1999 annual report purpose of operations · also in the commonwealth of independent states (cis)....

19 ANNUAL REPORT

DANISH INTERNATIONAL INVESTMENT FUNDS:

The Industrialization Fund for Developing Countries – Denmark

Purpose of OperationsFor the purpose of promoting economic activity in developingcountries, IFU has been created to promote investments in thesecountries in collaboration with Danish trade and industry.

THE DANISH PARLIAMENT, JUNE 7, 1967: THE ACT ON INTERNATIONAL DEVELOPMENT CO-OPERATION

IFU at a Glance

Founded

Institutional form

Total equity capital

Experience from

Working method

Eligibility

Size of investments

Participation

Financial engineering

By legislation in 1967, included in the Act onInternational Development Co-operation in1971.

Self-governing fund with board of directorsappointed by the Minister for Development Co-operation.

DKK 1,696 million of which reserves are DKK795 million.

71 countries.

401 projects.

With equity capital and/or loans IFU can partici-pate as a joint venture partner when Danish com-panies invest in developing countries.

To be qualified, projects must be evaluated ascommercially viable. Green-field projects as wellas expansion of existing projects and privatisa-tion of state-owned enterprises are eligible forIFU investments.

Host countries of investment must be on theOECD’s DAC-list of development aid recipients,and per capita income must not exceed USD5,280 (2000).

Both large and small projects, including pilotprojects, are financed by IFU. This flexibilitysuits the needs of developing countries and thestructure of Danish trade and industry.

On the basis of its many years of experience witha wide range of investments, IFU offers advisoryservice in the preparatory and initial phases ofinvestment projects. IFU is a working member ofthe board of directors as long as it holds shares inthe project.

IFU has expertise in identifying and mobilisingsupplementary sources of finance to ensure themost viable project financing.

99

The purpose of the InvestmentFund for Emerging Markets (IFV)is to encourage Danish companiesto establish local companies inemerging markets and to con-tribute to environmentally bal-anced economic growth in thesemarkets. 1999 was the second yearof operation for the Fund.

Like IØ, IFV is an independententity, but shares its board ofdirectors and management withIFU. It also works along the samelines as the other two Funds. Itcan co-finance the establishmentof new companies and the exten-sion of existing ones or privatisa-tion of state owned enterprises,provided that Danish companiesparticipate with financing as wellas in management. IFV also facili-tates Danish companies’ access tointernational project financing.

IFV can operate in countries orregions outside Europe, which areon the OECD’s list of recipients ofdevelopment aid, but have a percapita income above USD 5,280

in 2000. It thus covers almost anynon-industrialised country andregion which is not eligible forIFU or IØ financing.

Danish International Investment Funds is the umbrellaterm for IFU, IØ and IFV.

The funds offer co-financing in Central and EasternEurope and in developing countries and regions.Developing countries with relatively high per capita

incomes are eligible for IFV investments. Due to theireconomic growth some countries which were previous-ly in the IFU sphere have moved to the IFV sphere.Examples are Argentina, the Republic of Korea andSingapore.

– welcome you to call for more information or to present investment proposals.

Bremerholm 4DK-1069 Copenhagen KDenmarkTel: +45 33 63 75 00Fax: +45 33 32 25 24E-mail: [email protected]

[email protected]@inet.uni2.dk

DANISH INTERNATIONAL INVESTMENT FUNDS

I F U ’ S S I S T E R F U N D S

Regional Office

Representative Office

Adviser

Head Office

D A N I S H I N T E R N A T I O N A L I N V E S T M E N T F U N D S

Visit the web-site for up-date information:

www.ifu.dk

The Investment Fund for Centraland Eastern Europe (IØ) worksalong the same lines as IFU. TheFund was founded by an Act ofParliament in 1989 in order tofacilitate the transition to marketbased economies in Central andEastern Europe (CEE) includingthe three Baltic states and lateralso in the Commonwealth ofIndependent States (CIS).

Though an independent entity,IØ shares its board of directorsand management with IFU, and isadministered within the sameorganisation.

By the end of 1999, in co-oper-ation with Danish and local part-ners, IØ had participated in 256commercial investments in 16countries. IØ is counted amongthe biggest foreign investors inPoland and has an office in Warsaw. In other countries, IØ’spartners benefit from the Fund’snetwork of management advisers.

IØ is the focal point for con-tacts between Danish companiesand international financial insti-tutions. The Fund is the Danishfinancial intermediary for theEuropean Union’s Joint VentureProgramme (JOP), and for theEuropean Bank for Reconstruc-tion and Development (EBRD).

It has an investment co-operationagreement with the InternationalFinance Corporation (IFC).

IØ also administers a specialEnvironmental Investment Faci-lity (MIØ) in co-operation withthe Danish Ministry of Environ-ment and Energy.

IØ – the sister Fund for investments in Central and Eastern Europe

In the Czech Republic, the Plant Breeding Station Hladke Zivotice s.r.o., was established in co-operation with DLF Trifolium A/S and 7 members of the company’s management. It hasbecome a leading supplier of seeds for multiplication not only for the Czech market, but also for selected Central and West European markets as well.

IFV – the sister Fund for investments in Emerging Markets

Segetrans (Argentina) S.A., in which IFV invested DKK 2.9 million in 1999, offers trans-portation of fresh fruit and other perishables from producers in southern Argentina to the ex-porting harbours. By introducing modern technology, Segetrans ensures that the buyers in USAand Europe receive higher quality produce than before.

THE DANISH INTERNATIONAL INVESTMENT FUNDS

3

Contents401 Investments in 71 Countries 4

Report from the Board and the Management 5

Investments Contracted in 1999 7

Outlook: Development Impact 8

Financial Statements for 1999 12

Investment Portfolio 18

A Pre-launch Check-up 26

IFU Board of Directors, Staff and Advisers Inside cover

IFU as a Partner Cover

■ C A S E S T O R I E S

A Flourishing Business in West Africa 10

Wealth to a Poor Region (Peru) 11

Farmers Help Farmers (China) 11

Water for Thousands (Uganda) 17

Air Taxi to Paradise (Maldives) 17

The Industrialization Fund for Developing CountriesDenmark

401 Investments in 71 Countries

4

LATIN AMERICAArgentina * 5Belize 1Bolivia 2Brazil 27Chile 4Colombia 4Cuba 1Dominican Republic 1Ecuador 4Guatemala 1Guyana 1Jamaica 1Mexico 14Nicaragua 1Panama 4Paraguay 1Peru 4Uruguay * 5Venezuela 4

Total 85

AFRICASub-Saharan Africa 2Algeria 2Angola 1Benin 3Burkina Faso 1Burundi 1Cameroon 4Cap Verde 1Central African Republic 1Côte d’Ivoire 7Democratic Rep. Congo 2Egypt 7Ethiopia 1Ghana 8Kenya 5Lesotho 1Malawi 1Mali 1Morocco 4Mozambique 2Nigeria 14Rwanda 1Senegal 4South Africa 14Sudan 2Swaziland 2Tanzania 6Togo 9Tunisia 1Uganda 6Zambia 2Zimbabwe 7

Total 123

EUROPEMalta * 1Turkey 12

Total 13

ASIABangladesh 4Cambodia 1China 36India 45Indonesia 6Iran 1Jordan 1Republic of Korea * 3Malaysia 24Maldives 3Nepal 2Pakistan 11Papua New Guinea 1Philippines 12Singapore * 1Sri Lanka 11Thailand 14Vietnam 3Yemen 1

Total 180

Total IFU 401

* Now IFV eligible

As of December 31, 1999 IFU has contracted investments in 401 projects in 71 countries:

Bestseller Fashion Group, China.

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

Number of jobs

Africa Asia LatinAmerica

Denmark

Employment generated from new projects in 1999

0

2

4

6

8

10

12

14

16

18

20

22

24

Africa Asia Europe LatinAmerica

Number of projects

Furtherfinancing

Newprojects

Breakdown of number of new projects by region 1999

■ A D D I N G N E W E X P E R T I S E T O I F UReserve Bank of Zimbabwe.Mr Matsikire is ofgreat help to IFU’s partners, as he can con-tribute to cross-cultural understanding, hasin-depth knowledge of local conditions (pol-itical and economic), possesses contacts withthe local environment (government depart-ments, industry associations, investment insti-tutions etc.) and possesses the highest pro-fessional skills.

Deepa A. Hingorani, 29,from India, started workingwith IFU in 1995. She cameto IFU with a Masters de-gree in Finance and twoyears work experiencewith a large Indian corpo-

ration. On her own initiative she started in September 1998 at SIMI, Copenhagen.

By engaging professionals from developingcountries, IFU gains a broader expertise toadvise its partners in the private sector. IFUalso employs trainees from developing coun-tries.Their initial training often includes MBA-studies at the Scandinavian International Man-agement Institute (SIMI). This contributes tothe build-up of a new generation of businessmanagers in developing countries.

Thirty-year old BrightonMatsikire was first em-ployed by IFU in 1996 as a trainee. Since his gradu-ation in 1998 as an MBAfrom SIMI in Copenhagen,he has been employed on

regular terms in IFU’s office in Harare. Beforejoining IFU he worked for four years with the

Activities Continue at High Level

5

The international financial crisis of1997-1998 has almost had no visibleimpact on the volume of Danish for-eign direct investments in develop-ing countries. They are still on agrowing trend.

The total amount of IFU’s contract-ed investments in 1999 was DKK426.6 million against DKK 176.3 mil-lion in 1998. Out of the contractedinvestments in 1999, DKK 285.6 mil-lion were for new projects and DKK141.0 million were for furtherfinancing.

Of IFU’s total investment, DKK121.9 million (29 per cent) were dis-tributed as share capital and DKK304.7 million (71 per cent) as loans.

The total investments in the projectsamounted to DKK 2,645 million,including the contributions fromjoint venture partners in Denmarkand developing countries and fromother sources. For every DKK 100IFU invested, it thus generated anaggregate investment in developingcountries of DKK 826.

The investments in new projects in1999 will bring about an estimatedcreation/preservation of 6,200 newjobs in the host countries – as well asexport from Denmark worth DKK

1,300 million, equivalent to anemployment effect in Denmark of2,600 man-years.

During 1999 IFU participated in 52investments of which 24 were in newprojects and 28 were additionalfinancing in already existing projectcompanies.

In 1999, IFU withdrew from 31 pro-jects, and by the end of the year theportfolio of projects where IFU par-ticipated was 206.

IFU’s co-operation with Nordic,European and global financial insti-tutions gives the partners from theprivate sector access to much need-ed additional finance. Among theseinstitutions are the Nordic Develop-ment Fund (NDF), the EuropeanInvestment Bank (EIB), the Interna-tional Finance Corporation (IFC)and the NORSAD Agency in theSADC-region of Africa. Further-more, IFU is a member of EDFI, agrouping of 12 European Develop-ment Finance Institutions.

IFU is the Fund Manager for the sis-ter funds, the Investment Fund forCentral and Eastern Europe (IØ)and the Investment Fund forEmerging Markets (IFV).

Regional distribution

The most significant response ofDanish companies to the interna-tional financial crisis has been achange of focus to the least affectedcountries, in particular India andChina.

A total number of 8 new projectswere established in Asia.

Towards the end of 1999, the incen-tives to invest in China and Indiabecame even greater. The outcomeof the Indian elections was a con-tinued stable political and econo-mic environment. China’s step for-ward towards membership of theWorld Trade Organisation, when anagreement was reached with theU.S.A., reassured the investors aboutcontinuing improvements of thebusiness opportunities in that coun-try too.

4 new projects were established inLatin America, and IFU co-financedfor the first time a project in Cuba.

Focus on Africa

Since 1997, IFU has successfullymade a special and systematic effortto promote Danish-African businessco-operation. Earlier, there were 4

Working full-time with IFU in Denmark andin the network of SIMI colleagues has beenfruitful:

“This has helped me develop an insight intoDanish business and culture and I am able tounderstand and appreciate their way of think-ing and doing business much better. I can alsoshare with the Danish companies my knowl-edge of the South Asian business and politicalenvironment and culture. I feel better equip-ped now to advise the local partners in iden-tifying their capabilities and skills realisticallyand match them optimally with the Danishpartners’ expectations. I can also help inintroducing and explaining to them the subtledifferences in the way of thinking of the twocultures and act as a bridge between the twoends of the world.”

R E P O R T F R O M T H E B O A R D A N D T H E M A N A G E M E N T

The Board and Management wish to thank the entire staff and the advisersfor their dedication and efforts shown during the year.

Copenhagen, February 24, 2000

Johannes Poulsen Sven RiskærChairman Managing Director

cient to cover the demand for co-investments in the foreseeablefuture.

Expertise and human resources

Direct access to local know-how alsogives IFU a much broader base foradvising its partners. By the end of1999, IFU had about 25 advisers inrelevant geographical areas and IFUdirectly employed 13 staff membersfrom Asia, Africa and Latin Ame-rica. IFU is represented in Africa,Asia and Latin America with re-gional offices in Zimbabwe, China,India and Mexico.

IFU continues to enhance its workwith the environmental and ethicalaspects of its investment projects.During 1998-1999 independentexperts carried out a two-year reviewof the environmental status of pro-jects in India and Poland (where IØhas many activities). The results willbe published by mid 2000. In col-laboration with the Confederationof Danish Industries and the DanishCentre for Human Rights, IFUlaunched in 1999 a study of stepswhich can strengthen employees’rights and other human rightsaspects in private business in de-veloping countries.

By the end of 1999, IFU had a staffof 79, of which 42 were female. 63were employed at the head office.Of the staff, 44 were professionals. A total of 18 were non-Danes. 11new staff members were hired, and11 left. IFU continued its imple-mentation of a major scheme forhuman resource development forits staff in 1999.

6

or 5 new IFU projects in Africa peryear, while the number both in 1998and in 1999 was 11. IFU’s financialcommitment in Africa has increasedfrom about DKK 20 million per yearto about 40 million in 1998 andapprox. DKK 245 million in 1999. In1999 IFU co-financed for the firsttime a project in Lesotho. InNovember 1999, IFU’s Board visiteda number of project companies inGhana, South Africa and Zimbabwein order to get acquainted with therecent development in investmentconditions in these countries.

Three main groups of Danish com-panies have an interest in investingin Africa:• Those with strategic reasons to

seek a permanent business pre-sence in the market or to gainaccess to African produce or rawmaterials.

• Those wanting a share of themainly privately financed infra-structure development that is ex-pected to take place in the comingyears.

• And the growing group of thosewho already have experience fromactivities and alliances in Africasponsored by official Danish de-velopment assistance.

In the past couple of years, SouthAfrica, Zimbabwe and Ghana havebecome recipients of a significantshare of Danish investment inAfrica, resulting mainly from thethird group described above. In1999, Nigeria returned to the Danishinvestor’s map.

Accounts

1999 was the first year since 1995with a positive net result of DKK15.4 million against a loss of DKK20.4 million in 1998. Contributingfactors to the positive result in 1999were a high level of income fromsale of shares as well as dividends.Disbursement of share capital andloans to projects amounted to DKK299.3 million in 1999 against DKK217.4 million in 1998.

The total outstanding amount inprojects at the end of 1999 was DKK1,509.2 million against DKK 1,396.2in 1998. At the end of 1999, 61 percent of the outstanding amountconsisted of share capital. For thefourth consecutive year, DKK 150million was allocated to IFU fromthe Danish Government as additio-nal equity capital. In 1999, the equi-ty capital of IFU thus increased byDKK 165.4 million to DKK 1,695.8million. A capital allocation of DKK150 million is also expected in 2000.This completes a planned capital in-crease over five years of DKK 750million. Provided activities remainat the present level, IFU’s financialresources are expected to be suffi-

Johannes Poulsen, Chairman Sven Riskær, Managing Director

R E P O R T F R O M T H E B O A R D A N D T H E M A N A G E M E N T

7

IFU’s investment Expected(DKK million) employ-

mentProject Name Country Shares* Loans** Total (persons)

1 Fan Milk Benin 1.7 1.7 3252 Segetrans Transporte Chile 9.4 9.4 63 Mærsk Container China 13.9 13.9 6004 Impact Furniture China 0.6 0.6 255 Primo Kunming China 0.6 0.6 206 DinaFeed Cuba 1.3 1.3 257 Sinai White Portland Cement Egypt 41.8 41.8 4008 Convoy India India 0.5 0.5 69 Fowler Westrup India 3.1 3.1 85

10 Roulunds Hoses India 4.2 4.2 5011 Tantina Milling Lesotho 0.3 0.3 2712 IPOH Investments Maldives 42.3 42.3 013 Motorcare Mozambique 3.7 6.7 10.4 1214 Fan Milk Nigeria 16.0 6.5 22.5 2,20015 W. African Portland Cement Nigeria 35.4 35.4 55016 Fima Peru 8.6 8.6 50017 Benzak Beverages South Africa 1.0 1.0 2018 Stoneground Mills South Africa 0.9 0.9 1519 Today’s Signs & Graphics South Africa 0.2 0.2 720 Mærsk Africa Facility Sub-Saharan 50.0 50.0 500

Africa21 United Plantations Africa Swaziland 17.3 17.3 75022 Nation Egmont Entertainment Thailand 17.9 17.9 5023 Riegens Turkey 1.4 1.4 2024 Cosmos Trawl Uruguay 0.3 0.3 4

Total 90.0 195.6 285.6 6,197

Project Name Country Shares* Loans** Total

25 Ailinco Argentina 9.8 9.826 Coloplast China 6.2 6.227 Danfoss China 7.2 7.228 Danafco Ghana 0.7 0.729 Akay Flavours India 6.6 6.630 Grundfos Pumps India India 0.2 0.231 LK India India 6.7 6.732 Pedershaab-ACME India 0.0 0.033 Pioneer Wincon Limited India 2.0 1.9 3.934 Procon India 1.8 1.835 P.T. Aalborg Industries India 4.6 4.636 Vestergaard-Frandsen Kenya 5.0 5.037 Scandrill Malawi 3.8 3.838 Dankaffe Malaysia 4.1 4.139 Santa Lucía Mexico 10.4 10.440 Dane Foods Pakistan 0.3 0.341 New Africa Signs & Graph. South Africa 0.0 0.2 0.242 Dan-Essence South Africa 0.6 0.643 Kristensen Oceanfront Rest. South Africa 5.5 5.544 C.W.Mackie & Co. Sri Lanka 0.8 0.845 DAHACO Tanzania 4.7 4.746 Tanruss Tanzania 24.4 24.447 Penadansk Thailand 10.2 10.248 Tropic Dane Thailand 0.5 0.549 MTN Publicom Uganda 7.0 7.050 NIS Uganda Uganda 8.8 8.851 Victoria Engineering Uganda 3.0 3.052 Frese Zimbabwe 4.0 4.0

Total 31.9 109.1 141.0

Grand total 121.9 304.7 426.6

*) incl. overrun commitments**) incl. guarantees

Investments Contracted in 1999New projects

Further financing of ongoing projects

Competitiveness and access to glo-bal markets can be boosted in thesecountries with the help of FDI.

In the more open and performance-oriented world economy of thefuture, FDI will especially benefitthose countries that learn to providean auspicious macro-economic andregulatory climate for private invest-ments.

FDI’s immediate impact on a devel-oping country is to complementlimited local savings and enlargeinvestment flows that result in afaster growth of the economy.

Often, technology comes along withthe investment. Today, FDI’s keybenefits take the form of “soft” in-puts, such as:• knowledge of the global markets• management contacts and allian-

ces

8

The ScopeForeign Direct Investment (FDI) in the devel-oping countries has grown from about USD20 billion in 1990 to well over USD 150 bil-lion in 1998. In relative size, FDI is larger thanthe sum of private loans and portfolio invest-ments and Official Development Aid (ODA)to developing countries.

The Reasons FDI’s growth in the developing countries dur-ing the last decade results mainly from:• The liberalisation of world trade and the

regulations which previously limited foreigninvestments;

• The transition to market economies in Cen-tral and Eastern Europe;

• The trends toward privatisation (e.g., ininfrastructure); and

• Making the private sector the primaryengine of economic growth in practicallyevery country in the world.

FDI’s continuing expansion reflects the real-isation that its benefits, as a complement oflocal investment, far outdistance its costs forboth the developing countries and the foreigninvestors.

The MeansFDI takes place when a foreign investor buysinto the equity of a company in a foreigncountry. FDI is generally tied to foreigninvolvement in the management of the com-pany, and funds additions to productive capac-ity and the creation of new jobs.

Development ImpactWhat is the develop-ment impact of IFU’sactivities? This ques-tion is often put to themanagement of IFU.José Ruisánchez, who isan adviser for IFU,

gives an answer here. He is a former vice-president of the International FinanceCorporation (IFC) with responsibility forLatin America. Mr Ruisánchez is basedin Washington D.C., U.S.A.

The surge in Foreign Direct Invest-ment (FDI) flows in recent yearsaugurs well for the future growth ofthe developing countries and forenhancing the living standards oftheir peoples.

A powerful impact of FDI is itsdemonstration effect on the hostcountry. This may include bettersalaries, benefits and job conditions,as well as the higher productivity

and the professional and personalgrowth of the employees of a joint-venture or fully foreign- owned com-pany.

The demonstration impact alsoencompasses aspects of environ-mental and social responsibility,which contribute significantly to thelocal quality of life. Local competi-tors are often prepared to emulateand even outperform their foreigncounterparts, and the resultinghigher standards and competitioninvariably result in better andcheaper products and services forthe local consumer.

Benefits from FDI

The experience in the last decade ofthe twentieth century shows that it isfeasible for the developing, transi-tion and emerging economies tobenefit significantly from FDI.

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

1993 1994 1995 1996 1997 1998

FDI inflows to developing countries (USD millions)

Source:World Investment Report 1999, United Nations.

O U T L O O K O N I N V E S T M E N T

■ T H E G R O W T H O F F O R E I G N D I R E C T I N V E S T M E N T

In contrast, foreign portfolio investmentconsists of the purchase of existing sharesalready listed on the local Stock Exchange.One result of this difference is that FDI tendsto be long-term and stable, while portfolioinvestment can have a shorter time horizonand be more volatile.

9

• capacity to implement strategiesthat combine the best of the de-veloped and the developing worldand

• the knack of motivating and em-powering employees to attain everhigher levels of performance.

The Danish model

In the Danish model, where IFU co-finances the projects, the “soft”inputs of FDI arise primarily fromthe involvement of the Danish pri-vate partner. The contributions flowout of the Danish partner’s intimateknowledge of the business and arereflected in elements such as feasi-bility studies, the choice of strategy,the selection and training of per-sonnel, the suiting of products tomarket demands, and ensuring thatthe new business will be competi-tive. The combination of partnerand ownership provides a specialincentive to bring forth a successfulproject.

IFU also contributes expertise to itsprojects. Private investors appreci-ate IFU’s familiarity with joint ven-tures in developing countries and itsexperience in negotiating share-holders’ agreements that take careof the interests of all the partners.IFU tries to ensure that the objec-tives of the joint venture and therespective roles of the partners areclear and shared by all from the out-set. This is usually accomplished byhaving the partners review togetherthe business plan for the projectwith the support of IFU’s investmentofficers, advisers and, often, special-ist consultants.

The effective training of localemployees and managers is alwaysessential for the success of the pro-ject. In co-operation with the Dan-ish Ministry for Development Co-operation, IFU offers special fund-ing to cover these training costs.

IFU participates actively on theboard of directors of the joint ven-

ture company and co-operates withthe partners in overcoming themany challenges that a project usu-ally confronts. This includes guid-ance in establishing sound environ-mental and ethical governance.

For most foreign investors, FDI is anopportunity to participate in a busi-ness growth that is faster than thatpermitted in their traditional mar-kets. The larger critical mass, whichresults from FDI, allows the investorto spread research and other fixedexpenses in a more efficient way.Besides, going beyond the nationalfrontiers challenges the initiativeand entrepreneurship of investorsand managers alike. This improvestheir chances of succeeding in theglobal economy.

Smaller and poorer countries

The authorities in developing coun-tries are realising that sovereigntyand safety can be preserved withoutstate ownership of the means of pro-duction. The welfare of their citi-zens can be better served by a regu-lator state than by a central planner.When the market rewards excel-lence in performance with profit,the result is generally improvedopportunities for all.

To enhance the beneficial impactsof FDI and reduce potential draw-backs, many countries are shapingtheir regulations and the manner inwhich they are implemented.

In turn, most foreign investors tendto acknowledge that it pays to dealwith FDI’s higher risk by taking thelonger view and seeking rewardthrough the steady and professionalstewardship of their investments,rather than by following a short-term policy.

While it can be highly beneficial,FDI is no panacea. One of its weak-nesses as a booster of economic de-velopment is that FDI tends to flowinto the better functioning and larg-er economies. The smaller andpoorer countries have not benefitedmuch from FDI. This highlights theimportance of continued develop-ment assistance for these nations.For its part, IFU continues to active-ly encourage investments under theDanish model in the smaller andpoorer developing countries, andIFU directly supports joint venturesthat qualify as small and medium-sized companies. This reflects IFU’sconviction that limited size at start-up is seldom an impediment toachieving a significant developmentcontribution.

Foreign Direct Investment’s immediate impact on a developing country is to complement limited local savings and enlarge investment flows that result in a faster growth of the economy. Abidjan citycentre, Côte d’Ivoire.

■ A F L O U R I S H I N G B U S I N E S S I N W E S T A F R I C A

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In some kiosks of Accra, Fan Milk Products arethe main articles for sale.

Thousands of bicycle vendors pour into thestreets every day. Their distinctive bicycles withan icebox decorated with the Fan Milk logoserve as a living advertisement.

