SADC-DFRC CEO’s Forum

Progress on

DBSA-JICA’s Africa-Asia DFI Networking

Walvis Bay, Namibia

December 6, 2012

Tetsuya FUKUNAGA

TICAD Advisor to DBSA from JICA

Japan’s ODA and JICA

Japan’s ODA:

Official Development

Assistance

“Bilateral” Assistance

“Multilateral” Assistance

Technical Cooperation

Japanese ODA Loan

Grant Aid*

* This excludes “Grand Aid” which Japan’s Ministry of Foreign Affairs (MOFA) will continue to directly implement for the necessity of diplomatic policy. JICA’s “Bilateral” Aid

About JICA

(Japan International Cooperation Agency)

JICA is the world’s largest bilateral aid agency, in charge of administrating Japanese ODA (Official Development Assistance) scheme, such as 1)ODA Loans, 2)grant aid and 3) technical cooperation, and can offer value added development outcome through comprehensive assistance.

ODA Loan is;

Loan assistance scheme by low-interest, long-term and concessional funds for social and economic development.

Technical Cooperation is;

Aiming at capacity building in the recipient country and state owned enterprises by Dispatch of Japanese Experts, Training Program and Development Study (Master Planning, Feasibility Study, etc).

Grant Aid is;

JICA’s Financial Cooperation for securing BHN in mainly Least Developed Countries. (It can not be applied for upper middle income countries.)

JICAGovernment

State Owned Enterprises

JICA Expert / AdvisorHuman Reseource and

Institutional Development

Training in Japan Policy / Framework

Development Study Long-term Master Plan

Project Feasibility Study

ODA Loan Construction

Operation & Maintenance

Adding value through Comprehensive & Consecutive Assistance

Financial intermediary loans are implemented through the financial

institutions of the recipient country based on the policy-oriented

financial system of the partner country. These loans provide funds

necessary for the implementation of designated policies.

JICA’s Financial Intermediary Loans (Two-Step Loans)

TSL Project for SME Development

and Environmental Protection

Mongolia

Date of L/A :Mar 2006

Amount: 5 billion yen

Funds are provided on a long-term basis

through Mongolian commercial banks to SMEs

that represent the majority of private

enterprises driving economic development in

Mongolia. The objectives of this assistance

also include the promotion of environmental

preservation measures.

Revolving funds

JICA

Development Finance Institution

Local Clients

(SMEs and farmers)

Two Step LoanRepayment

Banking operations

DBSA-JICA’s Africa-Asia DFI Networking by

Technical Cooperation (T/C) to SADC-DFRC’s DFIs

MOU Between DBSA and JICA on May 27, 2010

Arrival of “TICAD Advisor” to DBSA from JICA on November 24, 2010

Establishment of “Knowledge Sharing Committee” in DBSA on February 2011

Identification of Importance and Requirement of T/C to SADC’s DFIs

Dispatching Delegation (Composed by DBSA and SADC-DFRC) for Knowledge Sharing and Networking between African DFIs and Asian DFIs to Japan and the Philippines from December 4 to 16, 2011

Knowledge Sharing and Networking between African DFIs and Asian DFIs at the CEO Forum (in Kasane, Botswana) from June 6 to 8, 2012

Selection of DFIs to Conduct T/C in FY2012/2013 by SADC-DFRC

Preliminary Visit to DBN, IDBZ and NDC to Conduct T/C in FY2012/2013

Selection of Japanese Consulting Team by JICA to Conduct T/C for SADC’s DFIs

<< T/C in FY2012/2013 >>

1. Dispatching Japanese Consulting Team to DBN, IDBZ and NDC for Extracting Present Problem(s) in Management

2. Accepting Trainees from Selected DFIs to Japan (as well as Asian Countries) toward Solution(s) in Present Problem(s)

3. Demonstrating Comprehensive Solution(s) toward Present Problem(s) in Selected DFIs

Technical Cooperation and Knowledge Sharing

between African DFIs and Asian DFIs

-- DTAF* --

ZIM DRC ANG ZAM TAN

Phase II:

