2007 Annual Report Proparco

Contacts

Pékin Paul de la Guérivière 7 Floor, Block C, East Lake Villas, 35 Dongzhimenwai Avenue, Dongcheng District, Beijing 100027 Tél : (8610) 84 51 12 00 Fax : (8610) 84 51 13 00 afdpekin@groupe-afd.org Sao Paulo (Brazil, Suriname) Christophe Blanchot Edificio Parque Cultural Paulista Avenida Paulista, 37-4° endar 01311-902 – Sao Paulo – Brasil Tel : + 55 11 22 46 27 91 Fax : + 55 11 22 46 27 99 New Delhi (India, Pakistan) Jean-Pierre Barral 1A Jan Path Delhi 11001 - India Tel + 91 11 23 79 37 47 Fax : + 91 11 23 79 37 38 Lagos (Nigeria, Benin, countries of the Economic and Monetary Community of Central Africa) Charles-André Le Pape Melrose Office suites Phoenix House Plot 26E Abdulrahman Okene Close Off Ligali Ayorinde Street Victoria Island - Lagos Nigeria Tel : + 234 12705740 Johannesbourg (South Africa, Zambia, Mozambique, Angola) Laurent Klein Ballywoods Office Park 1st Floor Block I 29 Ballyclare Drive Bryanston 021 P.O. Box 786555 Sandton 2146 Afrique du Sud Tél (27 11) 540 7100 Fax (27 11) 540 7117 afdjohannesbourg@groupe-afd.org Nairobi (Kenya, Tanzania Ouganda) Patrick Abbes Royal Ngao House - Hospital Road P.O Box 45995 Nairobi, Kenya Tel : (254 20) 271 84 52 Fax : (254 20) 271 79 88 afdnairobi@groupe-afd.org Tunis Ghislain de Valon Immeuble Miniar - Bloc B 3rd and 4st floor Rue du Lac d'Ourmia 1053 Les Berges du Lac Tel : 71 861 799 Fax : 71 779 825 afdtunis@tn.groupe-afd.org

Abidjan - IVORY COSTE, LIBERIA Tel. : (225) 22 40 70 40 Fax : (225) 22 44 21 78 afdabidjan@groupe-afd.org Accra - GHANA Tel. : (233) 21 77 87 55 Fax : (233) 21 77 87 57 afdaccra@gh.groupe-afd.org Addis-Abeba - ETHIOPIA, ERITREA, SUDAN, SOMALIA Tel. : (251) 11 442 59 01 Fax : (251) 11 442 59 04 afdaddisabeba@groupe-afd.org Alger - ALGERIA Tel. : (213) 21 69 43 00 Fax : (213) 21 48 41 20 afdalger@groupe-afd.org Amman - JORDANIA Tel. : (962 6) 46 04 702 Fax : (962 6) 46 04 705 afdamman@groupe-afd.org Antananarivo - MADAGASCAR Tel. : (261) 20 22 200 46 Fax : (261) 20 22 347 94 afdantananarivo@groupe-afd.org Bamako - MALI Tel. : (223) 221 28 42 Fax : (223) 221 86 46 afdbamako@groupe-afd.org Bangui - CENTRAL AFRICAN REP. Tel. : (236) 61 03 06 Fax : (236) 61 45 78 afdbangui@groupe-afd.org Beyrouth - LEBANON Tel. : (961) 1 420 192 Fax : (961) 1 611 099 afdbeyrouth@groupe-afd.org Brazil - BRASILIA Tel. : (55) 61 33 22 43 20 Fax : (55) 61 33 21 43 24 afdbrasilia@groupe-afd.org Brazzaville - DEM. REP. OF CONGO Tel. : (242) 81 53 30 Fax : (242) 81 29 42 afdbrazzaville@groupe-afd.org Bujumbura - BURUNDI Tel. : (257) 25 59 31 afd-burundi@usean-bu.net Casablanca - MOROCCO Tel. : (212) 22 29 53 97 Fax : (212) 22 29 53 98 afdprocasablanca@groupe-afd.org Cayenne - GUYANA, SURINAM Tel. : 05 94 29 90 90 Fax : 05 94 30 63 32 afdcayenne@groupe-afd.org Colombo - SRI LANKA Tel. : (94) 11 250 23 20 Fax : (94) 11 250 52 23 afdcolombo@groupe-afd.org Conakry - GUINEA, SIERRA LEONE Tel. : (224) 30 41 25 69 Fax : (224) 62 66 12 66 afdconakry@groupe-afd.org Cotonou - BENIN Tel. : (229) 21 31 34 53 Fax : (229) 21 31 20 18 afdcotonou@groupe-afd.org Dakar - SENEGAL, CAP-VERDE, GAMBIA, GUINEA-BISSAU Tel. : (221) 849 19 99 Fax : (221) 823 40 10 afddakar@groupe-afd.org

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Niamey - NIGERIA Tel. : (227) 20 72 33 93 Fax : (227) 20 73 26 05 afdniamey@groupe-afd.org Nouakchott - MAURITANIA Tel. : (222) 525 25 25 Fax : (222) 525 49 10 afdnouakchott@groupe-afd.org Noumea - NEW-CALEDONIA, VANUATU - SOUTH PACIFIC ISLAND STATES Tel. : (687) 24 26 00 Fax : (687) 28 24 13 afdnoumea@groupe-afd.org Ouagadougou - BURKINA FASO Tel. : (226) 50 30 60 92 Fax : (226) 50 31 19 66 afdouagadougou@bf.groupe-afd.org Papeete - FRENCH POLYNESIA Tel. : (689) 54 46 00 Fax : (689) 54 46 01 afdpapeete@pf.groupe-afd.org Phnom-Penh - CAMBODIA Tel. : (855) 23 426 360 Fax : (855) 23 426 243 afdphnompenh@groupe-afd.org Pointe-à-Pitre - GUADELOUPE Tel. : 05 90 89 65 65 Fax : 05 90 83 03 73 afdpointeapitre@gp.groupe-afd.org Port-au-Prince - HAITI Tel. : (509) 22 45 40 07 Fax : (509) 22 44 02 51 afdportauprince@groupe-afd.org Port-Louis - MAURITUS Tel. : (230) 213 64 00 Fax : (230) 213 64 01 AFDPortLouis@groupe-afd.org Rabat - MOROCCO Tel. : (212) 37 63 23 94 Fax : (212) 37 63 23 97 afdrabat@ma.groupe-afd.org Saint-Denis - REUNION, SEYCHELLES, LAND AND SOUTHERN FRENCH ANTARCTIQUES Tel. : 02 62 90 00 90 Fax : 02 62 21 74 58 afdstdenis@re.groupe-afd.org Saint-Domingue - REP. DOMINICAN BAHAMAS, CUBA, JAMAICA Tel. : (809) 547 12 89 Fax : (809) 381 05 92 afdstdomingue@groupe-afd.org Saint-Pierre - SAINT-PIERRE & MIQUELON Tel. : 05 08 41 06 00 Fax : 05 08 41 25 98 iedom-spm@iedom-spm.fr

