10 Years of EPSA. (Enhanced Private Sector Assistance for Africa) Initiative ( ) NSL: Non-Sovereign Loans From the People of Japan

Transcription

1 10 Years of EPSA (Enhanced Private Sector Assistance for Africa) Initiative ( ) NSL: Non-Sovereign Loans From the People of Japan ACFA: Accelerated Co-financing Facility for Africa FAPA: Fund for African Private Sector Assistance Prepared on the occasion of TICAD 6 held in Nairobi, Kenya 2016 Photography by Andrea Borgarello

2 What is EPSA? The Enhanced Private Sector Assistance (EPSA) Initiative is an innovative, multi-component, multi-donor framework for resource mobilization and development partnership to support implementation of the ADB s Strategy for Private Sector Development. Drawing on successful development experience in Asia and around the globe, EPSA was conceived in partnership with the Government of Japan (GOJ), which has provided generous financial support to its implementation since Components of EPSA: EPSA consists of (1) Accelerated Cofinancing Facility for Africa (ACFA), (2) Non-Sovereign Loan (NSL), and (3) Fund for African Private Sector Assistance (FAPA), as shown in the diagram below. What is ACFA? ACFA is a sovereign co-financing arrangement between the ADB and the Japan International Cooperation Agency (JICA). JICA may offer preferential terms to borrowers under this scheme (see JICA s website for its "Preferential Terms ). For Joint co-financing, ADB acts as Lender s agent, providing project appraisal and loan administration services for a fee. So far, there have been 21 projects approved totaling more than USD 1.4b from JICA, USD 3.3b from ADB and Total Project Cost of USD 6b mainly in the Transportation and Energy Sectors. What is NSL? NSL is a line of credit from JICA to the Bank on concessional terms for financing the Bank s private sector operations. So far, there have been 6 NSLs, totaling USD 1.2b equivalent, starting from NSL1 in 2007 to NSL6 in In principle, although the resources are pooled with the other financial resources of the Bank and subject to normal Bank processes (including eligibility and pricing), the Bank attributes the utilization of NSL proceeds to specific operations. Thus far, 33 projects totaling USD 1.8b of ADB approvals have been endorsed with Total Project Cost of more than USD 7b. Major projects include Credit Lines and Equity to Regional DFIs, Private Equity Funds, and Project Finance for Infrastructure PPPs etc. 2

3 What is FAPA? FAPA is a Trust Fund for technical assistance and capacity building for the Bank s public and private sector clients. Current volume of the fund: USD 72m; Financial contributors: Government of Japan (USD 59m: 82%), ADB (USD 10m; 15%) Government of Austria/ Development Bank of Austria (Total Euro 3m: 3%). So far, 62 projects have been approved, bringing total FAPA commitments to USD 52m. FAPA projects support implementation of the three key pillars of the ADDB s Private Sector Development Strategy: Improving the Investment & Business Climate; Provision of Social & Economic Infrastructure; and Enterprise Development. General Statistics of EPSA Achievements EPSA Phase 1 ( ) was USD 1b, which was achieved in EPSA Phase 2 ( ) has a target of USD 2b. Below shows the cumulative EPSA Achievements. Under EPSA2, nearly USD 1.7b has been achieved, and there are more than USD 400m the immediate pipeline to be approved soon, making EPSA2 highly achievable in the near future, giving way for replenishment for EPSA3 in the occasion of TICAD6. Unit: million USD ACFA NSL FAPA Total # of projects amount # of projects amount # of projects amount amount EPSA1 ( ) , EPSA2 ( ) , , , ,

