This document provides an overview of project finance and funding sources for infrastructure projects. It discusses various types of official agencies that can provide financing, including export credit agencies, development banks, and investment banks. Export credit agencies support exports by providing loans, guarantees, and insurance. Development banks focus on financing developmental projects in emerging markets. Private equity firms and infrastructure funds provide equity financing. The document outlines typical project finance structures, processes, timelines and documentation required to obtain funding. Key websites for various official financing institutions are also listed.

1. Funding Presentation
Project Finance
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2. Contents
Project Finance 3
Export Credit Agencies 4
Development Banks 9
Investment Banks 10
Private Equity Firms 11
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Project Finance Structure 12
Process 13
Timelines 15
Generic Terms 16
Project Documentation 17
Websites 18

3. Project finance is the long-term financing of infrastructure and industrial projects based upon the projected cash flows of the
project rather than the balance sheets of its sponsors. Usually, a project financing structure involves a number of equity
investors, known as 'sponsors', as well as a 'syndicate' of banks or other lending institutions that provide loans to the
operation.
They are most commonly non-recourse loans, which are secured by the project assets and paid entirely from project cash
flow, rather than from the general assets or creditworthiness of the project sponsors, a decision in part supported by financial
modelling.
Project Finance
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4. Description / Characteristics Advantages / Limitations
Export Credit Agencies • Financing is linked to procurement of goods and / or
services
• Provides comprehensive guarantees for loans
extended to support exports
▲Very predictable and competitive terms and conditions
▼Export tied eligibility criteria
Multilateral Agencies • Institution owned by more than one country
• Supports social and economic progress in their
member countries
• Focus on financing developmental projects
▲Relatively flexible eligibility requirements (untied)
▼Needs to adhere to certain statutory requirements such as
environmental, social and workers’ rights
▼Can be a fairly lengthy execution timeframe
Development Finance Agencies • Government institution that supports overseas
investments into the emerging markets
• Focus on financing of developmental projects
related to own government objectives
• Wide range of products
▲Continuous innovative solutions
▲Withholding tax exemption
▼Needs to adhere to certain statutory requirements such as
environmental, social and workers rights
There are a variety of different types of international and local official agencies that are relevant in Africa as they have the mandate to support, amounts other things,
infrastructure financings
Export Credit Agencies
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5. Export Credit Agencies, commonly known as ECAs, are public agencies and entities that provide government and private-
backed loans, guarantees and insurance to corporations from their home country that seek to do business overseas in
developing countries and emerging markets.
TAG has relationships with numerous ECAs and some are listed below:
 Export Credit Insurance Corporation – South Africa
 Coface – France
 EDC Canada
 Euler Hermes – Germany
 ICIEC – Saudi Arabia
 Miga – World Bank
 ECGD – United Kingdom
 US Eximbank – United State of America
 Afreximbank - Egypt
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Export Credit Agencies

6. General benefits of ECA financing
Benefits / Features
to Borrowers
Capacity: ECAs may support large
projects for up to several billion US$
Stable Credit Costs: ECA risk premia
do not fluctuate in line with
commercial market pricing ECA premia
are primarily determined by tenor
profile, country risk and availability
period
ECAs are influenced by borrower credit
risk, but their corporate spread curve is
not as steep as the commercial market’s
Diversification of Funding Sources and
Preservation of Bank Lines: ECA
guaranteed portion between 95% and
100% of the debt does not count
against client bank lines
Fixed Interest Rate: Many ECAs offer
Commercial Interest Reference Rate
(CIRR), offering arbitrage
opportunities without swap cost or
credit lines. No swap breakage costs.
Borrowers can monetise rate benefits
embedded in a CIRR
Stable Deal Execution: ECAs provide
reliable liquidity to the market and as
they are funded by governments, they
are not impacted as much by market
liquidity issues
Long Tenors: Under OECD guidelines,
ECA repayment periods (exclusive of
construction periods) are between 5
to up to 18 years depending on
country and purpose
Long Availability Period and
Drawdown Flexibility – set to match
payments under the commercial
contract
Reach back: Can finance past as well as
future CAPEX
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Export Credit Agencies