PROPARCO

Sanaa - YEMEN Tel. : (967) 712 65 77 93 Fax : (967) 1 269 068 afddjibouti@groupe-afd.org Vientiane - LAOS Tel. : (856) 21 24 32 95 Fax : (856) 21 24 32 98 afdvientiane@groupe-afd.org Yaounde - CAMEROON, CENTRAL AFRICAN REPUBLIC, EQUATORIAL GUINEA Tel. : (237) 222 00 15 Fax : (237) 223 57 07 afdyaounde@cm.groupe-afd.org

Agencies and offices of the AFD in foreign countries Agencies and offices of the AFD in Overseas INTERVENTION IN OTHER COUNTRIES ARE TAKEN DIRECTLY TO HEADQUARTERS.

2007

N’Djamena - CHAD Tel. : (235) 52 70 71 Fax : (235) 52 78 31 afdndjamena@groupe-afd.fr

A N N UA L R E P O R T 2 0 07

Bangkok (Cambodia, Indonesia, Laos, Thailand et Vietnam) Antoine Vigier 14 F Abdulrahim Place 990 Rama IV Road, Silom, Bangkok 10500, Thailand Tel : +662 636 12 35 Fax : +662 636 12 47 afdbangkok@groupe-afd.org

Annual report

AFD GROUP AGENCIES

P R O PA R C O

PROPARCO OFFICES

Groupe Agence Française de Développement

PROPARCO 5, rue Roland Barthes 75598 Paris Cedex 12 - FRANCE Tel. +33 1 53 44 37 37 - Fax +33 1 53 44 38 38 www.proparco.fr

Investing in a sustainable future

1

PROPARCO

PROPARCO: A NORTH/SOUTH COMMUNITY OF INVESTORS SERVING DEVELOPMENT

2

Board of Directors

3

Chairman’s message

1977 - 2007

4

Public-private governance of North/South partners

5

2007 results and 2008 outlook

6

Men and women serving development

7

A mission: to finance sustainable development in developing countries via the private sector

9

PROPARCO’s milestones: geographical expansion and diversification of financial instruments

10

An extended commercial network

13

MEASURING DEVELOPMENT IMPACTS

30 years of sustainable investment

Key Figures 2007

14

Systematic impact measurement

15

Profitability vs development impacts

16

Key 2007 indicators

€464.2 M

17

2007: A RECORD YEAR FOR PROPARCO’S ACTIVITY

Equity investments – Seventeen operations €77.9 M

18

Record high levels of activity

19

Drawing on sectoral expertise and prospecting new territories

20

Strengthening partnerships with public and private financial institutions

21

GEOGRAPHICALLY TAILORED PRIORITIES

22

Reaffirming the African continent as a priority

24

Equity and investment funds in Mediterranean countries

Commitments for the year

€597.8 M

including:

Loans – Twenty-nine operations

€55.7 M

Guarantees – Four operations

Total risk

€1.15

Net income

billion

€23.7 M

In 2007

25

Enhancing energy efficiency in emerging countries

28

Supporting sustainable development in France’s Overseas economies

29

INTEGRATING SUSTAINABLE DEVELOPMENT AND SOCIAL AND ENVIRONMENTAL RESPONSIBILITY IN EACH SECTOR OF OPERATIONS

30

Creating high-performing infrastructure to boost growth

32

Modernising, deepening and securing financial markets

34

Participating in investment funds dedicated to corporate financing

35

Supporting productive and service sectors

36

Scaling up projects contributing to corporate Social and Environmental Responsibility

37

TAILORING AND EXTENDING OUR RANGE OF FINANCIAL PRODUCTS

38

Strengthening corporate equity

40

Providing loans tailored to each project

41

Working in local currency and providing a wide range of risk-hedging tools

43

OPERATIONAL AND FINANCIAL RESULTS

43

Operational results

47

Financial statements analysis

51

Projects approved in 2007

52

PUBLICATIONS

PROPARCO contributed to

•Supporting the growth of 315 corporates •Creating or securing 47 000 jobs •Connecting 22.5 million people to telecommunications networks

•Generating 250 MW of renewable energy

•Saving 18 million tons of CO2 •Financing access to microfinance for 100

•

000 people

Increasing State revenues by €377

M

CONTACTS

A NORTH/SOUTH

COMMUNITY OF INVESTORS SERVING DEVELOPMENT

A North/South community of investors serving development

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A NORTH/SOUTH

COMMUNITY OF INVESTORS SERVING DEVELOPMENT

Board of Directors Chairman

Corporate officers

Jean Michel SEVERINO

Michel JACQUIER

Chairman: Jean-Michel SEVERINO Vice-Chairman: Michel JACQUIER Chief Executive Officer: Luc RIGOUZZO Deputy Chief Executive Officer: Étienne VIARD

Directors

Non-voting directors and observers

Jean Michel SEVERINO Michel JACQUIER Patrice MOLLIE Pierre JACQUET Olivier PEZET Rémi GENEVEY

Statutory non-voting directors

Vice-Chairman

FRENCH MINISTRY OF ECONOMY AND FINANCE: Stéphane CIENIEWSKI FRENCH MINISTRY OF FOREIGN AFFAIRS: Laurent AMAR Non-statutory non-voting directors

