Annual report AFD 2013

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www.afd.fr

Tél. : +33 1 53 44 31 31 - Fax : +33 1 44 87 99 39

5, rue Roland Barthes - 75598 Paris Cedex 12

France

AGENCE FRANÇAISE DE DÉVELOPPEMENT

ANNUAL REPORT

AGENCE FRANÇAISEDE DÉVELOPPEMENT

3

Foreword by the Chairwoman of the Board

Interview with the Chief Executive Officer

AFD in 20132013 Highlights

A commitment to sustainable development

A bilateral bank that advances France’s priorities

Panorama of 2013 financing activity

Targeted use of French financial resources

AFD financing benefits people and the planet

Giving financing priority to sub-Saharan Africa

Helping the Middle East and North Africa through political and economic transitions

Encouraging regional and environmental balance in Asia

Promoting equitable and sustainable development in Latin America

Contributing to sustainable development in France’s overseas provinces

Assisting during crises, conflicts and fragile social or political situations

Steps to obtain AFD project financing

Supporting NGO initiatives

Acting with French local governments and companies

Intensifying relations with the European Union

Working with other donors

Bolstering local competency

Thinking about development aid

Publications, videos and conferences

AFD TeamBoard of Governors

Group organigram

Management team

Working for AFD

AFD’s international reach

Financial informationFinancial statements

Financing commitments by country

Financed projects

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Contents

AGENCE FRANÇAISEDE DÉVELOPPEMENTRAPPORT ANNUEL

AGENCE FRANÇAISEDE DÉVELOPPEMENTAGENCE FRANÇAISE

DE DÉVELOPPEMENTANNUAL REPORT

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The next twenty-four months will prove crucial for France’s development policy. Two major negotiations will converge in 2015: one for a new global climate treaty and another for the United Nations (UN) Sustainable Development Objectives, which will take up where the UN Millennium Development Objectives left off.

This is a historic convergence: ever since the 1972 Stockholm Conference on the Human Environment, international nego-tiators have prioritized economic development over environ-mental protection, particularly climate-change prevention. The relationship between greater natural resource consump-tion and economic growth seemed inseparable; climate change became synonymous with a common burden and conflicts over resource access.

This shifting situation creates new perspectives for French development policy. Many countries now contest the single goal of precisely reproducing or “catching up” with the deve-lopment model of industrialized countries.

Development aid is no longer seen as conditional on trans-ferring — not to say imposing — norms of behavior or poli-cy packages. Now donors discuss policies with countries determined to explore their own paths. This involves a kind of apprenticeship or comparison of experiences. Coopera-tion now depends on each country’s ability to understand the other’s constraints and opportunities. Many broad policy areas have become part of this exploration, such as employ-ment, education and health, as well as policies to fight climate change. In a globalized world, such dialogue is indispensable for creating shared visions and norms, and for accommoda-ting interdependence between countries.

This worldwide discussion on redefining development models provides a marvelous opportunity for AFD: the Agency has the political, technical and intellectual means to enrich thinking in many fields. In July 2013, France’s Interministerial Committee for International Cooperation and Development clearly defined and differentiated AFD’s mandates.

The Committee determined that AFD must pursue develop-ment and projects in the least-developed countries, and help other countries in collective actions to strengthen global public goods. We will find opportunities to innovate by diver-sifying the Agency’s financial instruments and technical tools, whether for project finance or global and sectorial budget support. In discussions between international donors, the Agency can put forth ideas and methods tailored to speci-fic political and economic situations, drawing on a clearly defined strategic framework and appropriate sectorial tools.AFD will be able to deploy these methods as it prepares for the 2015 United Nations Conference of the Parties on Climate Change. In Paris, the parties will work toward a mutually binding agreement. This means that they must understand the obstacles to “decarbonizing” fossil-fuel-driven econo-mies. They also must propose solutions that show how economic growth can occur even with drastic reductions in greenhouse gas emissions; such solutions must also allow for adaptation to climate-driven changes already underway. This is a tremendous challenge for AFD, one that calls for the full mobilization of the Agency’s talents and resources!

In February 2014, the French legislature passed a draft bill to orient and plan French development and international soli-darity policies. This was a watershed moment: the fact that representatives of the French people will henceforth debate, evaluate and review the bill, just as they do other major public policy proposals, gives development policy the importance that it deserves.

Foreword

Laurence TubianaChairwoman of the Board of Governors

5

AFD saw several strategic milestones in 2013. How would you describe the mission that the Agency has received?

France’s Interministerial Committee for International Coope-ration and Development and the legislature’s draft bill on development and international solidarity confirmed AFD’s role as the pivotal actor in France’s cooperation policy. They also clarified the Agency’s mission: solidarity in facing shared, worldwide challenges. This translates into partnerships tailored for each geographic region. Poverty alleviation remains our highest priority, which is why we concentrate two-thirds of our grant monies on the poorest countries, giving precedence to those in Africa. However, an effective fight against poverty requires a long-term effort. We seek to meet development’s three-fold challenge by promoting enduring and job-creating economic trajectories, fighting social inequalities, and combating climate change. For this reason, in emerging Asian and Latin American countries, our mandate centers on “green and inclusive growth.” If Brazil and China do not make real progress in fighting climate change, current and future development progress will be threatened everywhere.

In the challenging economic climate that France and Europe confront today, many French citizens express fears about globalization. How does AFD respond to these fears?

I believe that the French and Europeans are increasingly aware of the interdependence globalization brings. Econo-mic, health and security crises that start in the developing world can affect developed countries, and vice versa. Our children’s future depends on development choices now being made everywhere in the world. In my opinion, AFD can serve France as a premiere instrument to push for better-regulated and more-balanced globalization. This is the function of our financing to bolster Niger’s healthcare system, for example; equally, it is why we fund lower-carbon urban development in Indian cities, or lend to Turkish banks so that they, in turn, can finance the efforts of small and medium-size businesses to improve their social and environmental practices. I am sure that the solid impacts and demonstration effects of the projects that we finance help reduce globalization’s imba-lances, directly and indirectly.

A new vision of Africa and of its potential seems to be spreading through economic and policy circles. How does AFD position itself for action on relevant development issues?

Africa is experiencing robust economic and population growth, sparking renewed interest, we are happy to say. The continent is facing its major challenges: financing its infrastructure, educating and training its youth, creating jobs, managing huge urban growth, fighting poverty, managing crises, and so forth. We help surmount these challenges, supporting African governments, businesses and localities that ask us for assistance. This is what President François Hollande requested at the Elysée Summit last December: AFD Group will use all its financial tools to provide €20 billion to Africa over the next five years. In 2013, more than half of our financing, not including funds earmarked for France’s over-seas provinces, benefited sub-Saharan and North Africa.

Beyond supplying this scale of financing, you seek impacts. However, some observers doubt the effec-tiveness of development aid. How does AFD ensure that its funding will achieve the hoped-for results?

That is a fundamental question for the Agency, one we answer by developing ways to measure our impacts and by rigorously evaluating our projects. I will give you three real examples: To give three actual examples: works financed by AFD in 2013 will ensure drinking-water access for an additional 1.5 million people, provide support for 878,000 family farms, and abate 3.3 million tons equivalent of carbon-dioxide. These are real achievements, even without including harder-to-quantify but equally essential impacts, such as capacity-building among local actors or structuring public policies, to cite but two examples. The methodical evaluations we conduct allow us to draw lessons from our work, informing our strategies and the content of future projects.

Interview with

Anne PaugamChief Executive Officer

6

French savoir-faire and expertise could be useful to the developing world. How does AFD integrate this know-how in its work?

First off, I would like to note that our beneficiaries often request French expertise in the broadest sense – from French companies, engineering offices, local administrations, nongo-vernmental organizations (NGOs), public agencies, and so on. I think, for example, of a partnership between India’s Bureau of Energy Efficiency and ADEME, France’s environment and energy management agency; they work as peers on energy efficiency. Another good example is the urban sector, where our companies have recognized experience. A new tool created in 2013 called FEXTE, a fund for technical expertise and experience transfers, will allow us to better deploy and exploit French know-how in middle-income countries.

AFD works in a constantly changing world where many new donors and aid providers appear every year. How does the Agency adapt to change and maintain its lead?

Innovation is our watchword. AFD must remain an adaptable, creative, thoughtful and forward-looking organization. We have to be able to foster and integrate new ideas, sugges-tions and ways of doing things – whether they come from internal sources or external ones. That means we must know how to take risks and share risk with others, such as when we support social entrepreneurship with partner organizations. In this vein, AFD and PROPARCO, its private-sector arm, work to set up coalitions of aid providers that include nongovern-mental organizations and companies of all sizes; together we find the best solutions to development challenges. We have done this to improve housing in Nigeria and nutrition in Mada-gascar, among other projects. We will continue in this vein in 2014, setting-up innovative partnerships with public and private sector aid providers.

2014 will also be a year of preparing for 2015 miles-tones, won’t it?

Within two years France will host the 2015 Paris Climate Conference. AFD is deeply committed to climate issues, and highly energized to work on them. Half our financing goes to projects that must show a “climate co-benefit,” for example by supporting lower-emission transportation infrastructure, renewables development or energy-efficient buildings. Such projects decidedly bolster France’s position during interna-tional negotiations. And along with other development banks from all quarters, we think about the crucial question of finan-cing the fight against climate change. The other big milestone in 2015 will be to define the Sustainable Development Objec-tives, which can replace the Millennium Development Goals. Here again, France and AFD are poised to contribute signifi-cantly to these historic discussions, which should result – for the first time ever – in a common agenda for the developed and the developing world.

Touring a professional training center in Tunisia

AFD in 2013

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Highlights 201318

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February

JuneMarch

March

April

MayBack to work in MaliAFD restarted operations in Mali. During a May 2103 donor conference on Mali development, representatives from 108 countries and international institutions pledged €3.25 billion towards Mali’s reformation.

Anne Paugam, the new Chief ExecutiveFormer Treasury Inspector General for Tax Administration, Anne Paugam was nominated as Chief Executive Officer of AFD.

French Development and International Solidarity SummitAFD participated in a Development Summit that brought together all French development organizations. Summit attendees created a permanent body for joint consultation, the National Development and International Solidarity Council. In the autumn after the Summit, the French parliament debated an important framework law for setting priorities in French development policy.

A second opinion on sustainabilityEach financing proposal must now pass through a “sustainability analysis” that identifies and forecasts the project’s contribution to major development goals: economic growth, poverty alleviation, inequality reduction, climate-change prevention, and natural resource and biodiversity preservation.

New office in BangladeshOwing to increased activity in Bangladesh, where it has operated since 2009, AFD opened a new office in the capital, Dacca. AFD is implementing its mandate to promote green and inclusive growth through several projects: an innovative bus rapid transit system with high service levels, and a new water purification plant to supply Dacca, among other initiatives.

20 years in AsiaAFD celebrated its 20th anniversary of working in Asia. The Agency now tallies operations in 18 Asian countries, nine offices and — in the near future — €1 billion in commitments.

CEFEB, AFD’s business university, is 50 years old Support for the private sector in the French Overseas Provinces

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2013

35

31

June

June

November

JulyDecember

July

CEFEB is 50 years old CEFEB, AFD’s business university, has hosted seminars and training courses for nearly 18,000 students since its creation 50 years ago. Students come from AFD and from more than 60 developing and emerging countries, where they work in central and local governments, banks, nonprofits, and private-sector companies.

Representing Bpifrance in France’s overseas provincesAFD continued to represent Oseo in the French Overseas Provinces under that organization’s new brand, Bpifrance, making all French financing products available to local entrepreneurs and promoting business investment and growth.

Strengthening NGO partnershipsAFD’s governing board approved the Agency’s first multidisciplinary framework agreement for civil society organizations, covering 2013-2016. The Agency has committed to increasing its financial support for these organizations in recognition of their essential contributions to development.

Putting French expertise to good useAFD set up a new fund, FEXTE, to finance knowledge transfers to middle-income countries, particularly fast-growing emerging nations. The fund aims to meet recipient-country requests for French expertise and experience while contributing to their sustainable development. The fund also helps to spread French economic influence, and furthers French diplomacy on public policy and ecological matters.

Laurence Tubiana, the new Chairwoman of the BoardLaurence Tubiana, an international sustainable development expert, was nominated as Chairwoman of the AFD Board of Governors.

“100 Innovations” ForumAs part of the Elysées Summit, the “Africa – 100 Innovations for Sustainable Development Forum” allowed 21 African innovators to present their projects to public and private sector donors, researchers, and NGO representatives.

The CICID meeting France’s Interministerial Committee for International Cooperation and Development (CICID) met for the first time in four years. It decided that France would concentrate its grant monies in 16 priority poor countries and in countries in crisis. At least 85% of the aid monies allocated to AFD will go to Africa. The CICID also reconfirmed the Agency’s mandate to promote green and inclusive growth in Asia and Latin America.

AFD celebrated its 20th anniversary in AsiaAFD restarts activity in Mali with a hospital in Sévaré

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A F D 2 0 1 3 A C T I O N

A commitment to sustainable developmentAFD finances and helps to implement development projects, responding to the needs of the developing world. The Agency’s actions aim to promote economically, socially and environmentally sustainable development.

Reforestation in Mayotte

AFD, France’s bilateral development bank, has worked for more than 70 years to alleviate poverty, preserve the environ-ment, and promote economic growth in the developing world and in the French Overseas Provinces.

AFD operates in more than 90 countries through 71 field offices and bureaus. The Agency’s top priorities include improving drinking water supply along with maternal and infant health, encouraging schooling and professional trai-ning, fighting climate change, and aiding farmers and small businesspeople.

AFD fulfills its mission with help from its private-sector arm, PROPARCO. The private sector is an essential link in the development chain because it creates jobs and invigorates economies. AFD and PROPARCO do not replace traditional banks; rather, they provide complementary or supplementary funding when traditional bank financing proves insufficient. They also pay special attention to the environmental and social dimensions of the projects they fund.

In addition, AFD manages the French Global Environment Facility, financing innovative environmental projects that preserve biodiversity, fight climate change, and prevent land and forest degradation, among other vital actions.

Combining economic development with social and environmental concernsGlobalization has lifted millions of people out of extreme poverty. It has also aggravated economic, social and environ-mental disparities. AFD is France’s preferred tool for addres-sing these imbalances. The Agency fights poverty in the poorest countries and climate change in emerging powers, while curbing the environmental impacts of both. In this way, AFD pursues solidarity in the face of shared, planet-wide challenges.

In 2013, AFD set up a sustainable-development second-opi-nion function to help the Agency achieve this mission. Inde-pendently of the department in charge of financing a given project, the second-opinion advisor aims to assess the contri-bution each project will make to important sustainable deve-lopment goals.

In addition, AFD has increased its efforts to fight climate change through reducing greenhouse gas emissions, mitiga-ting climate-change effects, and guiding public policy design. In 2013, the Agency committed €2.4 billion to finance 77 “climate projects” in developing and emerging countries and in the French Overseas Provinces. These climate projects benefit both economic development and the fight against climate change. More generally, 47% of AFD’s foreign aid funding had climate-related benefits.

Water purification plant in Egypt

Sustainable development also concerns social issues: AFD takes care to promote gender parity and presses for social responsibility in gover-nance, human resources, and financing activities. AFD must innovate to meet and adapt to these 21st century challenges. It constantly seeks out the most suitable financial tools – ones tailored to the needs of developing and emerging countries. The Agency also takes up new subjects and practices, such as social and inclusive economics, social protections, micro- and meso-finance, agro-eco-logy, and biodiversity.

Complete assistance and a multi-actor approachFor AFD, working for sustainable development also means placing beneficiary countries at the heart of its approach, intervening in response to their development needs, strategies and projects. For this reason, AFD proposes a variety of finan-cial instruments and very wide-ranging expertise. In particular, knowledge creation about develop-ment constitutes an indispensable activity and complement to project finance.

In a multi-actor world, AFD’s effectiveness depends on its ability to work through networks and in partnership with all development actors – other donors, the European Union, companies, local and central governments, nongovernmental organizations, and other stakeholders.

When called on to finance very large projects that no single entity can fund alone, AFD sets up cofi-nancing agreements with the European Union, other bilateral aid agencies and development banks, emerging donors, and/or foundations. The Agency also supports French and other NGOs, regional governments, and companies in their development work.

AFD’s collaboration with these development practitioners, as well as with public institutions and academic researchers, bolsters the practi-cal relevance of its expertise and financing. AFD can support public policies and facilitate contacts within emerging and developing countries; this both meets the demand for French expertise and allows beneficiaries to work with their French counterparts – on decentralized cooperation, twin-city partnerships, NGO optimization, and related efforts.

AFD’s complete development toolkit

AFD’s principle financing beneficiariesIn the developing world and the French Overseas Provinces, AFD finances:

Financing

Central governments

Professional training

French and other NGOs

Expertise and technical assistance

Local governments Public institutions

Public and private enterprises

Public policy design assistance

Developing-country banks and financial intermediaries

Knowledge creation and international discussions

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1

1 4

2 5

6

2

4

3

3

5

1

2

34

5

1

23

45

6

11

12

ɣ Loans: AFD offers (1) “sovereign” loans to central govern-ments and to public entities with a government guarantee; and (2) “non-sovereign” loans to private-sector companies and public- or private-sector entities without government backing.

ɣ Grants and subsidies: AFD provides grants and subsidies for high-impact projects that create indirect profit and do not qualify for loans, such as projects in healthcare, educa-tion and small-scale agriculture. Grants primarily fund the poorest African countries and NGO-led projects.

ɣ Guarantees: AFD uses credit guarantees to motivate commercial banks to lend (especially to small and medium-size businesses) for capital investment, job creation and environmentally-friendly projects. By guaranteeing loan repayment, AFD broadens access to lending and guarantees growth.

ɣ Private Equity: PROPARCO manages equity stakes, provi-ding funding that companies and financial institutions require for long-term growth.

A F D 2 0 1 3 A C T I O N

AFD committed €7.8 billion in financing in 2013 (€7.5 billion net of delegated funds from other donors), an 8% increase over 2012.