Fan Milk provides nutritious food for millions,jobs for thousands, and serves as a role modelfor other investors. The Danish partner com-pany, Fan Milk International A/S, is one offew Danish companies with a strategy focusingon West Africa.

Benin, Burkina Faso, Ghana, Mali, Niger, Nige-ria and Togo are countries in West Africa witha turbulent political record since indepen-dence.They are also countries where a Dan-ish initiative back in 1960 has generated prof-itable business for the Danish and WestAfrican shareholders.

Fan Milk International A/S is the company’sname and it is characterised by its endurance.Despite political and labour unrest the own-ers have had the courage to remain in busi-ness.

Fan Milk has achieved something extraordi-nary for a company of foreign origin. It has

adapted to the local market in its productselection, packaging systems and distributionorganisation. The dairies manufacture a vari-ety of dairy products, including frozenyoghurt, chocolate milk and ice cream. Bicyclevendors mainly sell the products in smallpackages, affordable to everyone. There arethousands of bicycle vendors.Their distinctivebicycles with an icebox decorated with theFan Milk logo serve as a living advertisement.They are seen all over, as Fan Milk distributesits products from a large number of depots.

A good example is Ghana where the firstdairy plant was established in 1960. In the late1980s, the company was re-vitalised after several years of stagnation. Partly financed byIFU, Fan Milk Ghana was soon turned into theflagship of the group of Fan Milk dairies inWest Africa.

Another example is Nigeria where FanMilk International A/S, under the name DanishDairy Services A/S, operates two dairies thatwere commissioned in 1963 and 1981respectively. During the last decade it hadbeen difficult to allocate funds for mainte-nance of plant, equipment and expansion ofthe dairy activities.

However, this has now changed. In 1998 arenovation plan financed by IFU and Fan MilkInternational A/S was initiated. IFU and FanMilk International A/S invested new sharecapital of USD 4 million. IFU further provideda loan of USD 1 million. According to thisplan, Fan Milk Plc., Nigeria will become an-other flagship in the group of dairy companiesoperated by Fan Milk International A/S.Witha market potential of more than 100 millionNigerians, this appears to be a realistic goal.

Fan Milk Plc., Nigeria employs 750 peoplein addition to the 1,500 bicycle vendors.

Today, the dairy plant in Ibadan appearscompletely new. In addition, a new fleet of lor-ries, bicycles and refurbished depots havebeen taken into use. From this plant, Fan Milksupplies frozen products to depots andagents in the southern part of Nigeria. Fortu-nately, there is a growing demand for Fan Milkproducts which will be met by increasing pro-duction capacity.

Fan Milk International A/S owns 58 percent of the shares in the company while IFU’s share is 24 per cent. The remainingshares are distributed among a large numberof Nigerians.

Fan Milk International A/S is one of fewDanish companies with a strategy focusing onWest Africa. It has considerable experience indoing business in the area.The Fan Milk oper-ations in West Africa are not only a commer-cial success, but they also fulfil importantdevelopmental objectives in a strong partner-ship with IFU.

Huhhot Hua Ou Starch Co. Ltd., a starch pro-duction company in China, demonstrates howtechnical know-how can be transferred frompotato farmers in Scandinavia to potato farm-ers on the other side of the globe – to themutual benefit of both parties.

As a result of the establishment of the jointventure, 20,000 Chinese farmers in a relative-ly underprivileged district of Inner Mongoliahave access to a new and secure market fortheir produce and thus to a better income.

In the next phase of the project, Scandina-vian farming methods will be transferred tothe farmers, whereby it is hoped that over thelong term their production could beincreased from the present 15 tonnes ofpotatoes per hectare to a level close to the

11

The climate in the dry valleys of the 700 kmstretch north of the Peruvian capital Lima isone of the only places in the world whereasparagus can be grown and harvested on acontinuous basis all year round. The highlyappreciated vegetable has been exportedfrom this area for decades. However, since aquality mark was introduced to Peruvianasparagus in the 1990s by the company Dan-per Trujillo S.A., income at all stages of theproduction chain has increased.

Danper which is a joint venture betweenIFU, Arne Hensel Berg, a Danish asparagusspecialist, and his Peruvian partners, is thusbringing wealth to a poor region.

The quality control system which makesthe difference is HACCP. At each critical pointin the production process, there is a detaileddescription of procedures. After incorporat-ing them, Danper Trujillo received a Lloyd’scertificate stating that the company is in com-pliance with the high HACCP standards. Itgives the customers a guarantee of quality,which is recognised by the final consumer. Inaddition, the thorough study of productionprocedures was an eye-opener. Many im-provements have been made already. And inthe year 2000, the use of water will be halvedby recycling.This will reduce the strain on theenvironment as well as on the productioncosts.

The HACCP certificate makes it easier forDanper Trujillo to enter the North Americanmarket and thus become less dependent oncustomers in Europe. The company, which isalready the largest exporter of asparagus inPeru, will not have problems in processingextra quantities. With its present capacity,production can be increased from the present20-25 tonnes per day to 45 tonnes.

The processing plant is situated 800 kmnorth of Lima, and the asparagus is purchasedfrom farmers within a radius of up to 120 km.A few suppliers transport asparagus fromfarms 700 km away. Danper offers themextension service and incentives in order to

increase both the quality and quantity of theirproduction. This has raised the income levelof some of the farmers to that of industri-alised countries.

Danper Trujillo is a labour intensive factoryand employs up to 600 workers, 80 per centof them women. They come from the leastprivileged groups, and many are unmarriedmothers. By offering them a stable incomeplus free medical services, including informa-tion on family planning, Danper Trujillo con-tributes substantially to the improvement oftheir standard of living.

The company has been given a grant fromthe Environment and Training Fund of Danida,the Danish International Development Assis-tance. It is used for environmental improve-ments, including the training of the personnel.

Danish production of 40-45 tonnes per hec-tare. The joint venture is setting up a modelfarm, where the Chinese farmers can see pro-duction methods in practice.

The Chinese partner in the joint venture isa former university professor, Guo ZhanChun, who founded his firm 15 years ago. Hehad a starch production plant with out-datedequipment when he came into contact withhis Scandinavian partners. Today he runs agroup of companies, the Nailun Group, withactivities ranging from research to hotel-man-agement.

The Danish partner is a co-operative com-pany, KMC. It was formed in 1933 as an asso-ciation of a number of potato starch factoriesowned by a total of 1,900 potato farmers

■ W E A LT H T O A P O O R R E G I O N

■ F A R M E R S H E L P F A R M E R S

Local partner,shares

IFU, shares

IFU, loans

Arne Hensel Berg, loans

Arne Hensel Berg, shares

Others loans

Distribution of investment

IFU

KMC

Nailun Group(Guo Zhan Chun)

SSF

Distribution of investment

today. Likewise, the Swedish partner, SSF, is aco-operative, owned by 1,350 potato farmers.

It is quite unusual for co-operative compa-nies from Denmark to engage in the foundingand running of processing companies in devel-oping countries. It is outside their businessarea, as they have been established by farmersto process and sell their own produce only.

To maintain their leading position, thestarch companies have to take unconven-tional action now. They are subject to Euro-pean Union dictated production quotas,which they cannot exceed. On the otherhand, their customers are merging on a globalscale and demand volume from their sup-pliers. Some of the customers are trans-national food and beverage companies withsubsidiaries in China. By establishing theirown production process in China, the Scandi-navian starch producers can improve theirshare of the fast growing market in China andat the same time redistribute some of theScandinavian production from exports toChina to sales in Europe.

Huhhot Hua Ou Starch Company Ltd.,established in 1996, reached full utilisation ofcapacity in 1999, an intake of 60,000 tonnes ofpotatoes. It is the largest company in the dis-trict but is already preparing a 50 per centexpansion.

Huhhot Hua Ou Starch Co. Ltd. is the largestcompany in the region.

The production is labour intensive. 80 per centof the workers are women.

12

Auditor’s ReportWe have audited the financial state-ments (pages 12 to 16) prepared bythe management of The Industrial-ization Fund for Developing Coun-tries (IFU) for the year endedDecember 31, 1999.

The audit

The audit was planned and per-formed in accordance with Danishgovernmental auditing practicesand generally accepted auditingstandards to obtain reasonableassurance about whether the finan-cial statements are free of materialmisstatements. During our audit wehave, based on an evaluation ofmateriality and risk, examined thesupport and documentation for theamounts and other disclosures inthe financial statements, and havefurthermore evaluated whether the

administration of IFU’s means hastaken place with due care. We havealso assessed the accounting princi-ples used and significant estimatesmade by management, as well asevaluated the overall financial state-ments presentation.

Our audit has not resulted in anyqualification.

Additional information

As a selfgoverning fund establishedby Act of parliament, IFU is not sub-ject to the provisions of the DanishAnnual Accounts Act for limited lia-bility companies.

The accounting principles for IFUhave been established with the aimat reflecting the activities of IFU inthe most clear and comprehensive

manner and are shown in the sec-tion “accounting principles applied”(pages 12 to 13).

Opinion

In our opinion, the financial state-ments are presented in accordancewith the accounting principlesestablished for IFU and the relevantlegal requirements and present fair-ly the assets and liabilities, the finan-cial position, the results of opera-tions and the cash flows for the year.

The audit was completed on February 24, 2000

ARTHUR ANDERSENBy:

Torgny Pahle Morten S. RengeState Authorized Public Accountants

As a selfgoverning fund establishedby Act of parliament, The Industri-alization Fund for DevelopingCountries (IFU) is not subject to theprovisions of the Danish AnnualAccounts Act for limited liabilitycompanies.

The accounting principles for IFUhave been established with the aimat reflecting the activities of IFU inthe most clear and comprehensivemanner.

The main accounting principlesapplied in the financial statementsfor the year ended December 31,1999 for IFU are described below.The accounting principles are thesame as for the previous year.

Income from projects

Dividends are recorded at the rateof exchange prevailing at the dateof declaration. Interest received onloans to projects is recorded at therates of exchange prevailing at theday of payment. Interest due for

payment, but not collected at thebalance sheet date, is includeddirectly in the balance sheet as inter-est receivables and reserves againstlosses. Interest receivables convert-ed into loan principals are classifiedas collected.

Share capital investments

Share capital investments in projectcompanies are stated at the acquisi-tion cost expressed in DKK.

Loans

Loans in foreign currencies to pro-ject companies are stated in DKK atthe rate of exchange prevailing atthe date of disbursement. Outstand-ing principal related to disburse-ments made prior to January 1, 1996are translated into DKK at the rateof exchange prevailing as of Decem-ber 31, 1995.

Reserves against losses

Specific reserves against losses areprovided as a debit to the profit andloss statement based on an indivi-dual evaluation of IFU’s own risk forlosses on each and every project in-vestment. For projects establishedwithin three years before the bal-ance sheet date, and where no spe-cific reserve is provided, generalreserves against losses are providedat a rate of 15, 20 or 30 per cent forloans and 20, 30 or 35 per cent forshare capital of the invested amountdepending on the host country risk.Finally there is provision for com-mitments to reimburse the cost offeasibility studies etc. Realised losseson investments and reimbursed fea-sibility study costs are continuouslydebited against the reserves for loss-es as and when they materialise, andthe resulting difference between theamount actually lost or reimbursedand the corresponding specificreserve against losses is recorded inthe profit and loss statement underprovision for losses.

Accounting Principles Applied

F I N A N C I A L S T A T E M E N T S 1 9 9 9

13

Syndicated capital

Syndicated capital is investment ca-pital received from third parties and invested in projects on theiraccount and risk. Syndicated capitalonly becomes due to the extent thatIFU receives payments from theseprojects. Syndicated capital in for-eign currency is translated into DKKsimilar to share capital investmentsand loans.

Receivables and debt in foreigncurrency

Receivables and debt in foreign cur-rency are translated into DKK at therates of exchange prevailing at thebalance sheet date. Realised andunrealised gains and losses on for-eign exchange are recorded in theprofit and loss statement.

Equipment

All purchases of equipment arecharged to the profit and loss state-ment.

Bonds

Bonds are stated at the officialprices quoted on the balance sheetdate except for called bonds statedat par value. Realised and unre-alised gains and losses on bonds arerecorded in the profit and loss state-ment. Bond investments only con-sist of publicly traded bonds issuedin DKK.

Cash and bonds allocated to projects

Cash and bonds which on the bal-ance sheet date are allocated forinvestments are shown as a part ofthe project assets and not as cashand bonds at disposal.

Operating expenses

The administration and accountingof all together four funds/facilitiesare managed by IFU. At present thisincludes IFU, The Investment Fundfor Central and Eastern Europe(IØ), The Environmental Invest-ment Facility for Central and East-ern Europe (MIØ) and The Invest-ment Fund for Emerging Markets(IFV). The total operating expensesincurred by IFU are divided at yearend between IFU, IØ, MIØ and IFVaccording to an activity dependentratio.