Permanent Representatives AGENCE FRANÇAISE DE DÉVELOPPEMENT: Jean-Michel DEBRAT NATIXIS: Jean-Claude GARDETTE GRAS SAVOYE: Jean-Marc de BOURNONVILLE COFACE: Maëlia DUFOUR SUEZ: Micheline BOSSAERT DEVELOPMENT BANK OF SOUTHERN AFRICA: Admassu TADESSE BNP PARIBAS: Philippe SECHAUD CAISSE DES DÉPÔTS ET CONSIGNATIONS: Pascal LAGARDE

SOCIÉTÉ GÉNÉRALE: Jean-Louis MATTEI AGA KHAN FUND FOR ECONOMIC DEVELOPMENT (AKFED): Lutaf KASSAM SOMDIAA: Alexandre VILGRAIN SOCIÉTÉ IVOIRIENNE DE BANQUE: Christian VALLOIS Government Commissioner Daniel BESSON AFD Works Council representative Jean-Louis LECOUFFE Auditors MAZARS: Guillaume POTEL and Max DONGAR KPMG: Pascal BROUARD

DEG: Winfried NAU

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Chairman’s message

P

ROPARCO has been created in 1977 by AFD (Agence Française de Développement) on the conviction that the private sector should be the main development actor in South economies. With development impacts and results constantly rising, thirty years later PROPARCO embodies the opportunity to finance operations which are economically viable, socially equitable, environmentally sustainable and financially profitable. Such success shows the initial conviction was founded. It is now reflected in all AFD Group instruments and AFD Group has put “non-sovereign” actions at the core of its strategy. It uses the private sector as an engine to create wealth, disseminate notions of social and environmental responsibility and implement public policies.

PROPARCO’s atypical and ambitious economic and strategic development model adds further interest to such success. It is based on: ◆ unique governance compared with other European partners.

PROPARCO’s capital and Board of Directors are open to public and private partners from the North and South alike; ◆ a unique approach to time and risk ; PROPARCO focuses exclusively on long-term financings in geographical areas or on counterparts considered too risky by commercial banks; ◆ a portfolio of projects selected on the basis of their social, environmental and economic impacts.

Yet despite such high development standards and risk-taking profiles, in 2007 PROPARCO has once again shown that it can provide shareholders with satisfactory financial returns which are the catalyst for other private investors. Indeed, PROPARCO ends 2007 with a record €598M in commitments and net income at €23.7M, more than double the FY 2006 figure.

Jean Michel SEVERINO Chairman

This success has meant AFD, along with the whole French cooperation, has reiterated its support for PROPARCO and its will to pursue a growth strategy for the company. This commitment consequently led AFD to enter into a underwritting agreement with PROPARCO, which means the latter can now invest in very large-scale operations. It also took the decision to proceed with a sizeable €300M capital increase which we know at this very time has been highly subscribed by both AFD and a number of public and private partners from the North and South alike. This operation will in particular allow PROPARCO to substantially increase its volume of equity investments and strengthen its resistance to exogenous shocks. It will also provide the opportunity to open its governance authorities to new financial and industrial partners from Europe, Africa and the Maghreb and will underpin PROPARCO’s privileged position as a “laboratory” for private sector financing in emerging countries.

PROPARCO’s activity is by nature contracyclical and in 2008 tensions on international financial markets will carry both threats and opportunities as they should enhance both the additionality of PROPARCO’s activity and its competitiveness.

Moreover, following the capital increase PROPARCO should be in a position to face the challenges posed by its growth, in particular in terms of staff levels and organisation and at the same time maintain its high standards in terms of social and environmental responsibility. Finally, for the whole AFD Group 2008 will be the year of the implementation of the French Presidency Initiative in Favour of Africa where PROPARCO should play a key role by contributing to strengthening AFD Group’s private sector instruments.

I know I can have complete confidence in PROPARCO’s teams which have successfully handled all these positive changes to face increased responsibilities and new challenges ahead.

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COMMUNITY OF INVESTORS SERVING DEVELOPMENT

Public-private governance of North/South partners PROPARCO is characterised by a unique public-private governance in comparison with other European Development Finance Institutions (EDFIs).

Indeed, PROPARCO is partly owned by Agence Française de Développement (AFD) and partly by private shareholders from the North and South.

This embodies its development mission, carries strong

synergies and means PROPARCO benefits from private shareholder inputs in terms of governance and strategic piloting, the expertise and experience of its African and European partners and support from AFD in terms of backing, commercial network and financial and logistical resources.

Expected changes to PROPARCO’s shareholding in 2008 French financial institutions AFD

14.5 %

69.7 %

10.4 % 5.3 %

International financial institutions

Ethical funds and foundations

Investors

0.4 %

French financial institutions

26.1 %

Capital breakdown prior to 2007 capital increase

57.5 %

11.6 %

International financial institutions

4.4 % AFD Investors

Likely capital breakdown in 2008

These changes are characterised by a considerable increase in international partners and private shareholders from Africa and the Maghreb.

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2007 results and 2008 outlook

P

ROPARCO’s thirtieth anniversary was marked by a record year in terms of results, growth in impacts and shareholder confidence.

The main features of 2007 are: a net income at €23.7M and a volume of commitments at €598M, respectively up 230% and 50% on FY 2006, an opening to four emerging countries and a sizeable upturn in equity business. In three years PROPARCO has tripled the volume of its operations, in particular due to regained growth in Africa.

PROPARCO’s mission in Africa, where it has 60% of its commitments, of which 45% in Sub-Saharan Africa, was reaffirmed during the year. The target is to pursue its readjustment of allocations for infrastructure, equity and services to the poorest.

PROPARCO ends 2007 with a balance sheet up 4%, despite the sharp depreciation of the dollar which had an impact on 40% of its outstanding amounts, total risk at 1.15 billion euros and non-performing loans at a record low, i.e. 4.5% of total outstanding amounts.

In parallel to these financial results which are well above Business Plan estimates, in 2007 PROPARCO continued to systematise project impact rating and 37 loan agreements with a total cofinanced amount of 3.9 billion euros were analysed. These assessments showed that PROPARCO financings directly or indirectly created or supported 315 enterprises and 47 000 jobs.

They also supported 70 enterprises in their SER (Social and Environmental Responsibility) processes, financed access to microfinance to 100.000 people, saved 1.8 million tons of CO2 and brought mobile phone networks to 22.5 million new subscribers.

