ICEX Seminar Working with the European Bank for Reconstruction and Development (EBRD) May 2016 Madrid, Spain

Transcription

1 ICEX Seminar Working with the European Bank for Reconstruction and Development (EBRD) May 2016 Madrid, Spain

2 Contents 1. INTRODUCTION TO EBRD 2. EBRD S INFRASTRUCTURE BUSINESS GROUP (IBG) 3. SEMED, TURKEY AND KAZAKHSTAN OPPORTUNITIES AND CHALLENGES 4. CASE STUDIES 5. CONTACTS 2

3 The EBRD is an international, AAA-rated financial institution, which promotes transition to market economies SHAREHOLDING STRUCTURE The EBRD has a triple-a rating from all three main rating agencies (S&P, Moody s and Fitch) Japan; 9% USA; 10% EBRD region excluding EU; 14% Others; 9% EU 27 Countries (1); 59% WHO WE ARE EBRD is an international financial institution that promotes transition to market economies. Owned by 65 countries and 2 inter-governmental institutions (EU, EIB). Recent new countries: 2014 Cyprus, 2015 Greece, 2016 Lebanon. China most recent shareholder (Jan 2016). Capital base of around EUR 38 billion. (1) Includes European Community and European Investment Bank (EIB) each at 3%. Among other EU countries: France, Germany, Italy, and the UK each holds 8.6% (2) Russia at 4% 3

4 Where we invest Estonia Latvia Lithuania Russia Poland Belarus Czech Republic Ukraine Slovakia Moldova Hungary Slovenia Romania Croatia Serbia Bosnia and Herzegovina Bulgaria Montenegro Kosovo Albania FYR Macedonia Georgia Armenia Uzbekistan Kazakhstan Kyrgyz Republic Tajikistan Mongolia Morocco Tunisia Greece Cyprus Azerbaijan Turkmenistan Jordan Egypt SEMED Western Balkans Turkey Armenia, Azerbaijan, Belarus, Georgia, Moldova, Ukraine Central Asia (incl. Mongolia) Central Eastern Europe

5 The EBRD is active in 37 countries EBRD TOP 10 COUNTRIES (ABI IN EUR M) 1 RUSSIAN FEDERATION ,816 1 TURKEY 1,904 2 TURKEY UKRAINE UKRAINE EGYPT POLAND KAZAKHSTAN ROMANIA POLAND SERBIA SERBIA KAZAKHSTAN MONGOLIA CROATIA MOROCCO BELARUS GREECE SLOVAK REPUBLIC AZERBAIJAN 269 OUR OBJECTIVES Projects in 37 countries across various sectors. Aim to promote transition to market economies by investing mainly in the private sector. Mobilise significant foreign direct investment. Support privatisation, restructuring and better municipal services to improve people s lives. Encourage environmentally sound and sustainable development 5

6 The EBRD has invested over EUR 105 billion across a wide range of projects EBRD SECTORS WHAT WE DO AND WHERE WE ARE EBRD invested over EUR 105 billion in around 4,500 projects since Manufacturing & Services Municipal & Environmental Infrastructure Transport Loan, equity and guarantees for wellstructured, financially robust projects of all sizes (incl. many small businesses). Close policy dialogue with governments, civil society and other stakeholders. Financial Institutions Natural Resources Telecommunications, Informatics & Media Targeted technical assistance. Focus on working with the private sector to foster innovation and openmarket economies. Property & Tourism Power & Energy Industry, Commerce & Agribusiness 6

7 At EBRD, the energy and infrastructure sectors are covered by different business groups INFRASTRUCTURE LED BY THOMAS MAIER (MANAGING DIRECTOR) ENERGY AND NATURAL RESOURCES LED BY RICCARDO PULITI (MANAGING DIRECTOR) MUNICIPAL AND ENVIRONMENTAL INFRASTRUCTURE TRANSPORT INFRASTRUCTURE RUSSIA AND CENTRAL ASIA (RCA) NATURAL RESOURCES POWER & ENERGY UTILITIES ENERGY & NATURAL RESOURCES RUSSIA AND CENTRAL ASIA Susan Goeransson Susan Barrett Ekaterina Miroshnik Eric Rasmussen Nandita Parshad Aida Sitdikova 7