Note 1999 1998DKK 1,000 DKK 1,000

Dividends, net 22,548 8,781Interest income related to projects 29,451 22,058Income from sale of shares in projects 57,393 12,451Other income related to projects 2,855 2,213

Income related to projects 112,247 45,503

Provision for losses (82,934) (71,418)Other expenses related to projects (5,456) (5,031)

GROSS CONTRIBUTION FROM PROJECTS 23,857 (30,946)

1 Operating expenses (31,085) (33,034)

OPERATING INCOME (LOSS) (7,228) (63,980)

2 Financial income, net 22,642 43,589

NET INCOME (LOSS) FOR THE YEAR 15,414 (20,391)

The net income for the year has been transferred to the equity capital.

Financial StatementsProfit and Loss Statement

14

Note 1999 1998DKK 1,000 DKK 1,000

ASSETSPROJECT ASSETSShare capital investment in projects 930,395 952,781Project loans 578,786 443,430Loans for feasibility studies 1,381 1,813

3 Cash and bonds allocated to projects 623,188 357,022

Total project assets 2,133,750 1,755,046

OTHER ASSETSInterest receivable related to projects 24,580 22,769Dividends receivable 226 5,333Other receivables 161,240 49,751

4 Cash and bonds at disposal 160,637 419,313

Total other assets 346,683 497,166

TOTAL ASSETS 2,480,433 2,252,212

LIABILITIES AND EQUITY CAPITALEQUITY CAPITALPaid-in capital beginning of year 750,936 600,936Paid-in capital received during the year 150,000 150,000Accumulated reserves beginning of year 779,486 799,876Net income (loss) for the year 15,414 (20,391)

Total equity capital 1,695,836 1,530,421

RESERVES AGAINST LOSSES 628,986 579,229

5 SYNDICATED CAPITAL 117,792 112,782

CURRENT LIABILITIESOther debt 37,123 25,505Deferred income 696 4,275

Total current liabilities 37,819 29,780

Total liabilities and reserves against losses 784,597 721,791

TOTAL LIABILITIES AND EQUITY CAPITAL 2,480,433 2,252,212

6 LEASE AND RENTAL COMMITMENTS7 AVAILABLE EQUITY CAPITAL AND CLEARANCES IN PRINCIPLE

Balance SheetDecember 31, 1999

Johannes Poulsen(Chairman)

Kirsten Fjord(Deputy Chairman)

Sven Riskær(Managing Director)

J. Dan Jensen(Deputy Managing Director)

Frank Norman Larsen(Deputy Managing Director)

Lars Andersen Niels Chr. Knudsen Lars Kolte

Eva Parum Friis Arne Petersen Kjeld Ranum

Birger Riis-Jørgensen Ingelise Saunders

Management:

Board of Directors:

Approved at the Board Meeting February 24, 2000.


15

Note 1999 1998DKK 1,000 DKK 1,000

CASH FLOW FROM OPERATING ACTIVITIESDividends from projects 27,675 3,293Interest from projects 29,451 22,058Other project related payments (6,453) 4,005Operating expenses, net (32,438) (34,110)Financial income, net 22,642 43,589

Net cash from operating activities 40,877 38,835

CASH FLOW TO INVESTING ACTIVITIESReceived from sale of shares 30,255 38,853Received from project loans and feasibility study loans 68,457 48,496Paid-in share capital in projects (103,813) (113,090)Disbursement of project loans and feasibility study loans (195,486) (104,331)

Net cash to investing activities (200,587) (130,072)

CASH FLOW FROM FINANCING ACTIVITIESProceeds from syndications related to projects 18,889 3,332Repayment of syndications related to projects (1,689) (2,054)Paid-in capital received during the year 150,000 150,000

Net cash from financing activities 167,200 151,278

NET CHANGE IN CASH AND BONDS 7,490 60,041

CASH AND BONDS BEGINNING OF YEAR 776,335 716,294

4 CASH AND BONDS END OF YEAR 783,825 776,335

4 Of these cash and bonds at disposal 160,637 419,313

An overall viewThe Last Five Years 1995 1996 1997 1998 1999

Operations:New projects (no.) 29 29 28 27 24

Portfolio of projects (no.) 179 191 203 213 206

Total project participations (DKK million) 1,543.0 1,646.6 1,809.9 1,777.9 2,158.4

Finances (DKK million)Income from projects, net 38.2 49.2 44.5 40.5 106.8Provision for losses (66.4) (107.8) (105.7) (71.4) (82.9)Operating expenses (32.8) (33.3) (31.4) (33.0) (31.3)Financial income, net 64.6 33.8 37.1 43.6 22.6Net income (loss) for the year 3.6 (58.1) (55.5) (20.3) 15.4

Equity capital 1,214.3 1,306.3 1,400.8 1,530.4 1,695.8

Cash Flow Statement

16

Notes on Financial Statements1999 1998

DKK 1,000 DKK 1,000

1 Operating expenses

Salaries, Head office 26,663 25,738Rental expenses 2,917 2,898Travelling expenses 4,464 4,479Regional office expenses 9,350 8,746Fees for board of directors 1,190 1,174Fees for external assistance 6,286 7,491IT expenses 3,779 4,848Environmental review expenses 95 882Office expenses 2,413 2,525Secondment of staff 751 884Various expenses 3,356 2,493

Total operating expenses 61,264 62,158

Operating expenses charged to IØ (23,764) (24,497)Operating expenses charged to MIØ (5,441) (3,841)Operating expenses charged to IFV (974) (786)

IFU's part of operating expenses 31,085 33,034

Specification of personnel expenses (salaries etc.)

Salaries, remunerations etc. 30,652 29,299Pension contributions 2,613 2,537Other expenses for social security 84 132

Personnel expenses in total 33,349 31,968

Total remuneration to the board of directors and management 4,146 3,852

Average number of employees, Head office 61 62Average number of employees, Regional offices 17 16

78 78

2 Financial income, net

The financial income, net is composed of the following items :

Interest income, cash and bonds 41,254 40,999Gain (loss) on bonds (18,618) 4,113Interest expenses, bank charges and exchange rate adjustments 6 (1,523)

Financial income, net 22,642 43,589

3 Cash and bonds allocated to projects

Cash and bonds which on the balance sheet date are allocatedfor investments are shown as part of the project assets and notas cash and bonds at disposal.

Amounts payable on project agreements 241,884 173,683Guarantees 15,855 41,777Binding commitments 365,449 141,562

Cash and bonds allocated to projects 623,188 357,022

1999 1998DKK 1,000 DKK 1,000

4 Cash and bonds at disposal

Bonds 346,100 566,708Interest receivables 7,563 8,129Cash 430,162 201,498

Cash and bonds end of year 783,825 776,335

Transferred to cash and bonds allocated to projects (623,188) (357,022)

Cash and bonds at disposal 160,637 419,313

5 Syndicated capital

Syndicated capital is investment capital received from third parties and invested in projects on their account and risk. Syndicated capital only becomes due to the extent that IFUreceives payments from these projects.

European Community Investment Partners (ECIP) 45,851 54,603European Investment Bank (EIB) 10,432 10,432Corporate investors 61,509 47,747

Syndicated capital in total 117,792 112,782

6 Lease and rental commitments

The total lease and rental commitments amount to 3,397 2,958

hereof due within the following year 2,959 2,807

7 Available equity capital and clearances in principle

The available equity capital is arrived at as follows (DKK millions):

Total equity capital 1,695.8 1,530.4 Reserves against losses 629.0 579.2 Syndicated capital 117.8 112.8 Project participation (2,158.3) (1,777.8)

Available equity capital 284.3 444.6

Clearances in principle for new projects amount to 271.6 482.4


17

Kenya. It has 80 employees and an annualturnover of DKK 18 million.

Whenever Drillcon bores a new well, anaverage of 350 people benefit from an imme-diate improvement in their quality of life. Fur-thermore, it also contributes to the generaldevelopment of Uganda:• All employees receive training• All employees will be able to support their

(large) families• All employees pay income tax• Drillcon’s bonus system has introduced the

modern concept of the common interestbetween employer and employee to Uganda

• Drillcon is a role model for Ugandan entre-preneurs in the water supply sector and is asource of inspiration for private initiatives.

Water is a precondition for life, and cleanwater a precondition for freedom from sick-ness. In Uganda, Drillcon Ltd. has providedsafe water for 400,000 people.The companystarted as a front runner in Uganda’s privati-sation wave – and when IFU four years lateragreed to contribute with a loan, the compa-ny’s position as a solid partner of the govern-ment, aid agencies and the private sector wascemented.

Drillcon Ltd. was founded in 1994, when itwas decided that a Danish financed watersupply project should contribute to the struc-tural adjustment in Uganda by engaging pri-vate drilling contractors instead of the gov-ernment department, which previously held amonopoly.There were no private drilling con-tractors with the technical capacity in Ugan-da, and the jobs would easily have gone to for-eign companies, if two Danish advisers fromthe project had not decided to try their luckas entrepreneurs.

Bent Hansen and Leif Marstrand Knudsenrisked their own savings, and invited a Ugan-dan water pump factory owner of Danish ori-gin, Palle Møller, to participate. Indirectly, IFUalso became stakeholder, as IFU had shares inMøller’s company,Victoria Pumps. In addition,a Ugandan businessman, Patrick Buhenga,became a minority shareholder.

But it was not until 1998 that IFU investeddirectly in Drillcon Ltd. with a loan of DKK1.3 million. It gave Drillcon a boost, at a timewhen lack of capital prevented the companyfrom fully exploiting its good reputation inthe East African market.

Today, Drillcon owns six drilling rigs, one ofwhich belongs to the company branch in

■ W AT E R F O R T H O U S A N D S

■ A I R TA X I T O PA R A D I S EThe Danish investors behind Maldivian AirTaxi Ltd., seek not only economic gain forthemselves, but also consider the social im-pact on the community an important para-meter of success.

Since Maldivian Air Taxi was founded in1993, the company’s activity has turned out tobe the key to growth for the tourism indus-try of this small nation of more than a thou-sand coral islands in the Indian Ocean. Indi-rectly, it has provided jobs for thousands ofMaldivians.

Before Maldivian Air Taxi was established,tourists had to add a boat ride of 4-6 hoursto the flight time of 13 hours from Europe.They arrived at their destinations sick andtired, (except for those few inured to the

sea), and it took them at least a day to recu-perate and recognise the charms of the tropi-cal paradise they had seen in the travel bro-chure.

Today Maldivian Air Taxi provides the trans-fer from the airport to the resorts by meansof 18 Canadian made Twin Otter seaplanes.The planes can land just off any island, and theintroduction of seaplanes is a principal reasonwhy the Maldives has succeeded in doublingits number of tourists over five years from200,000 to the expected 400,000 in the cur-rent season.

The island state has recently increased itsbed capacity by 30 per cent to over 15,000.All of the added hotel resorts are too faraway from the national airport to be reached

by boat. Maldivian Air Taxi was asked to guar-antee its provision of transport, before thegreen light was given for the building ofhotels.

Maldivian Air Taxi employs more than 200 people. An increasing number are Maldivianas the company has introduced its own edu-cation and training programmes. Recently thefirst five Maldivian pilots took their seats inTwin Otter cabins. And while all aircraft werepreviously flown to Canada for overhaul, Mal-divian Air Taxi has now built a hangar and hastrained its own staff to maintain the planes.

As the biggest foreign-owned company inthe Maldives, the company accepts social obli-gations. It transports medicines to the islands,and it takes children with Beta Thalassaemiafor regular treatment at the hospital in thecapital of Malé. Both services are free ofcharge. Beta Thalassaemia is a hereditaryblood disease, which afflicts one out of sixchildren in the Maldives.

Maldivian Air Taxi started on a small scalewith IFU providing half of the total investmentas a loan.The loan – DKK 2.5 million – is nowfully paid back, while the Danish investors, SeaPlane Holding A/S, have raised their invest-ment to over DKK 40 million. IFU is nowpreparing a new investment project, in co-operation with the same investors, in a hotelresort in the Maldives.