In 2007 PROPARCO also reinforced its core role in the club of the European Development Finance Institutions by signing a partnership agreement with the Netherlands’ FMO based on the model of the existing agreement between PROPARCO and Germany’s DEG. PROPARCO was also appointed to the Board of European Financing Partners (EFP), a financing structure for European development financing under the aegis of the EIB. PROPARCO undertook in-house reforms scheduled in 2007, the first was to strengthen its origination efforts with dedicated agencies in each geographical area of activity and to reinforce the Portfolio Department with the creation of a new position to carry out independent fund rating and the inclusion of the “special operation” team.

Luc RIGOUZZO Chief Executive Officer

Several innovative projects illustrate the diversity of PROPARCO’s portfolio: including a subordinated loan guarantee to a microfinance institution in the Maghreb, financing the construction of a hydropower plant in Uganda, participating in an investment fund dedicated to environmental protection projects in Asia and promoting access to higher education in Lebanon.

All these positive changes bear witness to the soundness and expertise of PROPARCO’s teams and the accuracy of its financial model. However, repeated exposure to emerging countries, the current fragility of financial spheres and, in particular, changes in IFRS accounting standards will probably lead to greater cyclicality in PROPARCO’s results, without however undermining its fundamentals.

In 2008 PROPARCO has therefore reached a turning point in its history. The international financial context is difficult, but leaves room for development finance institutions which are by nature contra-cyclical. PROPARCO will furthermore be able to rely on renewed shareholder confidence while its capital will have more than doubled. It will also strive to come up with an increasing number of financial solutions for innovative projects which catalyse private investment in developing countries. This will be achieved via enhanced arrangement and syndication capacities.

Its North-South shareholding structure is unique among donors and EDFIs and reflects the increasingly important role of South institutions in development aid. This will be a trump card for PROPARCO’s growth strategy which is based on the core sectors of its activity and its long-standing competences: African expertise, private equity investment in mediterranean countries and combating climate change in Asia.

PROPARCO also enhanced communication thanks to the creation of operational documents, press relations, a revamped website, the deployment of regional websites and a series of films on projects which will be pursued in 2008.

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Men and women serving development PROPARCO’s multidisciplinary teams are recognised as riskbearing specialists in developing countries, meaning Proparco always operates with a constant level of professionalism in geographical areas ranging from very poor countries to major emerging countries.

Credit and Portfolio Department It issues an independent opinion on allocation requests and is in charge of risk supervision and rating. It also has a workout function and proposes appropriate reschedulings.

Director Philippe BASSERY

Management In addition to the Chairman, PROPARCO’s Management comprises two corporate officers.

Chief Executive Officer Luc RIGOUZZO Deputy Chief Executive Officer Étienne VIARD

Investment Department It is in charge of project assessment, setting up financing and is based on four divisions (Bank and Financial Markets Division, Infrastructure and Mining Division, Corporate Division, Private Equity Division) and an international network comprising seven offices.

Director Laurent DEMEY Bank and Financial Markets Division Gilles GENRE--GRANDPIERRE Infrastructure and Mining Division Jérôme BERTRAND-HARDY

Finance and Administration Department In addition to its traditional functions (setting rates and repayment schedules, financial forecasts, financial risk supervision and hedging, ALM, management control, rate and margin setting) it negotiates, alongside the Management, with European Development Finance Institutions (EDFIs) and the EIB and manages European resources.

Director Thierry LISCIA Deputy Director Brigitte QUERTAINMONT

Legal Department It provides expert input to the design of financial set-ups and is in charge of drafting legal documents and formalising securities and guarantees negotiated with clients.

Director Philippe LEBOUCQ

Corporate Division Stéphanie LANFRANCHI Private Equity Division Pascal PIERRA

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COMMUNITY OF INVESTORS SERVING DEVELOPMENT

A mission: financing sustainable development in developing countries via the private sector

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COMMUNITY OF INVESTORS SERVING DEVELOPMENT

PROPARCO was created in 1977 by Agence Française de Développement (AFD) and was at inception specialised in venture capital. It opened its capital to private shareholders in 1988. In 1991 PROPARCO became a Financial Institution and raised its capital to FF225M and was then able to finance medium to long-term loans and guarantees and pursue investment in private equity. The last capital increase in 2001 brought its capital to €142.5M making Proparco a sizeable financial institution.

PROPARCO has gradually widened its geographical area to include emerging countries and since 2004 has been strengthening its equity financing. Today it is the only European Development Finance Institution with a governance based on public and private partners from both the North and South.

targets for economic growth, job creation and to remedy market mismatches (SMEs, SMIs, financial sectors, infrastructure…), ◆ development and social targets (infrastructure, microfinance, private social sectors…), ◆

◆

sustainable development targets (forestry, greenhouse gases, environmental procedures, anti-money laundering) and, in particular, reduce “global” negative externalities.

Two additional cross-cutting priorities are: ◆ to promote French expertise and ◆ to work in partnership with other donors.

PROPARCO was created on the conviction that the private sector has a crucial role to play in developing countries: ◆ it

is the first factor for growth and job creation and provides a fiscal base for States to play their role as investors in the general interest and ensure redistribution, ◆ it is a cornerstone for environmental, social and governance concerns, ◆ it

can become an intermediary for public policy by directly supplying certain basic services in social sectors.

PROPARCO’s core mission is to boost private investment in developing countries in favour of sustainable development and the Millennium Development Goals.

PROPARCO therefore finances transactions which are economically viable, socially equitable, environmentally sustainable and financially profitable.

The latter is the key criterion for knockon effects to other private investors.

PROPARCO’s strategy is closely tied to the strategic plan of AFD which bases its private sector activity on three core groups of targets resulting from analyses of stakes and constraints in its countries of activity: Bernard Moizo © IRD

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PROPARCO’s milestones: geographical expansion and diversification of financial instruments Launch of AVERROES Finance, the first “fund of funds” in the Mediterranean, comanaged by Proparco and CDC PME

Entry of DEG and activities extended to China, Thailand, Turkey, Jordan and Egypt Private Equity Department set up Office opened in Bangkok Scaled up activity in Asia and French Overseas Territories

PROPARCO’s thirty year history has been marked by its widely extended geographical area of activity, the range and sophistication of its products, its human resources, its financial results and its balance sheet size.