8 In 2015, EBRD invested a total of EUR 9.5 billion in 380 projects across a wide range of sectors ANNUAL BANK INVESTMENT 1) INVESTMENTS: Debt 82%, Equity 14% and Guarantee 4%. Annual business investment (ABI) in EURbn 1) Debt ABI Equity ABI Net Cumulative ABI Net cumulative business investment Capital market transactions ~20%. Net profit expected at EUR 0.8 billion. Local currency: Tenge, Lira, Rouble, etc. Both, direct investments and through holding companies. Amid economic and political turbulence, EBRD remains a strong, resilient and trusted partner. (1) Annual Bank investment (ABI) is the volume of commitments made by the Bank during the year 8

9 EBRD financing with Spanish Companies VALUE OF JOINT SPAIN-EBRD INVESTMENT EUR 4.0 billion as of December 2015: EUR 2.3 billion from EBRD EUR 1.6 billion from Spain Major target regions: Poland, Romania and Hungary. Dominant investment sectors: Energy: EUR 1.9 billion Industry, Commerce and Agribusiness: EUR 1.2 million Infrastructure: EUR 0.3 billion Financial Institutions: EUR 0.6 billion 9

10 Contents 1. INTRODUCTION TO EBRD 2. EBRD S INFRASTRUCTURE BUSINESS GROUP (IBG) 3. SEMED, TURKEY AND KAZAKHSTAN OPPORTUNITIES AND CHALLENGES 4. CASE STUDIES 5. CONTACTS 10

11 EBRD s infrastructure business group exemplified continuous growth EBRD INFRASTRUCTURE YE2015 Number of projects to date 640 Net cumulative Bank investment EUR 19.7bn Non-sovereign Share 50 per cent 11

12 EBRD s infrastructure business group as engaged partner to facilitate investments across sectors TRANSPORT In 2015: Investments of over EUR 1.0 billion in over 25 transactions. Since 1994: Over 275 transactions and commitment of EUR 13.9 billion. Sector focus: Roads, aviation, ports, shipping, rail and intermodal / logistic service. Since 2006: total of 12 PPP transactions with over EUR 1.2 billion in finance MUNICIPAL /ENVIRONMENTAL INFRASTRUCTURE In 2015: Investments of over EUR 0.7 billion in 45 transactions. Since 1994: Over 360 transactions and commitment of EUR 5.8 billion. Sector focus: Water and sewage, solid waste, district heating, urban transport and roads. Since 2006: total of 15 PPP transactions with over EUR 680 million in finance EBRD infrastructure investments 2015: over EUR 1.7 billion in 70 operations. Supported privatisation, restructuring and better infrastructure service delivery. Promoted policy dialogue with regards to investment climate business environment and policies. EBRD as catalyst to access additional equity, debt and trade finance. 12

13 Creating the Environment for Private Sector Participation Broad product range to engage with the public sector with the aim to create commercial principles for future private sector participation. Commercialisation of public entities: Cost recovery tariffs / user fees Improved cash flow and cost monitoring Outsourcing of (non-) core activities Public service/ management contracts EBRD VALUE ADDED FOR PRIVATE SECTOR PARTICIPATION Regulatory and legal reforms to support the private sector and a clear understanding and allocation of risks between the public and private sectors. Key technical cooperation: Financial/ operational improvement programmes (FOPIPs) Assistance with PPP tendering Key tool: IPPF 13

14 Contents 1. INTRODUCTION TO EBRD 2. EBRD S INFRASTRUCTURE BUSINESS GROUP (IBG) 3. SEMED, TURKEY AND KAZAKHSTAN OPPORTUNITIES AND CHALLENGES 4. CASE STUDIES 5. CONTACTS 14

15 EBRD Snapshot in SEMED Permanent offices were opened in Tunis and Amman in 2013, in Egypt in 2014 and in Morocco in To date, over 90 projects have been signed for a total value of EUR 3.5 billion. Local currency financings are available in the four countries. SHARE OF EBRD S PORTFOLIO IN SEMED BY SECTOR SHARE OF EBRD S PORTFOLIO IN SEMED BY REGION ~1% 30% Energy 24% FI 16% Jordan 8% Tunisia 0% 49% Egypt 21% Infrastructure 25% Corporate 27% Morocco Egypt (49%) - EUR 1.7 billion (33 projects) Morocco (27%) - EUR 0.9 billion (26 projects) Jordan (16%) - EUR 0.6 billion (22 projects) Tunisia (8%) - EUR 0.3 billion (20 projects) Note: as at 31 March 2016 Note: as at 31 March