IFU gave Drillcon a boost with a loan of DKK1.3 million

Drillcon has contributed to the provision ofclean water for 400,000 people

18 Canadian made Twin Otter seaplanes form the stem of the activities.

AlgeriaAltec Engineering Haldor Topsøe 0.6 3.0 50 1971-1977Cosider Construction Christiani & Nielsen 3.3 14.0 550 1978-1981Total for: Algeria 3.9 17.0 600AngolaNova Cimangola Cement FLS-Industries 7.5 150.0 1,000 1996-Total for: Angola 7.5 150.0 1,000BeninCimbenin Cement Fibo 8.6 6.9 105.0 170 1991-Fan Milk Dairy Fan Milk International 1.7 4.2 325 1999-Fan Milk Dairy Fan Milk International 0.4 1.0 12 1992-1996Total for: Benin 9.0 8.6 110.2 507Burkina FasoFan Milk Dairy Fan Milk International 0.7 2.5 22 1997-Total for: Burkina Faso 0.7 2.5 22BurundiAvicom Poultry farming DPD 1.0 1.2 4.0 40 1989-1996Total for: Burundi 1.0 1.2 4.0 40Central African Rep.SOGESCA Sugar refinery Danisco Sugar/NIRO-DDS 26.6 320.0 350 1985-1996Total for: C.African Rep. 26.6 320.0 350CameroonCamsavon Chemical industry Sønderstrup Sæbefabrik 0.0 1.0 40 1986-1988Camtainer Land transport Scancatrans 3.1 6.7 35.0 100 1984-1995Cocadac Construction E. Pihl & Søn 2.8 3.0 10.0 300 1976-1982NOBRA Brewery Cerekem 17.8 25.6 412.0 15 1986-1995Total for: Cameroon 23.7 35.4 458.0 455Cape VerdeCeris Brewery Bryggerigruppen 4.2 15.6 63.0 90 1985-Total for: Cape Verde 4.2 15.6 63.0 90Côte d’IvoireCITB Wood products Danish Wood Treating 0.3 1.0 4.0 15 1983-1984Fan Milk Ice cream Fan Milk International 0.7 6.9 20 1993-1995Sadofoss Chemical industry Sadolin Nobel 5.3 9.3 32.0 58 1976-1995SAM Furniture E. Roth Oversøisk Hårdtræ 0.5 1.1 15.0 25 1970-1999Sedan Construction Helsingør Værft 5.0 4.8 42.0 350 1976-1982Sitransbois Wood products Nordisk Trælast 16.8 12.6 83.0 600 1977-West Africa Growth Fund ❖ Financial institution No Danish partner 12.9 130.0 6 1997-Total for: Côte d’Ivoire 41.5 28.7 312.9 1,074Democratic Rep. CongoDilaz Dairy Primodan Dairy Equipment 0.9 10.0 25 1987-1988Danilait Powdered milk packing Scancool International 1.4 0.4 6.0 25 1987-1997Total for: Dem. Rep. Congo 2.3 0.4 16.0 50EgyptCLFF Research and development No Danish partner 2.1 3.0 40 1982-1996Dantex Clothing Brandtex 4.3 8.0 35.0 200 1984-1991Egypac Pulp and paper products Buhl Automation 2.3 9.2 30.0 30 1976-1986El Rayan Danfarm Dairy farm Danfarm Contractors 20.5 435.0 350 1987-1988EPL Research and development Danish Protein Institute 1.1 2.0 15 1980-1982Hotel Marina Hotels and restaurants Helnan Hotels 7.4 16.6 220 1992-Sinai White Portland Cement Cement plant Aalborg Portland 41.8 639.9 400 1999-Total for: Egypt 71.0 25.7 1,161.5 1,255EthiopiaMuus Feed mill Elias B. Muus 0.5 0.9 3.0 25 1972-1975Total for: Ethiopia 0.5 0.9 3.0 25GhanaDanafco Chemical industry Propharma 1.9 17.6 100 1998-Fan Milk Dairy Fan Milk International 2.9 15.4 19.0 110 1989-Ghana Emulsion Cold emulsion Phønix Contractors 3.8 1.0 27.0 50 1995-Muk Air Air transport Muk Air 2.0 10.5 30 1997- *Northsax Kiln Company Wood products Dalhoff Larsen & Hornemann 0.6 6.0 4 1997-Pako Bay Fishing Brdr. Kristensen 0.2 3.7 60 1997-1998Scanbech Ghana Production of plastic bottles Scanbech 1.3 6.5 80 1998-Volta Arkil Quarry Ove Arkil 2.1 2.5 9.0 30 1991-1999Total for: Ghana 14.6 19.0 99.3 464KenyaAcacia Fund Financial institution No Danish partner 0.1 13.2 140.0 7 1997-DCK-EA Agriculture and farming DCK Production 0.8 0.8 0.0 1 1970-1978DCK-Production Agriculture and farming DCK Production 3.9 4.0 34.0 5,000 1970-1978Muus Feed mill Elias B. Muus 0.7 1.3 3.0 35 1972-1980Vestergaard-Frandsen Textiles K. Vestergaard Frandsen 1.3 5.0 8.2 10 1995-Total for: Kenya 6.8 24.2 185.2 5,053LesothoTantina Milling Flour milling ABC Hansen 0.3 4.9 27 1999-Total for: Lesotho 0.3 4.9 27

AFRICA

18

Investment Portfolioas at December 31, 1999

IFU Participation Total Employ-Activity/product Danish Partner(s) Shares Loans Investment ment Period

––––––––––––– (DKK million) ––––––––––––– (persons)

MalawiScandrill Water supply Intertec Contracting 1.2 12.8 13.2 30 1986-Total for: Malawi 1.2 12.8 13.2 30MaliSomapil Batteries Alkaline Batteries 1.8 4.8 34.0 260 1984-1995Total for: Mali 1.8 4.8 34.0 260MoroccoComapral Dairy O.G. Hoyer 8.7 25.4 95.0 30 1986-1997Cool Time Trade O.G. Hoyer 0.0 110.0 1 1990-1998Ettamam Feed mill Schmidt & Jessen 1.5 19.0 50 1981-1986York Refrigeration Morocco Service company York Refrigeration 0.4 1.4 10 1993-Total for: Morocco 10.5 25.4 225.4 91MozambiqueFrigo Services Machinery and equipment Sabroe Marine 0.4 2.0 25 1989-Motorcare Sale and service of cars Kjær & Kjær Worldwide 3.7 6.7 29.0 12 1999-Total for: Mozambique 4.1 6.7 31.0 37NigeriaAdegbemile Flour mill United Milling Systems 1.1 0.2 25.0 40 1985-1998BARC Agriculture and farming Bryggerigruppen 440.0 950 1982-DEMCO Construction Bryggerigruppen 52.0 57 1988-Fan Milk Yoghurt and ice lollies Fan Milk International 16.0 6.5 73.8 2,2 1999-Fertile Acres Agriculture and farming Cerekem 2.5 2.9 23.0 100 1984-1996Grundfos Pumps Machinery and equipment Grundfos 1.3 20.0 60 1983-1986JIB Brewery Bryggerigruppen 55.5 0.3 416.0 1,400 1977-Nwankwu & Rasch Construction Rasmussen & Schiøtz 1.0 4.0 65 1976-1979Peacock Paints Paints Dyrup 4.5 9.7 101.0 64 1979-1999Pioneer Milling Milling plant Bryggerigruppen 52.0 90 1986-Plateau Bottling Soft drinks Bryggerigruppen 4.2 100.0 120 1981-1999Sunrise Bottling Soft drinks Cerekem 8.2 104.0 120 1983-1988Tiger Battery Batteries Alkaline Batteries 4.4 38.2 144.0 150 1983-1997W. African Portland Cement Production of cement F.L. Smidth 35.4 961.8 550 1999-Total for: Nigeria 98.5 93.3 2,516.6 5,966RwandaSorwapiles Batteries Alkaline Batteries 4.0 47.0 100 1985-1989Total for: Rwanda 4.0 47.0 100SenegalAfrican Seafood Fishing/processing P.F. Faromar 10.5 26.5 129.0 90 1984-1999Rutec Service company Atlas-DK 0.1 1.0 20 1980-1983Senegal Seafood Fishing/fish processing P.F. Faromar 0.0 2.0 30.0 250 1982-1985SOCA Agriculture and farming APV-DTD 3.4 13.0 48.0 75 1987-1996Total for: Senegal 14.0 41.5 208.0 435South AfricaBenzak Beverages Promotion/distribution of malt d Bryggerigruppen 1.0 2.7 20 1999-Credin Bakery Supplies Food ingredients Palsgaard Industries 0.7 2.9 9.8 70 1998-Danafrica Flour Mills Food and beverages Kongskilde Industries 0.1 1.0 50 1997-1999Dan-Essence Detergents & soap Sønderstrup Sæbefabrik 1.2 3.8 54 1997-Danforge Engineering Machinery and equipment Brdr. Jørgensen 0.5 0.4 2.6 15 1997-Kristensen Oceanfront Rest. Restaurants Kristensen Group 8.5 13.9 45.4 270 1998-New Africa Signs & Graph. Signs and posters Sign-Tronic 0.0 0.8 3.4 12 1996-

19



In November 1999 IFU’s Board of Directors visited investment projects in Ghana, SouthAfrica and Zimbabwe. Here the Board is welcomed to Benzak Beverages, Johannesburg,South Africa.

Newave Technology Prepress print Duplika 1.0 7.8 12 1998-Nielsen Tap Water taps Toni Armatur 0.3 0.2 1.0 30 1995-1999Princeton Computing Education Courseware Scandinavia 0.2 1.3 30 1996-1999Resource Dev. Consultants Consultancy Carl Bro Gruppen 0.8 1.5 4.5 20 1995-Sibaya Lake Lodge Hotels and restaurants Hotel Pakhuset/Claus Søgaard 0.4 5.5 20 1998-Stoneground Mills Manufacturing of mills ABC Hansen 0.9 2.7 15 1999-Today’s Signs & Graphics Production of signs Ladelund Skilte 0.2 1.1 7 1999-Total for: South Africa 11.5 24.1 92.6 625Sub-Saharan AfricaAMSCO Management services Carl Bro Gruppen/et al. 3.7 50.0 7 1989-Mærsk Africa Facility Transport related projects Mærsk 50.0 100.0 500 1999-Total for: Sub-Saharan Africa 3.7 50.0 150.0 507SudanSFI Dry yeast Danisco Bioteknologi 5.5 8.3 35.0 60 1977-1987SMS Milling Flour mill United Milling Systems 0.4 1.2 6.0 15 1981-1990Total for: Sudan 5.9 9.5 41.0 75SwazilandKGR Enterprises Rehab. of railwagons Giersing Rose 2.7 17.9 45 1993- *United Plantations Africa Plantations IPF 17.3 88.5 750 1999-Total for: Swaziland 17.3 2.7 106.4 795TanzaniaDAHACO Airport handling SAS 1.4 8.1 33.0 400 1984-Den-Tan Resources Fishing Pre-Consult 2.0 15.0 60 1992-1997Mashado Game Fish. Lodge Hotels and restaurants C.G.Jensen 5.9 5.1 69.3 160 1994-Mount Meru Hotels and restaurants Tanzania Hotel Investment 1.7 4.0 40.0 300 1974-1995RSP Transport Water transport Danea 1.2 6.4 15 1994-Tanruss Hotels and restaurants C.G.Jensen 15.4 69.3 414.2 350 1993-Total for: Tanzania 24.4 89.7 577.9 1,285TogoAfricotière Water transport Mortensen & Lange 0.1 1.0 35 1989-1992Atlantic Produce Agriculture and farming Tropical Plants Agencies 2.0 3.3 11.0 100 1991-Cerekem Exotic Agriculture and farming Cerekem 3.1 7.8 34.0 170 1986-1995Fan Milk Dairy Fan Milk International 2.1 3.6 10.0 68 1985-1996ITP Rubber and plastic products Nordisk Wavin 6.7 15.1 63.0 82 1980-La Gazelle Land transport Erik Conradsen 1.3 9.3 80 1991-1993Soprolait Dairy APV-DTD 0.7 2.0 25.0 40 1980-1996Sotodas Chemical industry DK-Kemi International 4.9 11.5 22.0 41 1985-1996STS Fabricated metal products Rambøll 1.2 3.6 14.0 250 1987-1997Total for: Togo 22.1 46.9 189.3 866TunisiaTDC Clothing D.T.C. Company 0.9 5.5 5 1992-1994Total for: Tunisia 0.9 5.5 5UgandaDrillcon Drilling of bore holes Victoria Pumps 1.3 5.7 45 1998-MTN Publicom Pay phones Ascom Nordic 2.6 7.0 29.6 15 1998-NIS Uganda Sale/maintenance of vehicles Kjær & Kjær Worldwide 3.2 8.8 44.5 60 1998-Victoria Engineering Manufacturing of pumps Knebel Drilling 3.0 8.9 56 1998-Victoria Fresh Food Fishing/fish processing Brødrene Gram 1.1 3.0 12.0 60 1988-1998Victoria Pumps Mechanical engineering Knebel Drilling 2.3 3.0 16.0 50 1988-Total for: Uganda 9.3 26.1 116.7 286ZambiaMilden Milling Maize milling United Milling Systems 5.0 60.0 200 1994-1995Verino Farms Broilers/dressed chickens Springkildegaard 1.9 12.2 120 1998-Total for: Zambia 5.0 1.9 72.2 320ZimbabweDanmeats Meat processing Pfeiffer/ et al. 1.0 3.4 5.5 50 1995-Dansafe Reflection textile Oppenhejm & Jansson 0.3 0.2 2.0 10 1995-1999Frese Plumbing equipment Frese Armatur 2.5 6.0 34.0 50 1996-Imperial Derby Coolers and freezers Derby 18.8 67.0 120 1993-Powervision Energy production/distribution IRD 0.5 0.2 2.5 70 1997-Ref-Air-Engineering Machinery and equipment DK Refrigeration Technology 0.6 1.8 2.4 25 1992-Scan-Lock Plastic floor tiles Scan-Lock System 0.4 2.3 20 1994-1999Total for: Zimbabwe 24.1 11.6 115.7 345Total for: AFRICA 436.7 641.7 7,449.9 23,040