4 (1) ACFA Approvals Unit: million USD Country Project Sector Approval Date (JICA) Total Project Cost JICA AfDB 1 Senegal Road Improvement and Transport Facilitation Program on the Southbound Bamako-Dakar Corridor (Bank: Senegal, Mali) Transport 31-Mar Tanzania Arusha Namanga Athi River Road Development Project (Bank: Tanzania, Kenya) Transport 9-Mar Mozambique Montepuez Lichinga Road Project Transport 19-Mar Uganda Bujagali Interconnection Project Energy 30-Oct Cape Verde Power Supply, Transmission and Distribution Project in Santiago Island Energy 25-Mar Cameroon Transport Facilitation Program for the Bamenda-Enugu Corridor (Bank: Cameroon, Nigeria) Transport 31-Mar Mozambique Nacala Corridor Phase I (Bank: Mozambique, Malawi) Transport 10-Mar Uganda Nile Equatorial Lakes Countries Interconnection line (Bank: Burundi, Rwanda, Uganda, Kenya, DRC) Energy 26-Mar Tanzania Road Sector Support Project Transport 31-May Tanzania Iringa-Shinyanga Backbone Transmission Investment Project Energy 13-Dec Cameroon The project to Strengthen and Extend the Electricity Transmission and Distribution Networks Energy 4-Mar (Subtotal EPSA 1) 2, ,

5 Unit: million USD Country Project Sector Approval Date (JICA) Total Project Cost JICA AfDB 12 Cape Verde Electricity Transmission and Distribution Network Development Project Energy 30-Mar ,14 Botswana, Zambia Kazungula Bridge Project Transport 12-Oct Tanzania Road Sector Support Project II Transport 8-Apr Mozambique Nacala Corridor Phase III Transport 29-Nov Cameroon Batchenga Lena Road Development Project Transport 7-Apr Angola POWER SECTOR REFORM SUPPORT PROGRAM (PSRSP) Energy 17-Aug , Tanzania Kenya-Tanzania Power Interconnection Project Energy 15-Jan Morocco Green Morocco Plan Support Program (DPL) Agriculture 4-Mar Rwanda Rusumo-Kayonza Road Improvement Project Transport 13-Jul (Subtotal EPSA 2) , (Total EPSA) 6, , ,

6 (2) NSL Endorsed Projects Project Name Country Type Pillar Approved ADB Amount Unit: million USD Total Project Cost 1 Access Bank of Nigeria Nigeria LOC FI/SME Zenith Bank Nigeria LOC FI/SME Bujagali Uganda LOAN INFRA Sahanivotry Hydro Madagascar LOAN INFRA RASCOM Regional LOAN INFRA Access Bank* Tanzania EQ FI/Micro TCX Multinational EQ FI EASSy* Multinational LOAN INFRA BOAD* Multinational LOC FI BCI Mauritania LOC FI/SME EVHA (Health Fund)* Multinational EQ FI/SME Investrust* Zambia LOC FI/SME Lekki Nigeria LOAN INFRA Mauritania Leasing* Mauritania LOC FI/SME MPEF II Multinational EQ FI/SME Zanaco* Zambia LOC FI/SME Lake Harvest Aquaculture Zimbabwe LOAN AGRI AAF Regional EQ AGRI Agri Vie Regional EQ AGRI Citadel Fund Regional EQ FI WAEMF Regional EQ FI/SME Takoradi II Ghana LOAN INFRA SME APEX Facility* Tunisia LOAN FI/SME ATI* Regional EQ FI/SME OLAM Nigeria LOAN AGRI AFC Regional LOC FI , EADB* Regional LOC FI/SME EADB* Regional EQ FI/SME PTA Bank* Regional LOC FI/SME Afeximbank Regional LOC FI/SME BOAD* Regional LOC FI/SME Africa SME Program* Regional LOC FI/SME Subtotal EPSA2: EPSA Total: , , , *These projects/clients are also supported with technical assistance funded by FAPA 6