16 Tunisia and Morocco: Reforms have initiated but challenges persist Opportunities Decentralization / reforms initiated but still in early phase Investments needed urgently (due to demography and urbanization) New PPP law in Morocco Morocco and Tunisia Private Sector Development (IPPs, PPPs) Technical assistance, adoption of best practices (i.e. ONEE) Support for more efficient uses of energy resources (E2C2) EBRD Added Value Challenges Continued strong centralization of the decision-making processes Limited financial resources of the government and broader economy High standards of basic utilities since the end of the Revolution Heavily subsidized and nonmarket oriented tariff systems Environmental challenges S&P credit rating - Morocco (BBB-), Tunisia (BB-) Promoting commercialization by improving regulation and reforming the tariff system (i.e. ONEE Water project) Funding of projects in rural areas and securing sustainability of supply 16

17 Egypt: Targeted reforms and private sector promotion as a basis for sustainable growth Opportunities Challenges Significant underinvestment in all infrastructure sectors (e.g. railway, local transport, wastewater) Inefficient and outdated means of transport Water network available only to 50% of the population (additional USD 12 billion required) Existing waste disposal systems are fragmented and unstructured, with large areas undersupplied Egypt 16 Abu Rawash WWTP (largest PPP in Egypt) Assistance with decentralization and development of targeted reform agenda (e.g. CTA) EBRD value added Political challenges: governance issues, slow progress of the legislative reform Tariff systems are not market based, are inefficient and highly subsidized Involvement of the private sector is very limited due to structural financing difficulties Unregulated financial help (i.e. Saudi Arabia, Kuwait, UAE ) S&P credit rating (B-) Private sector development (e.g. Maintenance contracts: Egyptian National Railways) Securing of energy supply for sustainable development of the private sector (e.g. EEHC Project) Technical cooperation to institutionalize international best-practices, including "Gender strategy" Ensuring long-term capital, unavailable on the market, and cooperation with other IFIs (i.e. CTA) 17

18 EBRD in Turkey (1) Key EBRD figures EBRD Snapshot in Turkey The EBRD has been investing in Turkey since 2009 with EUR 7.2 billion investments and over 180 projects signed Today, Turkey is the biggest country of EBRD operations In the resident offices in Istanbul, Ankara and Gaziantep, EBRD employs 50 professionals In 2015, EBRD invested EUR 1.9 billion for over 40 projects in Turkey SHARE OF EBRD S PORTFOLIO IN TURKEY BY SECTOR EBRD INVESTMENT IN TURKEY Note: as of 31 March

19 Turkey: Opportunities in the social infrastructure sector, contrasted with a challenging macroeconomic environment Opportunities Challenges Increases in the length of high speed rail lines, motorway network and passenger capacity at airports Surge in the construction of hospitals with provision of facility management in the form of PPPs Government strategy with a strong focus on raising education standards possible school PPPs in the future Significant underinvestment in municipal wastewater and solid waste facilities, large areas left underserviced Turkey Deteriorating macroeconomic and financial conditions (high inflation, currency depreciation, external imbalances and growing NPLs) Political instability (social and political polarisation, spillovers from the conflict in Syria, tensions with Russia). S&P credit rating (BB+) Technical cooperation to support the PPP programmes, procurement practices and increased private sector competitiveness through improved corporate governance Assistance with devising creative financing structures and credit lines which are replicated by other businesses and banks (intensive policy dialogues with national authorities) Key advisory role in social infrastructure projects to make the PPP contracts bankable through policy dialogue with Ministry of Health and sponsors EBRD value added 19

20 EBRD in Turkey (1) Key EBRD figures EBRD Snapshot in Kazakhstan To date, EBRD s investment amounts to EUR 6.3 billion in over 205 projects Resident offices in Almaty and Astana In 2015, EBRD invested over EUR 705 million for 30 projects in Kazakhstan SHARE OF EBRD S PORTFOLIO IN KAZAKHSTAN BY SECTOR EBRD INVESTMENT IN KAZAKHSTAN Note: as of 31 March

