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OECD EU Conference – River Nile Transport
Cairo, 17th of September 2014
Philip ter Woort, EBRD Director Egypt
What is the EBRD?
• IFI: Promotes transition to market
economies in 34 countries
• Owned by 64 countries and two inter-
go...
Projects in all key business sectors
9 October, 2014 © European Bank for Reconstruction and Development 2012 3
Transport
I...
Transport Team at EBRD
• Transport Team is part of EBRD Infrastructure Business
Group with over 30 banking and sector prof...
EBRD’s presence in Transport Sector
9 October, 2014 © European Bank for Reconstruction and Development 2012 5
Portfolio by...
6
6
PPP: What are the models?
Degree of Private Sector Involvement
DegreeofPrivateSectorRisk
Public Sector
Service Contrac...
7
7
PPP: Issues to consider
Project
essential ?
Political will may endure over long-term for essential
infrastructure and ...
EBRD support to PPPs
With public authorities
• General advice on acceptable
process
• EBRD Policy for procurement
• Grant ...
Case Studies
9
a
a
9 October, 2014 © European Bank for Reconstruction and Development 2012 10
Case Study
R1 Motorway Refinancing, Slovaki...
a
9 October, 2014
a
© European Bank for Reconstruction and Development 2012 11
Case Study
Eurasia Tunnel, Turkey
Client: A...
a
a
9 October, 2014 © European Bank for Reconstruction and Development 2012 12
Case Study
WHSD Central Section Road PPP, R...
a
a
9 October, 2014 © European Bank for Reconstruction and Development 2012 13
Case Study
Istanbul Ferries Privatisation, ...
a
a
9 October, 2014 © European Bank for Reconstruction and Development 2012 14
Client: TAV Ege Terminal Yatirim, a special...
Concluding remarks
Contact: Philip ter Woort: terwoorp@ebrd.com
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ISMED Training: PPPs in Egypt's River Transport_ERBD

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Presented at the Training Session on Public Private Partnerships organised by the MENA-OECD Investment Security in the Mediterranean (ISMED) Support Programme in September 2014.

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ISMED Training: PPPs in Egypt's River Transport_ERBD

