UK-LIBERIA INVESTMENT FORUM SEPTEMBER 14, 2012

IFC Strategic Pillars for Liberia

 Strengthen the Financial Sector  Scale up Infrastructure and Finance Select Private Sector Companies  Improve the Country’s Overall Investment Climate  Create Effective Capacity Building Initiatives  Accelerate SME Development

2

Strengthen the Financial Sector

•  Continue work to establish a Microfinance Bank with Access Holdings and partners  Expand Global Trade Finance Program and accelerate TA for Banks to improve take-up and utilization  Provide IFC funding (Investment and TA) to establish a leasing company with a credible partners  Review BEE for leasing  Implement AS leasing program including micro-leasing  Proactively partner with a regional Bank seeking to enter the Liberian market  Wholesale lending to Banks for SMEs, especially along the Value Chain of Growth Sectors

3

Scale up Infrastructure and Finance Select Private Sector Companies

 Explore the creation of IFC post-conflict infrastructure fund to finance specific portions of the “public P” in PPPs e.g. electricity T&D (similar to the AfDB one)  Continue CAS-CIN work for PPP in Monrovia power sector  Develop early stage involvement (equity & debt) in reopening Guthrie plantation

4

Improve the Country’s Overall Investment Climate

 Focus Investment Climate Program with specific tasks:  Reducing Barriers to formalization,  Creating a Public-Private Dialogue  Drafting an Commercial Code  Improving the Country’s Doing Business Ranking

5

Create Effective Capacity Building Initiatives

 Target Schools and Universities  Through the proposed IFC Schools Program  Grants to rehabilitate and Start/Restart Business Programs  Businesses through SME EDI, VA2F and AMSCO  Business Incubation  InfoDev, Business Edge, etc

6

Accelerate SME Development

 Accelerate implementation of US$10mm post-conflict equity fund for SMEs in Liberia  Extend GMS Outreach initiative to include Liberia – potential opportunities in RHPC  Undertake review and develop strategies to incubate MSME opportunities along value chain of growth sectors  Structure wholesale lending products to local banks for on-lending to MSME prospects  AS services to improve Corporate Governance in SMEs  Creation of at least one Business Incubator

7

IFC INVESTMENTS

8

Investment Activities



ACCESS BANK

 IFC has an 18% equity investment in Access Bank, the First Commercial Microfinance Bank in Liberia, along with EIB and AfDB, and is providing $1.25 million advisory services to support the management and build up the institution.



ECOBANK (LIBERIA)

 IFC committed a US$3 million tier 2 facility to Ecobank Liberia. The facility will improve the capital base of EcoBank Liberia and provide funds available for longer term lending.



WEST AFRICA VENTURES FUND

 IFC worked to set up the West Africa Venture Fund (“WAVF”), in Liberia and Sierra Leone, to provide risk capital and advisory services to small and medium sized businesses.



GUARANTY TRUST BANK

 In August 2011, a trade finance facility of US$4 million ($2mn Risk Weighted) was approved for GTB Liberia

9

Investment Activities



LIBERIA BANK FOR DEVELOPMENT & INVESMENT (LBDI)

 IFC has a 44 year old equity investment in LBDI – the only majority Liberian- where IFC is also a founding shareholder IFC also has a US$2mm trade finance line.



SALALA RUBBER CORPORATION

 IFC has initially made the first real sector investment of a $10 million loan in rubber sector in mid 2008 to Salala Rubber Corporation to rehabilitate plantations, upgrade processing facilities and improve social and environmental infrastructure.



CEMENCO

 IFC commitment of US$110 million equity investment in Heidelberg Africa (parent company of Cemenco) for its operations in African subsidiaries including Liberia is part of the proceeds that is going towards financing the installation of a new cement mill in the Liberia subsidiary.

10

WAVF Investment in 2012

WAVF Investments in Liberia (as of June 2012). Project Name

1. JD Trading, Liberia 2. Afbeko Inc, Liberia Logistics/Trading Agric Business (Coffee) 3. Continental Machinery & Support Services, Liberia Construction 4. Wen Inc. Liberia 5. Fabrar Rice

Sector Investment Size

$464,340.00 $275,000.00 $500,000.00 ICT $447,599.00 Agric Business (Rice processing) $405,527.00 6. National Toiletries Inc, Liberia 7. Mano River Livestock Inc, Liberia 8. Global Logistics Services Inc, Liberia 9. Hope Bakery Manufacturing (Toilet Tissue) Agric Business (Livestock) Logistics Manufacturing (Foods-Bakery) $328,430.00 $478,000.00 $450,000.00 $289,041.00

Equity

64% 51% Lease 68% 54% 66% 69% 40% 58%

11

ADVISORY SERVICES

12

C.A.S.A Program Achievements



LIBERIA BUSINESS REGISTRY

 IFC worked to establish a state of the art business registry by providing all Liberian businesses an opportunity to formalize and register their business with the government. The Business Registry now allows individuals to register their business within 48 hours.



BUSINESS EDGE

 The deployment of IFC’s widely acclaimed range of management training products & services specially designed for SME owners / managers. Four franchisees signed as BUSINESS EDGE Local Partners. Six trainers were certified as BUSINESS EDGE trainers, 45 SMEs /291 persons trained by certified trainers. BUSINESS EDGE has so far helped 10 SMEs devise and submit 10 Business Plans to fund managers for investment decisions.



COMMERCIAL CODE AND COMMERCIAL COURT

 IFC spearheaded the drafting NINE (9) Laws comprising the Code in order to improve investment climate and enhance security of commercial transactions. Additionally, IFC assisted in the court design and operational structure of the Court which seeks to improve access to finance by ensuring speedy resolution of commercial disputes .

13

C.A.S.A Program Achievements



FINANCE LEASING

 IFC’S continued efforts to assist the GoL to improve access to and the cost of finance by local entities has seen the ongoing project to implement a comprehensive finance leasing regimen which will vastly expand the manner in which businesses finance their operations in Liberia.



SECURED TRANSACTIONS REGISTRY

 IFC is presently working closely with the Central Bank of Liberia (CBL) and other government on establishing a secured transactions regime which will contribute substantially to the legal certainty and flexibility necessary for banks and other financial institutions to lend to businesses and individual consumers 

CREDIT REFERENCE BUREAU

 Credit bureaus and credit references are crucial building blocks that allow for greater access to finance for both individuals and small businesses. They are critical to the expansion of credit and improved risk management. IFC is currently working closely with the CBL and National Banker’s Associations to ensure such measures are implemented within a timely manner.

14

Investment Climate Program Achievements



TAX ADMINISTRATION REFORM

 IFC’ is supporting the designing of an appropriate tax policy and tax administration program, particularly as it relates to small and medium sized enterprises. The team has designed the work program to integrate, build upon and leverage, as appropriate, ongoing assistance being rendered by other development partners 

BUSINESS REGULATION REFORM

 This component is a cross-cutting component aimed at reducing compliance costs of business regulations, including through providing assistance to support improved institutional frameworks.



TRADE LOGISTICS

 Trade Logistics component aims to assist the GoL in reducing the time and costs for traders to import and export. The reform program focuses on the simplification and harmonization of border clearance documents and processes, the introduction of risk-based border clearance procedures and introduction of automated systems for border clearance.

15

Investment Climate Program Achievements



SUPPORT FOR THE LIBERIA BETTER BUSINESS FORUM

 To strengthen private sector participation in the reform agenda, IFC will continue to support the Liberia Better Business Forum (LBBF), Liberia’s public private dialogue. A key to IFC’s support will be enhanced communications and capacity building of local actors to ensure local ownership of the Forum.



INDUSTRY SPECIFIC INVESTMENT CLIMATE REFORM

 IFC will support the strengthening of the National Investment Commission and the Ministry of Agriculture’s investment facilitation functions to see through the successful completion (and start-up of) the various tree crop investment project leads currently in the pipeline. The tree crop investment generation dimension of the program will build upon and integrate the tree crop out-grower framework developed by the team

16

SME Ventures Program Achievements



BUSINESS EDGE

 The deployment of IFC’s widely acclaimed range of management training products & services specially designed for SME owners / managers is well on its way for full implementation: • • • Four franchisees signed as BUSINESS EDGE Local Partners Six trainers were certified as BUSINESS EDGE trainers 45 SMEs /291 persons trained by certified trainers 

SCHOOLS PROGRAM

 IFC’s Liberia Schools Program is an integrated advisory and investment program that will allow IFC to support educational institutions that develop employable skills in Sub-Saharan Africa through: • A technical support program to train partner financial institution in the marketing, credit assessment, and monitoring of education sector loans; • • A capacity building program to permit schools to undertake self-diagnostics, business planning, and curricula development; An investment framework through which IFC provides risk participation to commercial banks to support their lending to the education sector.

17