Africa business and its supporting scheme 18th October, 2012 Japan Bank for International Cooperation (JBIC)Executive Officer for Europe, the Middle East and Africa Toshiyuki KOSUGI 1
Political Conditions of African countries 1990s PresentHot spots in the 1990s Still in conflict Unrecovered political order after coup etc. (Source: Presentation material of Ministry of Foreign Affairs of Japan in February 2012)
GDP growth by country groups (annual % change) Russia China/India Brazil (Source: IMF ‘World Economic Outlook Database April 2012’)
World Top 20 of GDP growth by countries (annual % change) (Source: IMF ‘World Economic Outlook Database April 2012’)
Debt sustainability of African countries< The number of countries by stage of the HIPC Initiative in Africa > (Source: IMF ‘Debt Relief Under the Heavily Indebted Poor Countries (HIPC) Initiative’ – factsheet / progress report)
Japanese companies and nationals in Africa< The numbers of Japanese companies incorporated (left) and Japanese nationals (right) in Africa > (2006=100) 2006 2011 2006 2011 (Source <left>: Toyo Keizai ‘Kaigai shinshutsu kigyou soran’(A comprehensive survey of firms overseas)) (Source <right>: MoFA ‘Annual Report of Statistics on Japanese Nationals Overseas’)
Recent activities of Japanese companies in Africa (2011-2012)【 Energy and Natural 【 Manufacturing 】 Resources 】 The Japanese Government signed MOU in JBIC signed buyer’s credit for export of textile natural resources, incl. coal and natural machinery to Angola gas, development with Mozambique Mitsubishi Corp. signed Joint Venture for new Itochu Corp. decided to invest in Platinum fertilizer plant in Nigeria Exploration Project in South Africa Sojitz established a company, to process and【 Infrastructure 】 export woodchips, in Mozambique Sumitomo Corp. signed to build a gas-fired Fujifilm established a subsidiary in South power plant in Tanzania Africa and a representative office in Morocco to reinforce its business in Africa Mitsui & Co. signed EPC contract of power plant expansion project in Ghana Ajinomoto established a sales company in Côte dIvoire to further its Group’s market JBIC signed buyer’s credit for Jorf Lasfar development in West Africa Power Plant in Morocco Hitachi Construction Machinery Marubeni Corp. signed to supply mine commissioned its new remanufacturing plant drainage treatment plant in South Africa in Zambia (Source: News releases from related institutions)
JBIC Financing to Africa■ TICAD : Tokyo International Conference on African Development TICAD, co-hosted by Japan with UN and UNDP, was launched to promote high-level policy dialogue between African leaders and development partners. Since TICAD I in 1993, the conference has been held every 5 years.■ TICAD IV： May, 2008 in Yokohama, Japan The Japanese Government stated that US$2.5bn of JBIC’s financial support (in Loans and Guarantees) for Africa would be extended over a five-year period. Since then, JBIC has committed approximately US$2.9bn of financial support to projects in African countries. ⇒ TICAD V : 1-3 June, 2013 in Yokohama, Japan
Major JBIC Financing in Africa since TICAD IV Date Country Project Name Amount in US$ Untied Loan for Eskom Loan 42m *July 2008 South Africa （Power Transmission & Distribution） Guarantee 28m*Aug. 2008 Madagascar Overseas Investment Loan for Ambatovy Nickel Project Loan 400mSep. 2008 Egypt Overseas Investment Loan for Natural gas related project Loan 270m Untied Loan for Transnet Loan 214m*Mar. 2009 South Africa （Port Expansion） Guarantee 143m*Oct. 2009 South Africa Untied Loan for Standard Bank Loan 150mAug. 2010 Egypt Buyer’s Credit for Energy Refinery Project (Project-Finance) Loan 540m Buyer’s Credit for the National Authority for TunnelsSep. 2010 Egypt Loan 94m* (Metro Construction) Buyer’s Credit for the Government of AngolaNov. 2010 Angola Loan 138m* (Textile Plant Rehabilitation) Overseas Investment Loan for Woodchip Production andJune 2011 Mozambique Loan 5m Manufacturing ProjectMar. 2012 － Export Credit Line to Afreximbank Loan 60mJune 2012 Morocco Buyer’s Credit for Jorf Lasfar Power Project (Project-Finance) Loan 216m Buyer’s Credit for the Government of Angola (2)Aug. 2012 Angola Loan 469m* (Textile Plant Rehabilitation) * Japanese Yen-denominated transactions (converted at US$1=80)
Financing Facilities: (1) Export Loan Company Company In Japan In the UK Export Export Goods and/or Services Consultant JBIC 1) F/S Government / Company NEXI Commercial Banks 2) Loan in Japan in AfricaInsurance (*) If import of a large number of equipment and machinery each in a small amount from Japan is expected, an export loan may be provided in the form of a credit line.
Financing Facilities: (2) Investment Loan Company Company In Japan In the UK Equity Equity JBIC 1) F/S Joint Venture Company Commercial Banks 2) Loan in Japan in Africa(*) In addition to equity shareholding, the company in Japan needs to play a substantial rolein managing the Joint Venture Company, including operation and maintenance works.
Available Export Credit Lines extended by JBIC Borrower Afreximbank Eskom Requirement Import of Japanese Goods and/or Services (min. 30%)Undisbursed amount US$100m 25.3bn (= US$316m*) Repayment terms up to 7 years up to 10 yearsFinal Application date 25/03/2014 < under discussion > Angola, Benin, Botswana, Burkina Faso, Cameroon, Cape Verde, Côte dIvoire, Egypt, Ethiopia, Gabon, The Eligible countries Gambia, Ghana, Guinea, Kenya, Lesot ho, Liberia, Malawi, Mali, Mauritania, South Africa of importers Mauritius, Namibia, Niger, Nigeria, Rw (Eskom) anda, Senegal, Seychelles, Sierra Leone, Sudan, Tanzania, Tunisia, Ugan da, Zambia, and Zimbabwe (For further information, please contact each institution.) *Converted at US$1=80
Local Currency Lending• JBIC may provide loans < TCX Geographic Coverage in Africa > denominated in local currency of African countries by using TCX.• The Currency Exchange Fund (‘TCX’) is a special purpose international fund providing financial derivative products in emerging currencies which are not available in the market.• Amount of each loan: US$0.5m-50m (Source: TCX website - https://www.tcxfund.com/)
Outline of JBIC• Policy-based financial institution• Wholly owned by the Japanese government• Contributing to the sound development of Japan and the international economy and society• Supplementing the financial transactions implemented by private-sector financial institutions• Ensuring the financial soundness and certainty of repayment in making credit• Loans, guarantees and equity participation – Commitments (during Apr.’11- Mar.’12): ¥1,596bn (= US$20bn*) – Outstanding (as of 31 Mar.’12): ¥10,571bn (= US$132bn*) * Converted at US$1=80
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