21 Kazakhstan: Growing market with a strong state support for public-private partnerships Opportunities Challenges Growing population and raising standard of living Improved investment climate due to a set of systematic reforms taken by the government Infrastructure development as a cornerstone of the government s new economic policy (modernisation of utilities and social infrastructure) New PPP law adopted in 2015, aimed at expanding the breath of PPPs Privatisation programme of state infrastructure assets (airports and ports) Kazakhstan Uncertain macroeconomic prospects (low oil prices, depreciating currency, deteriorating external environment, budget deficit ), S&P credit rating: BBB Poor institutional environment and slow diversification of the economy (reliance on oil) Slow progress of the privatisation programme S&P credit rating (BBB) Amended legislation on PPPs was developed with the participation of EBRD and WB Advisory on the preparation of the PPP structure, following international best practice (e.g. BAKAD ring road project) and technical cooperation to support selection of qualified advisors Assisting the authorities in balancing the roles of the state and the market by supporting growth of private sector enterprises (commercialising of public enterprises and appropriate risk sharing the private and public sectors) EBRD value added 21

22 Contents 1. INTRODUCTION TO EBRD 2. EBRD S INFRASTRUCTURE BUSINESS GROUP (IBG) 3. SEMED, TURKEY AND KAZAKHSTAN OPPORTUNITIES AND CHALLENGES 4. CASE STUDIES 5. CONTACTS 22

23 Cross regional: Aqualia Investment Venture Project Summary Signed in 2009 Client Aqualia New Europe ( ANE ) is an investment vehicle created in 2009, in which EBRD has 49% and FCC Aqualia has the remaining 51%. The vehicle was created to promote investments in the water and wastewater sector in EBRD s countries of operations. EBRD Finance An equity investment of up to EUR 30 million Aqualia New Europe s investment: In February 2015, ANE completed its first investment through the acquisition of Aqualia s 45 per cent stake in the New Cairo WWTP in Egypt. The New Cairo WWTP was a PPP awarded in 2008 to Orasqualia, a 50/50 joint venture between Aqualia and OCI. The contract is a 20 year concession to build, own and operate a 250,000 m3/day WWTP. Abu Rawash WWTP PPP In August 2015, ANE was awarded the contract for the Abu Rawash WWTP PPP. The PPP contract is the largest awarded since the start of the PPP programme in Egypt in The project is a 25 year to build, own and operate a 1.6 million m 3 /day WWTP. Total project costs are EUR 500 million. 6 May,

24 Turkey: Adana Hospital PPP Project Project Summary Signed in 2015 Client ADN PPP Saglik Yatirim, a special purpose vehicle Objective Construction of an integrated hospital campus in Adana (population of 1.66 million), under an infrastructure facilities management PPP, including sustainable energy investments EBRD finance: A/B loan of up to EUR 225 million (EBRD loan EUR 125 million and a B loan tranche of up to 100 million syndicated) Co-financed by the International Finance Corporation (IFC), bilateral agencies (DEG/Proparco) and commercial bank EBRD value added/impact: Demonstration effect for commercial financing for privately financed, procured and operated hospital infrastructure; Implementation of value for money assessment and strengthening of the monitoring function for hospital facilities management PPP projects 6 May,

25 Turkey: EBRD as an anchor investor in a Turkish corporate bond Project Summary Signed in 2016 Client: Rönesans Holding A.S., a joint stock conglomerate with activities in construction, real estate and energy EBRD financing: An anchor investor in Rönesans TRY 200 million bond issue in the amount of up to TRY 100 million. EBRD value added/impact: EBRD s participation principally utilised for the equity needs in the Elazig Hospital PPP project. Facilitating development of the non-financial corporate bond market by increasing bond maturities; Encouraging companies to raise financing from the bond markets; Promoting a level of transparency sufficient to attract investor participation both internationally or locally. 6 May,

26 Tunisia: Clean-up of Lake Bizerte Project Summary Signed in 2015 Client Office National de l Assainissement (ONAS), ONAS, is the national sanitation utility created in 1974 to manage wastewater in Tunisia reporting to the Ministry of Environment and Sustainable Development. It provides sewerage services to 170 municipalities totalling over 6.6 million people. EBRD Finance A 20 million direct loan to ONAS and technical assistance, guaranteed by the Republic of Tunisia with a 18 years tenor, inclusive of a 4 years grace period. Use of proceeds To support the expansion and rehabilitation of the sewage network of the Bizerte s region and the rehabilitation of three wastewater treatment plants located near the Lake of Bizerte. EBRD value added / impact The operation will improve sanitation services to approximately 400,000 inhabitants in the Bizerte Governorate. Improvement in the water quality of the lake will also have a positive impact on the development of tourism and aquaculture. 6 May,