Activities extended to Brazil, India and Pakistan

Capital increased to €142.5M

20 04 20 05 20 06 20 07

20 03

Offices opened in New Delhi, Lagos and Sao Paolo

20 01 20 02

19 96

Activities extended to all African, Caribbean and Pacific countries, the Maghreb, Cambodia, Vietnam, Lao PDR

19 91

19 77

Creation of Proparco, a venture capital enterprise for the private sector with a capital of FF10M

PROPARCO becomes a financial institution with a capital of €34.3M and can finance loans, guarantees and consulting services

Evolution in PROPARCO’s main financial indicators (1991-2007) M€

1991

1999

2007

Total balance sheet

47

496

987

Commitments

71

203

597

Net income

0.3

3.5

23.7

[9]

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COMMUNITY OF INVESTORS SERVING DEVELOPMENT

An extended commercial network PROPARCO today benefits from over 40 agencies with AFD covering some 60 countries. It also develops its own network via dedicated regional offices in Africa, Latin America and Asia.

In 2007 PROPARCO opened three new offices in Lagos, New Delhi and Sao Paulo.

PARIS SAINT PIERRE & MIQUELON

TURQUEY

TUNIS

LIBAN

TUNISIA

PALESTINIAN TERRITOTIES

JORDAN

MAROCCO

ALGERIA

SINAI

EGYPT

BAHAMAS CUBA REP. HAITI DOMINICAN

MAURITANIA

MALI

JAMAICA GUADELOUPE DOMINICA MARTINIQUE BARBADE

CAP-VERDE GAMBIE GUINEA-BISSAU

TRINIDAD-AND-TOBAGO

GUINEA

TCHAD

YEMEN

BURKINA FASO CÔTE D'IVOIRE

SIERRA LEONE GUYANA SURINAME

NIGER

SENEGAL

LIBERIA

SUDAN

GHANA BENIN TOGO

DJIBOUTI

NIGERIA

LAGOS

CAMEROON

CENTRAL AFRICAN REPUBLIC

ETHIOPIA SOMALIA

AMAPA

OUGANDA SAO TOME-AND-PRINCIPE

EQUAT. GUINEA GABON

DEM. REP. OF CONGO

CONGO

KENYA

RWANDA BURUNDI

BRAZIL

TANZANIA

ZAMBIA ANGOLA

NAIROBI SEYCHELLES COMOROS MAYOTTE

MAURITUS MADAGASCAR

ZIMBABWE

NAMIBIA

REUNION BOTSWANA

SAO PAULO

MOZAMBIQUE SWAZILAND

JOHANNESBURG LESOTHO

SOUTH AFRICA

AFD intervention area PROPARCO offices

[ 10 ]

A NORTH/SOUTH

COMMUNITY OF INVESTORS SERVING DEVELOPMENT

Southeast Asia The Bangkok office covers Cambodia, Indonesia, Lao PDR, Thailand and Vietnam.

Antoine Vigier 14 F Abdulrahim Place 990 Rama IV Road, Silom, Bangkok 10500, Thailand Tel: + 662 636 12 35 Fax: + 662 636 12 47 afdbangkok@greoupe-afd.org Nigeria The Lagos office covers Nigeria, Benin and all countries in the Economic and Monetary Community of Central Africa.

Charles-André Le Pape Lagos Melrose Office suites Phoenix House Plot 26E Abdulrahman Okene Close Off Ligali Ayorinde Street Victoria Island - Lagos Nigeria Tel: + 234 12705740

P R O PA R C O O P E N S A N O F F I C E I N S AO PAU L O I N C H A R G E O F O P E R AT I O N S I N BRAZIL AND SURINAME. This new office will focus on financing projects to combat climate change, preserve biodiversity and combat major pandemics and will support French corporates in a strategic area since Brazil, the world’s 10th biggest economy, constitutes the world’s largest biodiversity reserve, is the 5th greenhouse gas emitter and France’s leading economic partner in Latin America.

BEIJING

CHINA

AFGHANISTAN

PAKISTAN

NEW DELHI INDIA LAOS THAILAND

BANGKOK

VIETNAM

CAMBODIA

SRI LANKA

SUMATRA

INDONESIA WALLIS-ET-FUTUNA

VANUATU

S

NEW CALEDONIA FRENCH POLYNESIA

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proparco-2007-bat2-ANGLAIS:Mise en page 1

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COMMUNITY OF INVESTORS SERVING DEVELOPMENT

China Paul de la Guérivière 7 Floor, Block C, East Lake Villas, 35 Dongzhimenwai Avenue, Dongchend District, Beijing 100027 China Tel: (8610) 84 51 12 00 Fax: (8610) 84 51 13 00 afdpekin@groupe-afd.org Tunisia Emmanuel Haye Immeuble Miniar – Bloc B, 3rd and 4th floor, Rue du Lac d’Ourmia, 1053 Les Berges du Lac Tunis, Tunisie Tel: 71 861 799 Fax: 71 779 825 afdtunis@tn.groupe-afd.org

P R O PA R C O O P E N S A N O F F I C E I N L AG O S I N C H A R G E O F C OV E R I N G P R O J E C T S I N N I G E R I A , B E N I N A N D C E M AC COUNTRIES PROPARCO has transferred its regional office from Douala to Lagos. The office’s mandate remains unchanged: to support multisectoral economic development, with a focus on the banking sector, communications infrastructure and the energy sector in Nigeria, Benin, Cameroon, Gabon, the Democratic Republic of Congo, Equatorial Guinea, Central African Republic and Chad.

After eight months of activity PROPARCO’s portfolio is estimated at USD80M in Nigeria, a country with huge private sector financing needs.

Brazil The Sao Paulo office covers Brazil and Suriname.

Christophe Blanchot Sao Paulo Edificio Parque Cultural Paulista Avenida Paulista, 37-4° endar 01311-902 – Sao Paulo – Brasil Tel: + 55 11 22 46 27 91 Fax: + 55 11 22 46 27 99 India The New Delhi office covers India and Pakistan.