BangladeshDandy Chewing gum Dandy 1.0 28.0 80 1991-1992KAFCO (Plant) Fertilizers Haldor Topsøe 35.1 21.3 2,500.0 800 1990-KAFCO (Prom) Fertilizers Haldor Topsøe 0.6 7.0 8 1987-1990Wavin PVC pipes Nordisk Wavin 3.0 60.0 134 1986-1987Total for: Bangladesh 39.8 21.3 2,595.0 1,022CambodiaDumex Chemical industry Dumex 1.0 2.0 6.0 100 1971-1976Total for: Cambodia 1.0 2.0 6.0 100

ASIA

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ChinaBaihua Publishing and printing EAC (Hong Kong) 18.0 62.5 160 1992-Bestseller Fashion Group ❖ Clothing Bestseller Wholesale 3.9 10.0 70 1997-Chinaust Changchun Automobile parts Codan Gummi 2.6 15 1993-1994Chinaust Plastics PVC pipes Codan Gummi 1.3 5.5 20.0 90 1987-1994Chinaust Shanghai Automobile parts Codan Gummi 6.5 25 1993-1994Codan Ling Yun Rubber hoses Codan Gummi 6.2 4.4 25.0 55 1994-Coloplast ❖ Rubber and plastic products Coloplast 22.4 46.7 100 1995-Dalian Xinshiji Publishing and printing EAC (Hong Kong) 16.0 40.0 150 1994-Danagraf China ❖ Electrical machinery/equip. Danagraf 0.4 1.0 10 1997-Danavox Xiamen Hearing aids GN Danavox 6.2 2.3 18.0 125 1989-1999Danfoss Medical/precision instruments Danfoss International 19.4 103.2 60 1995-Danhua Consultancy Kampsax/Vejdirektoratet 0.8 3.0 8 1993-Danisco (China) Food ingredients Danisco Ingredients 6.0 147.4 90 1997-East Lake Villas Real estate activities EAC (Hong Kong) 3.5 41.9 210.0 380 1987-1997Green Environment Consultancy Cowi/Rambøll 0.4 1.2 3 1995-1997Huhhot Hua Ou Starch Starch products Kartoffelmelcentralen 8.2 42.0 100 1996-Hydro-X Chemical industry Hydro-X 0.7 0.6 2.8 12 1995-Impact Furniture Production of sofas Eilersen 0.6 2.0 25 1999-Innovation Production of sofa sets Innovation 1.9 5.0 20 1998-International Nutrition Co. Food and beverages EAC (Hong Kong) 41.0 6.3 115.0 180 1992-Jacob Holm Chemical industry Jacob Holm & Sønner 20.8 221.0 90 1995-Mærsk Container Production of ship containers Mærsk Container 13.9 278.9 600 1999-Ningbo Zhedong ❖ PVC windows Plastmo 2.9 13.0 60 1996-Novo Nordisk Chemical industry Novo Nordisk 54.1 1,160.0 360 1995-Primo Kunming Plastic (PVC) windows Primo Danmark 0.6 2.5 20 1999-Shanghai Dansk ❖ Textiles Dansk Transfertryk 12.4 7.2 40.0 30 1995-Shanghai Shenlian Roulunds Rubber and plastic products Roulunds Fabriker 3.4 22.2 80 1996-SIDIC Consulting engineers Dangroup International 1.1 0.2 3.0 4 1987-1999Silcon Electrical machinery/equipment Silcon 2.5 0.8 17.0 80 1995-1999Smekru Consulting engineers I. Krüger Engineering 0.4 5.0 6 1988- *Ting Fung Starch Starch products Kartoffelmelcentralen 10.9 85.0 30 1996-Unicon-Dalian Ready-mix concrete Unicon Beton 3.3 25.0 50 1995-1999Wolfking Tianjin Co. Machinery and equipment Wolfking Danmark 2.0 9.0 35 1997-Yan-Dan Consultancy Dangroup International 0.8 4 1995-1999Zhejiang ACO ❖ PVC windows Plastmo 2.1 9.0 60 1996-Zi Dan Publishing and printing EAC (Hong Kong) 17.6 177.0 150 1996-Total for: China 291.3 82.9 2,932.3 3,337IndiaAkay Flavours Chemical industry Chr. Hansens Laboratorium 16.7 44.2 80 1996-Arcodan Communication equipment Arcodan 2.4 10.0 65 1994-1998Asian Can Fabricated metal products PLM Haustrup 3.0 17.0 175 1989-1990Asian Closures Fabricated metal products PLM Haustrup 2.3 13.0 50 1989-1990Balaji Foods Food processing Ovotec International 1.6 74.0 300 1994-CG Maersk Data EDP software Mærsk Data 4.2 16.2 450 1996-Coduras Exports Food and beverages Atlas-Stord 5.7 30.0 150 1993-Convoy India Designing of ships Logimatic 0.5 3.1 6 1999-CRIIL EDP software Computer Resources Int. 5.0 14.0 60 1991- *Dane Food Butter cookies Kelsen 0.2 0.3 5 1995-Dania Food Food additives Palsgaard Industries 0.0 2.5 9.0 40 1991-DDE-ORG Office machinery/computers Dansk Data Elektronik 2.6 24.6 565 1993-DLF Cement Cement FLS-Industries 8.8 0.0 843.0 300 1994-Engsko Kristone Mill stones Engsko 0.4 1.2 40 1995-Fibcom Electrical machinery/equipment Tellabs Denmark 6.2 72.0 74 1994-Fowler Westrup Machinery and equipment Westrup 3.1 17.4 85 1999-Garware-Utzon Textiles N.P. Utzon 1.5 6.0 20 1995-1998Global Wool Alliance Textiles Bloch & Behrens 13.7 14.2 87.2 360 1994-Grundfos Pumps India Assembly/production of pumps Grundfos 2.1 40.5 30 1998-Gujarat Sidhee Cement Cement FLS-Industries 13.2 175.0 400 1994-Hilton-Roulunds Rubber and plastic products Roulunds Fabriker 4.5 17.5 275 1992-Indo-Dan Lampshades Furniture Erik Frederiksen Production 0.7 4.3 85 1997-IndoDane Textiles Textiles K. Vestergaard Frandsen 0.9 7.0 94 1994-IRON Maxflow Machinery and equipment Maskinfabriken IRON 4.6 15.2 60 1995-Kampsax India Consultancy Kampsax 1.0 11.3 20 1994-L&T-Ramboll Consultancy Rambøll 2.0 6.5 25 1997-LEC India Software EDP software Landbrugets EDB-Center 1.9 9.0 50 1994-LICindia Engineering LICEnergy 0.6 1.8 20 1995-1998LK India Electrical equipment LK 1.9 6.7 12.1 200 1998-LM Glasfiber Non-metallic mineral products L.M. Glasfiber 12.0 31.0 130 1993-Marinplast Boat yard PF Marin Plast 0.5 0.9 5.0 40 1984-1988Mather Derby Machinery and equipment Derby 13.9 135.0 180 1991-1993MD-JK India Textiles Julius Koch Gruppen 0.4 2.5 40 1994-1998Pedershaab-ACME Machinery and equipment Pedershaab Maskinfabrik 0.7 4.7 30 1998-Pioneer Wincon Limited Electrical machinery/equipment Wincon West Wind 2.6 1.9 15.8 75 1996-Pipe LICEnergy India IT equipment LICEnergy 1.6 4.3 30 1998-Prism Cement Cement FLS-Industries 31.3 1,087.0 600 1993-Procon EDP software Ramas International 0.6 1.8 3.0 14 1996-Roulunds Friction Brake pads & linings Roulunds Fabriker 3.0 22.2 123 1996-Roulunds Hoses Production of rubber hoses Roulunds Fabriker 4.2 6.0 50 1999-

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Sabroe India Machinery and equipment York Refrigeration 0.9 4.2 75 1992-1999Saurashtra Cement Cement FLS-Industries 50.5 780.0 300 1996-Sividan Chemical industry Binadan 2.0 14.2 25 1996-1998Taparia Exports Food and beverages Dan-Extruder 0.6 5.9 35 1996-1998TTK Mærsk Medical Medical/precision instruments Maersk Medical 15.2 57.0 300 1996-Total for: India 249.7 29.1 3,760.2 6,131IndonesiaBorncharter Fishing Lauritzen Holding/ et al. 0.0 1.0 1 1990-1999Cowi Computer and rel. activities Cowi 1.8 11.0 10 1984-1987Danindo Fishing J. Lauritzen 6.7 118.0 67 1989- *Dankaffe Food and beverages Niro 11.5 94.9 100 1992-1993P.T. Wahana Derby Coolers and freezers Derby 3.4 4.4 19.7 101 1992-P.T. Aalborg Industries Fabricated metal products Aalborg Industries 9.9 1.1 46.0 101 1994-Total for: Indonesia 33.4 5.5 290.6 380IranDyrup Paints Dyrup 0.6 1.2 20.0 400 1970-1977Total for: Iran 0.6 1.2 20.0 400JordanDJDC Dairy MD-Foods International 2.1 23.5 86.0 110 1980-1994Total for: Jordan 2.1 23.5 86.0 110MalaysiaBredan Fabricated metal products Bredan Kompensatorfabrik 0.4 1.0 4 1991-Checkerasia Machinery and equipment Systema & Checker 1.8 0.3 2.0 23 1991-Cimbria Far East Machinery and equipment Cimbria Unigrain 0.4 0.4 3.6 13 1992-1996Dan Software Computer and rel. activities Dan Software International 0.1 0.5 1 1993-1997Daneel Fishing Ole T. Kragh/Per Kragh 0.3 1.8 3 1991- *Dankaffe Food and beverages Niro 28.4 6.8 120 1993- *DDE Information technology Dansk Data Elektronik 1.0 1 1990-1991DZ Security Plastic cards DZ Holding 2.7 4.0 7.0 42 1990-1997EAC-Horticulture Agriculture and farming EAC (Malaysia) 4.9 1.3 13.0 1 1988- *Goldkist Poultry processing Cerekem 1.5 2.6 12.0 40 1986-1996Guthrie-DDE EDP software Dansk Data Elektronik 3.0 13.0 22 1991-1998Kualiti Alam Sewage and refuse disposal I. Krüger Engineering 0.0 1.0 4 1991-1999Kvik Wood products Kvik Køkkenet 1.4 0.3 8.0 80 1989-1994Medicotest Medical/precision instruments Medicotest 2.1 5.3 52 1995-Niro Ceramic Granite tiles Niro 15.5 22.2 100.0 308 1988-1993Pl. Masterbach Chemical industry Kunststof-Kemi 0.6 5.0 15 1985-1987Pong Codan Marketing Marketing Codan Gummi 1.0 10 1989-1990Pong Codan Rubber Rubber and plastic products Codan Gummi 0.3 3.0 30 1988-1990Scan Dairy & Food Food and beverages Niro 20.6 89.0 104 1992-Scanavionics Medical/precision instruments Scandinavian Avionics 1.1 4.0 5 1993-Sika Furniture Sika Møbler 0.3 2.0 100 1974-1982Skaarup & Jespersen Architects Skaarup & Jespersen 0.1 1.0 6 1990-STAR Fishieries Fishing Skagen Fish Network 0.5 3.0 10 1996-1997Unico Kemi Chemical industry DK-Kemi International 6.4 57.0 90 1988-1991Total for: Malaysia 92.2 31.3 341.0 1,084MaldivesIPOH Investments Tourist Resort Seaplane Holding 42.3 84.0 0 1999-Maldivian Air Taxi Air transport Air Service International 2.5 4.8 25 1992-1999Male Water & Sewerage Water supply NTR Holding 27.2 20.3 126.3 80 1995-Total for: Maldives 27.2 65.2 215.1 105NepalGhorka Brewery Brewery Danbrew 8.1 5.0 52.0 100 1988-Nedrill Water supply International Water Contractor 2.4 3.1 5 1989-Total for: Nepal 10.4 5.0 55.1 105PakistanCattle Breeders Agriculture and farming APV-DTD 1.7 1.0 7.0 50 1982- *Chakwal Cement FLS-Industries 27.1 1,360.0 500 1995-CHEMI DANSK Co. Textiles Dansk Transfertryk 3.8 24.5 30 1997-Dairyland Food and beverages APV-DTD 3.8 45.0 140 1987-1988Dane Foods Cookies Kelsen 4.5 15.0 124 1993-Fauji Cement Cement FLS-Industries 42.9 970.0 400 1993-Fauji Fertilizer Co. Fertilizers Haldor Topsøe 29.2 1,600.0 1,550 1978-Fauji II Fertilizers Haldor Topsøe 39.5 2,145.0 300 1990-Maple Leaf Cement FLS-Industries 35.1 1,125.0 390 1994-Milkpak Dairy APV-DTD 1.4 3.2 66.0 225 1979-1989Pepcem Cement Cement FLS-Industries 32.9 1,000.0 250 1997-Total for: Pakistan 221.9 4.1 8,357.5 3,959Papua New GuineaPacific Battery Batteries Alkaline Batteries 4.5 54.0 90 1985-1987Total for: Papua New Guinea 4.5 54.0 90PhilippinesAtlas/Hi Cement Cement FLS-Industries 12.6 425.0 260 1984-Davao Union Cement FLS-Industries 23.8 750.0 300 1981-1996Drilling Corp. of Asia Construction Kampsax/I. Krüger Engineering 3.1 4.5 17.0 10 1981-1988DZ-Philippines Plastic cards DZ Holding 0.0 5 1992-