  1. 1. OECD EU Conference – River Nile Transport Cairo, 17th of September 2014 Philip ter Woort, EBRD Director Egypt
  2. 2. What is the EBRD? • IFI: Promotes transition to market economies in 34 countries • Owned by 64 countries and two inter- governmental institutions • AAA rated - capital base of €30 billion • Invested EUR 85 billion through 3945 projects
  3. 3. Projects in all key business sectors 9 October, 2014 © European Bank for Reconstruction and Development 2012 3 Transport Industry, Commerce & Agribusiness Financial Institutions Manufacturing & Services Municipal & Environmental Infrastructure Power & Energy Natural Resources Property & Tourism Telecommunications, Informatics & Media
  4. 4. Transport Team at EBRD • Transport Team is part of EBRD Infrastructure Business Group with over 30 banking and sector professionals • Deep experience: Executed 240 projects for a total project value of EUR 43.6 billion • Headquartered in London with dedicated sector coverage bankers in Astana, Istanbul, Kiev and Moscow • Transport Team can mobilize dedicated in-house specialists to support project needs, including procurement, improvement of environmental standards and energy efficient solutions • EBRD offers banking services (debt and equity) to clients across every transport mode: railways, maritime, aviation and roads 9 October, 2014 © European Bank for Reconstruction and Development 2012 4
  5. 5. EBRD’s presence in Transport Sector 9 October, 2014 © European Bank for Reconstruction and Development 2012 5 Portfolio by Region Portfolio by Sector The Bank supports the development of efficient multimodal networks, investing a total of EUR 11.4 billion as of end June 2014 across all sectors and regions to support 245 projects Central Asia 9% 27 projects/ € 1.0 bn Central Europe and Baltics 20% 56 projects/ €2.2 bn Eastern Europe and Caucasus 18% 51 projects/ €2.1 bn Regional 2% 4 projects/ €0.2 bn Russia 21% 41 projects/ €2.5 bn SEMED 1% 1 project/ €0.1 bn South-Eastern Europe 26% 58 projects/ €3.0 bn Turkey, 3% 7 projects/ €0.3 bn Aviation 6% 38 projects/ €0.7 bn Intermodal 4% 10 projects/ €0.4 bn Ports and Shipping 6% 47 projects/ €0.7 bn Rail 34% 73 projects/ €3.9 bn Road 50% 77 projects/ €5.7 bn
  6. 6. 6 6 PPP: What are the models? Degree of Private Sector Involvement DegreeofPrivateSectorRisk Public Sector Service Contracts Management Contracts Design-Build Operational Concession Design-Build-Operate-Maintain Design-Build-Finance-Operate Build-Operate-Transfer Build-Operate-Own Privatisation Realm of PPPs Adapted from P. Livesly
  7. 7. 7 7 PPP: Issues to consider Project essential ? Political will may endure over long-term for essential infrastructure and related services Value for Money ? Risk-adjusted cost of the proposed PPP project should be lower than by traditional public procurement means Does private sector has expertise? Private sector should be able to deliver the PPP and is willing to come to the market Size matters PPP transition costs are relatively high so that a project must be of a certain size to off-set the preparation costs (i.e. legal, technical, financial) Contract designs Allow a level of flexibility through ‘reference designs’ allowing private sector the creative ‘space’ to come up with new solutions
  8. 8. EBRD support to PPPs With public authorities • General advice on acceptable process • EBRD Policy for procurement • Grant funded technical assistance • General letter of interest to finance With bidders • Pre-bidding dialogue with interested players • Review of financing instruments (equity, debt) and indicative financing terms • EBRD cannot commit to exclusivity (‘open support’) – general letter of interest • After award, negotiation of detailed terms and conditions with the preferred bidder
  9. 9. Case Studies 9
  10. 10. a a 9 October, 2014 © European Bank for Reconstruction and Development 2012 10 Case Study R1 Motorway Refinancing, Slovakia Client: Granvia, a special purpose vehicle owned by VINCI Concessions SA and Meridiam Infrastructure Fund EBRD finance: EUR 200 million Type of finance: Project Bond Total Project cost: EUR 1,243 million Year: 2013 Project description: Refinancing of the R1 Motorway PPP project Impact: Optimising the long-term financing of newly constructed sections on the R1 Motorway PPP between Nitra and Tekovske Nemce and the Banska Bystrica Northern Bypass, totalling 51.6 km Fostering economic development in central Slovakia through provision of private sector engagement in road sector financing The project demonstrates EBRD engagement as a long term partner in support of the Slovakian Government’s PPP programme, following on from the successful construction and operational start of the R1 Motorway. Industry Recognition 2013 PFI Award 2013 - Bond Deal of the Year – Europe
  11. 11. a 9 October, 2014 a © European Bank for Reconstruction and Development 2012 11 Case Study Eurasia Tunnel, Turkey Client: ATAS, a joint stock company incorporated in Turkey EBRD finance: USD 150.0 million Type of finance: Senior Loan Total Project cost: USD 1.2 billion Year: 2012 Project description: Design, finance, build, operate and transfer concession for the road tunnel under the Bosphorus (Istanbul Strait Road Tube Impact:  Fostering expansion of private sector participation in the development, management and operation in the transportation sector in Turkey  Relieving traffic congestion within the city of Istanbul and region by reducing journey time and distance between and Göztepe significantly, with the subsequent positive impact the climate change and local environment The project forms part of a larger PPP transport sector programme under consideration by the Turkish authorities aimed at upgrading and modernising the transport network using private sector funding. Industry Recognition 2012 Project Finance International – Turkish Infra Deal of the Year Euromoney Project Finance – European Deal of the Year
  12. 12. a a 9 October, 2014 © European Bank for Reconstruction and Development 2012 12 Case Study WHSD Central Section Road PPP, Russian Federation Client: Northern Capital Highway, a special purpose company selected develop and operate the WHSD road PPP in St. Petersburg EBRD finance: EUR 200.0 million Type of finance: Senior Loan Total Project cost: EUR 3,128.0 million Year: 2012 Project description: Construction of the central section of WHSD road and tolling, operation and management of the full length of the road (46 km) under a 30 year concession agreement EBRD non-financial contribution:  Environmental due diligence gap analysis  Active Lender participation Impact:  Supporting the development of the first large road PPP awarded to a private sector concessionaire under a regional framework in Russia  The project will relieve pressure on the road network; the main transportation hub to the national motorway network, improving road access to the port and as such supporting increasing cargo traffic in and out of the country The project supports the continuation of the PPP road programme planned by the City of St. Petersburg Authorities to develop and expand the road transportation network. The investment is a priority national infrastructure investment in Russia.
  13. 13. a a 9 October, 2014 © European Bank for Reconstruction and Development 2012 13 Case Study Istanbul Ferries Privatisation, Turkey Client: TASS, a special purpose company, established by three Turkish companies (Tepe, Akfen, Sera) and the UK’s Souter Investments acquire IDO, the world largest municipal ferry operator, 50 million passengers p.a. EBRD finance: USD 150 million Type of finance: Limited recourse; mandatory cash sweep; USD 100 million - long term senior loan, sculptured repayments USD 50 million - mid-term junior loan, bullet repayment Total Project cost: USD 860 million Year: 2011 Project description: Financing acquisition of IDO by TASS EBRD non-financial contribution:  Upfront environmental due diligence  Active Lender participation on the structuring Impact:  Demonstration effect of the private sector value-added: introduction of new demand-driven ticket tariffs, creation of routes and intermodal passenger transportation services  Flexible financing structure with a sufficient grace period which allowed the sponsors to introduce measures to turnaround the company  Introduction of a gender action plan as a tool for inclusiveness The project assists in increasing private sector participation in the public transport sector in Turkey.
  14. 14. a a 9 October, 2014 © European Bank for Reconstruction and Development 2012 14 Client: TAV Ege Terminal Yatirim, a special purpose company established TAV Havalimanlari Holding A.Ş, to design, build, finance and new domestic terminal for the Izmir Adnan Menderes Airport EBRD finance: EUR 70 million Type of finance: Senior loan Total Project cost: EUR 430 million Year: 2012 Project Construction of a new domestic terminal at Izmir airport, and of this domestic terminal together with the international terminal Impact:  Demonstration effect of successful restructuring with the of the latest airport operations policies, passenger screening security arrangements  Expansion of private sector participation in terms of provision of capital as well as project management, construction and expertise The project supports the involvement of the private sector in the provision of public services, in particular where the Bank is additional to fill funding gaps for infrastructure projects and including active participation in financing PPP projects. Case Study TAV Ege Terminal, Turkey
  15. 15. Concluding remarks Contact: Philip ter Woort: terwoorp@ebrd.com

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