Jean-Pierre Barral New Delhi 1A Jan Path Delhi 11001 India Tel + 91 11 23 79 37 47 Fax: + 91 11 23 79 37 38

Southern Africa and Madagascar The Johannesburg office covers South Africa, Angola, Botswana, Lesotho, Malawi, Mozambique, Namibia, Swaziland, Zimbabwe and Madagascar Laurent Klein Ironwood House Ballywoods Office Park 29, Ballyclare Drive, Bryanston 2021 Johannesbourg, Afrique du Sud Tel: + 27 11 540 7100 Fax: +27 11 540 7117 proparcojohannesbourg@groupe-afd.org

Fance Two geographical areas are covered by PROPARCO headquarters in Paris: West Africa and the Mashreq.

5, rue Roland-Barthes 75598 Paris Cedex 12 Tel: +33 1 53 44 37 37 Fax: +33 1 53 44 38 38

East Africa The Nairobi office covers Kenya, Tanzania and Uganda.

Ghislain de Valon Royal Ngao House-Hospital Road PO Box 45995 Nairobi, Kenya Tel: (254 20) 271 84 52 Fax: (254 20) 271 79 88 afdnairobi@groupe-afd.org

[ 12 ]

MEASURING

DEVELOPMENT

Measuring development impacts

[ 13 ]

IMPACTS

MEASURING

DEVELOPMENT

IMPACTS

Systematic impact measurement Development institutions, in addition to their role of providing financing, strive to verify the effectiveness of their activity and measure the institutional, economic, environmental and social impacts of the projects they finance.

Development impacts are the cornerstone for EDFI criteria in project identification, in particular:

◆ current ◆ net

Since 2006 PROPARCO has been using a systematic project impact measurement tool. It is used selectively prior to any financing and then throughout the project life. The GPR (Geschäftspolitishes Projectrating ©) is an instrument adapted from a tool developed by PROPARCO’s German counterpart, DEG. It is also used by other European Development Finance Institutions (EDFIs) and harmonises impact measurements made

by European partners.

public revenue,

currency effects,

◆ employment, ◆ technology

◆ extension and improvement of basic service supply, ◆ improvement

of performances thanks to private

operators, ◆ social

effects (health, education, continuous training…),

◆ compliance

The tool, using a multidimensional approach, assesses: the economic viability of a project, its development impacts (see below), PROPARCO’s additionality compared with commercial banks and the profitability of the financing.

and know-how transfer,

with environmental standards,

◆ positive environmental impacts from greenhouse gas

mitigation measures, the use of renewable energies and energy saving.

PROPARCO also looks at a set of sectoral indicators in common with Agence Française de Développement.

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MEASURING

DEVELOPMENT

Profitability vs development impacts In addition to the individual assessment of the impacts of each project, the GPR© implemented in 2006 makes it possible to classify, analyse and strategically manage PROPARCO’s portfolio.

In 2007 PROPARCO carried out an ex-post evaluation on the expected outcomes of the whole 2000-2006 project portfolio. The analysis focused on over 150 projects with 1.3 billion euros of total commitments (own risk) for a global volume of cofinanced investments of some 8.4 billion euros.

75% of the assessed projects are implemented in Africa, 21% in Asia and 4% in the Caribbean.

Development projects ◆ 71% of projects were ranked above the satisfactory threshold defined in agreement with other European Development Finance Institutions.

This ratio rises to 86% of projects if development impacts are isolated. This confirms PROPARCO’s priority for development impact criteria in its investment policy, while still ensuring compliance with economic viability and profitability for each project. ◆

Compliance with environmental standards ◆ All recent projects comply with World Bank standards.

A strong correlation between profitability and development ◆ The cross–analysis of the four criteria measured by the GPR tool showed a positive correlation between project profitability criteria and development impact criteria. It identified a 40% “win–win” rate, i.e. 63 projects.

Conversely, the study shows that development impacts for projects considered low-profit during assessment are not always good.

Sizeable impacts between 2005 and 2006 ◆ 350 start-ups ◆ 60 000 jobs created or secured ◆ 750 000 households gained access to modern energy ◆ 30 million people had improved access to electricity ◆ 6.4 million new subscribers to mobile phone networks ◆ 1 200 Mw generated ◆ 3.9 million tons of CO2 saved

Compliance with social standards ◆ The social advantages of 35 corporates and 25 infrastructure projects were measured. All counterparts commit to complying with international social standards (ILO). The salaries of practically all the corporates financed are above national averages or direct sector competitors. Finally, all corporates financed comply with international standards such as World Bank guidelines on health and security at work.

[ 15 ]

IMPACTS

MEASURING

DEVELOPMENT

IMPACTS

Key 2007 indicators

GUARANTEEING A SUSTAINABLE ENVIRONMENT

Impact measurement forms part of a process to contribute to development. The impact of projects financed or cofinanced by PROPARCO are first and foremost to be credited to our clients. PROPARCO is in most cases a cofinancier which makes the project possible and its contribution matches the percentage of its financing. However, data for 2007 shown below illustrates the extent to which these impacts are considerable.

Credit lines and funds dedicated to environmental projects were financed in 2007 in line with PROPARCO’s aim to promote Global Public Goods in emerging countries as well as corporate Social and Environmental Responsibility (SER).

70 enterprises will be supported in their SER processes thanks to these specialised financings.

Moreover, in 2007 PROPARCO contributed to financing electricity generation projects using renewable energy in Africa and Pakistan. These projects will reduce CO2 emissions by 1.8 million tons.

DEVELOPING AND ENHANCING ACCESS TO ENERGY SOURCES

In 2007 development impacts were analysed for 37 loan agreements signed during the year totalling €425M in financial commitments (own risk) and a global investment cofinanced volume of some 3.9 billion euros.

A major 250MW hydropower dam project in Uganda will generate 1 200 GWh per annum at completion. This will raise the country’s energy capacity by 50% for the benefit of enterprises and the general public.

SC ALING UP ACCESS FOR THE POOREST POPUL ATIONS TO MEANS OF COMMUNIC ATION In 2007 and in the telecommunications sector PROPARCO financed the development of GSM networks in 7 countries including Malawi, Ghana, Chad and Lao PDR. These networks will eventually provide access for 22.5 million new subscribers.

SUPPORTING GROW TH AND EMPLOYMENT IN DEVELOPING COUNTRIES The portfolio of new projects financed or cofinanced by PROPARCO was instrumental in creating or supporting the growth of 315 enterprises and creating or securing over 47 000 direct or indirect jobs.