7 (3) FAPA Approvals Unit: USD Country Project Name Approved Amount Abstract 2012 Subtotal EPSA1 ( ) 28,624, Tanzania Entrepreneurs Financial Center Uganda Entrepreneurs Financial Center Regional Inclusive Industries Program 2012 To support the capacity development and ins- 935,526 titutional strengthening of a green-field national microfinance institution in Tanzania. To support the capacity development and ins- 935,464 titutional strengthening of a green-field national microfinance institution in Uganda To contribute to the establishment of an Inclu- 1,000.,000 sive Industries Programme (IIP) Regional ECOWAS Bank for Investment and Development , Regional Credit Analysis and Research Africa Regional East African Development Bank Regional TA Support to SME focused FIs benefiting from the Africa SME Program Senegal VoLo Africa Trust Information and Credit Bureau Pilot Tunisia BFPME: Boosting Private Sector Development through Small and Medium Enterprise Creation and Expansion Rwanda Skills development in the energy sector Regional To strengthen the strategic direction, human capacity and resources of the institution to enable EBID to deliver on its development mandate To facilitate the establishment of SME credit 250,000 rating agencies in five African countries under the sponsorship To strengthen EADB s capacity to enable it 915,000 deliver its development mandate more effectively and efficiently To provide Technical Assistance (TA) and ca- 3,978,367 pacity building to up to 20 smaller SME focused financial institutions (FIs) To facilitate financial inclusion and improve the 284,472 efficiency of SME financing in Senegal and Gambia 950,000 To stimulate the creation and growth of Small and Medium Enterprises (SMEs) To increase the competitiveness and produc- 800,000 tivity of public and private companies operating in the energy sector 491,150 To contribute to increased investment for port development under PPP scheme 46 Regional Africlear Regional Support to African Seed Companies Ghana Ghana SMEs Business Linkage Program 2014 The purpose of the project is to reduce the 400,000 costs of investing in African securities through lower costs of safekeeping, dividend, interest To provide Business Development Services for 1,000,000 at least 54 seed companies supported by the Program for Africa s Seed Systems (PASS). To help local SMEs in Ghana access new mar- 1,000,000 kets and access finance, ultimately supporting inclusive private sector growth in Ghana. 49 Identification of Bank Interventions for PPP Port Projects Seychelles 50 Regional Microfinance Training Course for Policy and Development Mozambique Cote d'ivoire Seychelles MSME Development Project 2014 Building Climate Resilience in the Limpopo Basin Project Support for Entrepreneurship Development 2014 To enhance growth of Seychelles micro, small and medium enterprises (MSMEs), in order to promote inclusive growth To contribute to improving regulatory frame- 250,000 works and management of the microfinance industry in the COMESA region To foster private investment in water infra- 941,274 structures and promote SME development in the agricultural value chains To promote private sector development; 947,625 create a better climate for investments and inclusive growth; 7

8 Liberia Access Bank Liberia , Regional Intra African Investment , Ethiopia Capacity Building for Financial Inclusion in Ethiopia ,000 To support private sector development in Liberia through sustaining and broadening access to finance for MSMEs The project will finance: main study on the scale, trends, composition of IAI, and impediments To advance financial inclusion and improve the efficiency of the participating five Ethiopian MFIs in Ethiopia 56 Togo The Kara and Lome Market Reconstruction and Traders Support ,146 To contribute to revitalizing and modernizing the women market traders in Lome and Kara markets 57 Zimbabwe Support to the beef and leather value chain ,000,000 Support the growth of the beef and leather sub-sector value chain 58 Morocco Management of Rural Water Supply Facilities by Private Contractors ,000 Pilot project for developing an output based PPP for the operation and maintenance of water supply facilities Regional 60 Regional/ West Africa Microfinance Training Course for Policy and Development ,980 Volo-CreditInfo (in 10 West African Countries) , Liberia Youth Employment & Entrepreneurship Program ,000, Burkina Faso Integrated Support to Shea Butter Sector for Women Economic Empowerment ,350 Subtotal EPSA2 ( ) 23,416,754 EPSA Total 52,041,076 To support policy-oriented microfinance training to ultimately improve MSME access to finance in the COMESA region. To deepen financial markets and access to finance by MSMEs in 10 West African countries To develop skills for youth employability and entrepreneurship To strengthen the shea butter value chain and build the capacity of women cooperatives 8