Various types of financing provided (AFD Group, € million)

Subsidized loans (below-market interest)

Exceptional operations (bridge loans)

Grants and subsidies (project grants, debt reduction-development contracts, budget support, NGO grants)

Guarantees Private equity Guarantees SME financing

Non-subsidized loans

Loans and grants

Private equity

1,372

1,993

1,852 (25%) 3,079 (41%) 897 (12%) 986 (13%)

2,730 571 972 312

9115

116 (1.5%) 174 (2%)

73 (1%) 346 (4.5%)

90 186

455 375 486 405

139

3,654267

78

78

TOTAL

6,977TOTAL

7,523 (100%)

TOTAL

In foreign countries In the French Overseas Provinces

2007

2012

2013

Includes PROPARCO’s financing but excludes delegated funds from other donors, such as the European Union, DFID, or others.

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ɣ AFD allocated €121 million to sub-Saharan Africa for agri-culture: food security and agricultural development are major concerns for the international community, which works to reduce malnutrition, especially in the Sahel.

ɣ AFD also committed about €90 million to biodiversity and natural resource conservation, particularly to projects reducing deforestation and forest degradation through the REDD+ mechanism.

ɣ In the education sector, AFD champions the idea of a continuum that starts with primary school and follows through to job market entry. The Agency works to upgrade basic education for all — and now includes secondary schooling — so that literacy may take root and endure. AFD also supports professional training, retraining, and higher education.

ɣ One of AFD’s priorities for the poorest countries is maternal and infant health. In middle-income countries, where the middle class seeks access to quality healthcare and educa-tion, the Agency helps create social protection systems. In the French Overseas Provinces, it serves as the main bank for medical facilities and social services, financing construction and upgrades to hospitals and other medical or educational infrastructure.

ɣ Through its water and sanitation projects, AFD Group supports sustainable water management efforts — optimi-zing use, depolluting urban and industrial wastewater, and extending distribution systems in poor, often peripheral urban districts and settlements. AFD also works to manage flood risk in urban areas and finances several stormwater drainage projects in Brazzaville, N’Djamena and Yaoundé.

ɣ AFD has three priorities for energy: renewables and effi-ciency, energy security, and rural and suburban electrifi-cation.

ɣ AFD steadily increased financing for transportation infrastructure in 2013. Beneficiary countries show strong demand for transportation aid, viewing it as a precursor to economic growth and regional and global trade inte-gration. Roads, railways and transit systems also decrease rural isolation and reduce spatial disparities. The Agency emphasizes urban mass transit and rail.

ɣ AFD also finances sustainable urban development projects to help cities meet challenges to future growth. This entails strengthening local governance, increasing funding, curbing urban sprawl, regulating land use, controlling secondary-city growth, rehabilitating slums, promoting basic services access, and invigorating urban economies. AFD serves as the benchmark donor for municipalities because of its ability to deploy French urban development expertise and its variety of financing tools.

ɣ Furthermore, AFD develops the financial services sector — banks, intermediaries and stock exchanges — to finance economic growth. It promotes financial inclusion through its support for microfinance and small-business lending. Through bank intermediation projects, the Agency helps commercial banks create innovative lending products, such as “green loans” targeting companies involved in renewable energy and energy efficiency, in waste mana-gement and depollution, and in other pro-environment industries. AFD can shoulder commercial lender risk through its credit guarantees; it also offers business- expansion projects for small and medium-sized enter-prises, such as programmes to strengthen commercial capacity.

Widely varied sectors of activity

€303mm (4%)

€771mm (10%)

€1,609mm (21%)

€479mm (6,5%)

€338mm (4,5%)

€724mm (10%)€

€917mm (12%)€3,299mm (44%)€

2013Financing totals

by sector*(€ million)

85

64

251

48

41

29

3030158

2013Number of financing

commitments per sector*

Other (budget support, debt relief)

Health and education

Water and sanitation

Environment and natural resources

Agriculture and food security

Business, industry and trade (microloans, SME support, banking-sector development)

Infrastructure and urban development

of which Energy

*Not including delegated funds from other donorsmm = million

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A F D 2 0 1 3 A C T I O N

A bilateral bank that advances France’s prioritiesAFD is the principal development agency for French bilateral aid. It is also an important actor in developing France’s overseas provinces.

Improvements to the urban environment in Vietnam

Under French law, AFD is classified as a public industrial and commercial entity having a general-interest mission. Conse-quently, the French government, through three supervisory ministries – Foreign Affairs, Economy and French Overseas Provinces – sets out the guidelines that direct the Agency’s actions.

AFD works at the heart of France’s international cooperation systemThree committees define the general orientation of France’s international cooperation, including that of AFD.

ɣ The Interministerial Council for Cooperation and Deve-lopment (or CICID) defines the principles and priorities of France’s international solidarity policy. AFD’s supervisory ministries (Foreign Affairs, Economy and Finance, Overseas Provinces) act as the council’s secretariat. The CICID met for the first time in four years on 31 July 2013 and clarified the Agency’s mandate for sustainable development.

ɣ The Interministerial Council for the Overseas Provinces, chaired by the French president, sets policy guidelines for operations in France’s overseas provinces.

ɣ The Strategic Orientation Board reinforces the articulation between the government’s policy guidelines and AFD’s operations. Members of the strategic orientation board include ministerial representatives who also sit on AFD’s governing board. The strategic orientation board coordi-nates preparation of the “means and objectives” contract binding AFD to the French government and then oversees its implementation.

In addition, AFD actively participated in summit meetings on development and international solidarity launched by the French government in late 2012. From November 2012 to March 2013, the summits provided a forum for discussion and debate about France’s cooperation policy. The meetings were attended by French lawmakers as well as represen-tatives from central and local governments, NGOs, unions, companies, foundations, researchers, and other interested parties from developed and developing countries.

At the end of the summit meetings, attendees agreed to set up a common consultative body, the National Council for Development and International Solidarity. The meetings also produced recommendations fora new legal framework, along with a plan of response to attendee calls for transpa-rency, consistent pro-development policies, and strategic aid stewardship.

Pupil studying in the Democratic Republic of Congo

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AFD’s governanceThe governing board and audit committee oversee Agency governance, ensuring transparency and good management in its international solidarity operations.

ɣ The Board of Governors comprises 18 members, including representatives from supervisory ministries, parliament, the AFD workforce, and external advisors. Members deli-berate on the Agency’s strategic direction, project finan-cing, and the Board’s own financial activities. The gover-ning board may delegate part of its authority to AFD’s chief executive, who must in turn answer to the board. Or it may delegate authority – within pre-set funding limits – to one of three special committees: the Committee for Operations in the French Overseas Provinces, the Committee for Operations in Foreign Countries, and the Committee to Support Nongovernmental Organizations’ Initiatives.

ɣ The Audit Committee performs the task of verifying the quality of information, assessing the appropriateness of accounting procedures, and evaluating the robustness of internal controls for the entire AFD Group. The audit committee is comprised of one member of the governing board and four external advisors.

Creating differentiated partnerships

At a 31 July 2013 meeting called by the French prime minister, the Interministerial Committee for International Cooperation and Development (or CICID) redefined the main priorities of French development and international solidarity policy, which in turn defines AFD’s mission. Committee members decided to design different partnerships for different countries and regions, featuring:

ɣ solidarity with the poorest African countries, where France will concentrate its grant monies;

ɣ priority to Africa and the Middle East, where France will allocate 85% of its foreign aid;

ɣ attention to countries in or emerging from crises, where France will primarily deploy grants;

ɣ joint pursuit of solutions for challenges common to emerging or middle-income countries in Asia, Latin America and the Caribbean, where French cooperation with emerging powers does not require public funding.

In recent years, the relationship between AFD and the French parliament has strengthened through the new constitutional provisions enacted in July 2010. In 2013 and 2014, preparations for the “Development and International Solidarity Framework Law and Plan” have also provided opportunities for important discussions and debates.Lawmakers acquired important information about AFD’s work during the design of strategic documents for AFD, particularly its “means and objectives” contract, which was submitted to the Senate and National Assembly for approval. Finance bills also served to inform legislators about the Agency during budget question-and-answer sessions. In 2013, jointly-organized National Assembly hearings further bolstered relations. Topics included French urban expertise in foreign countries, Franco-Chinese relations, and a landmark series of reports on Africa’s future development.

Firm accountability to French lawmakers

CICID deliberations

Power installation in Tahiti

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PARISHeadquarters

BRUSSELSEuropean institutions liaison o�ce

MARSEILLESCEFEB, AFD Business University

15% of financing activity

€1.169bn committed

45 projects



48 projects

FRENCH OVERSEAS PROVINCES


€1.506bn committed, of which €985 in loans and bank refinancing

128 loan and refinancing projects

Public sector loans

Private sector loans and bank refinancing

Private sector guarantees

Grants and subsidies(French Foreign A�airs Ministry)

Private sector financing(Bpifrance)

PROPARCO

€642.5mm (42.7%)€

€316.5mm (21%)€

€174mm (11.5%)€

€2mm (0.1%)€

€346mm (23%)€€25mm (1.7%)€

Sovereign loans

Non-sovereign loans

Grants and subsidies

Guarantees

PROPARCO

€6mm (1%)€

€1mm (0.1%)€

€198mm (17%)€

€269mm (22.9%)€€695mm (59%)€

Sovereign loans

Non-sovereign loans


Guarantees PROPARCO

€381mm (48%)€

€280mm (35%)€

€51mm (6.5%)€

€1mm (0.5%)€ €83mm (10%)€

Sovereign loans

Non-sovereign loans


GuaranteesPROPARCO

€687mm (57.5%)€

€405mm (34%)€

€23.5mm (2%)€

€74.5mm (6%)€€4mm (0.5%)€

In sub-Saharan Africa, AFD e�orts focus on infrastructure, urban development, agriculture, food security and access to healthcare, education and drinking water. Grants, budget support, private equity, and subsidized and unsubsidized loans serve as financing instruments.

In the French Overseas Provinces, AFD works to promote economic growth. E�orts focus on local governments, private sector companies, housing, urban development and regional economic integration.

In Asia and in Latin America and the Caribbean, particularly in middle-income and emerging countries, AFD works to promote green and inclusive growth. E�orts focus on economic partnerships. Loans serve as the nearly sole financing instrument.

In the Middle East and North Africa, AFD works to further regional economic

integration with Europe. E�orts focus on job creation and urban and rural development.

Loans serve as the primary financing instrument.



€796mm committed

57 projects



369 projects

AFD Group commi�ed €7.5 billion to finance 676 new development projects

1. Debt relief comprises Debt Reduction-

Development Contracts (C2D)

2. A fund investing in African companies

These totals combine financing from AFD and its subsidiary, PROPARCO, which

represent 99% of AFD Group net banking income. Totals exclude delegated funds

from other donors, such as the European Union.

mm = million bn = billion

1% of financing activity covers multiple disciplines and regions

PROPARCO and FISEA 2 Sovereign loans

Non-sovereign loansGrants and subsidies

Budget support and debt relief 1

Guarantees

€1.023,5bn (37%)€

€405mm (15%)€€190.5mm (7%)€

€600mm (21%)€

€110mm (4%)€

€449mm (16%)€

17

PARISHeadquarters

BRUSSELSEuropean institutions liaison o�ce

MARSEILLESCEFEB, AFD Business University



45 projects



48 projects



€1.506bn committed, of which €985 in loans and bank refinancing

128 loan and refinancing projects

Public sector loans

Private sector loans and bank refinancing

Private sector guarantees

Grants and subsidies(French Foreign A�airs Ministry)

Private sector financing(Bpifrance)

PROPARCO

€642.5mm (42.7%)€

€316.5mm (21%)€

€174mm (11.5%)€

€2mm (0.1%)€

€346mm (23%)€€25mm (1.7%)€

Sovereign loans

Non-sovereign loans


Guarantees

PROPARCO

€6mm (1%)€

€1mm (0.1%)€

€198mm (17%)€

€269mm (22.9%)€€695mm (59%)€

Sovereign loans

Non-sovereign loans


Guarantees PROPARCO

€381mm (48%)€

€280mm (35%)€

€51mm (6.5%)€

€1mm (0.5%)€ €83mm (10%)€

Sovereign loans

Non-sovereign loans


GuaranteesPROPARCO

€687mm (57.5%)€

€405mm (34%)€

€23.5mm (2%)€

€74.5mm (6%)€€4mm (0.5%)€

In sub-Saharan Africa, AFD e�orts focus on infrastructure, urban development, agriculture, food security and access to healthcare, education and drinking water. Grants, budget support, private equity, and subsidized and unsubsidized loans serve as financing instruments.

In the French Overseas Provinces, AFD works to promote economic growth. E�orts focus on local governments, private sector companies, housing, urban development and regional economic integration.

In Asia and in Latin America and the Caribbean, particularly in middle-income and emerging countries, AFD works to promote green and inclusive growth. E�orts focus on economic partnerships. Loans serve as the nearly sole financing instrument.

In the Middle East and North Africa, AFD works to further regional economic

integration with Europe. E�orts focus on job creation and urban and rural development.

Loans serve as the primary financing instrument.



€796mm committed

57 projects



369 projects

AFD Group commi�ed €7.5 billion to finance 676 new development projects

1. Debt relief comprises Debt Reduction-

Development Contracts (C2D)

2. A fund investing in African companies

These totals combine financing from AFD and its subsidiary, PROPARCO, which

represent 99% of AFD Group net banking income. Totals exclude delegated funds

from other donors, such as the European Union.

mm = million bn = billion

1% of financing activity covers multiple disciplines and regions

PROPARCO and FISEA 2 Sovereign loans

Non-sovereign loansGrants and subsidies

Budget support and debt relief 1

Guarantees

€1.023,5bn (37%)€

€405mm (15%)€€190.5mm (7%)€

€600mm (21%)€

€110mm (4%)€

€449mm (16%)€

18

A F D 2 0 1 3 A C T I O N

Targeted use of French financial resourcesAFD primarily derives funding from financial markets, and carefully optimizes public funds.

Where does AFD funding come from?Funding is mostly raised on international financial markets

AFD regularly issues bonds to raise funds from financial markets, and sold debt worth €4.8 billion in 2013. The Agen-cy’s good bond credit rating in turn allows it to offer lower- interest loans to its aid beneficiaries.

Financial support from the French government

The French government does not subsidize AFD’s internal operations; it does provide public funds to finance develop-ment projects in foreign countries and the French Overseas Provinces.

The French Ministry of Foreign Affairs provides funding that the Agency deploys as grants for projects and NGO-led initiatives. The Ministry of the Economy and Finance provi-des funding that serves specific operations, such as budget support or debt relief in the form of debt reduction- development contracts (C2D). Their funding also serves to subsidize loans by paying for interest rate points, reducing the borrower’s cost. In this way, AFD transforms one euro of public funds into thirteen euros of lending.

In addition, the Ministry of Overseas Provinces funds certain types of projects in those territories.

Because AFD can raise funding at favorable rates on inter-national markets and designs innovative cofinancing arran-gements, its loan recipients benefit from leverage effects — increasing the rate of return on their capital investments to one higher than their debt cost.

Support for family farms in Cameroon

International financial markets

Bond issuance: €4.837 billion in 2013

and Capital

Public funds€1.209 billion in 2013

Grants to foreign countries

€897 millionProject grants: €209mm (23%)

Debt reduction-development contracts: €511mm (57%)

Budget support: €89mm (10%)

NGO grants: €49mm (5.5%)

Miscellaneous grants: €39mm (4.5%)

Subsidies to foreign countries (to lower loan interest rates)

€285 million

Grants and subsidies to the French Overseas Provinces

€27 million

19

AFD primarily uses France’s state-allocated funding to finance development projects in sub-Saharan Africa. The poorest coun-tries receive grants, which include project grants, debt reduction-development contracts, budget support, and NGO grants. Middle-income countries receive subsidized loans. Larger, emerging countries receive no state-allocated funding, except for technical assistance grants; these aim to promote innovative and joint development approaches, knowledge transfers, and dialogue about public policies fostering a more-sustainable development model.

Grants dedicated to poor countries in sub-Saharan AfricaAFD concentrates its project grants – valued at €209 million in 2013 – in the poorest countries, financing projects in sectors that create indirect profits, such as health, education and small-scale agriculture.

The Agency allocates these grants to 17 priority poor sub- Sahara African countries: Benin, Burkina Faso, Burundi, Central African Republic, Chad, Comoros, Democratic Republic of Congo, Djibouti, Ghana, Guinea, Madagascar, Mali, Mauritania, Niger, Rwanda, Senegal and Togo.1

Fragile and post-conflict states (Afghanistan, Haiti, Iraq, Myanmar, Palestinian Territories and Sudan) received 13% of project-grant financing.

French Overseas Provinces

2%€27 million

of France’s state-allocatedaid funding

Latin America and the Caribbean(Primarily the Dominican Republic and Haiti)

0.5%€7 million

of France’s state-allocatedaid funding

7%€84 million

of France’s state-allocated aid funding

Middle East and North Africa

Asia(Primarily Afghanistan, Cambodia, Myanmar, Vietnam)

7.5%€90 million


81%€976 million


Sub-Saharan Africa

3% €33 millionof France’s state-allocatedaid funding

Fragile and Post-conflict States (Afghanistan, Haiti, Iraq, Myanmar, Palestinian Territories, Sudan and Yemen)(Afghanistan, Haiti, Iraq, Myanmar, Palestinian Territories, Sudan and Yemen)

Scope: Grants and subsidies include debt reduction-development contracts and budget support, but exclude European Union delegated funds.

2% of France’s state-allocated aid funding

Multi-country

Geographic distribution of France’s state-allocated aid funding in 2013

In 2013, AFD dedicated 57% of all project grants to 17 priority poor sub-Sahara African countries

(1) In accordance with the July 2013 session of the Interministerial Committee for International Cooperation and Development, this list will be reduced to 16 priority poor countries in 2014.

How public funds were used in 2013

20

A F D 2 0 1 3 A C T I O N

AFD financing benefits people and the planetAFD-funded projects that were underway in 2013 had the following impacts:

are protected by biodiversity - conservation and sustainable resource-management programs

MILLIONHECTARES30

BiodiversityAFD supports the creation and expansion of protected nature reserves and the sustainable management of forest and marine areas to renew and protect the diversity of living things.

PASSENGERSrode on new or modernized public transit every day

Transportation

110,000 MILLION PEOPLE

now live in better and safer homes1

Slum districts

AgricultureSMALL BUSINESSES73,000 received financial support or credit lines

FAMILY FARMS

878,000received direct aid

Microfinance and local economies

SCHOOLCHILDREN450,000Education and employment

attended primary and elementary schools

YOUTH100,000 enrolled in vocational training programs

MILLION PEOPLE

PEOPLE1.5 got access to drinking water 411,000 got access to improved

sanitation services


New projects financed in 2013 will help fight climate change by abating a huge amount of

greenhouse gas emissions:

million tons of CO2 equivalent per year3.3

Evaluating development projectsAFD conducts a post-project performance evaluation for most of the projects it finances; the Agency also makes broader or more targeted project assessments. AFD evaluations follow standards defined by the Development Assistance Committee of the Organisation for Economic Cooperation and Develop-ment (OECD). The evaluations aim to improve future projects and programs by deriving lessons from experience, and to find ways to make aid more effective. They also meet the Agency’s public accountability obligations.

The evaluations attentively examine project viability and economic, social and environmental impacts. AFD field offices lead the evaluations, calling on independent consultancies to perform the assessments, and presenting the results to local stakeholders. AFD commissions its evaluations from local experts in the beneficiary country, in order to take advantage of their knowledge of project context and to help build local

capacities. AFD shares the results of each evaluation with the financing beneficiaries who promoted and led the projects: central and local governments, companies, NGOs, and so on.

In 2013, AFD commissioned 26 project evaluations, along with nine conducted jointly with other donors or that cove-red several projects in a single sector. For example, one report evaluated 15 years of AFD efforts to promote pastora-lism in Chad; another assessed health-related NGO projects that AFD had funded. The Agency also pursued its scienti-fic impact-assessment program, notably for water-related projects, and evaluated its healthcare and social services work in France’s overseas provinces.

See the 2013 Evaluation Findings Report on http://evaluation.afd.fr

Uluroa Market in French Polynesia

An internet site dedicated to transparency of Mali aid was launched in September 2013. It aims to show French taxpayers and Malian citizens where aid given by France and AFD to Mali goes, providing a detailed explanation and geographic location for each project. In an effort to improve aid effectiveness, the site also features a “citizen oversight” messaging page where internet users – particularly Malian and French citizens – can send in confidential reports on project progress, delays, or problems, and also request more information. France plans to expand this initiative in 2014 to 15 other priority poor sub-Sahara African countries.

See http://transparence.ambafrance-ml.org

French aid transparency in Mali

21

http://evaluation.afd.fr

http://transparence.ambafrance-ml.org

22

A F D 2 0 1 3 A C T I O N

Giving financing priority to sub-Saharan Africa Africa south of the Sahara remains AFD’s priority region for aid operations, receiving the largest-ever financing commitment: a record €2.8 billion in 2013, or 46% of all foreign aid funding.

Water adduction system in Comoros

Aiding sub-Sarahan Africa first and foremostThe population of sub-Saharan Africa will double by 2050. Growth will only prove sustainable and inclusive if African youth are sufficiently prepared. Beginning in 2030, this young population will live primarily in secondary cities and major urban centers. Urban youth are already driving the emer-gence of an educated, informed, demanding and populous middle class. These consumers propel the growth of inter-nal markets, linking urban economies to rural ones, and will power future growth in Africa.

In partnership with other development actors in Africa, AFD financing helps transform these opportunities into realities; it also helps manage the risks. The Agency uses a tailored approach that depends on the country’s development level and its linguistic and cultural proximity to France. Of all the foreign aid monies that the French government allocated to AFD in 2013, 81% (€976 million) went to sub-Saharan Africa.

In 2013, AFD concentrated its financing and actions on stren-gthening Africa’s human capital, building sustainable cities, managing and conserving natural resources, and opening access for isolated territories, economies, and peoples. The Agency also bolstered rural development and food security, and invested in the dynamism of the private sector – the source of jobs and the engine of sustainable and redistribu-tive growth.

Strengthening human capitalSustainable, inclusive and competitive growth requires bols-tering human capital and supporting basic and seconda-ry education, professional training, social protections, and universal health insurance. In 2013, AFD focused most of its grant monies on improving maternal and infant health and supporting primary and secondary education and professio-nal training.

The Agency funded projects and programmes to improve primary-schooling access in the Democratic Republic of Congo, Niger, and Senegal. It also funded reforms for junior high schools in Togo. Professional-training projects helped improve courses at training centers in Benin, found solutions for public works, animal husbandry and light manufacturing in Chad and, in conjunction with local companies, reformed professional degrees and vocational courses in Djibouti.

AFD funding also helped the disadvantaged access health-care, as in Niger, where the Agency supported the creation of a social investment fund for health. The fund will reinforce and make permanent a mechanism exempting children from paying for healthcare, from birth to age five. In Côte d’Ivoire, as part of a debt reduction--development contract, AFD allo-cated €62 million to expanding paramedical assistance, improving maternal and infant care quality and accessibility, increasing the availability of medicines, and bolstering the institutional capacity of the Ivoirian Health Ministry.

23

The rise of sustainable citiesAs a barely visible demographic transition takes place, the management of current and future growth in large metropo-litan areas and secondary cities presents a crucial challenge. AFD concentrates its financing on local initiatives that promote and support more accessible, economically produc-tive, and locally- and globally-tenable urban development.For example, in Burkina Faso, AFD committed €40 million to the city of Ouagadougou through a loan dedicated to finan-cing urban infrastructure. In that sprawling city of more than two million inhabitants, the funding will help increase urban mobility and resident access to drinking water and sanitation services.

A debt-relief contract launched

The year 2013 saw the operational launch of the first debt reduction-development contract between France and Côte d’Ivoire. The three-year contract was signed on 1 December 2012, covering €630 million out of a total debt of €2.89 billion. Through this contract, an adjunct to the Heavily Indebted Poor Countries Initiative (HIPC), France will take the installment payments that Côte d’Ivoire makes on its previous French loans and return the funds to the country in the form of grants. This debt-relief contract – the largest ever – reflects an ambitious partnership between France and Côte d’Ivoire. It aligns with the latter’s national development plan and will finance policy implementations in key poverty-fighting sectors: basic education, professional training, employment, healthcare, agriculture, roadway infrastructure, water and sanitation. The first projects will help make medicines available to the most vulnerable, and will support drinking water access for those living in the Abidjan and Montagnes districts. In addition, the debt-relief contract will finance higher education, sustainable natural resource management, and the justice system. It will also prompt a constructive dialogue about public policies, drawing on civil society participation in both countries.

Housing access made easier

In Nigeria, a challenging demography and rapid urban growth shade the core of public policies in the southwestern federated states. Ogun State, bordering Lagos, faces a lack of decent housing for residents of its major and secondary cities.The Affordable Housing Project unites the French building materials company Lafarge with AFD and LAPO Microfinance Bank, Nigeria’s largest, to create the country’s first housing microloan program. AFD will loan €5 million to LAPO; in turn, LAPO will use these funds to make loans to 2,700 targeted households. The loans will be made in Nigerian nairas and range from €450 to €4,500, renewable four times.Lafarge will provide technical assistance to the borrowing homeowners, who will receive help in producing building plans for each type of project, e.g., family home, rentals, etc., and for evaluating construction costs and directing construction work. This pilot project is designed for replication in other parts of the country. The project will achieve three important goals: financing a local bank’s expanded product offerings, engaging a leading private-sector French company’s technical expertise, and easing access to affordable, housing and home ownership for middle- and low-income residents.

Support for primary teaching in the Democratic Republic of Congo

Côte d’Ivoire

Nigeria

24

Opening access for territories, economies and peoplesIsolation – whether of territories, economies or peoples — is one of the principal barriers to economic growth. For this reason, AFD concentrates activity in two critical sectors: regional and international transportation, and energy — notably financing regional and renewable energy projects, including hydroelectric, biomass and photovoltaic power.

In 2013, AFD financing helped expand airfreight facilities in Mozambique. In Ethiopia, a €50 million loan will pay for construction of an Ethiopian Airlines freight terminal at the Addis Ababa Bole International Airport. The new facility will significantly increase freight storage and management capacity; it will also improve parking for the airline’s cargo planes. In Cameroon, AFD contributed to the early stages of a planned industrial park and port complex in Kribi. The Agency provided a loan to fund feasibility and other pre-pro-ject studies.

In the renewable energy sector, AFD financed the design and construction of a 30-megawatt photovoltaic power station in Burkina Faso. The Agency also bolstered electricity supply in Nigeria’s capital, Abuja, and contributed to a grid inter-connection project that covers more than 1,000 kilometers between Ethiopia and Kenya.

Promoting family farmsAfrican farmers must increase the productivity of their farms to meet the continent’s need for food. Agriculture employs 65% of African workers. Family farms offer work to both men and women, and have the potential to absorb job-seeking youth. AFD’s main challenge lies in supporting the entire chain of agricultural productivity while preserving — or even restoring — fragile natural capital.

In Côte d’Ivoire, a project financed through a €62 million debt reduction-development contract will provide stimulus to several domestic foodstuff and export-crop growers and processors. This will improve the country’s food security, its trade balance, and farmers’ incomes all at the same time. The project will also help the process of securing land ownership and tenancy rights, meeting the Ivorian government’s desire to set up a pacified environment conducive to farming.

In northern Cameroon, AFD will again use the debt- relief mechanism to to finance technical innovation; this will support the intensification of farm and ranch food-production systems. In Senegal, AFD proposed an intervention in a project to improve food security and economic development in the rural areas of Podor Province, along the Senegal River Valley in the north. The innovative financing package will combine loan and grant monies to fund rural infrastructure construction and rehabilitation; it will also pay for creating a natural resource and land governance system.

Expanding job-creating enterprisesAFD and its subsidiary, PROPARCO, continue efforts they have made for many years to bolster job-creating economic growth in Africa. They do this by supporting private businesses of all sizes with a varied range of financial instruments, and by developing innovative risk-management and protection solu-tions that are likely to encourage and facilitate long-term productive investments.

In 2013, AFD Group committed €716 million to the private sector in the form of loans, grants, subsidies, ARIZ guarantees, and equity stakes taken by PROPARCO and FISEA. This finan-cing primarily targeted banks and the financial services sector, along with agricultural industries, tourism, professional trai-ning, and transportation. Commercial capacity-strengthening also drew funding.

Filling jerry cans with drinking water at public taps in the Democratic Republic of Congo

A F D 2 0 1 3 A C T I O N

25

Strengthened access to electricity in rural and suburban areas

Niger is one of the world’s poorest countries, with a particularly low rate of electricity access. Providing electricity to its citizens is a national priority, with a target of connecting 100 new localities to the grid each year. AFD and the European Union, acting through the EU-Africa Infrastructure Trust Fund, committed €30 million in loans and €11 million in grants as complementary resources to bolster the Nigerian [Niger] electricity company, NIGELEC, in its rural and suburban electrification effort. The AFD loan will finance electricity distribution to 14 districts on the outskirts of Niamey and a master plan for the city’s electrical grid. Loan funds will also finance connections to NIGELEC’s Central grid for the cities of Goure and Quallam, and to the Fleuve grid for the city of Tchintabarden. In addition, the loan will provide support for Niger authorities to develop a photovoltaic power plant project.The European Union grant monies will pay for low-profit rural electricity works, connecting 31 village administrative centers and providing subsidies for connecting branches in rural areas. The project should permit home electricity access for about 60,000 households, representing about 360,000 individuals.

A part-emergency, part-development initiative

Mali’s violent political rebellion and humanitarian crisis of 2012 weakened its already-fragile healthcare system. The situation caused a worrisome drop in health indicators, already among the lowest in the world. The security crisis in three northern Malian provinces, Timbuktu, Gao, and Kidal, prompted healthcare workers to flee the area and left unsecured clinics and hospitals open to pillage and destruction. The major task now at hand is to restore the healthcare system in the three provinces while ensuring the transition from an emergency situation, managed by nongovernmental organizations, to a more stable one managed by the Malian government. Mali’s Health Ministry and AFD decided to create a NGO funding facility for northern Mali, targeting Timbuktu and Gao Provinces. Following a request for proposals, a consortium of NGOs associated with Handicap International was selected for Timbuktu. For Gao, the chosen consortium brought in Medecins du Monde (MDM) Belgium and the French and Malian Red Cross. These two projects target maternal and infant health, healthcare worker training, healthcare access, services demand, and healthcare system performance. This innovative effort will help reinstate the Malian government and healthcare officials in the north.

Niger

Mali

The new Sominé Dolo Hospital in Sévaré, Mali

26

A F D 2 0 1 3 A C T I O N

Helping the Middle East and North Africa through political and economic transitions On the southern and eastern sides of the Mediterranean Sea, AFD emphasizes human welfare.

Cairo, Egypt

In 2013, the engines driving renewed economic growth in the Middle East and North Africa seized up once again, hampe-ring the return to pre-political-crisis levels of activity. Since 2013, Tunisia and Egypt have seen their steps toward poli-tical renewal falter, while Syria tumbled even deeper into a long-lasting civil war affecting all its bordering countries. This led to a slight increase in AFD financing allocated to the region; the total has reached €796 million.

Financing commitments by country (AFD Group, 2013)

Algeria €3 million (0.5%)

Egypt €80 million (10%)

Lebanon €67 million (8%)

Morocco €254 million (32%)

Palestinian Territories €17 million (2%)

Syria €7 million (1%)

Tunisia €6 million (1%)

Turkey €348 million (44%)

Multi-country programmes €13 million (1.5%)

The Arab Spring revolutions continue to modify the equili-brium between donors. Given the increase in public-sector investment and budget support from the Gulf States, AFD stepped up strategic discussions with the European Union and European donors – the European Investment Bank, European Bank for Reconstruction and Development and KfW – concerning use of Europe’s Neighbourhood Invest-ment Facility (NIF).

Reducing regional inequalities and improving social cohesionAFD has three goals for its interventions in the Middle East and North Africa during the 2012-2014 period:

ɣ strengthening social cohesion through job creation and professional training, among other efforts;

ɣ building up regions by supporting rural development poli-cies and urban sustainable development;

ɣ promoting better quality of life by helping secure energy supply in the countries most dependent on fossil fuels, while jointly managing natural resource scarcity.

To achieve these goals, the Marseilles Center for Middle East and North Africa Integration (Centre de Marseille pour l’intégration en Méditerranée) has lent to support to three programmes run by AFD: one for employment and social protections, one for urban mobility, and one for water demand management. Additionally, AFD pursues strategies in Egypt to increase women’s autonomy through higher workforce participation.

27

SME food processors upgraded

AFD provided a €100 million credit line to the Turkish bank, Ziraat Bankasi, to help it finance capital investments in small and medium-sized food-processing companies; this will allow such firms to upgrade their facilities to meet European environmental regulations and human and plant health standards. A technical assistance program will help the bank learn about these subjects and keep current with them. It will also facilitate the bank’s own social and environmental governance process, and assist companies in preparing loan applications.

Social housing funded

AFD committed €50 million in loan financing and €500,000 in grant funding to Holding Al Ommrane, a public-sector social housing and property development company, for its 2013-2016 capital investment programme. The financing will help pay for construction of subsidized housing, tailored to the needs of poor and low-income families in rural and urban areas. The programme should renovate or replace substandard housing and eradicate slums, using a comprehensive and sustainable approach to Morocco’s territorial development.

Jobs and better living conditions created

A project to strengthen social stability and reduce poverty in Egypt received a €80 million sovereign loan commitment from AFD and €15 million grant from the European Union through its Neighbourhood Investment Facility; it aims to create jobs and improve living conditions for low-income citizens. The funds will be used to finance micro- and small businesses, which are under-served by traditional banks. The project will upgrade and renovate public facilities in urban areas through highly labor-intensive works. It will focus on several informal settlements in the greater Cairo area, specifically in the governorates of Cairo and Giza.

Help for Syrian refugees and their hosts

In November 2013, AFD committed €4 million to a grant facility for NGOs working in Lebanon and Jordan to help them assist about 1.6 million Syrian refugees and local host populations. The NGOs aim to restore and expand basic services in support of local government actions, without discriminating between refugees and citizens. The aid projects should begin by spring 2014.

Aid for childhood and young people

Following the first phase of Algeria’s multi-actor plan for 2010-2012 (launched in 2007), a second €3.3 million phase for 2013-2015 has begun. It aims to solidify actions taken to date and to give member associations incentives to work together and with French partners. AFD has committed €2.5 million to help finance the second phase. About 100 Algerian nonprofits should benefit from the Joussour (“gateway” in Arabic) programme. It will provide funding for projects that help marginalized children and youths, all victims of social exclusion who need protection and/or who are physically, mentally or socially disabled. The programme will have both social and institutional impacts: it will improve the care of children and youths while strengthening the capacities of Algerian civil society.

Turkey

Morocco

Algeria

Lebanon and Jordan

Egypt

Syrian refugee family in the Bekaa Valley region of Lebanon

28

A F D 2 0 1 3 A C T I O N

Encouraging regional and environmental balance in Asia AFD seeks to lessen the pressure that rapid growth exerts on the environment in Asia, particularly in emerging countries. In less-developed countries, the Agency promotes regional synergy and growth industries.

During 2013, AFD designed a new Asia strategy for 2013-2016. It covers the 18 South, Central, and East Asian coun-tries where AFD operates, and focuses on urban and climate change-related issues. The strategy includes countries where AFD has newly received authorization to work: Myanmar, Central Asia and the Caucasus nations. The overarching goal is to promote green and inclusive growth. As requested by the participant Asian countries, AFD’s strategy empha-sizes the Agency’s role in harnessing French expertise and products for the region’s benefit.

The year 2013 saw the start of lending to Caucasus countries, with the first loan going to Armenia for social housing. The past year also saw AFD increase financing for South Asia: India, Bangladesh and Sri Lanka received more than 40% of the year’s Asian commitments.

Reducing the environmental footprint of cities and countriesAFD financing activity in 2013 illustrated the Agency’s willin-gness to take on climate and urban issues as central concerns.AFD helped integrate climate issues in public policy by finan-cing Vietnam’s “Climate Plan” for the fourth consecutive year. The Agency also financed Indonesia’s capital investment program for transportation infrastructure, and the Philippines programme in support of local governments. In addition to these policy-support loans, AFD supported cleaner ener-gy projects that targeted highly-emissive economic models reliant on carbon consumption. AFD set up two credit lines dedicated to renewables in India and Indonesia, and financed pilot projects for biomass and biofuels in China. The Agency also focused its attention on Asian cities, where nearly two billion people live. Aid projects centered on urban mobility

(a metro in Kochi), basic services provision (water and sani-tation systems in Dacca and Colombo and social housing in Armenia), and energy efficiency (electricity in Jakarta; a green-compliant addition to Karachi’s main hospital). AFD also promoted environmentally-friendly local development in general, through support for the capital investment funds of three Vietnamese cities.

AFD also worked to preserve biodiversity by financing a wetlands restoration project in the Chinese province of Lioaning.

Fostering regional convergenceAFD intervenes in the less-developed Asian countries, supporting their growth as regional economies move toward integration with the planned Association of South East Asian Nations (ASEAN) Common Market in 2015. The Agency also helps to bolster the competitiveness of these smaller econo-mies vis-à-vis their bigger emerging-country neighbors. AFD financing increases productivity in promising industries (such as agriculture and tourism) by building irrigation infrastructure in Vietnam and Myanmar and by providing hospitality-industry training in Cambodia. AFD also improves living conditions, particularly for women, by expanding basic utility services — for example, funding small-scale water operators and private-sector electricity companies in Cambodia and in the mountainous areas of Laos PDR.

Water management project in Vietnam’s Red River Valley

29

AFD’s partner in Asia

Since 2012, AFD has used European Union grant monies, channeled through European Commission funding facilities, to bolster the effectiveness of Asian projects supported by its own loans. The grant money brings a European foreign-aid dimension to AFD’s bilateral actions and allows the Agency to conduct pilot projects and strengthen local capacities. In 2013, the European Commission authorized AFD to deploy €12 million from its Asia Facility and Neighbourhood Investment Facility to supplement financing for projects in Cambodia, Pakistan, Bangladesh and Vietnam.

AFD and JICA jointly evaluated Climate Loans

AFD and the Japan International Cooperation Agency (JICA) made a joint assessment of Indonesia’s Climate Change Programme Loan, cofinanced by these agencies for nearly €600 million and $800 million respectively. This pilot evaluation demonstrated the program’s considerable influence — particularly its technical assistance — on the quality of projects designed to combat climate change.

Water supply made sustainable

The city of Dacca, with a population of 15 million, overuses its groundwater aquifer to meet a demand that may double by 2030. To address this problem, AFD committed a €73 million sovereign loan to Bangladesh, financing a project that aims to conserve the city’s subterranean water. The work will diversify drinking-water sources to include rivers, improve water supply services, and reduce leakage in the system.This project, cofinanced with the Asian Development Bank and the European Investment Bank, will help Dacca adapt to the effects of climate change. Besides broadly benefiting women, the project’s action plan foresees specific steps to aid them directly

World’s largest cattail marsh restored

The Shuangtai Estuary, in the Chinese province of Liaoning, boasts a nearly 300,000-hectare cattail marsh, rich in biodiversity and a refuge for many birds. Agricultural expansion, oil drilling and large-scale dry-outs have significantly degraded the estuary. AFD’s €35 million loan to China’s Finance Ministry will fund the rehabilitation of hydraulic infrastructure and the depollution of petroleum extraction sites. The project also plans to develop ecotourism and to diversify the artisanal and industrial uses for cattails.

Improving living conditions for the poorest in Laos

Opening of AFD office in Dacca, Bangladesh

The European Union

Indonesia

Bangladesh

China

30

A F D 2 0 1 3 A C T I O N

Promoting equitable and sustainable development in Latin America In Latin America and the Caribbean, AFD helps public-sector enterprises and local and central governments pursue green and inclusive growth.

France’s Interministerial Committee for International Cooperation and Development confirmed AFD’s mission to foster green and inclusive growth in Latin America and the Caribbean. The Agency helps central and local governments and public-sector enterprises meet three major challenges:

ɣ urban development in the world’s most urbanized region;

ɣ environmental preservation and climate change preven-tion, finding shared solutions to these global problems;

ɣ reducing social disparities in a region characterized by strong inequalities.

Furthermore, the Committee called on AFD to enlarge the scope of its activities to include all developing countries on the continent — particularly in Haiti, where the Agency is still working on post-earthquake reconstruction.In 2013, the AFD Group authorized €1.169 billion in finan-cing for the region. These funds will advance AFD’s strategy while strengthening partnerships between France and Latin American and Caribbean countries.

Developing citiesAFD bolstered its support for urban mobility by committing €300 million for a loan to the State of Sao Paulo, Brazil. The funds will be used to finance the metropolitan train company (Companhia Paulista de Trens Metropolitanos) in extending the Number 13 line. A technical cooperation programme will accompany the loan; France’s Île de France Region and its transportation union, the STIF (Syndicat des Transports d’Île de France) will share their expertise to foster good gover-nance in the city’s transport system.

In Colombia, AFD will provide a €52 million loan to the city of Barranquilla for implementing a plan to boost economic competitiveness and reduce social inequalities.

Fighting climate changeIn Mexico, AFD promotes agricultural practices adapted to climate change through a €37 million loan to a public finance institution, FIRAl. In addition, the Minas Gerais Development Bank in Brazil received a €50 million loan commitment for municipal sustainable development projects.

Increasing social equalityAs Colombia tackles a major reform in its mode of funding health and social protections, AFD will assist with a €295 million loan. In the Dominican Republic, the Agency approved a €7 million loan to FONDESA, the republic’s leading microfinance institution for agricultural loans. The financing supports loan access for young Dominicans who want to study agronomy; funding will also support capital investment in rural areas.

Nature conservation in the Dominican Republic

31

Island resiliency strengthened

After AFD endorsed its Latin America strategy in 2012, the Agency developed a Caribbean Action Plan in 2013. The plan addresses the specific challenges faced by small, developing island nations, and has two goals:

ɣ supporting viable and sustainable growth to strengthen the resilience of Caribbean nations, including improvements to infrastructure and the energy mix, conservation of natural environments and lands, and reinforcement of human capital;

ɣ promoting regional integration that benefits from the role and position of the French Overseas Provinces in the Americas.

Healthcare access equalized

The long-awaited, AFD-supported reform of Colombia’s healthcare and social protections aims to improve healthcare quality, reduce geographic and financial disparities in healthcare access, and control rising costs to ensure the system’s financial sustainability. AFD’s financing will underwrite health insurance coverage, a cause that France champions in international policy discussions. AFD is helping Colombia move from an American-style healthcare model to one inspired by the French system. This transition draws strongly upon French expertise, particularly that of employees working for France’s national health insurance organization. AFD also consults French companies specializing in managing health and social insurance information systems, for example manufacturers of smart cards, among other firms.

The year 2013 also saw significant progress in project implementation.

Following an international request for tenders, a proposal to rebuild the Hospital of the State University of Haiti was approved in August. The winning firm conducted detailed studies immediately thereafter to prepare for a start date in early 2014. At the same time, several measures have been taken, such as moving or reconditioning existing services, to ensure optimum continuity of care during the expected three-year reconstruction. The $83 million project has received financing through a €20 million grant from the French government and through funding from USAID and the Haitian government.

Mexico’s federal electricity commission, the Comisión Federal de Electricidad, used a 2012 AFD loan for €250 million to add natural gas capacity to the coal-burning Manzanillo power plant. The power station, with almost three gigawatts of installed capacity, was the country’s largest in 2013. Its conversion has allowed very significant greenhouse gas emission reductions, now approaching two million tons of carbon dioxide.

Caribbean

Colombia

Making real progress

RECONSTRUCTION ET EQUIPEMENTS DE LʼHÔPITAL DE LʼUNIV. DʼÉTAT DʼHAÏTIVUE ACCÈS GENERAL - VUES EN PERSPECTIVE

Construction worker building the Ayacucho Tramway in Colombia

Reconstruction of the Hospital of the State University of Haiti

32

A F D 2 0 1 3 A C T I O N

Contributing to sustainable development in France’s overseas provinces AFD assists local governments in the French Overseas Provinces with financing and advisory services to support their capital investments. It also provides resources and credit guarantees to local businesses, and supports projects involving other regional countries and companies.

In 2013, AFD strengthened its intervention capacity to compensate for financing difficulties experienced by inves-tors in the French Overseas Provinces. The Agency’s commit-ments reached €1.5 billion; 60% of this financing went to private-sector companies and 40% to the public sector. In addition to funding, AFD helps define local public policy through its office network and through consultations with provincial partners.

Closing the gap on social disparitiesEven more than on the French mainland, the public sector in the French Overseas Provinces drives economic activity, both through its purchases and the direct and indirect employment it generates. AFD’s social cohesion priorities manifest prima-rily in projects benefitting health and urban development.

In 2013, AFD increased commitments to the public sector by 50%, to €642 million; two-thirds of that amount came from state-subsidized loans for local government capital invest-ments. This financing mostly targets small towns and villages. AFD also holds a strong position in social housing through its equity participation in seven overseas property companies and the loans it makes to finance environmental upgrades and renovations.

Boosting economic activityAFD stimulates job-creating economic activity and direct-ly reduces unemployment and social tensions through its financial tools for private-sector development — loans, credit guarantees, investment capital, microfinance support, and Bpifrance representation. The agency also provides indirect support by financing public investment and by providing advi-sory services to localities.

AFD financing commitments for the private sector reached €862 million in 2013, of which 40% will be deployed in conjunction with Bpifrance, France’s public investment bank.

Protecting and using environmental capitalProtecting the fragile overseas environment is an AFD prio-rity, anchored in nature reserves and in water, sanitation, and waste management. The French Overseas Provinces reside on the front lines of international climate and biodiversity challenges.

In these territories, AFD advises and finances public offi-cials about water adduction, sanitation, waste treatment, and public transportation. The Agency provides financial resources to renewable energy companies, and participates in discussions about creating a European overseas biodiver-sity fund.

Drinking-water plant in Polynesia

33

Urban renewal in a Noumea suburb

All of the high-rise apartments in Saint Quentin, a suburb of Noumea, were built in the 1970s to meet the nickel-mining boom. Today, the district suffers from degraded housing stock, a deficit of public facilities, services, and shops, and a poor image among city residents. In 2013, AFD made a €10 million subsidized loan to one of its subsidiaries, SIC, a property company in New Caledonia. The funds will be used to finance a district-wide urban renewal project. The high-rises will be demolished and the site prepared for the construction of neighborhood facilities and 800 housing units tailored to Caledonian lifestyles. In addition to the loan, AFD signed and funded a partnership agreement with SIC and France’s national urban renewal agency, ANRU, to bring the latter’s expertise and experience to bear on this first urban renewal project in New Caledonia.

A new hospital in Saint Laurent du Maroni will improve patient services and accommodations, increase the amount and type of care available in the western part of French Guiana, and reduce waiting times. The new facility will also attract more healthcare professions into the area – an important factor in combating “medical deserts” in the region.

In a few years, the population of Saint Laurent du Maroni should exceed that of Cayenne, due to the city’s very high birth rate and its geographic location near the Suriname border. The need for healthcare services will increase considerably, even as our present-day infrastructure is already reaching its limits.

After studying the healthcare needs of populations living in the Maroni area, and aligning these needs with demographic projections, we saw a clear need for a new hospital.Financing for this ambitious project required important partners such as AFD, which gave us a subsidized €30 million loan.

More crops, renewable energy, and jobs

For the past several years, the island of Reunion has followed a sustainable development policy with support from AFD. In 2014, the Agency helped finance capital investments for the Bardzour Project, which means “early dawn” in Creole. The project, managed by the Akuo Energy Company, aims to build and operate a photovoltaic power plant; it will include both freestanding solar panels and others placed on greenhouse roofs in a correctional facility. The project has three development goals: energy production, from a nine-megawatt photovoltaic power plant coupled with a power-storage system; agricultural production, growing market crops in the solar greenhouses; and social integration for local residents and the inmates. The former will be employed in construction jobs during the plant building, and the latter will receive certified training in agricultural and apicultural techniques when the greenhouses are ready.

New Caledonia

French Guiana

Reunion

“ Gérard Barsacq General Manger of French Guiana’s Western Hospital Center

3-D image of a new hospital in French Guiana

34

A F D 2 0 1 3 A C T I O N

Assisting during crises, conflicts and fragile social or political situationsThe international development community faces a major challenge whenever fragile states and societies spiral into social or political violence. Everyone knows that there can be no security without development, and no development without at least some security.

Foreign aid has two crucial aims in this connection: to reduce the structural factors that lead to fragile states, and to manage surges of violence.

In many of the regions where AFD operates, it confronts crisis situations. The term covers many different problems, but most share at least some characteristics:

ɣ countries experiencing armed conflict or that have recent-ly ceased hostilities, such as the Central African Republic, Mali, Côte d’Ivoire, Iraq, Syria and Afghanistan;

ɣ failed or failing states that struggle to meet their obliga-tions, whether sovereign, such as providing homeland security and ensuring the rule of law, or administrative, such as delivering essential services – food security, healthcare, education – to their citizens;

ɣ divided and unstable societies suffering from cyclical or constant crisis with no clear way out, given the persistence of various tensions, — particularly regional, ethnic or reli-gious ones.

In these situations and others, AFD has a mandate to create the basis for and/or to bolster economic and social develop-ment. In fragile conditions,, the Agency must adapt the way it works to the specific nature of crisis situations. For this reason, in 2013 AFD’s governing board validated a strategy for fragile states and conflict zones, clarifying three principles for intervention: (1) doing (or adding) no harm; (2) achieving dual objectives; and (3) better articulating humanitarian and development aid.

Doing no harmThe first action guideline prescribes a deeper analysis of the situation; this forms the basis of the Agency’s intervention plan. The main goal of this approach is to avoid fueling the root causes of the fragility, crisis, or conflict. This means AFD must apprehend the overall situation and its economic, social and political components to better understand root causes and dynamics. This approach also allows the Agency to iden-tify and work around potential obstacles to project implemen-tation.

Achieving dual objectivesThe second action guideline calls for operations that have two objectives: (1) producing a development good, such as improved social services or economic productivity, just like any AFD-financed project, and (2) reducing some of the fragi-lities identified in the initial analysis. Dual-objective opera-tions are simple, flexible and robust, allowing aid actions and financing to have positive impacts in unpredictable and chan-ging situations.

Replacing opium poppy cultivation with cotton in Afghanistan

Water adduction in the Palestinian Territories

35

Better articulating humanitarian aid with development aidThe third action guideline for conflict- or crisis-recovery situa-tions, such as the aftermath of a natural catastrophe, consists of erasing the dichotomy between development aid and humanitarian assistance supplied by emergency-aid specia-lists. The usual division between the humanitarian-aid phase and the reconstruction phase is not very clear: immediate needs coexist with long-term needs in crisis situations, and decisions made during the humanitarian phase affect future development. This dichotomy creates a persistent gray area that requires coordination between humanitarian organiza-tions and development donors.

Setting milestones in response to 2013 crisesIn 2013, AFD continued to adapt its intervention strategy to crisis situations and drew closer to other donors also confron-ting the challenges violence poses to the development process. By applying this approach to news-making crises, AFD managed to reach several operational milestones. On behalf of the French government, AFD contributed to a multi- donor fund managed by Germany’s aid agency, KfW. The fund allowed aid organizations to respond as quickly as possible for reconstruction efforts in Syria. AFD also financed the efforts of local governments in Libya and Jordan to accommodate millions of Syrian refugees, helping to stem the spread of the crisis in the region. In Mali, AFD actively restarted cooperation efforts after the 2012-2013 crisis; the Agency also accelerated some projects, notably Sahel Heath Solidarity, a healthcare access initiative.In 2014, AFD will work with its supervisory ministries and its main partners – NGOs, other donors and the French defense ministry – to operationalize its strategy for conflict zones, particularly in the Central African Republic. The Agency will also equip itself with a range of special techniques and financial tools to address post-conflict reconstruction

challenges.

In 2013, AFD consolidated and continued the expansion of post-conflict psychosocial care to treat psychological trauma, thus preventing societies from falling into a spiral of violence. Just as individuals require food, housing and healthcare, so does development depend on the ability to strengthen mental balance and build harmonious social relationships. The mental health of traumatized populations constitutes a prerequisite for full success in Agency projects.

Psychosocial services aim to increase the resilience of individuals, families and communities affected by conflicts or natural catastrophes. Such support takes the form of activities such as group therapy, on-call psychosocial counseling, or psycho-educational games for children, among other strategies. In Côte d’Ivoire, for example, AFD will integrate a psychosocial component into one of its healthcare-system projects, financing the services through a debt reduction-development contract. The program, conducted in partnership with four French NGOs and the Humanitarian Aid and Civil Protection department of the European Commission (ECHO), will promote reconciliation among communities divided by recent violence.

Treating trauma victims with psychosocial services

Psycho-educational games organized by the Red Cross in Côte d’Ivoire

Sainte Therese Hinche Chantal Hospital in Haiti

36

Steps to obtain AFD project financing

1

NEGOTIATION OF FINANCING TERMS AND CONDITIONS

4 AFD examines in particular:The feasibility study’s hypotheses, conclusions, and financing plan;Project compliance with aid e�ectiveness principles: local project ownership, coordination with other donors, integration in local policy;Project's match with AFD and French development aid strategy;Economic, social and environmental e�ects for the beneficiary country or region;

Risk: technical, institutional, economic, financial (project profitability, borrower’s solvency, country macroeconomics), environmental, social, and project owner/shareholder risk of money laundering, terrorism financing and corruption.

AFD gets a “second opinion” about any financing application from a department independent of the one examining the project proposal. Since 2013, this “second opinion” includes an analysis of the project’s contribution to sustainable development.

3 Most often done by an external design or engineering o�ce; it may be paid for by AFD.

The study details project aims, expected results, technical and institutional feasibility, economic and financial viability (borrower’s repayment capacity, operating costs, and so forth).

The report describes the project, cost estimates and proposed financing.

It analyzes social and environmental impacts and project-related risk.

Financing beneficiaries

Central and local governments, NGOs, companies, project owners and developers, and others

AFD

provides project financing

FEASIBILITYSTUDY

9 Choice of suppliers according to local laws and AFD’s procurement principles, notably competitive bidding.

Monitoring of the work (if necessary, with technical assistance that may be financed by AFD) and payment of suppliers. At the project owner’s request, AFD may pay suppliers directly.

PHYSICALPROJECT

EXECUTION

FEASIBILITYSTUDY ANDFINANCING

APPLICATIONANALYSIS

9 Oversight for compliance with financing contract clauses (preconditions for funds transfers, no-objection notices for the selection modalities, choice of supplier and contracts, pre-authorization for any changes to the project, and so forth).

Funds transfer as the project progresses and expenditure receipts are received.

Vigilance over money laundering, terrorism financing and corruption risks. Ability to suspend fund transfers or require reimbursement.

Technical and financial supervision of the project.FUNDS

DISBURSEMENT

Examination of the project’s goals and its relevance to AFD’s priorities in the beneficiary country.

PROPOSAL ANALYSIS

PROJECTIDEA

2

AFD DECISION TO APPROVE FINANCING APPLICATION

76 FINANCING APPLICATION MADE TO AFD

5

SIGNING OF THE LOAN, GRANT OR SUBSIDY FINANCING AGREEMENT

Agreement on project parameters and financing terms and conditions

In 2013, 676 new financing commitments were made, totaling €7.5 billion

REPAYMENT OF LOAN TO AFD (IF CREDIT FINANCED)

10 Outstanding loans totaled €20.6 billion at the end of December 2013

In 2013, 677 financing contracts were signed, totaling €5.2 billion

POST-PROJECT EVALUATIONExamination of built works, their viability and economic, social and environmental impacts.11 In 2013, 26 completed projects were evaluated

In 2013, AFD disbursed €4.1 billion of funding

PROJ

ECT

IDEN

TIFI

CATI

ONFE

ASIB

LITY

ASS

ESSM

ENT

FINA

NCIN

G DE

CISI

ONPR

OJEC

T IM

PLEM

ENTA

TION

PROJ

ECT

COM

PLET

ION

8

Proposal submitted to AFD for financing consideration

37

1

NEGOTIATION OF FINANCING TERMS AND CONDITIONS

4 AFD examines in particular:The feasibility study’s hypotheses, conclusions, and financing plan;Project compliance with aid e�ectiveness principles: local project ownership, coordination with other donors, integration in local policy;Project's match with AFD and French development aid strategy;Economic, social and environmental e�ects for the beneficiary country or region;

Risk: technical, institutional, economic, financial (project profitability, borrower’s solvency, country macroeconomics), environmental, social, and project owner/shareholder risk of money laundering, terrorism financing and corruption.

AFD gets a “second opinion” about any financing application from a department independent of the one examining the project proposal. Since 2013, this “second opinion” includes an analysis of the project’s contribution to sustainable development.

3 Most often done by an external design or engineering o�ce; it may be paid for by AFD.

The study details project aims, expected results, technical and institutional feasibility, economic and financial viability (borrower’s repayment capacity, operating costs, and so forth).

The report describes the project, cost estimates and proposed financing.

It analyzes social and environmental impacts and project-related risk.

Financing beneficiaries

Central and local governments, NGOs, companies, project owners and developers, and others

AFD

provides project financing

FEASIBILITYSTUDY

9 Choice of suppliers according to local laws and AFD’s procurement principles, notably competitive bidding.

Monitoring of the work (if necessary, with technical assistance that may be financed by AFD) and payment of suppliers. At the project owner’s request, AFD may pay suppliers directly.

PHYSICALPROJECT

EXECUTION

FEASIBILITYSTUDY ANDFINANCING

APPLICATIONANALYSIS

9 Oversight for compliance with financing contract clauses (preconditions for funds transfers, no-objection notices for the selection modalities, choice of supplier and contracts, pre-authorization for any changes to the project, and so forth).

Funds transfer as the project progresses and expenditure receipts are received.

Vigilance over money laundering, terrorism financing and corruption risks. Ability to suspend fund transfers or require reimbursement.

Technical and financial supervision of the project.FUNDS

DISBURSEMENT

Examination of the project’s goals and its relevance to AFD’s priorities in the beneficiary country.

PROPOSAL ANALYSIS

PROJECTIDEA

2

AFD DECISION TO APPROVE FINANCING APPLICATION

76 FINANCING APPLICATION MADE TO AFD

5

SIGNING OF THE LOAN, GRANT OR SUBSIDY FINANCING AGREEMENT

Agreement on project parameters and financing terms and conditions

In 2013, 676 new financing commitments were made, totaling €7.5 billion

REPAYMENT OF LOAN TO AFD (IF CREDIT FINANCED)

10 Outstanding loans totaled €20.6 billion at the end of December 2013

In 2013, 677 financing contracts were signed, totaling €5.2 billion

POST-PROJECT EVALUATIONExamination of built works, their viability and economic, social and environmental impacts.11 In 2013, 26 completed projects were evaluated

In 2013, AFD disbursed €4.1 billion of funding

PROJ

ECT

IDEN

TIFI

CATI

ONFE

ASIB

LITY

ASS

ESSM

ENT

FINA

NCIN

G DE

CISI

ONPR

OJEC

T IM

PLEM

ENTA

TION

PROJ

ECT

COM

PLET

ION

8

Proposal submitted to AFD for financing consideration

38

A F D 2 0 1 3 A C T I O N

Supporting NGO initiativesIn 2013, AFD consolidated its ties with NGOs through increased funding and the adoption of its first strategic intervention framework for civil society.

Over the past year, in accordance with a promise from the French government, AFD continued to increase funding for civil society organizations. The Agency granted €48.7 million to 56 French NGOs, for an average of €667,000 each, to finance 73 projects. Eighty percent of the organizations recei-ving funds were small- to medium-sized, having total reve-nues of less than €15 million.

Three-quarters of this funding (€36.5 million) went to in-country projects. These included multi-organization programs in Algeria, Guinea, and the Republic of Congo, where funding aimed to strengthen civil-society capacity and its participation in public policy design.

One-quarter of the grant funding was dedicated to public education on development issues, creating nonprofit orga-nizations, and structuring the local nonprofit ecosystem. For example, AFD provided funds to Engineers Without Borders for a project to increase awareness of international solidarity issues. AFD also provided resources to the Agriculture and Food Commission of Coordination Sud to strengthen French NGOs during the 2014 International Year of Family Farming.

The NGO Innovation Funding FacilitySince 2007, AFD has used a special funding instrument known as Fisong to finance groundbreaking projects conduc-ted by international solidarity organizations. The funding faci-lity calls on NGO capacity to create real-world innovations in AFD’s priority sectors. The instrument also serves to catalyze discussions about shared interests and synergy between the Agency and NGOs.

Each year, AFD makes two calls for proposals on subjects jointly defined by the Agency and the NGOs. In the past year, the proposal topics were “Training through apprenticeships for social and professional integration,” and “Adapting farming practices to climate change.” After a joint review, AFD allocated €5 million to eight NGOs.

The year 2013 also saw the launch of three geographic funding facilities that took the form of NGO project solicitations: the €8 million Mali Facility and the €4 million Madagascar Facility, targeting family planning and maternal and infant health. The €4 million Lebanon-Jordan Facility focuses on improved living conditions for refugees and their host communities.

Microfinance program in Comoros

Health and anti-HIV/AIDS

15%


8%

Agriculture and food security

16%

Environment and natural resources

4%

Education3%

Infrastructure and urban development

3%

Business, industry and trade

7%

Human rights, governance,development education

and nonprofit support structures

44%NGO funding

by sector

Hospital in Sevaré, Mali

39

Increasing dialogue with civil societyThe year 2013 saw a step change in dialogue between AFD and civil society, as the Agency’s governing board adopted its first multidisciplinary civil-society intervention framework, the result of discussions between the Agency and several NGOs.

The past year also saw AFD engage with civil society organi-zations in periodic discussions about NGO financial hardships, their quality-assurance systems and strategies, and the impact of development education projects, among other topics. The Agency completed several post-project perfor-mance evaluations that covered Coordination Sud projects, health projects financed in several countries, projects for the Palestinian Territories, a cartography of development-educa-tion projects, and other initiatives.

AFD also sponsored several seminars about internatio-nal solidarity issues, including civil society dialogue with public officials, homeless street children, decent work, and micro-projects in developing countries. The seminar series also addressed the use of development education to promote other educational projects in developing countries.

AFD Intervention Framework for Civil Society Organization Initiatives

AFD has shown its willingness to create further synergy with civil society organizations through its strategic NGO intervention framework. All development practitioners recognize NGO knowledge of local conditions, as well as their expertise, innovative approaches, and influence in important international debates. In the coming years, AFD will orient its efforts in three major directions: supporting civil society in developing countries to alleviate poverty and achieve the Millennium Development Objectives; helping NGOs promote good governance, gender equality, and fundamental human rights; and reinforcing the effectiveness of French NGOs working in foreign countries.

Directions for 2013-2016

Sub-Saharan AfricaSub-Saharan Africa

Latin Americaand the Caribbean

Latin Americaand the Caribbean

AsiaAsieMiddle Eastand North Africa

Middle Eastand North Africa

57 %

27 %

10 %

6 %

Breakdown of NGO financing by region

Financed NGOs by revenue size

Between

€3 millionto €15 million

More than

€40 million

Between


Between


23 % 12 % 18 % 27 % 11 % 9 %

Between

€500,000to €1 million

Less than

€500,000Less than

€500,000

40

Partnering with French local governmentsOne of France’s foreign aid strengths lies in the internatio-nal cooperation efforts of French regional and local govern-ments. Consequently, French local governments have beco-me important partners for AFD. This cooperation, written into the Agency’s strategic orientation plans since 2007, covers all regions and sectors. AFD has signed about 30 partnership agreements with French local governments that have expressed strong interest in international aid. The Agency has begun about 60 joint projects, while another dozen have been funded through trilateral agreements (each co-signed by AFD, a local government in France, and a partner munici-pality in a developing country).

AFD participates in and financially supports many events and roundtables to give more life to these partnerships. The Agency also conducts joint studies with various decen-tralized cooperation partners on a number of subjects; this work results in numerous publications on water, urban trans-portation, inclusive economies, regional nature reserves, and other topics.

AFD and French local governments use public funds when they aid foreign countries. This requires the continued support of French taxpayers. In 2013, AFD took its story to the public by touring a photo exhibition, Objectif Développement, through several of its partner-cities in France.

In addition, AFD began the pilot phase of a direct finance system supporting the cooperation efforts of French local governments. The local authorities take the lead in iden-tifying and implementing projects for their beneficiaries in developing countries. This pilot experiment aims to finance sustainable land development in the least-developed coun-tries and/or those in fragile situations.

Working in tandem with companiesAFD has several types of relationships with French compa-nies. First, the Agency regularly communicates with French business associations and trade groups, as well as with French companies doing business in countries where AFD operates.

In 2013, AFD began an effort to bolster this communication and to increase the Agency’s awareness of France’s international aid opportunities for French businesses, and to increase their understanding of the range of AFD’s foreign-aid work. The goal is for AFD to help extend France’s economic influence, within the confines of the Agency’s mission and procedures. AFD supports innovative private-sector efforts that fulfill a central role: reducing poverty and creating stable jobs.

In 2013, AFD joined with business partners and the French chapter of the international solidarity organization CARE in support of a social enterprise start-up in Ghana. This project, currently under study for economic viability, would create a retail distribution network in rural areas, allowing vulnerable and isolated women a means to sell products. CARE France and its private-sector partners have used AFD financial support to conduct market research and sociological studies, the better to test what business model will prove socially and financially viable.

Business start-up program with CARE in Ghana

A F D 2 0 1 3 A C T I O N

Acting with French local governments and companiesAFD forms operational and intellectual partnerships with French local governments and private-sector companies – themselves major actors in development work. All these parties work alongside civil society stakeholders in developing countries.

Support for Minas Gervais State in Brazil, with the help of France’s Nord Pas de Calais Region

41

Division of labor and increased aid effectiveness on a European scale demand strategic partnerships between European institutions – the European Commission, the European Exterior Action Service, and the European Parliament. These aims also require daily work-related communication between teams in developing countries and in Brussels.

The year 2013 saw a new era for AFD and the European Union, one funding development through collective means at the European level. This new phase draws together European development agencies, resting on shared expertise and the value added by each donor.

The better to meet the needs of developing countries, AFD and the European Union increased their use of two forms of cofinancing: investment facilities that blend grant monies with loans, and delegated cooperation that transfers responsibility for fund management and disbursement.

The loan-grant blending facility combines loans from financial institutions with grants from the European Union to finance projects in beneficiary countries. This innovative approach provides a European response to ever-greater needs in developing countries; it strengthens initial project quality while integrating European priorities. The approach has financial objectives – mobilizing funds that can meet the needs of beneficiary countries – and nonfinancial ones: improving the sustainability and longevity of projects, promo-ting coordination between donors, increasing impacts and sectorial dialogue, and making European aid more visible. In 2013, AFD — already present and active in all of the regio-nal funding facilities— lobbied to open the blending facility to sub-Saharan African countries, targeting national projects and “orphaned” sectors, such as food security, agriculture, water, sanitation, health, education, and urban development or renewal.

Delegated cooperation, aims to increase aid effective-ness. It is a two-way process: AFD may transfer French bila-teral aid funds to the European Commission for manage-ment, or the Commission may delegate the management of European funds to AFD. Since 2008, AFD has received nearly €283 million from the Commission for project implementa-tion, primarily in sub-Saharan Africa. In return, AFD has trans-ferred €38.5 million to the European Commission for a road-way project in Haiti, and €10 million for healthcare in Guinea, making AFD one of the most “virtuous” donors in terms of reciprocity.

together with

A F D 2 0 1 3 A C T I O N

Intensifying relations with the European UnionAFD and the European Union have consolidated their partnership and improved aid effectiveness. They closely collaborate to cofinance projects and build European development-finance capacity. Seafaring know-how in Tahiti

In 2013, AFD actively worked on European Union facilities blending loans and grants, and participated in the European Development Days.

More than

€3 billion in loans provided

by AFD

€11 billionworth of investment in developing countries

Complementary funding from other donors as well as self-funding

€640 millionin European grants delegated to AFD

2007

2013

42

A F D 2 0 1 3 A C T I O N

Working with other donorsWorking with other donors maximizes means and impacts, favoring a coordinated approach.

The financing needs for development have increased, mobi-lizing bilateral and multilateral banks, UN and other agen-cies, civil society organizations, foundations, private-sector companies, and other agents.

In this context, aid professionals increasingly work together and use cofinancing techniques to stretch their financial and technical capacities. Aware of this challenge and following the lead of other donors, AFD has enlarged the number and breadth of its partnerships to maximize the leveraging effect of money and expertise.

AFD meets two goals in partnering with bilateral donors, such as KfW and JICA, and with multilateral donors, such as the European Investment Bank, World Bank, African Development Bank, Asian Development Bank and the Inter-American Development Bank:

ɣ Maximize leverage and scale economies when finan-cing development projects and programmes.

ɣ Exploit the comparative advantage of AFD and each partner.

In 2013, for example, AFD and the Asian Development Bank renewed a cofinancing framework agreement to increase their effectiveness in meeting beneficiary needs. These kinds of operational partnerships further the Agency’s extension of cofinancing deals to other donors. In 2013, AFD cofinanced 37 international projects, providing €1.7 billion of approxima-tely €8 billion total project funding.

Such cofinancing mostly went to infrastructure projects that generally require such large sums that a single donor cannot cover them alone. Half of these AFD-cofinanced projects benefited sub-Saharan Africa.

In 2013, AFD’s largest cofinancing partner was the European Union (through its financial instruments and the European Investment Bank), followed by the World Bank. The Asian Development Bank, the Inter-American Development Bank and Germany’s KfW numbered among AFD’s other principal cofinanciers.

AFD also works with various United Nations (UN) agen-cies, such as the UN Environment Programme, the UN Development Programme, and the International Fund for Agricultural Development. These collaborations entail joint finance of projects, group missions to beneficiary countries to assess project pertinence, and knowledge coproduction — funding experts and research and organizing colloquia. AFD also works in partnership with foundations, such as the Aga Khan Development Network and the Bill and Melinda Gates Foundation.

Furthermore, AFD is an active member of various develop-ment agency clubs and organizations — notably, the Interna-tional Development Finance Club (IDFC), whose membership comprises regional and national bilateral development banks. The IDFC promotes the role of development banks in fighting climate change.

Electricity grid in Vietnam

Electricity grid in Vietnam

43

Combining technical expertise with project financeAFD’s capacity-building activities aim to increase individual skills in project design, institutional montage, implemen-tation, and evaluation. The Agency also aims to improve organizational function and to help structure public policies in health, education, water, transportation, agriculture, and other sectors.

Grants usually fund support for capacity-building. These efforts target very diverse beneficiaries, from ministries, local governments and public entities to nongovernmental organi-zations, private-sector companies and other actors, mostly in sub-Saharan Africa. Capacity-building support comes in many forms, such as consulting and advisory services or technical assistance funding — particularly for agriculture, health and the environment — and is implemented by design or enginee-ring offices and public-sector organizations.

Training through CEFEB courses AFD’s business university in Marseilles, CEFEB, educates indi-viduals from beneficiary countries as well as AFD employees and cofinanciers.

Every year, 40 development practitioners attend the Masters program for Public and Private Works Management, pursuing a degree conferred by the University of Auvergne. The students are professionals from ministries, local govern-ments, businesses, and financial institutions in countries where AFD operates. Program coursework covers all aspects of project set-up, management, and financing, tying together several disciplines: economics, finance, management, public policy, and market regulations.

In addition to offering the Masters program, every year CEFEB organizes about 40 seminars to disseminate new information and field experiences, thus giving attendees a much-valued opportunity to network with one another. In June 2013, CEFEB also launched the “e-Dev” project: this is a new and truly innovative online learning tool that will allow CEFEB to reach geographically distant students and to offer more flexibility in scheduling and learning.

The FEXTE, a fund created in 2013 for technical expertise and experience transfers, is a financing instrument designed for middle-income countries, particularly emerging or rapidly-growing ones. In keeping with AFD’s geographic and sectorial mandates, this fund aims to meet demand for French expertise and experience while contributing to sustainable development. It finances technical cooperation, completing the range of tools that AFD can use in middle-income countries, and extends French influence.

A F D 2 0 1 3 A C T I O N

Bolstering local competencyGiven that capacity-building is a key element of sustainable development, AFD goes beyond project finance, helping improve the performance of in-country development actors.

CEFEB professional-training classroom

Meeting demand for French expertise in middle-income countries

44

In 2013, AFD reviewed and clarified its research strategy: knowledge creation provides a critical complement to deve-lopment finance. The creation of knowledge follows the same continuum as AFD’s financing goal: the encouragement and support of economically, socially, and environmental-ly sustainable development. This means embracing global issues, such as the climate and biodiversity, and covering the same intervention areas in foreign countries and the French Overseas Provinces.

Knowledge creation has two objectives. First, it informs and enriches operational strategies by promoting better unders-tanding of specific situations. Second, it bolsters AFD and French participation in international debates about develop-ment and its financing. The link between AFD operations and strategies remains essential and constant. Research serves above all to shed new light on action, joining operational questions to innovative research, publishing original findings, and clarifying each situation’s singularity. Research depends on strong multidisciplinary thinking that combines economics, management, anthropology, geography, demography, urba-nism, and political economy.

AFD concentrates its research efforts on specific issues, inclu-ding cities, environment, natural resources, social cohesion, human capital, states in fragile situations, accountability, development measurement, aid effectiveness, development finance, innovation, and climate (particularly in prepara-tion for the 2015 Climate Summit). Agency operations foster partnerships among research centers in beneficiary coun-tries, French institutions of higher learning and research such as CIRAD and IRD, and internationally-renowned European, Asian and American institutions — collaborations that can pose major challenges in themselves. AFD-supported research systematically includes partners and beneficiaries in the developing world.

As a financial institution, AFD analyzes the macroecono-mic situation of the countries in which it operates. This knowledge creation mainly serves internal uses and risk assessments; however, the Agency publishes some of its findings in journals and newsletters. AFD also conducts project performance evaluations according to the principles and criteria of the Organisation for Economic Co-operation and Development Donor Assistance Committee (OECD-DAC). The key lessons of these evaluations serve first to improve policies, programmes, and future aid projects. They then help build knowledge about development and provide fodder for public discussions. They also help AFD meet its accountability requirements

In 2013, AFD commissioned about one hundred research studies and published 45 journals and other works, adding to a catalogue of approximately 500 titles. Knowledge disse-mination also takes place through workshops, seminars and international conferences. AFD produced a conference on 22 November 2013 concerning France’s overseas provinces and international competition, and another on 11 December in conjunction with the European Research Development Network and BMZ, Germany’s economic cooperation and development ministry.

A F D 2 0 1 3 A C T I O N

Thinking about development aidHow can we measure vulnerability or social cohesion? Which public policies effectively promote low-carbon growth? How can we improve the articulation between professional or vocational training and the job market? AFD research teams work on these and other questions, in tandem with the Agency’s financing activity.

Conference about the French Overseas Provinces

WORKS ABOUT AFD’S ROLE AND MISSION

AFD and ...Brochures highlighting AFD’s operations and activities in various regions and sectors. 2013 titles include:

ɣ AFD and Cambodia ɣ AFD in East Africa ɣ AFD and Kenya ɣ AFD and marine protected areas

ɣ AFD and the commercial capacity- building programme

Action PlanThis collection summarizes AFD’s strate-gies and commitments, and presents its capabilities and expertise in specific domains and countries.

ɣ Reconciling Development and the

Fight Against Climate Change

ANTHOLOGIES

KaléidoscopeA monthly bibliography culled from inter-national journals, listing scientific and technical articles on economic develop-ment and poverty alleviation. In French.

ProduitdocA quarterly bulletin reviewing commodi-ties markets, organized by product and illustrated with graphs and summary tables. In French.

JOINT PUBLICATIONS

In partnership with the World BankThe African Development Forum Series focuses on sub-Saharan Africa’s princi-pal social and economic development challenges. Each volume addresses one issue, enriching thought about local, regional, and global policies.

Enterprising Women: Expanding Opportunities in Africa Mary Hallward-DriemeierWashington, DC, World Bank Publishing, 2013This book analyzes four key areas for expanding women’s economic empowerment in Africa: strengthening women’s property rights and their ability to control assets; improving women’s access to finance; building human capi-tal in business skills and networks; and strengthening women’s voices through business environment reform.The author analyses the latest data from surveys in 41 sub-Saharan African coun-tries and provides practical steps for policy makers and practitioners on how to close gender gaps and enable more women to shift to more profitable activi-ties.

A Planet for Life 2013, in partnership with IDDRI and TERIReducing Inequalities: A Sustainable Development Challenge, Rémi Genevey, Rajendra Kumar Pachauri, and Laurence Tubiana (eds). 2013The 2013 edition of A Planet for Life features case studies and a great deal of expertise to understand how each country and region can develop solutions to the problem of inequality.

Savoirs CommunsA discussion series based on AFD’s prac-tical experiences and those of other development aid professionals and parti-cipants. The series capitalizes on shared knowledge and good practices to foster mutual learning and enrichment.

N° 12 | Street Children: from indivi-dual care to the introduction of social policies (written with Samusocial International)This issue will help the reader unders-tand the situation of homeless “street children,” following them in the street and through their young lives. It discusses aid mobilization to provide lasting and multi-disciplinary care for their needs, overco-ming real challenges.

VIDEOS

Includes recent filmed interviews with experts, aid beneficiaries and deci-sion-makers, and recordings from several conference proceedings:

ɣ “Building Tunisia.” For the past 15 years, AFD has financed urban redeve-lopment projects in Tunisian slums and in settlements on the outskirts of cities. The Agency recently arranged finan-cing for further redevelopment efforts; it includes funding for an ambitious institutional support program.

ɣ “Green Morocco.” In 2008, the Kingdom of Morocco adopted the “Green Morocco Plan” to stimulate the country’s agricultural sector. The plan rests on several pillars; the second one, backed by AFD financing, supports fragile farm workers and organizations while fighting rural poverty.

ɣ “Enlightened Women.” Commu-nity-level women leaders promote change and development by taking on management of village savings asso-ciations.

ɣ “20 Years in Cambodia.” Since 1993, AFD’s work in Cambodia has evol-ved, diversified, and helped establish excellent relations between the Agen-cy and Cambodian aid beneficiaries.

AFD AND MARINE PROTECTED AREAS

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Publications, videos and conferencesThis is a partial list. You can download all English or French AFD publicationsfrom www.afd.fr

45

http://www.afd.fr

CONFERENCES

AFD produced 17 conferences in conjunc-tion with its international blog, “Ideas for Development” (or ID4D). About 100 people attended each event, which featured a wide variety of topics: “Sino-African Relations,” “The Right to Water,” “Decentralized Cooperation,” Food Price Instability,” “Youth Employment in Africa,” and “Decent Work,” among others.

SCIENTIFIC JOURNALS

Afrique contemporaineA quarterly journal of research articles analyzing major trends in African politics, economics and society. In French only. Published by de Boeck.

À SavoirA series featuring reviews of books and papers that frame current understanding of operational issues. AFD published 8 numbers in 2013, inclu-ding:

N° 17 | Managing food price instability in developing countries

This book identifies and analyzes four “pure” strategies that can be used to manage food price instability. It clearly underscores the limitations of conventio-nal solutions that rely on combining risk management with crisis management. It explains the need for considerable government involvement, in order to stimulate the modernization of agricultu-ral production and markets and recapita-lize vulnerable households. Public inter-vention is necessary to prevent prices from reaching extreme levels. Such inter-ventions must rest on a combination of instruments that match the specificities of each nation or region. The international community has a key role to play in the success of these policies.

N° 20 | Abolishing user fees for patients in West Africa: lessons for public policy

After 30 years’ expansion of direct service payments by African healthcare patients,

an increasing number of countries have initiated exemption policies to improve healthcare access, particularly for vulne-rable groups. This paper presents results from a 2009-2012 research program that documents the emergence, formulation implementation, and effects of these new payment-exemption policies in Burkina Faso, Mali and Niger. This rarely-seen multidisciplinary analysis of policies in West Africa makes an original contribu-tion to the subject of free healthcare in francophone countries, combining quan-titative, qualitative, sociological and anthropological approaches.

Conferences and SeminarsA series summarizing presentations and conclusions, drawn from development practitioner conferences and seminars.

N° 8 | Water and its Many Issues Methods and Cross-cutting Analysis

This issue contains proceedings from the “Water and Its Many Issues” conference (July 13-21, 2012, in Hanoi and in the Tam Đåo Hill station) on oceans, risks and governance; urban growth, social needs, and water and sanitation-service access; field-survey training for social and econo-mic water management; and a practical approach to agent-based modeling.

Working PapersA series of varied works on development policy, including in-depth articles, acade-mic works, and discussion papers.AFD published 6 numbers in 2013, inclu-ding:

N° 133 | Energy Efficiency Policies in China, India, Indonesia, Thailand and Vietnam

This study describes the current situation and recent trends in final energy demand in China, India, Indonesia, Thailand and Vietnam, analyzing their policies and the steps they have taken to increase end-use energy efficiency.

N° 134 | South-South cooperation and new agricultural development aid actors in western and southern Africa. China and Brazil - Case studies

This study improves understanding of the scope and methods of Chinese, Brazilian and Argentinian agricultural cooperation in western and southern Africa, specifi-cally Benin, Ghana, Mozambique, and Senegal.

FocalesA series presenting accounts of field experiences in developing and emer-ging countries, focusing on AFD and its partners – experts, researchers, consul-tants and practitioners.

N° 10 | Access to Water and Militant Uses of the Law. A Case Study in Soweto

In 1994, at the end of apartheid in South Africa, actualizing the right to water, as recognized in the new Constitution, became a priority. Johannesburg had launched in 1993 the Gcin’Amanzi project in its largest township, Soweto. From the outset, the project caused much contro-versy and in 2006 led to a trial known as the “Mazibuko Affair” when five Soweto residents contested two aspects of the project: the installation of prepaid water meters and the policy of free water, judged of insufficient quantity. This study retraces the history of Mazibuko Affair. Researchers interested by issues concer-ning militant use of the law and practitio-ners working in the water sector, particu-larly those in developing countries, will find a useful illustration to help predict the potential effects of water access rights. It will also help them judge the effectiveness of adjudicating the right to water, or social rights in general.

Ex post A collection that evaluates work by AFD and its partners and summarizes key lessons, organized according to five themes: Evaluation and Capitalization, Executive Summary, Methodology Notes, Impact Analyses, and Joint Evaluations. AFD published 6 titles in 2013.

MacrodevA series providing macroeconomic analyses of development processes, by country, region or topic. 2013 numbers include:

N° 11 | Emerging countries and financial globalization: Break or continuity?

N° 8 | Growth and Employment in South and East Mediterranean Countries: Do Labour Productivity Gains Play a Role in Job Creation?

N° 7 | Euro-Med Growth and Trade Inte-gration: Can we talk of a cost of the non-Mediterranean?

Development Questions A new publication from the AFD Research Department aimed at inspiring new actions, thought and strategies, through summaries of studies, evaluations, and research initiated or supported by AFD.

N° 4 | Public stocks of foodstuffs in Africa

N° 3 | Private education in sub-Saharan Africa

Nº 1 | Sustainable forest management

ResearchA series featuring AFD-initiated and direc-ted research studies.

46

Abolishing user fees for patients in West Africa: lessons for public policy

After 30 years of the spread of direct payment by health service users in Africa, more and morecountries are engaging in exemption policies to improve access to health care, with particularattention towards vulnerable groups relative to the Millennium Development Goals (pregnantwomen, children). While many research studies have focused on the positive effects of this freeaccess to care in terms of visits to health centers, rare are the works which study these public policiesas a whole, analyzing notably their implementation, their contradictions, their inconsistencies aswell as their perceptions by the actors concerned. Consequently, this file presents some resultsfrom a research program (2009 – 2012) which aims to document the emergence, the formulation,the implementation and the effects of these new policies of exemption from payment in BurkinaFaso, Mali and Niger. This is an original contribution in francophone countries, associatingquantitative techniques and a qualitative socio-anthropological approach in a West Africancontext where these policies have only barely been analyzed from this interdisciplinary angle.

AUTHORSValéry RIDDECRCHUM and University of Montré[email protected] OLIVIER de [email protected]

CONTACTSPascal BROUILLETAgence Française de Dé[email protected] de PERETTIAgence Française de Dé[email protected]

20

20

Valéry RIDDECRCHUM and University of Montréal

Jean-Pierre OLIVIER de SARDANLASDEL

Abolishing user fees forpatients in West Africa: lessons for public policy

May 2013

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AFDTeam

48

Board of GovernorsMembers as of 30 April 2014

MINISTRY OF THE ECONOMY AND FINANCE

Anthony REQUINDivision Head for Multilateral andDevelopment A�airs Treasury Directorate

Alexandre KOUTCHOUK7 th Vice Director of National Budget O�ce

Arnaud BUISSÉVice Director for Multilateral Financial andDevelopment A�airsTreasury Directorate

Armelle DAAM O�ce Head of Foreign A�airs andDevelopment AidBudget Directorate

MINISTRY OF FOREIGN AFFAIRS

Anne-Marie DESCÔTESGeneral DirectorGlobalization, Development & Partnerships

Véronique VOULAND-ANEINI Deputy Director

Africa and the Indian Ocean

Jean-Marc CHÂTAIGNERDeputy DirectorGlobalization, Development & Partnerships

Marc BARETYDeputy Director Middle East and North Africa

MINISTRY OF THE OVERSEAS PROVINCES

Thomas DEGOS Director, General Delegate and Prefectfor the French Overseas Provinces

Marc DEL GRANDEVice Director for the Public Policy O�ceOverseas Provinces Directorate

MINISTRY OF THE INTERIOR

Luc DEREPASGeneral Director of Foreigners in France

Francis HURTUT Division Head for International A�airs andCohesive Development

EXTERNAL EXPERTS

PARLIAMENTARIANS

ELECTED AFD EMPLOYEE REPRESENTATIVES

Omar KABBAJAdvisor to His Majesty The King of Morocco

Sylviane JEANNENEY-GUILLAUMONTProfessor Emeritus at the University ofAuvergne and CERDI Researcher

Jean-Louis VIELAJUSChairman of Coordination SUD

Jean-Louis MATTÉIChairman of the Supervisory Board for Société Genérale's Moroccan subsidiary

Guy DUPONTHonorary Chairman of the Federation of Overseas Enterprises

—

Michel DESTOTIsère Representative

Noël MAMÈREGironde Representative

Stéphane DEMILLYSomme Representative

Yves NICOLINLoire Representative

Yvon COLLINTarn and Garonne Senator

Jean-Claude PEYRONNETHaute Vienne Senator

Fabienne KELLERBas Rhin Senator

Christian CAMBONVal de Marne Senator

Jérémie DAUSSIN CHARPENTIER

Hatem CHAKROUN

Anne-Laure ULLMANN

François PACQUEMENT

Pierre RADANNEChairman of the Dossiers and Debates for Sustainable Development nonprofit organization

Marc-Antoine MARTINHonorary General Engineer of Bridge, Water and Forest Works

Laurence TUBIANACHAIRWOMAN

Government Commissioner: Claude WARNET

Appointed by the Ministries of the Economy and Finance; Foreign Affairs; Overseas Provinces; and the Interior

Appointed by the Ministry of the Ecology, Sustainable Development and Energy

Representatives appointed by the National Assembly Chairman

Senators appointed by the Senate Chairman

INCUMBENT ALTERNATE

49

AFD Group organigramSee detailed organization chart on www.afd.fr

Board of Governors

Executive Office

Ethics Advisor

Internal Audit—

Compliance, risk-management, anti-corruption and effectiveness

auditing

Board Secretary—

Preparation and follow-up of work done by the governing board and

committees

Operations Strategy External Affairs and Partnerships Administration Human

Resources Risk

Financing proposal analysis and execution oversight for development

projects

Strategic planning, development-

related knowledge creation and

international debate participation

Financial, organizational, budget, IT and logistics

management and administration

Employee recruitment, career management

and professional training

Risk prevention and mitigation for the Group’s

financing activity

LEGAL

Assistance for Operations in Foreign Countries

Support for Operations in French Overseas Provinces and other Legal Affairs

INTERNAL AUDIT AND COMPLIANCE

Disbursements Verification

GROUP RISK MANAGEMENT

Risk Monitoring

Credit Risk Analysis

Second OpinionAdvice from an expert outside the Project Risk Assessment department

Career Management and Recruitment

Workforce Development and Training

Employee Benefits Administration

Payroll and Benefits Comptroller

Labor Relations

External Affairs

Communication

NGO Partnerships

European Institutions Liaison Office (Brussels)

RESEARCH

Economic and Social Research

Knowledge Management Assistance

Evaluation and Capitalization

Macroeconomic and Country-Risk Analysis

STRATEGIC PLANNING AND FORECASTING

Strategic Planning

Organization and Forecasting

Crisis and Conflicts unit

CEFEB

Business University (Marseilles)

Administration and Communication

Training

FRENCH GLOBALENVIRONMENTFACILITYSECRETARIAT

State-funded financing facility for climate preservation and biodiversity conservation projects

MULTIDISCIPLINARY ASSISTANCE

Assistance for projects involving multiple sectors or geographic areas

Climate Change

Social and Environmental Assistance

Capacity Building Assistance

Procurement Assistance

SUB-SAHARAN AFRICA

MIDDLE EAST AND NORTH AFRICA


ASIA

LATIN AMERICA AND THE CARIBBEAN

HUMAN DEVELOPMENT

Education and Professional Training

Health and Social Protections

SUSTAINABLE DEVELOPMENT

Water and Sanitation

Transportation and Sustainable Energy

Agriculture, Rural Development and Biodiversity

BANKS, PRIVATE SECTOR AND LOCAL AUTHORITIES

Local Authorities and Urban Development

Financial Institutions and Private-Sector Support

Structured Finance

Guarantees

Non-sovereign Credits Monitoring

FINANCE AND ACCOUNTING

Financial Planning and Strategy

Financial Accounting

Back Office

Funding and Market Operations

Financial Communications

BUDGET COMPTROLLER

Business Efficiency Unit

Procurement Office

IT, BUILDINGS AND LOGISTICS

Business Support

Assistance for Business-Owners’ Changes

Software Lifecycle Management

Cross-functional Business Management

Buildings and Logistics Management

Urbanization, Architecture and Techniques

Security and Business Continuity

Communications and relations with national and

international partners, such as NGOs, companies,

and local authorities

PROPARCOSubsidiary for private-sector

project finance

AFD NETWORK

AFD field offices and bureaus

http://www.afd.fr

50

Management teamAs of 30 April 2014

Operations Strategy External Affairs and Partnerships Administration Human

Resources Risk

Jean-Marc GRAVELLINI*Chief Operating Officer

Jean-Yves GROSCLAUDE*Chief Strategy Officer

Catherine GARRETA*

Chief External Affairs and Partnerships Officer

Colette GROSSET*Chief Administrative Officer

Christine HARNÉ*Chief Human

Resources Officer

Éric BAULARD*Chief Risk Officer

Jean-Claude BREDELOUXVice President of Operations

Emmanuel DEBROISE

Vice President of External Affairs and Partnerships

Laurence LAJOINIE-GNANSIA

Vice President of Human Resources

Valérie ALEXISVice President of Risk

Operations Strategy Administration Risk

Yves BOUDOTSub-Saharan Africa

Marie-Pierre NICOLLET

Middle East and North Africa

Pascal PACAUTFrench Overseas

Provinces

Grégory CLEMENTEAsia

Philippe ORLIANGELatin America and

the Caribbean

Christian BARRIERHuman Development

Maurice BERNARDSustainable

Development

Odile LAPIERREBanks, Private Sector and Local Authorities

Dimitri KANOUNNIKOFF

Multidisciplinary Assistance

Alain HENRYResearch

Bernard ESNOUFStrategic Planning and

Forecasting

Roger GOUDIARDCEFEB

French Global Environment Facility (FGEF)

François-Xavier DUPORGE

Administrator

Philippe BAUDUINFinance and Accounting

Bertrand LOISEAUBudget Comptroller

Françoise TISSEYREIT, Buildings and Logistics

Valérie ALEXISLegal Affairs

Marianne SIVIGNON- LECOURT

Compliance and Internal Audit

Jean-Philippe AUBERTELGroup Risk

Management

DEPARTMENTS - Directors

DIVISIONS

*Executive Committee Member

EXECUTIVE OFFICE

PROPARCO

Anne PAUGAM*Chief Executive Officer

Jacques MOINEVILLE*Deputy Chief Executive

Claude PÉRIOU*Chief Executive Officer

Marie-Hélène LOISONChief Operating Officer

Ghislain DE VALONChief Administrative Officer (interim)

Didier MERCIERChief Inspector General

François KERHUELChief Ethics and Compliance Officer

51

A F D T E A M

Working for AFDAFD has offices on four continents and finances development projects in more than 90 countries. The Agency maintains a worldwide network of 71 field offices and bureaus, including nine in the French Overseas Provinces and one in Brussels. Of the AFD Group’s 1,744 employees, 41% work in the field office network.

Working on a transmission tower in French Polynesia

AFD Group employee headcount 2013

Employees working in mainland France 1,183

Employees working in foreign countries and the French Overseas Provinces 561

Total employees 1,744

Employees of Reserve Banks* 362

International volunteers (AFD Group and Reserve Banks) 103

* The Reserve Banks act in the name of and on behalf of the Banque de France, under its authority. They operate as central banks in the French Overseas Provinces. However, their employees come under the economic and social unit, AFD/Reserve Banks.

Latin America andthe Caribbean

7%

Asia and the Pacific16%

French Overseas Provinces17%

Middle East and North Africa12%

Sub-Saharan Africa48%

AFD employeesin foreigncountries

in 2013

30 Offices

11 Offices

9 Offices

13 Offices

7 OfficesKnowledge creation and partnerships

15%

Management and administration31%

Risk management12%

Fiduciary banking5%

Projectfinance

37%

Breakdownby speciality(Employees working

in France, not includingmanagement)

3.78% of grosssalaries

136 newemployees

Training budget

Recruitment

(65 new hires in mainland France and 71 new hires in foreign countries or French Overseas Provinces)

196

41%

employees

transferred between headquarrters and a field o�ce

Internal mobility

of which

52.3%

45

women

Male-female ratio

Average age

17% under 30 years old

22 work-study and on-the-job training contracts

103 internationalvolunteers

96 interns

Youth employment

Some key numbers for 2013

52

53

Employees exercise many generalist and specialist professions within AFD Group, at headquarters and in the field offices.

Virginie Leroy SaudubrayDeputy DirectorAFD office in Kinshasa, Democratic Republic of Congo

In the Democratic Republic of Congo, we work very closely with our beneficiaries, sharing and applying our expertise. The fields I work in – the environment and climate, education and health – have changed greatly over the past four years. Our work arises from the expansion of AFD’s financing activity and the implementation of a debt reduction-development contract.

Christophe CottetEconomist, Strategy DivisionAFD headquarters in Paris, France

Economists working in the Research Department conduct macroeconomic analyses of AFD’s principal operating regions, evaluating risks to AFD financing operations. We providing a reading and ranking of country risk levels. Our work as economists is vital for project managers and others in the field; we help the AFD Group anticipate changes in beneficiary country status and their future needs.

Demba TandiaTrader, Finance and Accounting DepartmentAFD headquarters in Paris, France

Traders ascertain interest rates, manage market risks, and structure AFD’s loans. We are also responsible for funding AFD through capital markets, and we work in close collaboration with the Agency’s counterparties.

Abdelilah ChachProject Assistant

AFD office in Rabat, Morocco

Since 2013, I have been providing operational support to visiting project leaders, standardizing files, sorting the Rabat office directories, digitizing archives

and managing the local IT network.

Aurélie ChevrillonProject Manager for Sustainable Agricultural Development

AFD headquarters in Paris, France

Project managers do all kinds of work…They talk with beneficiary-country project partners, aid recipients, and suppliers. They work with local offices to identify needs, find partners, and analyze projects prior to implementation. They also monitor projects, provide onsite

expertise, and oversee the country’s environmental, regulatory, and institutional policies, among other services.

54

IN FOREIGN COUNTRIES

AFGhANISTAN

ALGERIA

ANGoLA

BANGLADEShAlso overseen by India field office

BENIN

BRAZIL

BuRKINA FASo

BuRuNDIAlso overseen by the Kenya office

CAMBoDIA

CAMERooNAlso oversees: Equatorial Guinea

CENTRAL AFRICAN REPuBLICAlso overseen by the Cameroon office

ChAD

ChINA

CoLoMBIA

CoMoRoS

CoNGo (DEMoCRATIC REP.)

CoNGo

CôTE D’IvoIREAlso oversees: Liberia

DjIBouTI

DoMINICAN REPuBLICAlso oversees: the Bahamas, Cuba, Jamaica

EGYPT

EThIoPIAAlso oversees: Eritrea, Somalia, South Sudan, Sudan

GABoNAlso oversees: Sao Tomé and Principe

GhANA

GuINEAAlso oversees: Sierra Leone

hAITI

INDIAAlso oversees: the Maldives

INDoNESIA

IRAQ

joRDAN

KENYAAlso oversees: Rwanda

LAoS PDRAlso overseen by the Cambodia office

LEBANoN

MADAGASCAR

MALI

MAuRITANIA

MAuRITIuSAlso oversees: Seychelles

MExICo

MoRoCCo

MoZAMBIQuEAlso oversees: Swaziland

NIGER

NIGERIA

PAKISTAN

PALESTINIAN TERRIToRIES

PhILIPPINES

SENEGALAlso oversees: Cape Verde, The Gambia, Guinea Bissau

SouTh AFRICAAlso oversees: Botswana, Lesotho, Malawi, Namibia, Zambia, Zimbabwe

SRI LANKAAlso overseen by India office

SuRINAMEAlso overseen by French Guiana office

TANZANIAAlso overseen by Kenya office

ThAILAND

ToGo

TuNISIA

TuRKEY

uGANDAAlso overseen by Kenya office

vIETNAM

YEMENAlso overseen by Djibouti office

IN THE FRENCH OVERSEAS PROVINCES

FRENCh GuIANAAlso oversees: Brazil (Amapá), Guyana, Suriname

FRENCh PoLYNESIA

GuADELouPE

MARTINIQuEAlso oversees: Barbados, Lesser Antilles, Trinidad and Tobago

MAYoTTE

NEW CALEDoNIAAlso oversees: South Pacific Island Nations, Vanuatu

REuNIoNAlso oversees: French Southern and Antarctic Territories

WALLIS AND FuTuNAAlso overseen by New Caledonia office

SAINT PIERRE AND MIQuELoN

CLOSE TO EUROPEAN INSTITUTIONS

BRuSSELS

AFD’s international reachAFD maintains a worldwide network of 71 field offices and bureaus

Beneficiary country

Field office or bureau

Contact details and information about the operations of each office and bureau may be found on www.afd.frA neighboring AFD office or AFD headquarters in Paris oversees operations in countries without a field office or bureau.

http://www.afd.fr

Financialinformation

56

A F D F I N A N C I A L I N F O R M A T I O N

Financial statementsA view of the AFD Group’s (AFD and PROPARCO) financial standing as of 31 December 2013.The complete 2013 AFD Group financial report is available in the Registration Document, which can be downloaded from www.afd.frRounding may cause totals to vary slightly from an item-by-item addition.

ASSETS (€ million)

2012 2013LIABILITIES AND CAPITAL (€ million)

2012 2013

Loans (net outstanding) 18,617 20,553 Bonds and borrowings from the market

14,271 17,109

Loans (gross outstanding) 18,941 20,848

(-) Allowances for capital and interest impairments

-422 -408

(+) Accrued interest 98 113 Borrowings from French Treasury 2,548 2,630

Financial liabilities (excluding own debt)

223 201

IMF-PRGF operations* 1,861 1,859 IMF-PRGF operations* 1,860 1,858

Investment portfolio 692 689 Managed funds and advances from French government

646 640

Cash and short-term instruments

1,228 2,356 Accruals and other liabilities 992 1,214

Equity participations 436 478

Provisions 781 911

Property, plant, equipment and intangible assets

203 213 Capital and Retained earnings 2,200 2,225

Accruals and other assets 573 732 Net income 88 93

ToTAL 23,610 26,880 ToTAL 23,610 26,880

2011 2012 2013

Net banking income (€ million) 361 363 441

Salary costs / Net banking income 46.1% 46.9% 41.8%

Net income (€ million) 73 88 93

Dividends paid to French Treasury (€ million) 71 55 63

Return on equity Overhead expenses(1) / Net banking income 71.6% 73.8% 63.6%

Return on capital employed Earnings before interest and tax / Capital employed(2) 4.3% 5.0% 5.3%

Return on assets Net income / Total assets 0.4% 0.4% 0.3%

Balance Sheet

Key ratios and indicators

*PRGF: Poverty Reduction and Growth Facility. IMF: International Monetary Fund

(1) Overhead includes depreciation and amortization expenses.(2) Average debt liabilities and average shareholder’s equity net of provisions for general banking risk (€460 million).

http://www.afd.fr

57

ExPENSES (€ million) 2012 2013 INCOME (€ million) 2012 2013

Borrowings expense 952.4 942.0 Income earned on loans and guarantees

1,027.9 1,074.4

Interest expense 398.2 401.3 Interest income and commissions on loans and guarantees

528.2 569.3

Swaps expense 549.9 535.1 Swaps income 539.7 548.4

Net allowances for unpaid interest -7.1 -5.1

Interest income losses 0.0 -0.2

Net allowances for sovereign credits impairments -42.1 -47.0

Net foreign exchange loss (- gain) 4.3 5.7 Recoveries on subsidy account for SAL* and mixed loans-grants

9.2 9.0

Income earned on interest rate subsidies 184.6 190.0

Investment income 54.5 51.9

Income from equity participations 3.5 13.4

Commissions on operations 36.6 43.2

Miscellaneous financial expenses 30.2 29.8 Miscellaneous commissions 37.4 38.6

Expenses for IMF-PRGF operations 37.1 14.9 Income from IMF-PRGF operations 38.0 15.9

Total Banking Expenses 1,019.7 986.7 Total Banking Income 1,382.5 1,427.4

Net of IMF-PRGF Operations Expenses

982.6 971.9 Net of IMF-PRGF Operations Income 1,344.5 1,411.5

NET BANKING INCOME 362.9 440.7

General and administrative expenses 254.1 265.6

• Employee compensation and benefits 170.3 184.3

• Taxes and regulatory fees 4.7 5.0

• Other general and administrative expenses 79.1 76.3

Net allowances for depreciation of property, plantand equipment and amortization of intangibles

13.7 14.8

Total operating expenses 267.8 280.4

GROSS OPERATING INCOME 95.1 160.2

Cost of risk and other credit risk provisions -8.8 -60.4

Net allowances for loan impairments 5.2 19.4

Provisions for contingencies and charges -12.1 -80.6

Capital losses on bad debt and loan losses -2.0 0.9

Gross income from operations 86.3 99.9

Gains or losses on fixed assets 1.9 2.2

Net profit before tax and exceptional items 88.1 102.1

Net income (- loss) from exceptional operations -0.3 -9.2

Net Income 87.9 92.9

Income Statement

*SAL: Structural Adjustment Loan

58

GRANTS AND SUBSIDIES LOANS GUARANTEES PRIVATE EQUITY

BUDGET SUPPORT AND DEBT REDUCTION-

DEVELOPMENT CONTRACTS TOTAL DELEGATED FUNDS

2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013

SUB-SAHARAN AFRICA

Benin 0.3 6.2 10.0 1.7 12.0 6.2 1.3 9.0

Burkina Faso 23.6 3.2 92.5 5.7 1.4 19.5 48.8 97.0 59.8

Burundi 5.2 3.5 0.3 3.0 5.6 6.5

Cameroon 0.5 0.6 83.2 179.7 14.1 21.3 33.5 10.0 131.3 211.6

Central African Republic 6.6 0.4 6.0 12.6 0.4 3.8

Chad 11.4 8.3 6.6 6.8 18.0 15.1 9.5

Comoros 15.0 0.5 3.0 1.0 18.0 1.5 4.2

Congo (Democratic Rep. of the) 0.5 6.7 8.0 2.4 2.0 0.5 46.0 11.3 54.7 2.4

Congo (Republic of the) 1.0 40.0 41.0 5.1

Côte d'Ivoire 1.2 2.5 76.3 60.0 30.4 18.1 0.1 144.7 388.7 252.7 469.4 19.9

Djibouti 6.0 6.3 6.0 6.3 5.2

Ethiopia 1.5 50.0 0.1 0.1 51.5

Gabon 165.0 6.7 5.8 12.0 12.0 18.7 182.8

Ghana 0.6 0.5 125.6 61.6 2.0 2.7 5.4 12.3 133.7 77.0 5.0

Guinea 9.0 12.4 3.9 0.9 5.0 14.0 14.0 31.2 1.7

Kenya 0.03 0.5 128.9 267.9 0.4 4.0 129.3 272.5 26.1 30.0

Liberia 5.2 3.9 3.9 5.2

Madagascar 16.6 13.8 11.6 12.1 28.2 25.8

Mali 0.8 15.2 5.0 1.6 3.5 15.0 2.4 38.7 17.1

Mauritania 6.5 2.2 41.3 13.0 60.9 2.2 20.4

Mauritius 1.0 82.6 60.0 0.2 0.9 3.9 86.8 61.9 3.0

Mozambique 1.5 50.0 82.8 1.6 50.0 85.9

Namibia 4.8 2.0 2.0 6.8 2.0

Niger 2.7 26.0 40.0 30.0 0.8 10.0 10.0 52.7 66.7 11.0

Nigeria 0.4 76.8 197.7 77.2 197.7

Rwanda 0.3 0.1 3.8 4.2

Senegal 30.2 8.7 152.0 183.0 11.1 16.0 193.3 207.6

Seychelles 10.0 10.0

South Africa 0.3 145.2 100.0 7.1 152.3 100.3

Sudan 1.4 1.4

Tanzania 0.9 0.7 56.5 107.6 0.8 0.2 58.2 108.5

Togo 8.1 10.3 3.8 6.0 11.8 16.3 39.9

Uganda 0.5 18.8 27.5 0.2 19.5 27.5 0.8

Zambia 59.1 50.0 0.9 59.1 50.9 6.7

Zimbabwe 0.8 14.7 0.8 14.7

MULTI-COUNTRY PROGRAMMES 46.0 56.6 256.8 101.3 7.2 11.9 23.1 60.0 322.0 240.9 25.0 78.5

TOTAL 195.1 190.4 1,425.8 1,841.4 109.2 109.8 32.7 36.3 250.7 599.7 2,013.5 2,777.7 161.3 224.0

MIDDLE EAST AND NORTH AFRICA

Algeria 3.0 3.0

Egypt 387.0 80.0 387.0 80.0 20.8 15.0

Jordan 1.0 150.0 151.0

Lebanon 2.7 1.2 56.5 65.6 59.2 66.7

Libya 0.3 0.3

Macedonia 0.7 0.7

Morocco 0.7 4.3 380.0 250.0 380.7 254.3

Palestinian Territories 16.4 15.4 1.5 1.2 17.9 16.6 4.9

Syria 7.0 7.0

Tunisia 3.4 6.2 50.0 2.0 8.5 63.9 6.2 32.1

Turkey 151.9 348.5 151.9 348.5 21.7

MULTI-COUNTRY PROGRAMMES 5.9 13.4 5.9 13.4 0.2 5.0

TOTAL 30.4 51.2 1,175.3 744.1 3.5 1.2 8.5 1,217.7 796.5 58.0 41.7

AFD Group 2013 financing commitments by country (€ million)


59

GRANTS AND SUBSIDIES LOANS GUARANTEES PRIVATE EQUITY

BUDGET SUPPORT AND DEBT REDUCTION-

DEVELOPMENT CONTRACTS TOTAL DELEGATED FUNDS

2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013

ASIA AND THE PACIFIC

Afghanistan 26.3 10.0 26.3 10.0

Armenia 0.5 21.1 21.6

Azerbaijan 11.5 11.5

Bangladesh 57.3 73.2 0.2 0.3 57.5 73.5 2.9

Cambodia 6.8 2.1 69.7 18.6 3.7 3.8 76.4 28.1 0.7

China 130.6 115.0 130.6 115.0

Georgia 15.6 15.6

India 0.1 0.4 280.4 330.0 0.1 26.9 8.5 307.4 339.0

Indonesia 140.5 211.6 140.5 211.6 3.0

Laos PDR 4.0 4.0

Mongolia 11.4 11.4

Myanmar 1.9 4.0 1.9 4.0

Pakistan 61.0 11.9 61.0 11.9 2.5

Philippines 0.1 60.0 109.8 60.0 109.9

Sri Lanka 0.4 24.0 75.1 24.4 75.1

Vanuatu 0.3 0.1 0.3 0.1

Vietnam 1.6 1.6 103.0 143.8 104.6 145.4 6.0

MULTI-COUNTRY PROGRAMMES 3.6 0.7 11.1 9.6 3.6 21.4

TOTAL 41.0 23.5 942.0 1,144.1 0.2 4.1 26.9 21.9 1,010.1 1,193.6 15.1

LATIN AMERICA AND THE CARIBBEAN

Argentina 15.1 15.1

Brazil 2.0 756.4 395.0 10.0 7.7 768.4 402.7 1.5 1.5

Chile 18.5 18.5

Colombia 149.9 404.1 149.9 404.1 9.5 7.7

Costa Rica 7.7 15.6 7.7 15.6

Dominica 6.5 6.5 2.0

Dominican Republic 0.1 0.9 59.6 14.8 59.7 15.7 10.0

Ecuador 16.2 17.5 16.2 17.5

El Salvador 1.1 1.1

Guatemala 0.2 0.2

Haiti 7.5 3.6 3.0 2.5 0.7 8.0 18.0 7.2 4.7

Honduras 16.0 15.5 16.0 15.5

Mexico 1.5 60.0 147.0 61.5 147.0 7.0 14.7

Nicaragua 20.3 14.6 20.3 14.6

Panama 37.0 6.8 6.8 37.0

Paraguay 7.8 7.8

Peru 36.9 44.6 36.9 44.6

Saint Lucia 0.2 0.2

Suriname 0.3 0.3

Uruguay 31.1 31.1

MULTI-COUNTRY PROGRAMMES 0.1 11.6 7.4 19.1

TOTAL 11.0 6.4 1,175.7 1,146.6 2.5 0.7 16.8 15.1 8.0 1,214.1 1,168.8 34.6 23.9

NON-COUNTRY-SPECIFIC PROGRAMMES

34.4 25.9 4.0 55.1 5.0 43.4 80.9

TOTAL FOREIGN COUNTRIES 312.1 297.4 4,722.8 4,931.3 115.4 115.7 89.8 73.3 258.7 599.7 5,498.7 6,017.5 254.0 304.6


French Guiana 77.3 92.4 6.9 18.1 84.2 110.5

French Polynesia 0.4 0.5 170.7 136.5 67.3 36.5 238.4 173.6

Guadeloupe 190.6 146.1 33.5 28.9 224.1 174.9

Martinique 175.6 349.5 23.1 26.8 198.7 376.3

Mayotte 46.5 48.9 6.7 3.8 53.2 52.7 2.8

New Caledonia 0.3 0.7 241.9 202.3 10.9 9.7 253.1 212.7

Reunion 337.8 324.1 67.5 75.2 8.5 413.8 399.4

Saint Pierre and Miquelon 4.8 1.4 0.3 0.04 5.1 1.5

Wallis and Futuna 0.1 0.2 0.1 0.2

Shared by several local governments 0.6 0.3 1.8 3.6 2.4 3.9

Shared by several provinces 5.0 5.0

Shared by several local governments and provinces

0.4 0.4

TOTAL FRENCH OVERSEAS PROVINCES 1.8 1.7 1,250.2 1,301.3 217.9 202.7 8.5 1,478.4 1,505.6 2.8

AFD GROUP TOTAL 313.9 229.1 5,973.0 6,232.6 333.3 318.4 98.3 73.3 258.7 599.7 6,977.2 7,523.1 256.8 304.6

The above amounts reflect financing commitments made by AFD Group in 2013 for current and future disbursement.

60

SECTOR COUNTRY PROJECT BENEFICIARY

TOTAL COMMITMENT

(€ MILLION)

AGRICuLTuRE AND FooD SECuRITY

AFGHANISTAN Rural development in the Central Highlands NGO 10.00

CAMEROON Support for comprehensive agricultural and grazing resource management in North Cameroon Central government 10.00

CÔTE D'IVOIRE Support to speed the recovery of agricultural industries (Agricultural debt-relief contract) Central government 62.55

DOMINICAN REPUBLIC

Support for rural microfinance Private-sector bank 2.00

LAOS PDR Development programme for mountainous regions in the north Central government 4.00

MOROCCO Credit line to support small and midsize farms Private-sector bank 20.00

MYANMAR Irrigation improvements in arid regions Central government 3.00

NIGER Support for comprehensive management of the Niger-Kandadji river basin Central government 7.00

SENEGAL Support for irrigated-crops diversification and livestock development in Podor Central government 30.00

TURKEY Credit line to upgrade SME health and sanitation safety levels Public-sector bank 100.00

VIETNAM Credit line to finance private-sector activity in rural areas Public-sector bank 20.00

Hydraulic infrastructure for agriculture in Binh Dinh and Hung Yen Provinces Central government 18.80

MULTI-COUNTRY Support for an agricultural risk-management programme Public-sector bank 2.00

Support for family farms in sub-Saharan Africa NGO 1.67

Trade capacity-building programme for local procurement, food-processing and quality improvement in West Africa

Public-sector enterprise 2.00

Support for irrigation policy design Non-profit organization

1.20

INFRASTRuCTuRE AND uRBAN DEvELoPMENT

ARMENIA Creation of credit instruments to encourage renovations and energy-efficiency improvements to low-income housing

Public-sector bank 10.00

BRAZIL Municipal-finance credit line for the Minas Gerais Development Bank Public-sector bank 50.00

Construction of the "Guarulhos Train" suburban railway line Local government 300.00

BURKINA FASO Sustainable development project in Ouagadougou Central government 40.00

COLOMBIA 2012-2015 Development Plan for the Municipality of Barranquilla Local government 51.68

Partial funding for Antioquia Province's capital investment budget Local government 52.10

CONGO Urban road construction (Corniche highway) Central government 40.00

CÔTE D'IVOIRE Intercity and rural road rehabilitation Central government 152.60

EGYPT Support for jobs stimulus and improved living conditions Central government 80.00

ETHIOPIA Freight services capacity extension for Ethiopian Airlines in Addis Ababa Public-sector enterprise

50.00

GABON Ndjolé-Médoumane Highway rehabilitation in Gabon Central government 55.00

INDIA Funding for lightrail subway in Kochi Central government 180.00

INDONESIA Institutional support for transport infrastructure planning and construction Central government 74.70

KENYA Airfreight infrastructure upgrades at Mombasa's Moi International Airport Public-sector enterprise 48.00

MOROCCO Urban development of the new city, Zenata Public-sector enterprise 150.00

Support for the environmental and social plan adopted within Al Omrane's capital investment programme


MOZAMBIQUE Runway rehabilitation at Maputo International Airport Central government 32.45

NIGERIA Pilot program for microloans to support homeowners building, expanding and renovating their homes, with technical assistance provided by Lafarge

Private-sector bank 5.00

PHILIPPINES Local-government finances reform programme Central government 109.79

SENEGAL Dakar Highway extension Central government 89.00

SOUTH AFRICA Railway modernization programme Public-sector enterprise 100.00

SYRIA Contribution to the multi-donor Syria Recovery Trust Fund Private-sector bank 7.00

VIETNAM Support for Ho Chi Minh City's capital investment fund Public-sector bank 30.00

Local development and capital investment fund for the cities of Lao Cai and Kahn Hoa Central government 20.00

MULTI-COUNTRY NGO funding facility to help countries hosting Syrian refugees NGO 4.00

AFD 2013 Project financing commitments This is a partial list of projects approved for funding by AFD.


61


TOTAL COMMITMENT

(€ MILLION)

WATER AND SANITATIoN

BANGLADESH Sustainable development of Dacca's water supply Central government 73.20

BURKINA FASO Production-capacity increase at Ziga Dam and water adduction and potable-water supply expansion in Ouagadougou


CAMEROON Improvements to water-supply systems in Yaoundé, Bertoua, Edéa and Ngaoundéré. Central government 79.68

Rainwater purification in Yaoundé Central government 80.00

CHAD Improvements to access and governance of water and sanitation services in N'Djamena Central government 2.50

CÔTE D'IVOIRE Support for drinking-water and sanitation programme Central government 70.90

GABON Development of the Gué Gué watershed in Libreville Central government 110.00

MEXICO Support for water policy Central government 100.00

PALESTINIAN TERRITORIES

Water purification station in Hebron Local authority 10.00

SRI LANKA Modernization and extension of Greater Colombo's drinking-water supply Central government 75.07

ZAMBIA Copperbelt Province water and sanitation project Central government 50.00

EDuCATIoN BENIN Professional training and youth employment improvements Central government 4.00

CAMBODIA Support for tourism activities Central government 1.50

CHAD Support for professional training to improve business competitiveness Central government 5.00

DEMOCRATIC REPUBLIC OF CONGO

Support for primary-school teaching programme (debt reduction-development contract) Central government 40.00

DJIBOUTI Support for education and professional training Central government 6.00

LEBANON Support for the modernization of Lebanon's Cnam Conservatory (Conservatoire National des Arts et Métiers) and the Beirut High Teachers College (École Normale de Beirut)

Central government 21.00

MAURITIUS Support for professional training Central government 1.00

NIGER Support for an education and training programme Central government 12.00

SENEGAL Support for improving basic education in Casamance Central government 10.00

TOGO Improvments to primary and secondary teaching quality Central government 8.00

MULTI-COUNTRY Support for environmental and forestry-training institutions in central Africa NGO 1.50

Support for Pôle de Dakar to improve education in Africa NGO 5.05

ENERGY BURKINA FASO Zagtouli photovoltaic power station Central government 22.50

CHINA National pilot program for rural and industrial biofuels development Central government 30.00

Biomass cogeneration plant in Yichun, Heilongjiang Province Central government 35.00

INDIA Environmental credit line Public-sector bank 150.00

INDONESIA Secure electricity supply in Jakarta Public-sector enterprise 100.00

KENYA Kenya-Ethiopia power systems interconnection Central government 91.00

MOZAMBIQUE Construction of a natural gas thermal power station Central government 38.35

NIGER NIGELEC electricity grid extension Central government 30.00

NIGERIA Power line construction Central government 126.53

PALESTINIAN TERRITORIES

Support for the implementation of the Palestinian Authority's energy-efficiency policy Local authority 2.00

TANZANIA Credit line for energy-efficiency and renewables projects Private-sector bank 9.40

Renovation of transportation hubs Central government 53.00

UGANDA Credit line for energy-efficiency and renewables projects Private-sector bank 23.00

MULTI-COUNTRY Sustainable energy funding facility for West African businesses and households Private-sector bank 35.00

Sub-Saharan Africa regional funding facility for energy-efficiency and renewables studies and technical assistance

Central governments or parapublic institutions

3.00

ENvIRoNMENT AND NATuRAL RESouRCES

CHINA Waterway and wetlands restoration in Liaoning Province Central government 50.00

CÔTE D'IVOIRE Restoration of forests and natural reserves for conservation purposes Central government 16.46

GABON Support for monitoring and managing forests Central government 12.00

INDONESIA Renewables credit line Private-sector bank 36.90

LEBANON Sovereign credit line to finance energy efficiency projects Central government 30.00

62


TOTAL COMMITMENT

(€ MILLION)

ENvIRoNMENT AND NATuRAL RESouRCES

MADAGASCAR Forest conservation programme NGO 2.00

MEXICO Support for agriculture and to fight climate change Public-sector bank 37.00

TURKEY Support to reduce tourism and energy-production pressure on natural resources Private-sector bank 60.00

Support for Turkey's forestry policies, cofinanced with the European Investment Bank Central government 150.00

VIETNAM Support for Vinacomin's environmental investment programme Local government 35.00

MULTI-COUNTRY Support for the sustainable development of sub-Saharan Africa's coastal areas NGO 1.80

Support to fight climate change NGO 2.00

Support for the International Union for Conservation of Nature (IUCN) NGO 2.60

hEALTh AND huMAN WELFARE

BURKINA FASO Urban sanitation project Public-sector enterprise 2.50

COLOMBIA Sovereign loan to Colombia to support human-welfare policy reforms Central government 295.31

CÔTE D'IVOIRE Reinforcement of Cote d'Ivoire's healthcare system Central government 62.20

DEMOCRATIC REPUBLIC OF CONGO

Improving drinking-water access and hygiene to combat cholera in Uvira Central government 6.00

GUINEA Renforcement of infant and maternal healthcare services Central government 10.00

MADAGASCAR Improvements to infant and maternal healthcare services NGO 4.00

MALI Support for an anti-malaria research and action programme Research center 2.00

Funding facility for the NGO, Health for Mali NGO 8.00

MOZAMBIQUE Hospital construction in Beira and Marromeu Central government 12.00

NIGER Healthcare access for children under age five Central government 6.00

PAKISTAN Support for the Aga Khan Hospital Center in Karachi to upgrade facilities to meet environmental standards

Foundation 11.93

TANZANIA Support for basic healthcare services Foundation 39.88

MULTI-COUNTRY Support for the Epidemiological Surveillance and Investigation Network for Member States of the Indian Ocean Commission


Strengthening laboratory services in 7 West African countries Foundation 5.00

Anti-AIDS programme and support for stigmatized populations NGO 1.35

BuSINESS, INDuSTRY AND TRADE

BURUNDI Support for microfinance Central government 3.00

CAMBODIA Water and electricity credit line Private-sector bank 11.06

MALI Agricultural credit line Public-sector bank 5.00

MAURITIUS Environmental credit line for Mauritian banks Public- and private-sector banks

60.00

TUNISIA Support to set up a microfinance institution Private-sector bank 1.00

Support for young entrepreneurs Central government 1.80

MULTI-COUNTRY Support for microenterprises in sub-Saharan Africa NGO 1.23

Programme to strengthen regional trade in the Indian Ocean region Chamber of Commerce

2.40

Pilot programme to promote access to financial services through product diversification and innovation

NGO 2.00

BuDGET SuPPoRT AND oThER

ALGERIA Civil society reinforcement programme NGO 2.50

BURUNDI Budget support Central government 3.00

CÔTE D'IVOIRE Global budget support (debt-relief contracts) Central government 24.00

GUINEA Global budget support (debt-relief contracts) Central government 7.00

Strengthening programme for civil-society organizations NGO 1.92

MALI Global budget support Central government 15.00

NIGER Global budget support Central government 10.00

SENEGAL Budget support loan Central government 60.00

VIETNAM Budget support to fight climate change Central government 20.00

MULTI-COUNTRY Global budget support for CEMAC International institution

20.00

Global budget support for UEMOA International institution

40.00

Above does not include PROPARCO or French Overseas Provinces projects. Please refer to their annual reports for details about their projects.


63

CreditsAFD Coordination: Marie de Jerphanion, Benjamin Neumann, Kulthum Laoufi.Art direction and lay-out: Pepper Only. Printing and production: Déjà Link.English translation: Suzan Nolan, BlueSky International.

Photo credits P 1: Olivier Jourdanet, based on a model globe created by Joachim RobertP 2: a: James Keogh - b: Julien Girardot - c: Laurent WeylP 3: a: Joseph Moura - b: Isabelle Bonillo - c: François Carlet SoulagesP 4: Pepper Only / P 5: Alain Goulard / P 6: Ons Abid for AFD / P 7: Laurent WeylP 8: a: CEFEB - b: Éric Thauvin / P 9: a: Éric Beugnot - b: Mathieu ArnaudetP 10: a: Isabelle Bonillo - b: Didier Gentilhomme P 14: a: Laurent Weyl - b: Joseph MouraP 15: Thierry Trouillet / P 18: Alexander Schuecke / P 21: Julien GirardotP 22: Modali for AFD / P 23: Joseph Moura / P 24: Joseph MouraP 25: Harandane Dicko / P 26: Thierry Latreille / P 27: Daoud BouledrouaP 28: François Carlet Soulages / P 29: a: Aude Flogny - b: Olivier Gilard, AFDP 30: Franck Galbrun / P 31: a: Carlos Tobon - b: All rights reserved. P 32: Julien Girardot P 33: a: Western Guyana Hospital Center - b: Gérard BarsacqP 34: a: Oriane Zerah / b: AFD All rights reserved.P 35: a: Chantal Regnault - b: Stephan RichardP 38: a: Nawal Moiline for AFD - b: Harandane Dicko P 40: a: Matthias Ripp Creative Commons license - b: Fabienne PouyadouP 41: Julien Girardot / P 42: a et b : Laurent Weyl / P 43: CEFEBP 44: a and b: LeverdeRideau for AFD / P 47: Joseph Moura / P 51: Pepper Only P 52: Thierry TrouilletP 53: a: Virginie Leroy Saudubray - b: Abdelilah Chach - c: All rights reserved. d: Éric Thauvin - e: Pascal FellousP 63: a: François Carlet Soulages - b: Julien Girardot - c: Carlos Tobon

This report was printed with vegetable- rather than petroleum-based inks. Use of the Programme for the Endorsement of Forest Certification (PEFC) logo indicates that the timber harvested for paper pulp did not contribute to deforestation or impair environmental, economic and social uses of forest areas.

ISSN : 1299-0108Copyright © June 2014

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