MICROFINANCE Financing for one of the Maghreb’s leading microfinance institutions will give nearly 100 000 people access to financial services to develop a microenterprise.

CONTRIBUTING TO STATE REVENUE 30% of projects signed in 2007 will directly contribute to increasing revenues and financing, up to 377 million euros, for States where the projects are implemented.

[ 16 ]

2 0 07 :

A

RECORD

YEAR

FOR

PROPARCO’S

2007: a record year for PROPARCO’s activity 2007 was a milestone year for PROPARCO in terms of both volume and prospects. The sharp rise in commitments was based on strategic fundamentals and thus validates choices made over the last two years: to target selected areas of expertise, develop new

territories with caution, focus on core mission sectors, consolidate public-private partnerships and place origination at the centre of our activity. This policy brought about these rapid changes and will be pursued and strengthened in 2008.

[ 17 ]

ACTIVITY

2 0 07 :

A

RECORD

YEAR

FOR

PROPARCO’S

ACTIVITY

Record high levels of activity Commitments (€M)

700 600 500 400 300 200 100 0 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 01 20 02 20 03 20 04 20 05 20 06 20 07

Total gross commitments at 31 December 2007 reached a record €598M, including €529 on own account and €69M on behalf of third parties, against €401M in 2006, including €377M on own account, and €216M in 2004. It is the highest ever increase recorded by PROPARCO on one year (+47% in total and +36% on own account). Signings have also risen sharply to a record €432M, i.e. an increase in line with the rise in commitments.

A number of factors account for continued growth in PROPARCO’s commitments: ◆ the

growth upturn in Africa which generates increased needs in infrastructure, in particular due to the emergence of Nigeria, Africa’s largest country, whose sound development is a major stake for the continent and hence for PROPARCO,

◆ the

opening to new emerging countries with a mandate to protect Global Public Goods following a French government decision in 2006. This had a direct impact on activity as early as 2007 thanks to heavy prospecting (€64M committed as early as 2007 in Brazil, India, Indonesia and Pakistan),

◆ the strengthening of the partnership strategy with

other development finance institutions engaged upon three years ago.

The sharp growth in commitments on behalf of third parties is also based on deep changes to PROPARCO’s financing capacities. Indeed, a subparticipation agreement signed with AFD allows it to use AFD’s balance sheet to invest much higher amounts. For instance, in 2007 this led to a USD60M loan for a dam in Uganda and a €50M credit line to a bank in Turkey.

This rise can be seen in all PROPARCO products and sectors. The level of equity commitments rose to a record €78M with a strong focus on investment funds which reach the core of SME fabric. These results bear witness to the success of the upturn policy for equity investment activities launched in 2002-2003.

Moreover, infrastructure financing continued to rise with a 47% share of commitments. Telecommunications was the main sector of activity, taking over

[ 18 ]

2 0 07 :

A

RECORD

from energy which dominated in 2006, and PROPARCO pursued its policy to support communications network development in difficult countries with investments in Chad and Lao PDR.

YEAR

FOR

PROPARCO’S

For corporates the year saw a balance between two of the main traditional sectors, tourism and agribusiness, with a new project in the education sector in Lebanon.

Drawing on sectoral expertise and prospecting new territories PROPARCO pursued its development in its three main areas of expertise: ◆ Africa,

mainly for infrastructure and financial sectors: 46% of commitments focused on SubSaharan Africa, i.e. €330M, with projects in the poorest countries (Chad, Uganda, Malawi, Madagascar), support to South Africa’s Black Economic Empowerment policy and a successful move into the continent’s main economy, Nigeria,

investment in the Mediterranean: PROPARCO is a major equity investment player in this zone and has always supported the teams which created this industry. It pursued its market policy in 2007, invested in several funds and coinvested in Moroccan and Egyptian SMEs in some funds. PROPARCO and Caisse des Dépôts launched

ACTIVITY

Averroès II, which follows the launch of the first fund of funds in the region comanaged by both Institutions which is now 100% invested, ◆ climate

change in emerging countries: a major issue for humanity, combating climate change and promoting renewable energies are at the core of PROPARCO’s strategy in the major emerging countries. 2007 marked the deployment of expertise gained over the past four years in China and Thailand to new zones: Pakistan, India, Brazil and Indonesia.

◆ equity

Moreover, PROPARCO is a development institution, hence contracyclical, and must be present in high political risk zones in order to support initial investments in fragile States or post-crisis countries.

[ 19 ]

2 0 07 :

A

RECORD

YEAR

FOR

This policy was embodied in Lebanon in 2007 with the extension of St. Joseph University and in Côte d’Ivoire with several equity investments in financial institutions.

It will be strengthened from 2008 onwards with increased marketing in these countries.

PROPARCO’S

ACTIVITY

many years and drawing on its expertise. In 2007 PROPARCO made equity investments in Morocco, Cambodia and Algeria and will continue to scale these up in this sector over the coming years.

Finally, PROPARCO decided to relaunch its activities in the microfinance sector, thus complementing work carried out by Agence Française de Développement for

Strengthening partnerships with public and private financial institutions PROPARCO is at the core of a network of partners, firstly thanks to the public-private and North-South structure of its shareholding. This network extends to all development actors or financial players in its areas of activity. More clients are reached through this policy and consequently benefit from complete financing solutions. It also expresses the vocation of donors and development finance institutions to disseminate best standards in terms of SER or governance. Finally, it recognises deep changes in the financial landscape of its geographical areas where the number of operators has increased and South institutions play an increasingly predominant role.

in October 2006. Closer ties were established with African finance institutions, the African Development Bank, DBSA in South Africa, BOAD in West Africa: all have become major players on the continent. Contacts with Nordic bilaterals increased, with the signing in November of a first subparticipation cofinancing agreement with Finnfund.

Moreover, PROPARCO is consolidating ties with commercial banks operating in these zones and wishes to increase its leverage effect by developing syndication products. An initial project was assessed in Ghana with two subparticipating commercial banks.

This partnership policy was therefore strengthened in 2007. A cooperation agreement was signed with FMO in May following a similar agreement signed with DEG

[ 20 ]

GEOGRAPHICALLY

TAILORED

PRIORITIES

Geographically tailored priorities PROPARCO has always been recognised as an expert in Africa, but has also become a specialist in energy issues in Asia and equity investment in Africa and the Mediterranean.

