Investments in Biofuel Projects in      Emerging Economies           Two Perspectives           Jonathan Morley-Kirk      ...
Perspectives of potential investors and host           emerging economies• Motives• General needs• Specific areas of inter...
Jonathan Morley-Kirk•   Samuel Montagu & Co./Midland Bank Plc.•   S.G.Warburg & Co. Ltd•   Continental Capital Management ...
Countries - What do they want from investors? •Inward investment •Build up specific industrial sectors •Infrastructure enh...
Investors –What do they want from the host                 country?•   Governmental certainties•   Fiscal regime•   Corrup...
Foreign Private Sector Investors are not………•The only solution•Bottomless pit of investment monies•Allowed to pay bribes•Pr...
Project Overview•   Planning•   Investment monies committed•   Development works•   Production•   Distribution of products...
Specific Investment Project Considerations•   Legislation•   Government Departments involved•   Imported Capital rules/res...
Investment Structure                              Holding Company                            Intermediate CompanyOther Jur...
Investment Structure•   Investment Monies In•   Production•   Sales -Domestic / Export•   Investment Monies Out
Debt / Equity Swaps                                   1                 Investor                                 Debt $Loc...
Debt / Equity Swap Example• Investor buys $5 million FV debt @ 40 cents on the  dollar , cost $2mill• Central Bank swaps d...
Benefits of Debt / Equity Swap•Reduce sovereign indebtedness and interest payments•Improve balance of payments•Attract mor...
Bioenergy Investments• General Investment Regime vs Specific Sector/Area  Development• JVs and Local Empowerment Laws• Alc...
Country and Investor Needs• Need investors          •   Modern legislation• Need to raise           •   Investment made ea...
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Bioenergy clifford

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Bioenergy clifford

  1. 1. Investments in Biofuel Projects in Emerging Economies Two Perspectives Jonathan Morley-Kirk Financial Director, GBTF
  2. 2. Perspectives of potential investors and host emerging economies• Motives• General needs• Specific areas of interest
  3. 3. Jonathan Morley-Kirk• Samuel Montagu & Co./Midland Bank Plc.• S.G.Warburg & Co. Ltd• Continental Capital Management Ltd.• Fox-Davies Capital Ltd.
  4. 4. Countries - What do they want from investors? •Inward investment •Build up specific industrial sectors •Infrastructure enhancements •Employment and training of local workers •Tax generation •Others
  5. 5. Investors –What do they want from the host country?• Governmental certainties• Fiscal regime• Corruption control• Red tape minimum• Workforce• Business operations – enabling regime
  6. 6. Foreign Private Sector Investors are not………•The only solution•Bottomless pit of investment monies•Allowed to pay bribes•Proxies for their home countries•Mind readers•All the same
  7. 7. Project Overview• Planning• Investment monies committed• Development works• Production• Distribution of products• Return of investment monies
  8. 8. Specific Investment Project Considerations• Legislation• Government Departments involved• Imported Capital rules/restrictions• Double Tax Treaties of host country• Debt/equity swaps / debt for goods schemes• In country taxation / customs duties
  9. 9. Investment Structure Holding Company Intermediate CompanyOther JurisdictionsIn Country Investment Company Project 1 Project 2 Project 3
  10. 10. Investment Structure• Investment Monies In• Production• Sales -Domestic / Export• Investment Monies Out
  11. 11. Debt / Equity Swaps 1 Investor Debt $Local Currency 4 3 Local Currency 2 Project Central Bank
  12. 12. Debt / Equity Swap Example• Investor buys $5 million FV debt @ 40 cents on the dollar , cost $2mill• Central Bank swaps debt for $2.5 mill equivalent of local currency• Investor invests local currency into local company to invest in the project
  13. 13. Benefits of Debt / Equity Swap•Reduce sovereign indebtedness and interest payments•Improve balance of payments•Attract more investors•Possible to restrict repatriation of investment funds
  14. 14. Bioenergy Investments• General Investment Regime vs Specific Sector/Area Development• JVs and Local Empowerment Laws• Alcohol Related Matters• Non Payment By Local Buyers• Duties and Taxes
  15. 15. Country and Investor Needs• Need investors • Modern legislation• Need to raise • Investment made easy employment levels • Fixed and fair taxes• Businesses to • Red tape minimised successful • Make suitable returns• Raise taxation • Corruption stamped• Raise global profile out
  16. 16. Thank you

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