:

African Countries Asian Countries

Development Bank of:

Japan

South Korea

Malaysia

Thailand

:

:

:

NAM

SADC-DFRC UNOPS

DBSA

Phase I:

Phase X:

(1) “Present” Technical Transfer by DTAF

(3) Technical Transfer

by “New” Framework

(2) Knowledge Sharing

by “New” Framework

* DTAF: DFI Technical Assistance Facility (DTAF) by DBSA, SADC-DFRC and UNOPS (United Nations Office for Project Services) (established on March 26, 2010)

JICA’s Experience for

“Reinforcement of Financial Systems” (From 1995 to 2009)

1. Technical Cooperation: 40 Projects

Indonesia (7), Vietnam (7), Mongolia (4), China (4), Laos (3), Malaysia (2), Thailand (2), Argentina (2), Cambodia (1), Myanmar (1), Tajikistan (1), Kazakhstan (1), Kyrgyz (1), Kenya (1), Paraguay (1), Chile (1), El Salvador (1)

2. Training Program in Japan: 60 Programs

Indonesia (10), World (7), Asian Countries (7), Thailand (7), ASEAN Countries (including China) (5), Malaysia (4), China (4), Vietnam (3), Central Asian Countries (2), Laos (2), Mongolia (2), Central and Eastern European Countries (2), West Asian Countries (1), Tajikistan (1), Saudi Arabia (1), Syria (1), Kenya (1)

3. Dispatching Expert: 32 Experts

Indonesia (10), Thailand (5), Vietnam (3), Mongolia (3), Uzbekistan (2), Malaysia (2), China (2), Philippines (1), East Timor (1), Papua New Guinea (1), Kenya (1), Switzerland (1)

4. ODA Loans: 11 Disbursements

Philippines (2), Sri Lanka (2), Pakistan (2), Bangladesh (1), Ghana (1), Kenya (1), Peru (1), Bolivia (1)

By Categories and the Number by Country

(Road Map) JICA’s Future Cooperation to SADC DFIs

Capital Volume →

JICA's Imput

DFI's own Capital

Organizatonal

Capacity

without Capacity

Two Step Loan

Setting up Phase Self-Sustainable PhaseTaking-off Phase

Project Loan

↑

DFI

Functionable

DFI

Viable

DFI

SMEs, Farmers,house owners asdomesticbeneficiaries

Pubulic & RegionalInfrastructureProjects

Public PrivatePartnershipInfrastructureProjects

Financing PrivateInvestmentprojects byJapanese Firms,etc

ManagementDiagnosis

TrainingProgram

JICAAdvisor

What JICA do for SADC DFIs?

through Technical Assistance

Drafting DFI’s polices, rules and regulations

Designing DFI’s structure & its operation models (bond issues, ALM, lending, monitoring, etc)

Formulating DFI’s business Strategies & Action Plan

Training for Knowledge and Skills Enhancement

through ODA Loan

Strengthening DFI’s financial capital (Two Step Loan)

Expanding DFI’s lending opportunities for economic infrastructure development (co-finance with JICA Project Loan)

SADC Countries

Targeted Country

Competent Authority Concerned Authority

Targeted DFI

Characteristics of JICA’s Assistance in Setting up Phase

Contents of JICA’s Assistance in Setting up Phase

DFI Diagnosis

- Dispatching JICA study team for reviewing organizational capacities

- Identifying operational and managerial issues which the DFI should resolve

- Selecting candidates of training program in Japan

- Submitting the diagnosis report including some practical recommendations

how to solve specific issues of the DFI

Training Program/Workshop

- Lectures on Development Finance in Asian countries, Japanese Infrastructure Development, PPP investment, etc