22



JEDE Asianbakers Food and beverages B. Christensen Maskinfabrik 1.5 2.4 11.4 208 1996-Philcadan Furniture Philcadan 0.3 0.8 6.0 500 1975-1981Philmop Pulp and paper products Brdr. Hartmann/EAC 2.3 3.4 16.0 25 1976-1988Rotex Friction materials Roulunds Fabriker 0.3 0.3 4.0 25 1972-1987Summit Air transport Sterling 3.4 1.3 6.0 10 1975-1982Towi Furniture M. Krüger 0.5 6.1 8.0 210 1974-1987Unidex Clothing Unidex 0.3 9.7 25.0 1,060 1979-1992Vitarich Animal feed Cerekem 2.9 5.8 49.0 150 1980-1982Total for: Philippines 51.0 34.3 1,317.4 2,763Republic of KoreaKDDC Dairy MD-Foods International 33.4 20.5 107.9 108 1985-Kodas Animal feed Flemstofte Mads Amby 7.1 1.8 10.0 2 1985-1988Novenco Ventilation Novenco 1.5 7.0 12 1988-1988Total for: Republic of Korea 42.0 22.3 124.9 122SingaporeI.B.S. Construction Larsen & Nielsen/EAC 1.3 20.0 300 1973-1974Total for: Singapore 1.3 20.0 300Sri LankaAsia Power Energy production/distribution B&W Scandinavian Contractor 9.9 372.0 60 1997-Bünger Machinery and equipment Bünger Engineering 1.0 20 1982-1987C.W.Mackie & Co. Trade and distribution Aarhus Oliefabrik 13.2 7.8 154.1 3,120 1998-Ceymac Rubber Co. Rubber products C.W. Mackie 33.0 321 1998-Ceytra Limited Rubber products C.W. Mackie 6.6 115 1998-Elsteel Fabricated metal products Erik Løgstrup 2.0 11.3 15 1997-Korea Ceylon Footwear Manufacture of footwear C.W. Mackie 72.0 1,858 1998-Scan Products Holding Co. Production of squashes C.W. Mackie 13.5 65 1998-Serendib Coconut Products Dessicated coconuts C.W. Mackie 14.2 530 1998-Silver Power Energy Jesma-Matador 0.5 2.0 20 1985-1987Skanko Lanka Textiles Skandinavisk Kokosvæveri 0.8 1.5 10.0 90 1987- *Total for: Sri Lanka 24.4 11.3 689.7 6,214ThailandBeer Thai Brewery Carlsberg International 19.7 863.0 600 1992-Carlsberg Brewery Brewery Carlsberg International 19.7 750.0 600 1992-DZ Plastic cards DZ Holding 0.5 6.2 18.0 124 1985-1993Flux B. Grimm Electrical machinery/equipment Flux Transformerteknik 0.7 7.2 36 1995-1997Nation Egmont Entertainment Publishing house Egmont 17.9 27.0 50 1999-P. C. Hose Rubber hoses Codan Gummi 0.3 2.0 11.0 30 1985-1994P. C. Rubber Rubber profiles Codan Gummi 3.6 13.0 410 1991-1994Penadansk Textiles Dansk Transfertryk 9.5 10.2 51.0 30 1997-Pongpara Rubber products Codan Gummi 1.4 3.6 8.0 410 1980-1987Premier Dairy Food Dairy Mejerigården/ et al. 1.8 1.3 8.0 15 1993-Quick-Cool Co. Fabricated metal products Brødrene Gram Invest 1.0 4.1 25 1997-Royal Scandinavia Jewelry Royal Scandinavia 3.0 11.0 30 1998-Scanthai Furniture M. Krüger 0.4 0.5 13.0 90 1975-1981Tropic Dane Ceramics and furniture Tropic Dane Trading 1.4 6.1 50 1996-Total for: Thailand 54.0 50.7 1,790.4 2,500VietnamHue Brewery Brewery Tuborg International 26.3 3.7 130.0 192 1994-MK-Rubico Wood products M. Krüger 5.9 40.0 120 1992-1994S.E. Asia Brewery Brewery Carlsberg International 35.8 91.0 120 1992-Total for: Vietnam 68.0 3.7 261.0 432YemenMuus Feed mill Elias B. Muus 0.2 0.5 1.0 20 1976-1978Total for: Yemen 0.2 0.5 1.0 20Total for: ASIA 1,215.2 393.9 22,917.1 29,174

MaltaMellieha Hotels and restaurants DFF-Fonden 2.5 5.4 69.0 50 1975-1989Total for: Malta 2.5 5.4 69.0 50TurkeyAytac Food and beverages APV-DTD 17.8 466.0 750 1994-DLF-Trifolium Agriculture and farming DLF-Trifolium 0.6 2.0 8 1994-1995Ege-Baltica Insurance Baltica 12.5 16.0 40 1990-1992Entas Agriculture and farming KFK-Korn og Foderstof/ et al. 27.2 1.5 250.0 230 1984-Golden Dolphin Hotels and restaurants DK Turkish Inv. 1.6 40.0 250 1973-1985Klimasan Coolers and freezers Derby 4.4 26.3 208 1992-KÖY-TÜR Agriculture and farming No Danish partner 14.5 140.0 79 1988-Parlar Clothing Minelli 8.8 26.0 90 1989-1993Riegens Production of light fittings Riegens 1.4 4.7 20 1999-S & Q Mart Technical services S & Q Tech 0.3 2.0 3 1990-ScanBrid Agriculture and farming ScanBrid International 5.0 17.7 30 1993-1996Viking Pulp and paper products Papyrus 15.6 15.5 125.0 200 1969-1986Total for: Turkey 100.9 25.8 1,115.7 1,908Total for: EUROPE 103.5 31.2 1,184.7 1,958

EUROPE

23



ArgentinaAilinco Sewage and refuse disposal Kommunekemi 12.1 9.8 118.4 81 1994-Dan Austral Fishing Norfo 3.4 10.0 70 1993-1999Euroamérica Harbour terminal J. Lauritzen 4.2 9.3 60.0 20 1992-1998Palle Westerby Machinery and equipment Westconsult 0.9 0.4 5.0 15 1986- *PECORSA Energy production/distribution NEG Micon 0.6 1.7 5.0 3 1993-1999Total for: Argentina 17.7 24.5 198.4 189BelizeBelize Minerals Mining Svend Brorsen 0.6 0.5 4.0 15 1991-Total for: Belize 0.6 0.5 4.0 15BoliviaBera de Bolivia Fabricated metal products Paul Bergsøe/EAC 0.6 0.7 32.0 20 1976-1987Hielo Seco Chemical industry Hydrogas Danmark 2.9 3.6 16.0 25 1989-Total for: Bolivia 3.4 4.4 48.0 45BrazilBiotropical Agriculture and farming Chr. Hansens Laboratorium 8.5 13.8 65 1988-1997Cáceres Florestal Forestry Dalhoff Larsen & Hornemann 5.1 8.6 138.0 350 1990-Capricórnio Florestal Nature park Verdensnaturfonden 0.7 3.7 12 1993-1996Danfoss do Brasil Machinery and equipment Danfoss International 10.0 30 1987-1994Danfrio Refrigeration equipment Brødrene Gram 5.1 3.0 10.0 50 1972-1983Danica Tupiniquim Machinery and equipment Per Barke Nevermann 0.0 2.2 21.5 245 1992-Design 2000 do Brasil Furniture Danish Design Group 7.2 17.0 70 1996-1998FLS Comercio Cement machines FLS-Industries 10.6 17.5 55.0 200 1975-1984Gerstenberg Machinery and equipment Gerstenberg & Agger 3.3 1.2 9.0 4 1989-1996Glunz & Jensen Electrical machinery/equip. Glunz & Jensen 2.0 25 1983-1983Grindsted Food and beverages Danisco Ingredients 13.3 1.1 30.0 30 1986-1993Hartm.-Mapol Montes Claros Pulp and paper products Hartmann-Mapol 85.0 100 1997-Hartmann-Mapol Pulp and paper products Brdr. Hartmann 36.5 86.0 500 1995-Hempel Tintas Paints Hempel 0.4 0.4 16.0 50 1970-1976Kongskilde Machinery and equipment Kongskilde Industries 0.8 1.5 7.0 50 1973-1981Mapol Pulp and paper products Brdr. Hartmann/EAC 11.4 4.9 57.0 400 1970-1986Multiwing Machinery and equipment F.S. Andersen 2.0 2.0 10 1979-1987Nordisk do Brasil Chemical industry Novo Nordisk 1.8 5.0 2 1984-1992Nordisk Timber Wood products Dalhoff Larsen & Hornemann 9.4 62.5 151 1994-Sabroe do Bahia Refrigeration equipment Sabroe do Brasil 1.0 7 1990-1993Sabroe Export Refrigeration equipment Sabroe do Brasil 0.0 1 1985-1997Sabroe Marine Service Refrigeration equipment Sabroe do Brasil 1.0 25 1991-1993Sabroe Montagens Refrigeration equipment Sabroe do Brasil 0.0 71 1992-1997Sabroe/York do Brasil Refrigeration equipment York Refrigeration 6.2 39.2 83.0 650 1981-Sul Americana Refrigeracäo Refrigeration equipment Sabroe do Brasil 0.0 39.0 50 1997-1999Aalborg Industries Fabricated metal products Aalborg Industries 5.8 2.7 25.0 130 1991-Aalborg Pontin Fabricated metal products Aalborg Værft 11.3 1.7 18.0 80 1978-1984Total for: Brazil 122.2 101.4 797.5 3,358ChileCopenhagen Smokehouse Food and beverages Vendsyssel Denmark 0.7 4.5 40 1996-1999Sabroe de Chile Refrigeration equipment Sabroe do Brasil 1.8 2.9 25 1992-1997Segetrans Trucking J. Lauritzen 4.2 13.9 50 1994-1999Segetrans Transporte Trucking J. Lauritzen (Chile) 9.4 25.9 6 1999-Total for: Chile 0.7 15.5 47.2 121ColombiaCementos Rioclaro Cement production FLS-Industries 10.4 18.2 1,000.0 230 1983-1995Coldin Fishing I. Krüger Engineering 1.6 11.2 25 1987-1992Plumrose Madrileña Meat processing EAC 6.1 66.0 200 1995-1999Sabroe de Colombia Machinery and equipment Sabroe do Brasil 1.2 2.3 20 1997-1999Total for: Colombia 18.1 19.4 1,079.5 475CubaDinaFeed Feed mill DinaCuba Holding 1.3 16.0 25 1999-Total for: Cuba 1.3 16.0 25Dominican Rep.Indulac Dairy Emidan 2.7 1.9 21.0 110 1971-1978Total for: Dominican Rep. 2.7 1.9 21.0 110EcuadorDan Química Chemical industry Rustfri Stålmontage 13.2 32.4 80.0 70 1979-1998Ecudina Agriculture and farming Holsted Tørrestation 5.1 13.3 25.0 20 1980-1986PECS-DESMI Oil pit cleaning De Smithske 3.3 13.2 46 1996-1998Scanform Construction Scan-Form 0.1 1.0 5 1980-1981Total for: Ecuador 18.4 49.0 119.2 141GuatemalaCementos Progreso Cement FLS-Industries 59.5 855.2 700 1997-Total for: Guatemala 59.5 855.2 700GuyanaGuyabreed Agriculture and farming Cerekem 2.4 10.7 35.0 15 1987-1995Total for: Guyana 2.4 10.7 35.0 15

LATIN AMERICA

24



25



IFU participation is the sum of IFU’s contracted investment in the project company until the balance sheet date. Investment in shares includes overrun commitments and investment in loans includes issued guarantees. Total investment is the total investment in the project company as foreseen in the project agreements. The number of employees is the number expected to be employed according to the budget of the investment agreement.IFU’s participation in a project ends when either IFU has disposed of its assets in the project company or IFU’s contractedobligation towards the project company is legally liquidated.

