PSI: Private Sector Investment Programme

Funding Opportunity by the Netherlands for Private Sector

What is PSI

• The goal of PSI is to promote sustainable economic development by means of stimulating innovative pilot investments in developing countries.

• The project must contribute to a long term cooperation between the two companies. For that: – After the project period, the companies need to make

additional investments that contribute to further growth of revenue and employment.

How Much Funding is Offered

• For 2013 a budget of 90 million euro is available.

• The maximum project budget for a PSI project is EUR 1.5 million.

• For PSI Plus, the contribution is 60 percent of the project budget.– As a result, the maximum contribution is EUR

900,000

How the Funding is Made

• PSI projects are result-based. This means that the grant is disbursed upon the realization of results that are determined before the start of the project.

• PSI Plus offers more flexible conditions for projects in Afghanistan, Burundi, the Democratic Republic of the Congo, Pakistan, the Palestinian Authority, Sierra Leone and southern Sudan.

What is Being Subsidized

• Costs for sustainable capital goods (hardware), which will be used for the production process, excepting existing buildings and land;

• - Costs for technical assistance, such as project management, training, advisory costs, certification.

Project’s Funded in PakistanProduction of Calcium Chloride Prills

Nivoba B.V., Veendam, The Netherlands

Ittehad Chemicals Limited, Lahore, Pakistan

EUR 947,000

ProFarm Pakistan Ltd CRV Holding B.V., Arnhem, The Netherlands

ProFarm Pakistan Ltd, Lahore, Pakistan

EUR 1,009,587

Fine fragrance and flavour extract manufacturing withbenign solvent extraction

Feyecon Development & Implementation B.V., Weesp, The Netherlands

Kasur Straw Board Factory, Lahore, Pakistan

EUR 540,000

Muta Pakistan Project (MPP), Production and sublimation ofsportswear

Muta Sport B.V., Leeuwarden

Capital Sports Corp. (PVT) Ltd, Sialkot, Pakistan

EUR 775,000

Feed for Milk Trouw Nutrition International B.V., Putten, The Netherlands

Vandana Limited, Sheikhupura, Pakistan

EUR 845,350

Project Steps

STEP 1: DISCUSSING YOUR PROJECT IDEA

– have identified a challenging but realistic opportunity for a long-term investment in a developing country.

– believe the investment is innovative for the country in question.

– You have a local company as an investment partner

– the risks are high and as a result, commercial financing is not available.

STEP 2: APPLICATION

• PSI is a tender programme. This means that applications compete with one another in an open competition, held twice a year.

• For PSI Plus, competitions are held three times a year. In 2010, :– 8 February, – 23 August, always closing

Results

• The PSI grant is result-based. This means that the grant will be provided in phases upon realisation of a number of results. In the application form you are asked to divide your project into a maximum of five clearly defined results, grouped according to activity and spread over the duration of the project.

• These general results should then be divided into more detailed sub-results with corresponding means of verification.

Corporate Social Responsibility (CSR)

• An overview needs to be given concerning the current CSR policies of the companies involved in the application. In addition the applicant company either needs to include a CSR policy with the application or submit with the First Project Result. Furthermore, you are asked to include CSR-related (sub-)results in your application.

• Special attention should be paid to the theme child labour and/ or forced labour.

STEP 3: EVALUATION• This assessment will take approximately 19 weeks.• The application must have a sufficient score on each of the

three main categories of criteria (Partners, Project and Impact). Apart from a good overall score on the main criteria, there are a few sub-criteria which are considered crucial.

• Applications will be rejected if they fail to meet the criteria on financial standing of the partners (1E), innovative character of the project (2B), potential for growth of the project after completion (3A), chain effects (3D), environmental impact (3E), or position of women(3F).

• The maximum project duration is 30 months.

Step 4: Subsidy granting and implementation

• Subsidy granting• Progress reporting• If the period between the completion of two results is

more than 6 months, an intermediary progress report should be submitted. In this report, the applicant should update NL EVD International on the implementation of the project and possible problems encountered.

• Advance payments• Fixing of subsidy• Information after fixing

Step 5: Monitoring• During the course of the project, NL EVD International will

monitor project progress on the basis of the progress reports provided upon completion of the results, or at least every six months if the period between two results is longer than six months. Regular visits to the project location and to the partners also constitute part of the monitoring process.

• A Project Advisory Committee (PAC) meeting will be organised at least once a year to discuss project progress. This meeting will be attended by the applicant, the local partner, possible third partners and the PSI Project Officer. The Dutch Embassy of the country in question and the local authorities will also be invited to these meetings.