partnership with Supply Chain  Invests third-party World Bank, advice on capital alongside IFC broader market  Securitized Finance development and  Risk Management enabling environment  Blended Finance for private sector $9.8 bn under $55 bn Committed Over 700 projects valued management (FY17) Portfolio (FY17) at $1.5 bn (FY17) Note: IFC year-end is June 30 th . Note: IFC year-end is June 30 th . 3

OVER $245 BILLION INVESTED SINCE 1956 • Over six decades of experience in emerging markets • Largest global development institution focused on private sector • Founded in 1956 with 184 member countries • AAA - rated by S&P and Moody’s • Equity, quasi-equity, loans, risk management and local currency products • Takes market risk with no sovereign guarantees • Promoter of environmental, social, and corporate governance standards • Resources and know-how of a global development bank with the flexibility of a merchant bank • Infrastructure and Natural Resources accounted for 18.1% of commitments in FY17 FY 2017 Commitments by Region FY 2017 Highlights Middle Latin Portfolio (IFC’s account) $55 billion East & Global America & North 1% East Asia & the Africa New Commitments $11.9 billion the Pacific Caribbean 8% 15% 23% Core Mobilization* $7.4 billion # of Companies 2,006 Sub- South Asia Saharan # of Countries 78 17% Africa 20% Europe & * Includes 3rd parties Note: IFC year-end is June 30 th Central Asia 18% 4

IFC’S GLOBAL REACH Global presence through 100+ regional offices in 94 countries, AAA credit rating 3,860 staff (56% are based outside Washington, DC) 5

IFC – SUPPORT FOR PORT AND LOGISTICS DEVELOPMENT What can we do for the public sector? Consulting on Public-Private Partnership Projects • Advising the public sector partner • Turn-key project development: • Project identification • Selection of the project structure • Development of the legal documentation • Presentation of the project to potential investors • Negotiations and financial closing • Development of the project monitoring mechanism for the public partner Example: TIBAR BAY – East Timor 6

IFC – SUPPORT FOR PORT AND LOGISTICS DEVELOPMENT What can we do for the private sector? Financing of Investment Projects  Equity (including early equity – InfraVentures)  Quasi-equity  Loans (including in certain local currencies)  Syndication / mobilization  Risk Management  Blended Finance Plus selective lending to state-owned enterprises 8 7

IFC PORT INVESTMENTS WORLDWIDE Total Investments: US$4.4 billion since 2005 8

MPS TEMA PORT  Construction and operation of a new container terminal in the Port of Tema, approximately 30 km east of Accra, Ghana. After project completion, the Port will have capacity for 1 million TEUs  35-year concession granted by the Ghana Ports and Harbors Authority  In FY16, IFC committed US$195 million for its own account and mobilized US$472 million in funds from commercial banks as part of a US$1.4 billion project cost PROJECT OVERVIEW PROJECT HIGHLIGHTS  IFC’s largest port investment to date and the largest debt mobilization committed in Sub- Saharan Africa  Given its strategic location in relation to Accra, Tema handles over 90% of the country’s container traffic and serves as an outlet for landlocked neighbors (i.e. Burkina Faso, Niger, Mali)  Development Impact: Improving logistics to reduce transportation costs and increase Ghana’s competitiveness 9

SEMEIKHON (SMK) RIVERSIDE PORT  Construction and operation of a new riverside port with cargo and container capacity along the bank of Ayeyarwady river southwest of Mandalay, Myanmar’s second largest city  In FY18, Infraventures, IFC’s infrastructure project development fund, invested US$3.85 million in early stage development equity and also provided experienced project development support for the port’s construction PROJECT OVERVIEW PROJECT HIGHLIGHTS  The finished container port will feature warehousing and a mixed use Industrial Zone to help create an integrated logistics hub  The investment is in line with IFC’s strategy to support Myanmar’s infrastructure to enable it to do business more efficiently and unlock the country’s potential for international trade  The investment will also help develop the use of the Ayeyarwady river as a viable alternative to long-haul trucking within Myanmar 10

SNOWMAN LOGISTICS  One of the leading cold chain logistics providers in India, operating a network of temperature- controlled warehouses and refrigerated trucks  IFC has made several investments in Snowman, supporting its expansion  In FY09 , IFC invested US$5.4 million for a 20% equity stake  In FY12 and FY13 , IFC invested US$6.6 million and US$ 2.8 million in two 8-year corporate loans  Snowman has grown from a storage capacity of 9,142 pallets in 2007 to 98,000 pallets in 2016 PROJECT OVERVIEW PROJECT HIGHLIGHTS  IFC provided the first round of private institutional capital to a small but market-leading company in a nascent, rapidly growing sector, which signaled confidence in the company’s management and helped with subsequent fundraising  Snowman completed an IPO in 2014, 60x oversubscribed and IFC presence as an equity investor was crucial  Provided long-term financing when the company was in the process of implementing a turnaround  Improved environmental and social standards 11

CONTINENTAL WAREHOUSING CORPORATION • Integrated logistics player with 7 operational multi modal terminal facilities and an express logistics / 3PL business • CWC has 4 Container Freight Stations around major ports in India and 3 rail-linked inland terminals, which will cater to container and bulk traffic for both Exim and Domestic purposes • In FY16 , IFC invested US$ 25 million equity and provided a US$ 35 million A-loan, to finance the expansion of 2 new inland terminals and refinance existing debt, aligning it to projected cash flows PROJECT OVERVIEW PROJECT HIGHLIGHTS  IFC’s investment will help increase rail transportation in India, which is cheaper, safer and more efficient over long distances  This represents an alternative to existing dilapidated government-run freight terminals and complements public investment in new railway lines to encourage freight movement on the rail network 12

WHAT IFC LOOKS FOR IN POTENTIAL PROJECTS: Commercially • IFC invests exclusively in for-profit projects and charges market rates for its products and Sound services • IFC generally finances no more than 25-50% of total project cost • Never the largest shareholder, typical stake up to 20% Market Catalyst • Typical ticket size $20-50m, but can go to $100m + • Able to mobilize additional debt (B loan program) and equity funds (AMC) Long-term • IFC invests for the medium-to-long term Horizon • Each investment assessed for E&S risks by in-house team of experts, and action plan put Environmentally in place to mitigate risks & Socially • Increasingly relevant for clients, i.e. land acquisition, carbon footprint, community buy-in Responsible • Facilitates debt raising (Equator Principles) • Detailed corporate governance assessment carried out (dedicated internal resources) Corporate • Work on governance issues with companies pre-IPO and those already listed • Roster of quality independent directors Governance • Facilitates exit, especially in public markets 13

Annex 14

WHAT CLIENTS VALUE ABOUT IFC Financing Ability to Long-Term Not Readily Stamp of Mobilize Partner Role Available Approval Additional Elsewhere Funds Social, Advice based Affiliation Environmental on Global Worldwide with the and Corporate Expertise and presence World Bank Governance Knowledge Group Expertise 15