Transport & Logistics – EBRD financing Houda Lahrech CGEM, Casablanca, 2 May 2017
Agenda • EBRD overview • EBRD in the Transport sector • Why transport • Our vision in the transport sector • How to deliver sustainable transport • Logistics: area of increasing focus • Why sustainable logistics • Solutions for Green Logistics • Barriers • Examples of tools available 2
EBRD in a snapshot • IFI to promote transition to market economies in 36 countries; • Over 117 € bln invested in 4,700+ projects since 1991; • 9.4 € bln invested in 400 projects in 2016; • Owned by 65 countries and two intergovernmental institutions (AAA rated); • HQ in London, it has 36 regional offices; Across all business sectors (Infrastructure, • Energy, Industry & Agri, Financial Institutions, etc.) • Private sector oriented (80%) 28 August, 2017 3
EBRD’s Activities since 2012 in Morocco EBRD’s activities EBRD’s portfolio (1) (1) • Financing capabilities in hard & local currency for debt & equity investments Industry Commerce & Agribusiness • Indirect & Direct Financings: 17% Financial Institutions ✓ Credit lines with Moroccan banks (TFP, MORSEFF, 33% SME) € 1.2 bn Energy ✓ Limited Partner Investor in Equity Funds 21% ✓ Flexible financings tailor-made to the project’s needs (Senior debt, Project finance, Infrastructure Fixed/Floating rates) 29% ✓ Anchor investor in Bonds • € 1.2 bn bn invested d since ce 2012 • Financing SME, Family Group & International ✓ € 920 m invested in 32 32 project cts Sponsor ✓ € 250 m for Trade Finance credit lines • 300 300 Techni nica cal Assist stance ance projects • Investments from € 3 m to € 200 m across FI, • Supported Innovative financing structures Infrastructure, Energy & ICA • Promoted “Green” investments (1) Based on signed transactions as of 31/12/2016. TFP: Trade Finance Programme. 4
EBRD in the Transport Sector Over EUR 13 billion invested in 270+ projects 28 August, 2017 5
Why Transport? • Safe and efficient transport networks fundamental to economic growth and well-functioning markets Infrastructure gap • • Severe constraints on public budgets: Private sector participation is key • Emphasis on regional integration: Increased risk of cross- border projects Sector reforms needed • • Innovation and multimodality are crucial for sustainable development • Transport is fundamental to deliver climate policies (COP22): only major sector in the EU where GHG missions are still rising. 28 August, 2017 6
Our vision in the Transport Sector “ EBRD promotes and finances safe, secure and sustainable transport systems across the region which embody market principles ” (Transport Strategy) Traditio ditional nal strategic ic approac oach: h: Are reas s of increa reasing sing focus: s: • Transition gaps: Sector reform and • Sustainable Transport: Private Sector Participation, Market Energy Efficiency, Gender Inclusion, Orientation, Commercialisation, Road Safety + Financial Sustainability, Corporate • Logistic Development & Intermodal Governance Transport • Bridging infrastructure gap: regional • Small Business Initiative integration and trade facilitation 28 August, 2017 7
How to deliver Sustainable Transport? Improve business environment and • regulatory framework Stakeholder engagement (eg. IFIs, Policy Over EUR 20 mln p.a. CAREC, TRACECA, etc.) • Dialogue mobilized to support sector reforms and challenges TCs for project • Technical identification (eg. Cooperation Energy Audits) and • Wide range of preparation (IPPF) financing instruments Projects & for public and private Investments clients • Risk mitigation – catalyst (IFI status) • Mobilize EU and climate funds 28 August, 2017 8
Logistics: Area of increasing focus Over the last 5 years the EBRD has invested €2billion in 35 Projects cts about Intermodal Transport & Logistics The demand for freight transport is growing and the Bank aims to bridge the infrastructure gap and facilitate the sustainable development of the sector: • Logistics Centres Intermodal Terminals • • Road Fleet modernization • Port Development • Rolling stock and railcars • Short-Sea Shipping & Inland River Transport Capital markets and financial restructuring (IPO, • private placement, etc) • Modernization and Green Logistics 28 August, 2017 9
