Joerg Simon, Senior Investment AdviserMILLENNIUM CITIES INITIATIVE

THE EARTH INSTITUTE AT COLUMBIA UNIVERSITYhttp://mci.ei.columbia.edu

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1. The Millennium Cities Initiative (MCI)2. MCI‘s investment-related activities3. Importance of capacity-building in city investment

promotion 4. Purpose of the Handbook5. Structure of the Handbook6. Preparation of the Handbook7. Follow-up

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1. Millennium Cities Initiative (MCI)

• Localize MDGsContinuing rural-urban migration; MDGs at national level – need to beachieved at local level

• Assist second-level cities in Sub-Saharan Africa in achieving the MDGs by 2015

Criteria for selection of cities; stimulating economic development;needs assessments; integrated MDG-based city developmentstrategies

• Complement to Millennium VillagesAgricultural value chain; cities as regional hub for rural area

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2. MCI‘s investment-related activities

• Preparation of investment-related materialsAssessment of legal framework for investment, investors guides;assessment of infrastructure constraints to business activities;investment opportunities and profiles of promising sectors identified byKPMG, UNIDO and Columbia University

• Dissemination of informationInvestors missions; investment days in-country and abroad; specifictargeting efforts

• Promoting the city as an investment sideStrengthening the city’s capacity in facilitating investors in establishingbusiness and after-care services; enable the city administration tobetter servicing businesses

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3. Importance of capacity-building in city investment promotion

• Role of investment in building productive capacityInvestment brings capital, jobs, technologies and skills; it contributes tothe improvement of local infrastructure, export capacity andCompetitiveness of local enterprises

• Investment is always localCities are key nodes of the global economy and supply pools of skilledworkers that companies need to access; cities also benefit directlyfrom inward investment (e.g. also from business linkages)Companies are now investing more and more where the resources(including human talent, services) are located; companies increasinglyassess and compare the attractiveness of cities (or sub-regions) ratherthan countries when making location decisions

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3. Importance of capacity-building in city investment promotion (continued)

• Growing importance of promoting citiesCities respond to their growing importance by developing their owncapacities for attracting and facilitating inward investment;the number of sub-regional and city investment promotion agencieshas increased during recent years – both in the developed world aswell as in emerging markets • Challenges medium-sized and low-budget cities in emerging

markets are facing in attracting FDILimited budgets and underdeveloped capacities for attracting andservicing investors, identifying investment potential; existing investmentclimate and infrastructure

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4. Purpose of the Handbook

To serve as a tool for medium-sized, low-budget cities to:

• Strengthen investment promotion capacity• Develop a strategic approach to attracting investment• Brand and market the city• Identify potential investment opportunities • Facilitate investors and provide after-care services for investors• Promote private-public sector dialog • Better benefit from FDI, e.g. through business linkages

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5. Structure of the Handbook

10 modules, each of them is being introduced by topics, objectives andconcluded by key take-away points and resources. Cases of best practicedemonstrate how cities and agencies are gaining experience in attractingand servicing investors.

Module I. The HandbookBased on world-wide best practices it provides under-resourced cities inemerging markets with a practical framework and easy-to-follow guidelineson how to increase inward investment. While the focus is on how to attractFDI, most of the modules will be equally useful for attracting domesticinvestment.

Module II. Introduction to foreign direct investmentThe module provides a general overview of FDI definitions, determinants,benefits, trends and issues. It is essential background reading for investmentofficers and FDI policy makers wanting to understand the world of FDI.

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5. Structure of the Handbook (continued)

Module III. A framework for investment promotionA complete overview of “how to do” investment promotion, as well as therational and importance of it.

Module IV. How to develop a city investment promotion strategyHelps policy makers develop an investment promotion strategy for theircities, preferably developed in conjunction with the national IPA. Thestrategy can use the templates provided in this module, with a key emphasison making the strategy sector-based and focused on achieving clear targetsthat can be monitored and evaluated.

Module V. How to build a city investment promotion agencyDesigned to inform cities on how to establish a new investment promotionagency. The practical illustrations of the organizational structure, vision,mission, and client charter of an IPA are laid out, as are budgets andfunding. Also discussed are the staff, skills and roles, as well as theimportance of IPA networks.

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5. Structure of the Handbook (continued)

Module VI. How to market a city to foreign investorsPays attention to the importance of marketing in attracting inwardinvestment to a city. Provides best practices and templates for developingthe most important marketing materials. Cautions low-budget cities tospend very limited resources on expensive image and brand buildingcampaigns.

Module VII. How to target investors and generate leadsProvides city IPAs with a comprehensive toolkit for developing andimplementing an investor targeting and lead generation strategy andindividual campaigns. By following the main topics and proven bestpractices, city IPAs should, over time, increase the volume of investmentinto their cities.

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5. Structure of the Handbook (continued)

Module VIII. How to facilitate inward investmentDesigned to assist city IPAs in understanding how to handle investor

inquiries, provide information to an investor in the most effective format, organize a successful site visit, and consider the options for the facilitation services the city IPA can provide to an investor.

Investment facilitation is essential for every city IPA to ensure seamless entry of investment. Effective investment facilitation ensures that:

(i) The investment is completed (and not cancelled).(ii) Investors are happy, which adds to the image and reputation of the city

and its IPA - a satisfied investor is the most effective promotional tool possible.

(iii) Reinvestment is encouraged.

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5. Structure of the Handbook (continued)

Module IX. How to develop after-care and policy advocacyInforms medium-size, low-budget cities in emerging markets of theimportance of after-care and policy advocacy and provide guidelines forhow a city investment promotion organization can develop an after-careand policy advocacy program.

Module X. Next steps: moving city investment promotion forwardAssists a city set up an investment promotion agency and implementinvestment promotion activities, identify priorities for investment promotion

and establish a monitoring and evaluating success.

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6. Preparation of the Handbook

• Prepared in 2008/2009• Workshop with international experts in December 2008• Final draft in May 2009• Verification with a number of experts in city investment promotion• Launch in December 2009• Available on-line in English on http://mci.ei.columbia.edu

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7. Follow-up

• Distribution world-wide to city and sub-regional institutions• Publication of hard copies• Translation into Arabic, French, Chinese, Russian • Training based on the Handbook

Thank you very much for your attention!

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