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International Financial Institutions



Ministry of Jobs, Tourism and Innovation presentation by Caterina Papadakos explaining how to make use of International Banking funds to off-set risk when expanding internationally.

Ministry of Jobs, Tourism and Innovation presentation by Caterina Papadakos explaining how to make use of International Banking funds to off-set risk when expanding internationally.



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International Financial Institutions Presentation Transcript

  • 1. Doing Business with the International Financial InstitutionsCaterina PapadakosInternational Business Development ManagerMinistry of Jobs, Tourism and InnovationSeptember 14, 2011
  • 2. Presentation Outline What are the big International Financial Institutions and what do they buy? What are the International Financial Institutions‟ products and services? The Project Cycle & Procurement Process Canada‟s Track Record Best Practices in Pursuing International Financial Institution Funded Projects Opportunities for B.C. businesses Support for Canadian Firms: The International Financial Institution Support Network.
  • 3. International Financial Institutions Their common goal…• to reduce global poverty and improve peoples living conditions and standards;• to support sustainable economic, social and institutional development; and• to promote regional cooperation and integration.
  • 4. What do the International Financial Institutions buy?... Relatively little!They provide $150 billion It is the borrowingannually in loans and grants or recipientto developing countries for countries who usepoverty alleviation and these funds to buyeconomic development products orinitiatives services to carry out these projects
  • 5. Goods / Equipment: Pharmaceuticals,medical equipment, vehicles,machinery, tractors, farm equipment,fertilizer, transport equipment, electricalmachinery and plants, industrialfacilities, mining equipment, hardware,telecommunication systems, satellitecommunication systems, schooltextbooks, furniture, spare parts, andraw materials
  • 6. Civil Works: Constructionof hospitals, ports, highways,schools, housing, railways,bridges, irrigation works,water supply and sewagefacilities, and power plants
  • 7. Services: Design and feasibilitystudies, supervision of installationand construction, environmentalassessment studies, monitoring ofmanagement activities, aerialphotography and mapping, oil andgas exploration, financial services,and auditing assistance
  • 8. The Big Guys• World Bank (WB)• Inter-American Development Bank (IDB)• Asian Development Bank (ADB)• African Development Bank (AfDB)• Caribbean Development Bank (CDB)• European Bank for Reconstruction and Development (EBRD)• United Nations
  • 9. The World Bank Group
  • 10. IBRD IDA IFC MIGA International Bank International International Multilateral for Reconstruction Development Finance Investment and and Development Association Corporation Guarantee Agency To promote institutional, legal and regulatory To promote private To reduce political Role: reform sector development investment risk Governments of Governments of member countries with poorest countries with Private companies in Foreign investors in Clients: per capita income per capita income of member countries member countries between $1,025 and less than $1,025 $6,055. - Equity/Quasi-Equity - Technical assistance - Technical assistanceProducts: - Loans - Long-term Loans - Political Risk - Interest Free Loans - Risk Management Insurance - Policy Advice - Policy Advice - Advisory Services
  • 11. World Bank Group• In 2010, 875 projects worth $72 billion• 63% Civil Works, 24% Goods, 13% Consultants• Yearly flow of 100,000 contracts worth $25 billion• Approximately $18 billion in co-financing from the International Finance Corporation annually• HQ in Washington, D.C. and 150 offices in >100 countries (15,000 staff)
  • 12. Inter-American Development Bank• In 2009 the Bank approved over US$15.5 billion in lending (38% increase over 2008)• IDB Group includes the: – Multilateral Investment Fund – Inter-American Investment Corporation• HQ in DC & offices in 26 countries• 2000 staff (mostly Spanish & Portuguese speaking)
  • 13. Member Countries Finland Norway SwedenCanada United Kingdom Denmark Netherlands Germany Belgium Austria France Switzerland Croatia Slovenia Italy Portugal Spain United States South Korea Japan Israel Bahamas Mexico Dominican Republic Jamaica Haiti Trinidad and Tobago Belize Guatemala Honduras El Salvador Nicaragua Barbados Costa Panama Venezuela Guyana Rica Columbia Suriname Ecuador Peru Brazil Bolivia Paraguay Argentina Uruguay • 48 Members Chile • 26 Borrowers • 22 Non-Borrowers (China, 2009)
  • 14. Asian Development Bank• Total loans, grants and technical assistance in 2009 = $14.6 billion• Canada is the 2nd largest shareholder of ADBs non-regional members and, overall, its 7th largest shareholder• More than 50% of ADBs assistance has gone into building infrastructure - roads, airports, power plants, and water and sanitation facilities• Headquartered in Manila and 30 field offices• Mostly public sector lending but some equity investments, guarantees, and loans to the private sector
  • 15. African Development Bank• Approved approximately C$12 billion in project financing in 2009• Consist of 53 regional member countries in Africa, and 24 countries elsewhere in the world• AfDB Group includes the: – African Development Bank (non-concessional) – African Development Fund (concessional) – Nigerian Trust Fund• Currently headquartered in Tunis
