Association of Ghana Industries (AGI) 1D1F partner banks One- District, One-Factory Project.

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Elijah McLaughlin
6 years ago
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1 1D1F-CNBM Facility

2 Facility Overview The CNBM facility is a turnkey project financing option secured by Association of Ghana Industries (AGI) and 1D1F partner banks for private sector led industrialization under the One- District, One-Factory Project. The facility is being offered by China National Building Materials International (CNBM Group), a China based Investment & Trading Entity with support from Ghana EXIM Bank and other local 1D1F Partner Banks. The facility offers: financing support of up to 85% of total Capital Expenditure required for factory setup. This comes in the form of factory equipment and machinery covered by warranty and strict fitness of purpose clauses Technical Management and Training of up to 2 years (By which time factories should be setup and operational) Working Capital support from local 1D1F Partner banks Guaranteed market for selected products

3 Target Industry Areas The facility covers a number of industry areas including: General Manufacturing Agriculture, Agribusiness & Agro processing ICT Garments & Textiles Renewable Energy Waste Management Pharmaceuticals & Cosmetics Tourism & Creative Arts

4 Target Industry/Commodity Areas Commodities targeted under this facility are high potential commodities identified in the various districts in Ghana. These include: Cassava Cocoa Plantain Cashew Maize Wood Pineapple Herbs & Spices Aluminum & other metals Poultry Sisal Coconut Shea Butter Salt Fish Clay Orange Banana Oil Palm Rice Soy Tomato Cotton Waste

1D1F-CNBM Process Flow Screened Applications Approved Projects Projects Approved for EXIM underwriting Submission of Application via ID1F /AGI. 1.

Evaluation Review & Approval Evaluation Review and approval by Technical Committee.

Signoff & Offer Release Sign off by 1D1F & Consent from 1D1F to CNBM; Release of Offer 3 Evaluation Recommended Projects with Evaluation Summary Projects Approved

5 1D1F-CNBM Process Flow Screened Applications Approved Projects Projects Approved for EXIM underwriting Submission of Application via ID1F /AGI. 1. Submission 2 Initial Screening Initial Screening by Receiving Institution* Evaluation by AGI* Evaluation by EXIM * Evaluation by 1D1F/ CNBM Invoice confirmation * 4 Evaluation Review & Approval Evaluation Review and approval by Technical Committee. Due Diligence & Risk Analysis by Lending Bank* 5 Due Diligence & Credit Assessment 6. 1st Approval Approval from lending Bank. By EXIM Bank 7. 2 nd Approval 8. Signoff & Offer Release Sign off by 1D1F & Consent from 1D1F to CNBM; Release of Offer 3 Evaluation Recommended Projects with Evaluation Summary Projects Approved for lending Initial screening will be done to select applications that match 1D1F objectives and have good industry recommendations *Contact with Applicant for technical assistance may be necessary TAT for process is 10days, provided all necessary documents are submitted.

6 Key Stakeholder Institutions One District, One Factory Project Ghana EXIM Bank Association of Ghana Industries China National Building Materials International (CNBM Group) Local 1D1F Partner Banks including: Ghana Commercial Bank Universal Merchant Bank Access Bank

7 Roles of Key Stakeholder Institutions One District, One Factory Project Secretariat Ghana EXIM Bank Association Of Ghana Industries Other Local 1D1F Partner Banks CNBM Group Provide facilitation support for land acquisition, district readiness, marketing support, export support, research raw material development Compliance & certification. Underwriting of Bank Guarantee Evaluation of Project Proposals Final Approval of Proposal, if required. Provide funds for raw material development. Submission point of Proposal Evaluation of Proposal Assist with monitoring of projects after offer has been released. Partner with relevant institutions for provision of Technical Assistance Assign Desk officers dedicated to handling all 1D1F issues Provide Bank Guarantee for facility inclusive at interest rate of all fees & charges Undertake Due Diligence, Credit assessment & Risk analysis of applicant. Provide Working Capital Support. Engage monitoring company approved by Ghana EXIM Bank Provide at least three invoices for confirmation by Technical Committee & applicant. Undertake feasibility, if required. Provide equipment for setup. Provide technical management & training

8 Facility Terms Interest Rate : 7.5% (This covers entire facility i.e. CNBM CAPEX Support, Bank Guarantee and Processing fees) Collateral: Factory setup and Equipment Global limit: Not fixed. 85% of total CAPEX required. Tenor: 8-25 years. Moratorium: 2-3 years. (Negotiable as factory should be well into production before loan repayment starts) Entrepreneur s Matching Funds: 15% of total CAPEX required. (Can be in cash or kind)

9 Who is Eligible An applicant is considered eligible for the offer when the applicant can/has: Prove arrangement to guarantee raw material supply. prove he/she has secured/is securing land and platform for factory. Provide a feasible project plan Provide 15% of CAPEX required for factory setup and has a good credit rating to access working capital support. An experienced team with the required skills to manage the factory. Provide a solid succession plan

10 How to Apply Application is done via One-District, One-Factory District offices Association of Ghana Industries (AGI) Offices Online at 1d1fghana.org/apply

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