7. Ex-Im Bank (US) ECGD/Hermes/EKN/Coface
(Europe)
ECIC (South Africa) JBIC/Nexi (Japan) Asian ECAs (Korea/China)
Financing
Amount
i. Up to 85% of the Export
Contract Value
ii. Local costs up to 30% of
Export Contract Value
iii. Premium
i. Up to 85% of the Export
Contract Value
ii. Local costs up to 30% of
Export Contract Value
iii. Premium
i. Up to 85% of the Export
Contract Value
ii. Local costs up to 30% of
Export Contract Value
iii. Premium
i. Up to 85% of the Export
Contract Value
ii. Local costs up to 30% of
Export Contract Value
iii. Premium
i. Up to 85% of the Export
Contract Value
ii. Chinese programs (China-Exim
and Sinosure) flexible on
foreign content amounts
Type of Facility •Guarantee
•Direct Lending
•Comprehensive Insurance •Comprehensive Insurance •JBIC: Direct Loan
•Nexi: Comprehensive Insurance
•Can be combined
•Direct Loan and
Co-financing
•Korea Exim does
some guarantees
Coverage •100% •95–100% •100% •JBIC: Up to 100%
•Nexi: Up to 95% comprehensive
•Korea: Up to 100%, but may
require co-financing
•China: Between 50–90% of
project amount
Pricing
Guidelines
•OECD •OECD •OECD but not bound •OECD •Korea: OECD
•China: OECD, but
not bound
We have vast experience structuring ECA-supported financings for our clients and can quickly assess the viability of an ECA solution based on
the source, amount and type of equipment being imported.
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Export Credit Agencies

8. A number of the OECD countries also have funding programs that are mandated to fund under ECA facilities to support their exporters on both fixed and
floating basis as well as in various currencies
Funding Programs
• Key countries have agencies to fund ECA guarantees such as the US, Sweden, Finland, Canada, Denmark and UK
• The majority of these agencies can fund in most major currencies and provide their support in fixed or floating rates
Commercial Interest References Rates (“CIRR’s”)
• The CIRRs are fixed rate offered by the OECD ECAs to support their exports
• The CIRR is a fixed rate that is reset monthly (on the 15th of each month) to the average of the preceding calendar month’s average applicable
government bond yield plus 1.0%
• CIRR is quoted in multiple lending currencies, including USD and EUR in three separate repayment tenor ranges
(2–5 years (or < 5 years), 5–8.5 years, more than 8.5 years)
• The offering of the CIRR fixed rate does not require banks to book credit lines as there is no swap exposure for banks involved
• For some amortization profiles the USD CIRR has been swapping into extremely attractive levels at or (in some cases) below EURIBOR in recent months
Investment Base built over time
• We have been working extensively with passive bank investors and buy-to-hold institutional investors (insurance companies and pension funds) to
enable the wider syndication of ECA backed transactions
• ECA backed transactions for infrastructure development in emerging Africa are very attractive to such institutional investors as it allows them to fulfil
certain sustainable lending criteria at the same time as providing an asset that they can manage in terms of understanding the risk profile and returns
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Export Credit Agencies

9. Development Banks are financial institutions set up by one individual country to finance development projects in
a developing country and its emerging market, hence the term bilateral as opposed to multilateral.
TAG has relationships with numerous Development Banks and some are listed below:
 DBSA – South Africa
 Proparco– France
 DEG – Germany
 FMO – Nederland
 AfDB – Ivory Coast
 PTA – Kenya
 IDC – South Africa
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Development Banks

10. Investment Banks are financial institutions that underwrite new debt and equities for all types of corporations. Investment
Banks play a big role in Developing and Emerging markets by either providing a corporate loan facility or project finance
facility.
TAG has relationships with numerous Investment Banks and some are listed below:
 Nedbank Capital – South Africa
 Standard Bank – South Africa
 Investec – South Africa and United Kingdom
 ABSA Capital – South Africa
 Rand Merchant Bank – South Africa
 Citi Bank – United Kingdom and South Africa
 HSBC – United Kingdom
 Barclays Bank – United Kingdom
 Canara Bank – India and South Africa
 Royal Bank of Scotland – United Kingdom
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Investment Banks

11. A Private Equity and Infrastructure Fund is an asset class consisting of equity securities and debt in operating companies
that are not publicly traded on a stock exchange. A private equity or infrastructure investment will generally be made by
a private equity or infrastructure firm to ensure that there is adequate equity in the project of transaction in order to obtain the
correct debt vs equity formula.
TAG has relationships with numerous Investment Banks and some are listed below:
 PAIDF– South Africa
 EMIF– United Kingdom
 Nesograph Investments – South Africa
 CBO Capital – Nigeria
 Blackstone – United Kingdom
 Actis – United Kingdom
 TGL Capital – United Kingdom
 Quantum Global - Switzerland
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Private Equity Funds

12. Project Finance Structure
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Supplier /
Contractor
Infrastructure Project
Project
Income
Local Escrow
Account
Off Shore
Debt Service
Reserve
Account
Off Shore
Debt Service
Account
Bank
Private
Equity
ECA
Insurance
100% PRI
85% CI
Pvt
Insurance
95% PRI