  • 16. European Bank for Reconstruction & Development (EBRD)• Owned by 61 countries and two intergovernmental institutions (HQ in London)• Invests mainly in private enterprises, usually in cooperation with commercial partners• Invests across various sectors• Works with publicly owned companies to support privatization, the restructuring of state-owned businesses and improvement of municipal services• Canada has a voting share of 3.4% in the EBRD
  • 17. Caribbean Development Bank• Expected lending of $200 million/yr for the next 5-10 years• Canada holds 9.56 percent of the Banks total shares• Established in 1969 and headquartered in Bridgetown, Barbados• 21 regional and five non-regional members – 17 of which are borrowers• Focus on environmental sustainability and disaster risk management and reduction, education and training, private sector development, rural and agricultural development, public sector capacity building, private enterprise development, etc
  • 18. The United Nations• Not a Multilateral Development Bank (no loans etc.), but manages aid & development projects and operations• Market of US$ 13.8 billion (2009) for all types of goods and services• Canada‟s share of the UN market in 2009: US$ 184 million... more than all the Multilateral Development Banks combined!• Opportunities at more than 50 UN organizations, including: – UN-Procurement Division – UN Development Program – World Food Program 85% of total UN procurement – UNICEF demand in 2009 – UNOPS – UNHCR Register as a supplier at UN Global Marketplace (UNGM)
  • 19. What are the opportunities for B.C. businesses with theInternational Financial Institutions?Who do you target as your client?
  • 20. Corporate Procurement: The International Financial Institution is Your ClientThe International Financial Institution needs: • Services for early stages of the funded projects  Design and feasibility studies The World Bank‟s  Environmental assessment studies  Monitoring of management activities D.C. HQ procures  Aerial photography and mapping $1 billion/year  Auditing assistance • Goods and services for HQ and offices eConsultant 2 is  Furniture utilized for most of  Hardware this operational  Communication equipment and services procurement  Transportation
  • 21. Project Procurement:The Implementing Agency and International Financial Institution Are Your Clients The Implementing Agency in the borrowing country needs: • Technical assistance (TA) services  Feasibility studies, Environmental studies • Goods, Works and Services related to development projects  Engineering services, Architectural services, etc.  “Bricks and mortar” for:  Schools, dams, bridges, ports, roads, railways, industrial plants…  Education and training services  Pharmaceuticals, vaccines, medical equipment, etc.  Vehicles, spare parts  Telecommunication systems ...and so much more…!
  • 22. Project Financing: The International Financial Institution is Your PartnerTo aid in overseas development projects, some of the International FinancialInstitutions provide:  Equity  Quasi-equity  Loans  Risk management  Local currency products ... these opportunities are negotiated on a case-by-case basis – contact us for more information!A few of the International Financial Institution‟s many considerations include:  Is the sector/region a priority for the International Financial Institution?  What is the company/sponsor/management team‟s track record, capability and reputation?  What are the strengths of the project including competitiveness compared to alternatives, social and environmental impacts?  What other groups would the company be dealing with? (eg. In the energy sector who the off taker is etc.)  What the size and scalability of the project is - very small projects are not normally considered  The stage where the project is at – what investment has already been made and what permits etc. are in place?
  • 23. Project Procurement:The International Financial Institution Project Cycle
  • 24. Key points: The Project Cycle The borrowing member countries, through an „Executing Agency‟ are responsible for implementation of the projects – NOT THE INTERNATIONAL FINANCIAL INSTITUTIONS However… the International Financial Institution-prescribed rules & procedures must be followed throughout the project cycle The project cycle can last for many years but there may be business opportunities throughout all phases (though most often in the „implementation‟ phase) Projects are advertised publicly when above certain thresholds ($100K - $300K depending on the International Financial Institution)
  • 25. Project Cycle Negotiation ExecutionProgramming Identification Preparation & & Appraisal Supervision Evaluation ApprovalBorrower Borrower Borrower Borrower Borrower l Bank & Bank & Bank to a & Bank & Bank & Bank minimal degree Country Strategy Impact Assessments Project Procurement Profile Plan Project Completion Report
  • 26. Key Documents: Available on International Financial Institution Websites• Guidelines for selection of consultants and guidelines for goods and works contracts• Country Assistance Strategies / Country Partnership Strategies• Monthly Operational Summary• Plan of Operations (IDB)• Project Information Document (WB)• Project Appraisal Document• Procurement Plan• General Procurement Notices• Specific Procurement Notice – turnaround time can be very short!• Consulting: Often two-staged and including:  Calls for Expressions of Interest (EOIs)  Call for Proposals for short-listed firms (4-6)
  • 27. GPN vs SPN
  • 28. Search for active & pipelinetransportation projects inKenya.