Why Sustainable Logistics? Time for Action • About 2,800 million tonnes CO2 p.a. caused by logistics sector; • Carbon emissions are forecasted to grow at 2.3% p.a. until 2050 Despite improvements, energy intensity in the EBRD • region remains on average over three times higher than in the EU • High and volatile energy costs as an obstacle for competitiveness Pressure from clients, requiring stronger • environmental performance and stricter reporting • Pressure from policy makers and stakeholders aiming for modal shift to rail 28 August, 2017 10
Solutions are out there BMS, insulation, cogeneration, etc. Electric handling equipment Intermodal solutions New generation railcars ITS systems LED lighting Eco-driving CNG, aerodynamics, low rolling tires, etc. 11 28 August, 2017 11
Barriers for Sustainable Logistics Lack of local financing for early Weak standards of corporate • • movers governance • Inadequate policies and tax • Few trained and skilled disincentives professionals on Sustainable Logistics, both in public and • Lack of information (or private sector sometimes too much information!) • Low of penetration of solutions and suppliers • No MRV carbon footprint systems implemented to Infrastructure gap! Lack of • understand the results and pipeline of projects impact of measures Unsuitable appraisal • • Changeable policy environment methodologies • Misunderstanding of risks (too much focused on construction) 12 28 August, 2017 12
Examples of tools available: Donor funded TC available Over r EU EUR 20 mln mobil bilized ized from om our ur don onor ors s to sup uppor ort t our ur clients ents. . Some examples: • Detailed energy audit to identify opportunities for EE (terminal modernization, handling equipment, etc.); • Feasibility Studies of new products and services • Sector reform • Capacity Development, training, etc. • Environmental Management Systems, • Road Safety Management, (etc.) 13 13 28 August, 2017 13
Examples of tools available: Green Logistics Programme • Funded by EBRD and Global Environment Facility (GEF): 16 mln USD • Programme to facilitate implementation of innovative practices and technologies in the sector • Components: • Concessional cessional finance. nce. Subject to eligibility criteria (carbon savings, BAT, governance practices, etc.), the facility can cover up to 35% of the loan at LIBOR+75bps in Mediterranean and Black Sea Countries (non-EU) Projects also benefit from donor funded Techn hnica ical Assista istance nce to prepare • and implement green solutions • Policy cy Dialogue ogue : GLP will partner with professional institutions to transfer skills about Green Logistics in the region (certified training programmes) and develop transparent MRV methodologies 1- Eligible countries: Albania, Armenia, Azerbaijan, Belarus, Bosnia, Egypt, FYR Macedonia, Georgia, Jordan, Moldova, Montenegro, Morocco Serbia, Tunisia, Turkey, Ukraine 2 – Subsectors: Logistic terminals/centres, ITS, Road fleet modernization, Port development, Short sea shipping, Inland river transport, Rail rolling stock 28 August, 2017 14 14
Examples of tools available: Green Transport Line • EBRD is working with local banks to offer a Green Transport Line in Morocco • Transport sector needs financing for fleet renewal. The idea is to offer a new dedicated product taking in consideration sector characteristics thanks to a package including financing and technical assistance. • Part of the line will benefit from the GLP concessional funding • We are currently talking with the banks and we intend to share the progress of the project and discuss it with you Moroccan GEF EBRD Borrower Bank 28 August, 2017 15
Examples of tools available: Fintecc Finance and Technology Transfer Centre for Climate Change • Funded by Global Environment Facility (GEF) and EU • FINTECC is a programme that helps companies in Kazakhstan, Ukraine, Early Transition Countries and SEMED 1 to implement innovative climate technologies with low penetration. • Components: • Donor-funded technical audits to evaluate opportunities • Incentive fees for private companies to introduce eligible technologies (grants for up to 25% of the eligible costs, capped at 0.5 mln EUR) Policy support on a range of policy topics • http://fintecc.ebrd.com/index.html 1- Early Transition Countries: Armenia, Azerbaijan, Belarus, Georgia, Kyrgyz Republic, Moldova, Mongolia, Tajikistan, Turkmenistan and Uzbekistan SEMED: Morocco, Tunisia, Jordan, Egypt 16 28 August, 2017 16
Annexes Case Studies 17
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