- Workshop to enhance skills and capabilities in terms of identified theme

- Networking Japanese DFIs, Governmental Organizations and Private Companies

- Discussion with JICA HQ about the way forward to achieve take-off phase

Follow-up (if necessary)

- Based on the request for additional technical cooperation, JICA may dispatch advisor to solve the DFI’s managerial and operational issues

Workshop Program

Flight

(2 days)

Leave Africa (respective airports)

Arrive in Japan (Narita Airport)

Workshop

(10 days)

Lecture: About JICA (organization, roles), Roles and Responsibilities of JICA

Africa Division and Two-step loans

JICA

Lecture: Linkage of development finance between Asia and Africa ADFIAP Secretariat

Lecture: Water industry in Japan

Lecture: Development in Africa from Japan’s viewpoint

Lecture: Development and environmental protection in Japan

Visit infrastructure project site (e.g. high-efficiency clean coal-fired power plant)

Lecture: Next step of TICAD MOFA

Lecture: Roles and responsibilities of JBIC JBIC

Lecture: Economic development in Japan after WWII

Lecture: Development finance in Japan after WWII

Lecture: Infrastructure development in Japan

Lecture: Industrial development in Japan after WWII and lessons for Africa from

the experience

Lecture: Infrastructure development in PPP

Lecture: South Africa corridor project and finance

Lecture: Roles of trading firms in infrastructure development

Discussion: Issues in the three respective countries with regard to infrastructure

finance and input from Japan

- Reporters and panelists: 1 or 2 from each DFI

- Panelists and commentators: MOFA and JICA

Flight Leave Japan (Narita Airport)

(2 days) Arrive in Africa (respective airports)

Development Finance Workshop in Japan (Tentative Course Plan)

Year 2012 2013

Month 11 12 1 2 3 4 5 6 7 8 9

Deliverables (reports) ▼Inception Report ▼Draft Final Report ▼Final Report

▼1st Mission Report ▼2nd Mission Report ▼Brochure (draft) ▼Brochure

Schedule 1st Mission 2nd Mission 3rd Mission

Discuss Inception Report Discuss Final Report

Studies on SADC

Studies on Target Countries

Study on Target DFIs

Development Finance Workshop

(in Japan)

　　　　　　　Mutual Work

(Namibia, Zimbabwe, and

Tanzania)

仮想ＰＤＤ作成

Target Countries (Namibia, Zimbabwe, Tanzania)

SADC

Target DFIs

Development Finance Workshop in Japan

(Interview with DBSA, SADC Secretariat, SADC-DFRC, and NEPAD)

Gather information and data with regard to finance sector (including infrastructure)

(Interview with JICA, JETRO, and Japanese companies located in SADC area)

Find both Japanese companies' needs for the projects and financing

(Interview with SADC Secretariat, central banks, finance ministires, target DFIs)

Gather information about financial sector

(Interview with DFIs)

WS

Gather information and analyze organizational structure and its operation of target DFIs(focusing on bankable sector: electicity, water, and ICT)

(DFIs, managing ministries, major companies, commercial banks, etc.)

Clarify current situation and issues in infrastructure finance in target countries (focusing on bankable sector: electricity , water, and ICT)

(Interview with central banks and finance ministries)

Work out present condition and issue of financial policy and financial sector development, and forecast growth of the financial sector

Comments from TICAD V

Output from Development Finance

Workshop

Discussion output with Workshop participants

and JICA

Comments from counterparts

--> Propose solutions

Select members, grasp needs from target DFIs, prepare for Workshop

Clarify Issues

Find the possibility of collaborative works and/or technical assistance

project with JICA(based on the needs from the government and target DFIs)

(Interview with line ministries and major service providers)

Understand line ministries' policy and action plan toward funding gap in major infrastructure

Overall Project Plan

Thank you very much!

Tetsuya FUKUNAGA

TICAD Advisor to DBSA from JICA

fukunaga.jpn@gmail.com tetsuyaf@dbsa.org