  • 29. Unadvertised Consulting Opportunities?• Such opportunities DO still exist!• The key is to make yourself known to Bank staff at HQs &/or in country offices• Follow International Financial Institution projects diligently & target Bank staff whose lives you can „make easier‟• Know your niche & highlight relevant experience• Most Bank staff maintain informal databases of preferred consultants• Pursue subcontracting opportunities by reviewing contracts awarded
  • 30. Awarded contract example - a potential subcontracting opportunity Free basic information (like this example) --- Or buy a membership for $600USD/yr for full access Provides the name of the company that won the bid Click on it to get the company‟s contact info Provides some basic information on the project
  • 31. Highlights of Canada’s Track Record• Much stronger success in consulting services than goods/works• Comparatively, Canada does extremely well at the African Development Bank and the Caribbean Development Bank• Currently Canada ranked #1 in providing consulting services to the African Development Bank• Canada had a very good year at the World Bank in 2010 – $71 million in contracts in 2010 up from $46 million in 2009• Canada‟s success still only represents less than 1% of contract awards – however data never includes sub-contracts.
  • 32. Best Practices in Pursuing Project Procurement• Learn about how the Banks operate / know who your client is• Identify priority countries – as a part of your company‟s regional strategy• Read all Bank-strategies for the countries you are targeting – look for whether or not they have your sector of interest listed as a priority• Look at projects in the pipeline – don‟t wait for the procurement notices!• Network with decision makers & gather intelligence• Find competent, experienced local partners• Dedicate resources to pursuing these opportunities (staff & financial)• Monitor and bid (and be patient!)
  • 33. Canada has a great support system to help you navigate these opportunities!Offices for Liaison with theInternational Financial Institutions(OLIFI) Maintain and grow the percentage of International Financial InstitutionPrivate Sector Liaison Officers (PSLO) funded contracts awarded to Canadian firmsRegional Offices of the TradeCommissioner Service in CanadaTrade Commissioners at Provide on the ground support andCanadian missions in suggestions for local partnersdeveloping countries Represents Canada‟s interests at the Banks. Strategic information onExecutive Director’s Offices policies, priorities and activities. Willrepresenting Canada at the IFIs also support Canadian clients when trouble-shooting or interventions may be required.
  • 34. Offices for Liaison with theInternational Financial InstitutionsPart of the Canadian Trade Commissioner Service, located in 4 Canadian Embassies abroad: OLIFI Washington (WB/IDB): Amber Germain (202) 448-6416 / OLIFI Manila (ADB): Alex George (011-632) 857-9096 / OLIFI Tunis (AfDB): Ezzeddine Cherni (011-216) 71-104-054 / OLIFI Bridgetown (CDB): Tammy Brathwaite (246) 429-3550 / development-humanitarian-aid-markets/index.jsp
  • 35. Private Sector Liaison Officers (PSLO) ...your first point of contact• Local contact person who builds awareness of and facilitates access to the International Financial Institutions‟ products and services• The Private Sector Liaison Officer role for British Columbia resides in the Ministry of Jobs, Tourism and Innovation• The local Private Sector Liaison Officer can host training and partner with other organizations to promote IFI opportunities at events – like this one!• The Canadian PSLO Network works collaboratively to share resources, host missions to the International Financial Institution headquarters and a variety of other events.
  • 36. Upcoming Related EventsDate Location Event DetailsWeek of October Washington, DC, Multi-country PSLO-led Energy Mission to Washington17, 2011 USANovember 2011 Colombia, Peru Multi-country PSLO-led Mission: WB, IDB, and meetings with and/or Haiti executing agenciesDecember 2011 Caribbean Nova Scotia mission to Caribbean Development BankJanuary 2012 Washington, DC Environment Mission to the IFIsMarch 12-13 2012 Vancouver, BC IFI Bootcamp. Focus on strategic alliances (international)
  • 37. Support / Questions:Caterina Papadakos, International Business Development Manager Ministry of Jobs, Tourism and Innovation (604) 660-1045