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Process
Complete Project
Information Sheet
Information Sheet with
relevant documentation
submitted to TAG
Review of the Information
TAG Contact Financial
Institutions
TAG reverts back to the
Applicant and provide a
Mandate Proposal
Applicant signs the Mandate
Proposal
Meeting held over two days
Project Meeting held at
Applicant premises or in the
UK
TAG obtain all information
including KYC Documents

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Process
TAG Prepare Application for
Financial Institutions
TAG Submit Application to
Financial Institutions
Various meetings held with
Debt and Equity Institutions
Financial Institutions Due
Diligence Visits
Credit / Investment
Committee Submission
Loan & Equity
Documentation Signed
Legal Council Appointment
Credit Approval / Termsheet
Condition Precedent
completion and Financial
Closure

15. Item Week
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 - 24
• Identification of Suppliers
• Award of Mandate
• Preparation and submission of Info Package to ECA
• Agencies review Application, Info Memo, Business
Plan and Environmental due diligence documents
• Due Diligence visit if required
• Q&A on the Project
• Appointment of legal counsel and drafting of
documentation
• Preliminary Agency approval
• Facility documentation negotiation
• Receipt of final approval from ECA
• Finalization of loan documentation
• Collection of CPs
• Financial Close
Typical ECA financings can take between 1- 6 months, largely dependent on the degree of environmental due diligence
required. Proven experience with the ECAs, ensures that timely and seamless execution can be achieved
Timelines
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16. Each of the above mentioned institutions will have their own criteria and terms and conditions. It would be irresponsible of
TAG to list any form of terms and conditions as this will normally be negotiated with the specific financial institution that we
approach. Government transactions have different criteria and in most cases a sovereign guarantee will be required to
support the transaction.
In private transactions institution on the debt side will most probably look at a debt vs equity ratio of 70:30, but this will largely
depend on the industry and the strength of the project promoter supported by an equity fund.
Terms and conditions will always for part of the negotiations between the project promoter and the financial institution. TAG
will play an integral role in discussing these terms and conditions with the financial institutions.
Private Equity Firms will always consider the amount of equity the project sponsor commit to the transactions and will
calculate the value of the equity in order to provide the project sponsor with an equity position. The project sponsor will
always have the opportunity to claw back equity during the period of the investment.
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Generic Terms

17.  Project Information Sheet
 Executive Summary
 Business Plan / Feasibility Study
 Financial Model
 Company Presentation
 Project Presentation
 KYC Documentation
 All Government Approvals, Permits and Licenses
 Any additional documentation that might be required by the financial institutions
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Project Documentation

18. Examples of ECA’s
 http://www.exim.gov/ - US Exim Bank (USA)
 https://www.gov.uk/government/organisations/uk-export-finance - ECGD (United Kingdom)
 http://www.ecic.co.za/ - Export Credit Insurance Corporation (South Africa)
 http://www.jbic.go.jp/en - Japan Bank for International Cooperation (Japan)
 http://www.ekn.se/en/ - EKN (Sweden)
 http://www.coface.fr/ - Coface (France)
 http://www.eulerhermes.com/ - Hermes (Germany)
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Websites
Examples of Development Banks
 http://www.dbsa.org/ - Development Bank of Southern Africa (South Africa)
 http://www.proparco.fr – Proparco (France)
 https://www.fmo.nl/ - FMO (Nederland)
 https://www.deginvest.de/ - DEG (Germany)
 http://www.afdb.org/en/ - African Development Bank (Ivory Coast)
 http://www.ptabank.org/ - PTA Bank (Kenya)
 http://www.idc.co.za/ - Industrial Development Corporation (South Africa)

19. Examples of Investment Banks
 http://www.rmb.co.za/ - Rand Merchant Bank (South Africa)
 https://www.investec.co.uk/ - Investec Bank (United Kingdom)
 http://investmentbank.barclays.com/ - Barclays Bank (United Kingdom)
 http://cib.absa.co.za/ - ABSA Capital (South Africa)
 http://www.capital.nedbank.co.za/ - Nedbank Capital (South Africa)
 http://icg.citi.com/icg/corporateandinvestmentbanking/invest_banking.html - Citi Bank (United Kingdom)
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Examples of Private Equity & Infrastructure Funds
 http://www.harith.co.za/ - Harith Fund Managers (South Africa)
 http://www.quantumglobal.ch/ - Quantum Global (Switzerland)
 http://www.act.is/content/Home.aspx - Actis (United Kingdom)
 http://www.emergingafricafund.com/ - Emerging Africa Infrastructure Fund (United Kingdom)
Websites

20. You don’t build a business. . . you build people
and then those people build the business.
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21. www.thealtgroup.uk
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