9 What has it brought to Africa? 1 Net Economic Benefit (NPV): roughly USD 4,700m; 2 Infrastructure Development: Roads nearly 4,000 kms; Generation more than 600 MWs; Transmission Lines roughly 2,500 kms; Distribution Lines nearly 3,000 kms;electrification nearly 740,000 connections; connecting borders of Senegal Mali, Tanzania Kenya, Cameroon Nigeria, Mozambique Malawi, Uganda - Rwanda - Tanzania,etc; 3 Liquidity and Risk Money into Financial Institutions and PE Funds: LOCs/ Equity Investments to Banks, including microfinance institutions: nearly USD 850m and 40m respectively; Equity into Private Equity (PE) Funds: nearly USD 150m; 4 General Business Environment and Policy/ Regulatory Improvements: (a) Improved access to finance: Bank accounts per 1,000 adults in Sub-Saharan developing countries have increased from mere 0.7 to between 2001 and 2014; (b)1 Policy Loan to Energy Regulatory Reform in Angola; 1 Policy Loan to Agricultural Policy in Morocco; 5 Human Resources Trained: roughly 8,400 firms/ 290,000 people trained, mainly SME related activities 6 Jobs Created: roughly 60,000 jobs created out of which more than 5,000 women 7 Tax Revenues generated for the Government: roughly USD 500m or more Note: The figures have a mix of Ex-Ante and Ex-Post information, as some projects are still under implementation. The calculation consistency needs to be further verified whether the numbers can directly or indirectly be attributed to the financing. Case Study Corridor Developments in East Africa (Kenya, Uganda, Rwanda, Tanzania, and Mozambique): The below Map shows the ADB JICA collaborative efforts in developing the Transport and Electricity Corridor in the East Africa. Road Projects are shown in Red and Energy Projects are shown in Blue. (4) Bujagali Interconnection Line (19) Kenya-Tanzania Power Interconnection Line (21) Busega -Mpigi and Kagitumba Kayonza Rusumo Road (2) Arusha Namanga Athi River Road & (Prospect) Arusha Holili / Taveta - Voi Road (8) Nile Equatorial Lakes Countries Interconnection Line (9) Road Sector Support Project & (15) Road Sector Support Project II (10) Iringa-Shinyanga Backbone Transmission Line (3) Montepuez Lichinga Road (7) Nacala Corridor Phase I & (16) Nacala Corridor Phase III 9

10 Relation to Japan The below shows the ADB s Non-Sovereign Japan-related Projects, some of which are NSL endorsed and some of which are not. 10

11 How to utilize EPSA? ACFA: Governments may communicate with ADB/JICA EPSA Focal Points for the possibility of co-financing. FAPA: Public and private sector clients may discuss their technical assistance needs with their ADB loan officer. NSL: Private firms may communicate with ADB s Private Sector and Finance Sector Departments (contacts below) to apply for ADB non-sovereign financial products (loans, guarantees, etc.). Organizational Information ADB Group Constituent Institutions The African Development Bank (ADB); The African Development Fund (ADF); The Nigeria Trust Fund (NTF) Established 1964 (ADB) Headquarter Abidjan, COTE D IVOIRE President Dr. Akinwumi ADESINA Shareholders 80 countries (54 African and 26 non-regional) (ADB) Authorized Capital UA billion (as of Dec 2015) Approved Operations, operations totaling UA 6.33 billion Total Cumulative Approvals, ,974 approvals totaling UA billion JICA Established: 1974 (in 2008, merged with Japan Bank of International Cooperation (JBIC) ODA Loan Operations) Headquarter: Tokyo, JAPAN President: Dr. Shinichi KITAOKA Shareholders: 100% Japanese Gov t Owned Incorporated Administrative Agency Capital: 7 trillion billion JPY (end of JFY 2014) Approved in Africa, 2015 (calendar year): ODA Loans: USD 1.56 billion, Grant Aid: USD 0.46 billion Technical Assistance: 0.46 billion USD currency calculation rate (1USD=100JPY) Total Cumulative Approvals, (Japanese Fiscal Year) JPY trillion 11

12 Enhanced Private Sector Assistance for Africa Assistance renforcée au secteur privé en Afrique Contact Information for EPSA ADB Group (1) Contacts: Non-Sovereign Operations (Private Sector Department OPSD and Finance Sector Department OFSD): EPSA/ FAPA: / housing reforestation infrastructure development power generation technical assistance capacity buildin equity investmentss regional integration FINANCING GROWTH FINANCER LA CROISSANCE access to credit reforestation digital communication serviceses infrastructu ture dev evelopment power generation equity investments ts housing technical assistance technical assistance r fo cap apacity buildi ding housing ef restation digital commun nication services regional integration power generationer capacity building social services equ housing access to credit uity investmentss digital communication n services refo restation regional integration housing Japan-related issues: asia.office@afdb.org (2) Website: JICA (EPSA) (FAPA) (ASRO) Africa Department Contact jica6r@jica.go.jp