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Tina Kollerup Hansen, Investment Director

DBDH Seminar

5 December 2017

To get previous design

Subsidised, tied loans for investments in sustainable infrastructure which has limited access to commercial markets

DANIDA BUSINESS FINANCE AT A GLANCE

The financing is partly ODA (subsidy), partly from a commercial Bank (commercial)

Total outstanding commitment is DKK 4.022 billion

Financing Annual frame (finanslov) (DKK million)

WHAT?

FL17 FFL18

2017 2018 2019 2020

250 325 400 400

ELIGIBLE COUNTRIES

✓ DAC countries✓ GNI/capita max USD 4.035✓ Danish representation

Now also when in relation to IFU investments!!

IFU Board Meeting12/11/2017PAGE 2

To get previous design

DBF Strategic Principles

for project selection• Non-commercially viable

• Focus countries (income level – DK representation)

• Country development strategy and sector plan in place

• Complementarity and synergy

• Acceptable guarantor/preferably Ministry of Finance

• Project related criteria:

• Projects will be assessed on the contribution to the SDGs, life cycle cost and

sustainability including IFC standards and UNGP

• Projects should have a minimum size of preferably DKK 100 million. Upper limit

depends on budget available.

• Involvement of Danish companies that are competitive based on “life cycle

cost”:

To get previous design

DANIDA BUSINESS FINANCE

SUBSIDY

• INTERESTS DURINGIMPLEMENTATION AND

REPAYMENT PERIOD

• EXPORT CREDITPREMIUM

• MARGIN TO DANISHLENDING BANK

• CASH GRANT

CONTRACT AMOUNT LOAN AMOUNTTO BE REPAID BYBORROWER/BUYER

TO BE PAID BY DANIDABUSINESS FINANCE(TOTAL DANIDA SUBSIDY)

+ COMMITMENT AND

MANAGEMENT FEES TO DANISH

LENDING BANK

TO BE PAID BYBORROWER/BUYER

DANIDA BUSINESS FINANCE - SET UP

PROJECT IMPLEMENTATION

6

- Monitoring and Verification Consultant

- Quarterly reports from Contractor

- Verification at taking over

- Verification at End of Defect Liability

- Reports on results and indicator for 5 years after taking over

- Verification and review after 5 years (project completion report)

LOAN CONDITIONS

• 10 YEARS REPAYMENT AFTER “TAKING OVER” WITH 6 MONTHS GRACE PERIOD

• LOANS IN EUR OR USD

LOAN MATURITY PERIOD AND CURRENCY

• MINISTRY OF FINANCE MUST ACT AS GUARANTORGUARANTEE

• BUYER, BORROWER AND SUPPLIER MUST SIGN DANIDA

DECLARATIONSDECLARATIONS

• BI-ANNUALLY INSTALMENTS OF THE FINANCED AMOUNT LESS

THE CASH GRANT

• COMMITMENT FEE (SHALL NOT EXCEED 0.25 % P.A.)

• MANAGEMENT FEE (SHALL NOT EXCEED 0.375% FLAT)

TO BE PAID BY THE BORROWER

APPROVAL PROCEDURE

Implementation

Final approval of support from Danida Business Finance

Contract and Loan agreement

Procurement - carried out by buyer

Approval in Danida’s Council for Development Policy

Appraisal

Feasibility study – supported by Danida Business Finance

Screening of project in Danida’s Programme Comittee

Identification

Danida Business FinanceMetro Fiber Networks and Cloudband, Burkina Faso (50% subsidy)

Contract amount: 55.7 million EUR

Cash grant: 15.5 million EUR

Loan amount: 40.2 million EUR

93 MW Wind power project in Santa Cruz, Bolivia – in tender (35% subsidy)

Estimated contract amount: 118.3 million EUR

Estimated cash grant: 26.3 million EUR

Estimated loan amount: 92.0 million EUR

Danida Business Finance

Country Project titel Sector

Contract

(1,000 kr.)

Grant

(1,000 kr.)

Bolivia Warnes, San Julian and El Dorado Wind Projects Wind 854,920 366,000

Vietnam Son La Radio Comm. 44,624 22,500

Vietnam Vi Thanh Drainage and Water Treatment Project Water 86,200 33,800

Ghana Road Bridges in Northern Ghana Transport 380,000 178,690

Bangladesh Saidabad III Water 1,350,000 976,600

Bangladesh Saidabad I upgrading Water 126,474 63,237

Kenya Thika and Githunguri Water & Sanitation Improvement Project Water 350,000 122,500

Tanzania Waste management Facilities in Dar es Salaam Env. 45,000 22,500

Tanzania Sewerage Treatment Project in Dar es Salaam Water 1,138,266 569,133

Pakistan Faislabad Waste Water Treatment Plant Project Water 750,000 262,500

Uganda Kampala South Water Treatment Plant Project Water 700,000 350,000

Uganda Hoima and Masindi Water & Sanitation Project Water 350,000 175,000

Ethiopia Assala Wind Power Project Wind 1,264,740 632,370

Total 7,440,224 3,774,830

DBF pipeline

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Tina Kollerup Hansen

Investment Director

Tel: +45 33 44 12 35

TKH@ifu.dk

www.dbfinance.um.dk

IFU

Fredericiagade 27

1310 Copenhagen K

Denmark

Tel. +45 33 63 75 00

Fax +45 33 63 75 99

ifu@ifu.dk

www.ifu.dk

Further contacts: