The IFC and the Norway/IFC Technical Assistance Trust Funds (TATF) Program

Presentation to Norwegian Dialogue May 13, 2004

International Finance Corporation

Agenda1.1. What does IFC do and Why IFC does What does IFC do and Why IFC does

TATA2.2. The IFC Technical Assistance Trust The IFC Technical Assistance Trust

Funds Program (TATF)Funds Program (TATF)3.3. Donor (Country) Trust FundsDonor (Country) Trust Funds4.4. Examples of TA Activities UndertakenExamples of TA Activities Undertaken5.5. Opportunities for (Donor Country) Opportunities for (Donor Country)

ConsultantsConsultants6.6. Working with the IFC Trust Funds Working with the IFC Trust Funds

Program Program

International Bank for Reconstruction and Development, 1945

International Finance Corporation, 1956

International Development Association, 1960

Multilateral Investment Guarantee Agency, 1988

IFC: Part of theWorld Bank Group

IFC is owned by its 176 member countries, which collectively determine policies.

IFC Mission

Promote sustainable private sector Promote sustainable private sector investment in developing investment in developing

countries, helping to reduce countries, helping to reduce poverty and improve people’s livespoverty and improve people’s lives

• Provide loans and equity for viable Provide loans and equity for viable projectsprojects

• Mobilize capital from other sourcesMobilize capital from other sources• Provide advisory servicesProvide advisory services

Services OfferedServices Offered

• Financial productsFinancial products:: loans, equity, loans, equity, quasi-equity, guarantees, and risk quasi-equity, guarantees, and risk management facilitiesmanagement facilities

• Resource mobilizationResource mobilization:: loan loan participations and securities participations and securities offeringsofferings

• Advisory servicesAdvisory services:: country, country, industry, financial, and technicalindustry, financial, and technical

Investments by SectorFY03 Total Commitments: $5.03 billion

Gross investments, including loan syndications and financing for IFC’s own account. Also includes guarantees and risk management products, which are off-

balance-sheet.

SectorSector $ $ millionsmillions

FinancialFinancial 2,5292,529Transportation, Transportation, Warehousing, & UtilitiesWarehousing, & Utilities

562562

Oil, Gas, Mining, & Oil, Gas, Mining, & ChemicalsChemicals

383383

Food & BeveragesFood & Beverages 378378Industrial & Consumer Industrial & Consumer ProductsProducts

246246

Nonmetallic Mineral Product Nonmetallic Mineral Product ManufacturingManufacturing

194194

InformationInformation 182182Accommodation & Tourism Accommodation & Tourism ServicesServices

9898

SectorSector $ $ millionsmillions

Wholesale & Retail Wholesale & Retail TradeTrade

9393

Textiles, Apparel, & Textiles, Apparel, & LeatherLeather

9191

Agriculture & ForestryAgriculture & Forestry 6666Construction & Real Construction & Real EstateEstate

5050

Primary MetalsPrimary Metals 5050Plastics & RubberPlastics & Rubber 4747Health Care & Health Care & Education Education

3737

Pulp & PaperPulp & Paper 2323Professional, Scientific, Professional, Scientific, & Technical Services& Technical Services

77

Why IFC does TA• IFC’s main business: to make profitable IFC’s main business: to make profitable

private sector investments in private sector investments in developing countries.developing countries.

• Constraints:Constraints:• Regulatory and legislative framework not conduciveRegulatory and legislative framework not conducive• Project sponsor has limited knowledge of the Project sponsor has limited knowledge of the

industryindustry• New and unfamiliar technology, skills or New and unfamiliar technology, skills or

management may be requiredmanagement may be required• Audited financial statements may not be prepared Audited financial statements may not be prepared

according to international standardsaccording to international standards

2. What is TATF? IFC’s TATF program secures funding for TA IFC’s TATF program secures funding for TA projects to help projects to help strengthen the business strengthen the business environmentenvironment and promote private sector and promote private sector growth in developing economiesgrowth in developing economies

• FundingFunding: governments, development : governments, development institutions, & the World Bank Groupinstitutions, & the World Bank Group

• Eligible countriesEligible countries: IFC’s developing : IFC’s developing member countriesmember countries

• ManagementManagement: IFC, under its own operating : IFC, under its own operating procedures & agreements with donorsprocedures & agreements with donors

TATF Program ScopeSince establishment of TATF program in Since establishment of TATF program in 1988:1988:

• 46 trust funds with 23 donor agencies46 trust funds with 23 donor agencies• More than 1000 assignments approvedMore than 1000 assignments approved• In FY2003: 132 TA assignments totaling In FY2003: 132 TA assignments totaling

US$17 million approvedUS$17 million approved• Almost all our funds are tiedAlmost all our funds are tied• Size of assignments: $30~800,000.Size of assignments: $30~800,000.

Technical Assistance Trust Funds

Funds are used to support a wide range of Funds are used to support a wide range of activitiesactivities• Pre-investment feasibility or market studies Pre-investment feasibility or market studies

linked to potential IFC investmentslinked to potential IFC investments• Support for SMEsSupport for SMEs• Sector Reviews and project identificationSector Reviews and project identification• Enabling environment including regulatory Enabling environment including regulatory

reformreform• Training and capacity strengtheningTraining and capacity strengthening• Privatization and advisory workPrivatization and advisory work

Types Of TA Assignments FY03

# of TA # of TA AssignmentsAssignmentsRelated to specific investmentRelated to specific investment 5858SME SupportSME Support 5656Sector reviews/identificationSector reviews/identification 3939Enabling environmentEnabling environment 3333Training and capacity buildingTraining and capacity building 3131Privatization/corporate advisoryPrivatization/corporate advisory 3030Post-privatization supportPost-privatization support 3 3OthersOthers 8 8

• Eastern Europe and CISEastern Europe and CIS – Created in – Created in 1993 by the Eastern Europe Section of the Royal 1993 by the Eastern Europe Section of the Royal Ministry of Foreign AffairsMinistry of Foreign Affairs

• GeneralGeneral – Created in 1990 by NORAD – Created in 1990 by NORAD

3. Norwegian TA Trust Funds

TA Proposals—Processing Cycle

Promotion & Identification(IFC Investment Department identifies TA requirements)

Selection2. (Proposal brought to TF Program to select appropriate Trust Fund)

Detailed Review3. (Review and modify TA contents)

Consultation & Approval4. (Consultation with and approval from specific Trust Fund donor)

Implementation5. (Select and contract with consultants)

Follow-up & Reporting6. (Follow-up TA assignments and donor reporting)

1.

4. Examples of recently funded TA projects under

Norwegian TATFs• Mozambique – Advisory Services Mandate for Mozambique – Advisory Services Mandate for Privatization of PetromocPrivatization of Petromoc

• Comparative Study of the Development of the Comparative Study of the Development of the IT Industry in China and India- Manufacturing or IT Industry in China and India- Manufacturing or ServicesServices

• Mozambique - Study into the Potential for Mozambique - Study into the Potential for Carbon Finance to Support the Introduction of Carbon Finance to Support the Introduction of Natural Gas into MozambiqueNatural Gas into Mozambique

• China – Minsheng Shipping Company: China – Minsheng Shipping Company: Assistance in Market Study/Business Planning Assistance in Market Study/Business Planning and Capacity Building in Financial Managementand Capacity Building in Financial Management

5. Opportunities for Consultants

• Industry and Sector SpecialistsIndustry and Sector Specialists• Accounting/FinanceAccounting/Finance• Financial MarketsFinancial Markets• SMEsSMEs• Health Care and Education Health Care and Education • Environmental and Social Environmental and Social

SustainabilitySustainability• OthersOthers

IFC’s other donor-supported TA programs

In addition to the Technical Assistance In addition to the Technical Assistance Trust Funds Program (TATF):Trust Funds Program (TATF):

• Sustainable Business Assistance Sustainable Business Assistance Program (CCF, SFMF, EOF)Program (CCF, SFMF, EOF)

• Foreign Investment Advisory Services Foreign Investment Advisory Services (FIAS)(FIAS)

• Private Enterprise Partnership (PEP)Private Enterprise Partnership (PEP)• SME FacilitiesSME Facilities• Norway/Bank Group TF for Private Norway/Bank Group TF for Private

Sector and InfrastructureSector and Infrastructure

Consultant Opportunities

• IFC DatabasesIFC Databaseshttp://www.ifc.org/tatf

• Meet with IFC task managers in Washington or Meet with IFC task managers in Washington or in the field (field office locations available on in the field (field office locations available on external web)external web)

• Executive Director’s OfficeExecutive Director’s Office• Innovation Norway Innovation Norway

6. Working with TATF

Working with TATF

Contact information :Contact information :

Fred Wright, Principal Project OfficerFred Wright, Principal Project Officer Trust Funds DepartmentTrust Funds DepartmentInternational Finance CorporationInternational Finance CorporationWashington DC 20433Washington DC 20433

Telephone: Telephone: 202-473-6076202-473-6076Fax: Fax: 202-974-4344202-974-4344E-mail:E-mail: fwright@ifc.orgfwright@ifc.org