27 Morocco: Nador West Med Project Summary Signed in 2015 Client Nador West Med is a Moroccan public company under private law, created and charged by the government for implementation, development, planning, promotion and management of the industrial port complex. EBRD Finance EBRD financing EUR 200 million. Total cost of the project EUR 943 million. Use of proceeds Financing the construction of basic port infrastructure for a greenfield port in Nador, Morocco. EBRD added value / impact Expanding competitive market interactions by attracting FDI investors with subsequent market linkages to creating a local industry. Promoting private ownership by awarding all commercial port operations to third parties under concession contracts, including container handling and operation of a hydrocarbon terminal. Setting standards for corporate governance and business conduct for infrastructure projects in Morocco through implementation of environmental and climate-related measures. 6 May,

28 Egypt: Cairo Metro Project Summary Signed in 2015 Client the Arab Republic of Egypt. The beneficiary is a state owned National Authority for Tunnels (NAT). EBRD Finance A sovereign loan of up to EUR 175 million to the Government of Egypt. The loan will consist of a committed tranche (EUR 100 million) and an uncommitted tranche (EUR 75 million, utilised only in the event the EIB financing does not come through). Use of proceeds: Procurement of new train sets for Cairo Metro Line II, improvement of metro s services and lower carbon emissions. EBRD value added/impact The project will improve and reform public transport services in Cairo (greater commercialisation of services, enhanced private sector participation, improved regulation and opportunities for on the job training and use of carbon monetisation mechanisms). 6 May,

29 Hungary: Iberdrola Magyar Wind Project Summary Signed in 2010 Client Iberdrola Renovables Magyarország ( IBR Magyar ) is a fully-owned Hungarian subsidiary of Iberdrola Renovables, a world leading developer in the renewable energy industry. EBRD Finance 25% equity investment in IBR Magyar of the HUF equivalent to up to EUR 50 million, by subscribing for shares following a capital increase. Use of Proceeds Proceeds of the investment will fund the development, construction, and operation of the Company s current portfolio of wind power projects in Hungary. EBRD value added By financing one of the most visible wind farm portfolios in Hungary, EBRD s investment will provide comfort to project developers and other private investors and will demonstrate confidence in Hungary s renewable energy framework. 6 May,

30 Cross regional: Gestamp Project Summary Signed in 2013 Client Gestamp, a global leader in the design and manufacture of automotive metal components and a key supplier to the world s leading automotive producers. EBRD Finance A loan facility consisting of a EUR 100 million. Syndicated amortized A/B loan and a EUR 50 million loan with bullet repayment Use of Proceeds to partially finance the expansion of Gestamp Automocion in the EBRD Countries of Operations, namely in Russia, Turkey, Hungary and Poland. EBRD value added The loan support implementation of Gestamp s strategy of increasing its production capacities in the countries where its customer OEMs are moving their car assembly facilities. As a supplier of metal components, further expansion of Gestamp will create a critical mass of demand for the locally produced automotive steel that itself shall trigger the investment into the high quality automotive steels by major local steel manufacturers. 30

31 Poland: Golice Wind Farm Project Summary Signed in 2011 Client Golice Wind Farm - fully owned by Acciona Energy Poland, itself a subsidiary of Acciona Energía EBRD Finance Senior loan of PLN 97.2 million (EUR 22 million equivalent) and representing up to 50 per cent of the total debt financing, and up to 35 per cent of the total Project cost. Use of Proceeds Develop the 38 MW Golice wind farm in Poland EBRD value added Setting standards for business conduct, through communicating the viability of renewable energy financing in Poland to the market; expansion of renewable energy sector in Poland, through supporting Acciona s participation in this and other renewable energy projects in the country 6 May,

32 Contents 1. INTRODUCTION TO EBRD 2. EBRD S INFRASTRUCTURE BUSINESS GROUP (IBG) 3. SEMED, TURKEY AND KAZAKHSTAN OPPORTUNITIES AND CHALLENGES 4. CASE STUDIES 5. CONTACTS 32

33 Contact Thomas Maier Managing Director, Infrastructure Tel: EBRD One Exchange Square London, EC2A 2JN UK 33