IFU investment through a holding company: ❖ Operation discontinued: *

JamaicaGolf Beach Hotels and restaurants H. Hansen & P. Pedersen 0.2 2.5 5.0 50 1970-1976Total for: Jamaica 0.2 2.5 5.0 50MexicoAlta Tecnologia Dairy Niro de Mexico 9.9 12.5 39.2 107 1994-1999Biblomodel Furniture B.C Inventar 5.5 27.0 181 1981-Carpur Feed lot Niro de Mexico 5.0 25.0 70 1993-Danfoss de Mexico Compressors Danfoss 49.9 575.0 800 1996-La Campiña Dairy Niro 12.7 95.0 270 1988-1991Lacpur Dairy Niro de Mexico 11.9 17.1 39.0 70 1993-Monica’s Food Dairy Niro de Mexico 10.3 5.8 27.9 108 1994-1999Nordisk de Mexico Chemical industry Novo Nordisk 1.8 5.0 15 1984-1988Palmex Food ingredients Palsgaard Industries 3.1 6.0 11 1996-Pescado Chiapas Fishing/fish processing Atlas-DK 6.5 240.0 650 1982-1984Prolac Dairy Niro de Mexico 4.3 6.1 19.4 73 1995-Rosti de Mexico Plastic products Rosti 30.8 90.0 300 1998-Sabroe de Mexico Refrigeration equipment Sabroe do Brasil 1.3 2.0 20 1991-1999Santa Lucía Vegetable oil refinery Aarhus Oliefabrik 30.6 391.3 300 1992-Total for: Mexico 71.1 154.1 1,581.8 2,975NicaraguaENISA Wind mill farm No Danish partner 0.4 0.7 5 1998-Total for: Nicaragua 0.4 0.7 5PanamaMærsk Jupiter Oil exploration A.P. Møller 26.7 85.7 25 1994-1999Mærsk Mercury Oil exploration A.P. Møller 20.7 110.7 25 1994-1999Mærsk Sirius Oil exploration A.P. Møller 39.5 202.0 250 1997-PECS-DESMI Holding ❖ Oil pit cleaning De Smithske 1.7 6.8 3 1996-1998Total for: Panama 88.5 405.2 303ParaguayCesusa Brewery Carlsberg International 12.0 0.2 70.0 91 1990-1996Total for: Paraguay 12.0 0.2 70.0 91PeruAgroindustria Danper Agriculture and farming Wiik & Co. 0.1 1.0 50 1985-1988Danper Trujillo Asparagus processing Arne Berg 2.1 8.4 15.5 300 1991-Fima Machinery and equipment Atlas-Stord 8.6 266.3 500 1999-Sabroe de Peru Refrigeration equipment Sabroe do Brasil 1.3 5 1995-1997Total for: Peru 2.2 16.9 284.1 855UruguayAstra Fishing/fish processing Lauritzen Holding 14.9 17.0 280.0 1,200 1982- *Cosmos Trawl Production of trawls Cosmos Trawl/Randers Reb 0.3 3.0 4 1999-Gley Cheese powder Lactosan 5.0 20.0 10 1991-1996Mvd Int. Container Terminal Port terminal A.P. Møller 38.9 193.0 80 1998-Oceanica Fish processing Lauritzen Holding 10.0 600 1987-1991Total for: Uruguay 14.9 61.2 506.0 1,894VenezuelaAFI Pig breeding Plumrose Latinoamericana 14.3 66.0 42 1998-Haustrup Venezolana Fabricated metal products PLM Haustrup 6.6 5.7 84.0 105 1980-1994PECS-DESMI-CPVEN Oil pit cleaning De Smithske 0.7 5 1997-1998Plumrose Latinoamericana Processed meat products EAC 23.5 961.8 3,000 1996-Total for: Venezuela 20.9 29.2 1,112.5 3,152Total for: LATIN AMERICA 308.7 639.7 7,186.3 14,519

Grand total: 2,064.1 1,706.5 38,738.1 68,691

26

A Pre-launch Check-upIn order to improve the quality andprofitability of investment projects,IFU, IØ and IFV (the Danish Inter-national Investment Funds) haveestablished a new service for its part-ners. The initiative is mainly direct-ed at small and medium-sized part-ners.

Background

World-wide experience shows thatjoint ventures by small and mediumsized enterprises often have disap-pointing results. Statistics from IFUand IØ confirm this finding: Re-turns from small companies are low-er than returns from larger invest-ments.

This is often due to a lack of man-agerial experience in working in for-eign markets, under-capitalisationand overestimation of sales poten-tial. Among other factors are differ-ent expectations between partnersand a lack of shared strategy.

Action Up-front

The Danish International Invest-ment Funds have decided to tacklethe problems up-front by proposingthat all potential partners reviewtheir business plans prior to com-mitting capital to their projects.This is done at a so-called Pre-Invest-ment Meeting (PIM).

A PIM is a workshop, where allstakeholders have the opportunityto discuss all the conditions and airany concerns openly.

The Agenda

An independent facilitator draws upthe agenda in consultation with thepartners. He or she would ensurethat the various partners bring upany outstanding issues of impor-tance to the project’s implementa-tion. The facilitator also leads thePIM. By choosing an independentperson for this task, all partners areassured of an equal opportunity to

discuss and debate the issues and nosingle partner is allowed to domi-nate the discussion.

The facilitator would also presentthe conclusions of the workshop,often including the drafting of anaction plan. It would however be thepartners’ task to take care of the fol-low-up.

Efficient

By the end of 1999 about 20 PIMshad been conducted. An indepen-dent evaluation carried out at therequest of the Danish InternationalInvestment Funds found that a PIM,according to the partners, increasesthe chances for a project’s success.

The evaluation report even suggest-ed that PIMs should be conductedin projects with stronger partners, if it is felt that the partners have not dealt adequately with all keyissues.

The PIMs were found to be efficientin exposing “hidden and burning”issues and resolving them in anamicable manner. The evaluationreport further described the PIM asa “last call” for a “reality check” for all partners prior to final commit-ment.

Pre-Investment Meeting in China, January 1999.

Department for projects inAfrica and Latin America

Department for projects in Asia and the Middle East IFU Advisers

Corporate Affairs Department

Morten ChristiansenDepartment Director

Alma AndradeTrainee

Henrik ScheinemannDepartment Director

Rena ChenInvestment Officer

Elisabeth I. HansenInvestment Officer

Mohamed AhmedCairo, Egypt

Kodjo AziagbéLomé, Togo

Joti BhokavanijBangkok, Thailand

Riyaz BokhariLahore, Pakistan

Jette Hansen BlomquistLima, Peru

Nigel BremnerNairobi, Kenya

Isabella CarlsenAccra, Ghana

Roberto FernandezMontevideo, Uruguay

Thomas FrøhlichHavana, Cuba

Meriç GemayelIstanbul, Turkey

Geert Lassen HolmArusha, Tanzania

Bjarne Rørbæk JensenSão Paulo, Brazil

Hemming JørgensenLuxembourg

Armando MartinezMexico City, Mexico

Jørgen MelchiorDenmark

José M. RuisánchezWashington D.C., USA

Flemming RickforsHong Kong

Peter RasmussenSuzhou, China

Robert SatchwellDar Es Salaam, Tanzania

Poul WeberBangkok, Thailand

Anand K. SethiNew Delhi, India

Bendt StarupSingapore

Nguyen Tuyet MaiHo Chi Minh City, Vietnam

Bjørn JakobsenDepartment Director

Jens RixenLegal Adviser

Regional office in Harare Representative office in Beijing

Liaison office in Chennai (Madras)

Michael HedegaardInvestment Officer

Henrik JepsenInvestment Officer

Erik LarssonInvestment Officer

Jørn Fredsgaard SørensenInvestment Officer

Kesavan NarayananInvestment Officer

Henrik StarupInvestment Officer

Anders BjørnshaveEnvironmental Adviser

Clea H. GebaraEnvironmental Officer

Tayengwa MasawiInvestment Officer

Hans-Jørgen M. NyegaardRegional Representative

Brighton MatsikireInvestment Officer

Jens C. HøgelResident Representative

Hong JiangInvestment Officer

Niels EvendtDepartment Director

Henning WongIT Officer

Søren HeilmannIT Officer (Systems)

Bente LarsenLibrarian

Regional office in Mexico City

Peter KilianRegional Representative

Martin M. KristensenResident Representative

Sridhar SampathInvestment Officer

Sudhir DravidInvestment Officer

IT Department

Environmental Unit

Service Unit

Board of Directors

Johannes PoulsenManaging Director

Vestas Wind Systems A/S

Kirsten FjordDeputy Managing Director

Tele Danmark A/S

Lars AndersenManaging Director

The Economic Council ofthe Labour Movement

Niels Chr. KnudsenChairman

Albani Bryggerierne A/S

Lars KolteDeputy Director General

Danish Agency for Trade and Industry

Eva ParumManaging Director

Service Udvikling A/S

Friis Arne PetersenPermanent Secretary,

AmbassadorMinistry of Foreign Affairs

Kjeld RanumManaging Director

Århus Oliefabrik A/S

Birger Riis-JørgensenUnder Secretary,

AmbassadorMinistry of Foreign Affairs

Board of Management

Sven RiskærManaging Director

Jørgen Dan JensenDeputy Managing Director

Frank Norman LarsenDeputy Managing Director

Deputy ChairmanChairmanFinance Department

Niels Gravgaard LaursenDepartment Director

Peter HoveChief Accountant

Birthe MikkelsenChief Cashier

Martin RømerFinance Officer

Deepa HingoraniInvestment Officer

Ingelise SaundersManaging Director

Novo NordiskPharmaceuticals Ltd. (UK)

The Industrialization Fund for Developing Countries (IFU)

Bremerholm 4DK-1069 Copenhagen KDenmarkTel.: +45 33 63 75 00Fax: +45 33 32 25 24E-mail: [email protected]: www.ifu.dk

IFU’s Regional Office in Zimbabwe

IFU – Harare11th floor, NSSA House77 Park Lane Harare – ZimbabweTel.: +263 4 250621 - 3Fax: +263 4 250625E-mail: [email protected]

IFU’s Regional Office in Mexico

IFU - Mexico CityApartado Postal 20-753San Angel 0100101730 Mexico CityMexicoTel.: +(525) 635 7150Fax: +(525) 635 6676E-mail: [email protected]

IFU’s Representative Office in China

IFU - BeijingRm 1815, China Travel Service Tower (CTST)No. 2 Beisanhuan East RoadBeijing 100028, ChinaTel.: + 86 10 6461 2423

+86 10 6460 9797Fax: +86 10 6460 9799E-mail: [email protected]

IFU’s Liaison Office in India

IFU – Chennai (Madras)8th Floor, Temple Tower476 Anna Salai, NandanamChennai 600 035IndiaTel.: +91 44 432 1979Fax: +91 44 432 1980E-mail: [email protected]

ISSN 0901-6171

IFU as a partnerOn terms with its partners

Experience

Project financing

Terms of investment

Financing of training

Continued support

Termination

IFU prefers to consider each project proposal on its merits indirect dialogue with the potential partner companies.

IFU strives to work on the terms of its private partners in develop-ing countries and in Denmark.

In its recruitment of staff, preference has been given to peoplewith working experience in private companies.

Flexible and unbureaucratic are adjectives which IFU tries its bestto live up to.

During the preparatory work, IFU’s partners can benefit fromIFU’s investment experience. More often than not, IFU has priorexperience and liaison with the authorities and the financial andprivate sectors of the host country.

Due to IFU’s close contacts with Nordic, European, internationaland local financing institutions, IFU will often suggest supple-mentary financing proposals which will help securing the best pos-sible financing of the project.

IFU’s aim is to invest in financially viable projects in co-operationwith Danish companies and partners in the host countries.

IFU can finance by share capital and/or by granting loans up to25% of the total investment including working capital.

IFU can finance up to 30% of the share capital. As a general rule,IFU’s part of the share capital will not exceed that of the Danishpartner.

Loans are typically granted for a period of up to 5 years, often witha grace period depending on e.g. the projected cash flow require-ment. The loans are offered on commercial terms.

Equity loans and guarantees for loans from other sources can alsobe offered.

Training and education of personnel in the project company isoften a condition for business success. IFU administers a specialfund for such purpose, which has been established by Danida(Danish International Development Assistance). On a grant basisit provides financing of training programmes on projects with IFUparticipation.

IFU takes a seat of the board in the project company.

The shares are normally offered for sale to the partners, when IFUwithdraws from the project after 5-7 years, when the project com-pany is consolidated.

Gujarat Sidhee Cement Limited,India.

Danish International Investment Funds,Copenhagen, March 2000

Text consultant: TextPartner ApS

Photographic credits: Pages 9, 10: Jesper JespersenBack pages: Nordfoto, Polfoto, Jesper JespersenOthers: IFU and partner companies

Graphic production: Levison+Johnsen+Johnsen a/s, Denmark 541 023

1999 annual report purpose of operations · also in the commonwealth of independent states (cis)....

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