PROPARCO has a specific approach in three major geographical areas: ◆ growth

and job creation in Africa,

◆ climate change and biodiversity in major emerging

countries, ◆ rising equity investment in Mediterranean countries.

[ 21 ]

GEOGRAPHICALLY

TAILORED

PRIORITIES

Reaffirming the African continent as a priority Between 2003 and 2007 average annual growth in Africa stood at around 6%. Such growth had not been seen since national independencies and gives reason for optimism, yet it is not enough to reach poverty reduction targets since population growth dampens such positive effects.

KEY FIGURES FOR PROJECTS IN AFRIC A SUPPORTED

BY P R O PA R C O I N 2 0 07: ◆ 46 268 jobs created or saved ◆ 11.4 million people connected to phone networks

Support to African growth is more than ever before a key factor for official development assistance policies.

◆ 54 million euros contributed annually to State

revenues ◆ 1200 GWh generated per annum

The private sector is the main engine for this, the main source of job creation, the fiscal base which allows a State to play its role as a regulator, and an intermediary for public policies which target access for populations to basic services.

PROPARCO’s priority objective is to boost private investments on the continent in order to support growth, job creation, poverty reduction and reach the Millennium Development Goals (MDGs).

◆ 100 000 people with access to microcredit

Loans: geographical breakdown in foreign States (commitments)

In relative terms PROPARCO is one of the most committed European Development Finance Institutions in Africa. The continent accounted for 60% of its allocations in 2007 and Sub-Saharan Africa alone made up 45%.

Asia, Caribbean

West Africa

22 %

28 %

10 %

24 % 16 %

In order to meet Africa’s development challenges, PROPARCO aims to gradually double its private sector commitments on the continent

Maghreb and Mediterranean

[ 22 ]

Central and East Africa

Southern Africa and Indian Ocean

GEOGRAPHICALLY

TAILORED

PRIORITIES

PROPARCO focuses its activity on strengthening sectors which support growth and job creation: ◆ financing corporates (export, regional markets…), ◆ supporting

financial intermediation (local banks, investment funds…), high-performance private infrastructure essential for growth (basic infrastructure, cost-saving infrastructure, logistical and digital divides…),

◆ strengthening

◆ preserving local and global environments, ◆ supporting the creation of local entrepreneur groups.

I N C R E A S I N G E L E C T R I C I T Y G E N E R AT I O N I N U G A N DA In 2007 PROPARCO committed €330M in Africa including €60M for corporates, €116M for infrastructure and €154M for the financial sector.

Uganda is one of the world’s most lagging countries in terms of access to electricity with less than 10% of the population connected to the electricity network. Electricity generation will have to be practically doubled in order to face demand which is expected to triple over the next fifteen years.

Among projects studied Bujagali was identified as being the most interesting from an economic, environmental and social point of view.

The project will contribute to making a considerable and sustainable improvement to Uganda’s energy crisis and will lead to the number of households connected being raised by a third over the next ten years.

The project includes the construction of a hydropower plant with 250 MW of installed capacity on the Nile downstream from Lake Victoria.

The project is implemented by BUJAGALI ENERGY LIMITED (BEL) whose shareholding is controlled by the Aga Khan Fund for Economic Development (AKFED) via its subsidiary Industrial Promotion Services (IPS), the US company Sithe Global Power and the Ugandan government. BEL has a 30-year concession, at termination its assets will be transferred to the State for a symbolic US dollar.

The total project cost stands at 872 million US dollars. The total amount of the loan allocated by PROPARCO and AFD stands at 72.8 million US dollars and is part of a global 682 million US dollar financing in which other development institutions and European, African and American banks are participating.

The Bujagali dam alone will generate almost half of the energy produced in Uganda at commissioning in 2012. The electricity generated will be much less costly than the currently used thermal-based energy and will restore economic balance to Uganda’s energy sector.

Over 1 100 direct jobs will be created during the dam construction phase and BEL will, through taxes, contribute up to USD800M to the State budget during the concession period.

The project will reduce CO2 emissions by 1.5 million tons a year. Finally, the project’s environmental and social impacts, defined in a management plan in compliance with international standards, will be relatively limited (run-ofriver dam with population relocation limited to 85 households).

[ 23 ]

GEOGRAPHICALLY

TAILORED

PRIORITIES

Equity and investment funds in Mediterranean countries The Mediterranean zone covered by PROPARCO includes ten countries: Morocco, Tunisia, Egypt, Algeria, Jordan, the Palestinian Autonomous Territories, Yemen, Lebanon and Turkey.

Economic growth in these countries, at an annual average of around 4% between 2001 and 2006, is encouraging but is still not enough to bring about real economic take-off which is essential to meeting employment challenges in the region.

Indeed, over a hundred million jobs need to be created over the next twenty years in order to face huge active population growth.

SMEs and large corporates often remain focused on traditional sectors and employment potential in service sectors still remains widely untapped.

Moreover, these economies often remain debtoverhang economies with a limited product range (little equity and/or quasi-equity). Alternative mechanisms to bank financing have been promoted for ten years now due to the reluctance of banks to grant loans to SMEs in countries in the region.

PROPARCO provides its expertise and financial means.

PROPARCO was involved right from the start of the activity in the early 1990s and was present when professional teams emerged in early 2000. It has also contributed to building networks and integrating teams and enterprises, in particular via the Averroès Finance regional fund of funds which is comanaged with CDC Enterprises.

PROPARCO has also led or been involved in several training and communication actions focusing on the interest of equity investment and the regulatory changes required.

In 2007 PROPARCO committed €140M in Mediterranean countries, including €29M for corporates, €20M for infrastructure and €91M for the region’s financial sector.

Equity investment provides one of the best solutions to this situation as it offers an alternative to overindebtedness and gives financial solidity to expanding corporates. It also provides expert technical assistance, new partnerships, new markets and new technologies.

It is also a way for the Mediterranean economy to upgrade to international corporate standards and it boosts local financial systems.

Finally, it can facilitate and promote the handing down of business leadership to the next generation in the region’s enterprises.

Film « Capital investment in Morocco » www.proparco.fr

[ 24 ]

GEOGRAPHICALLY

TAILORED

PRIORITIES

SUPPORTING THE DEVELOPMENT OF N O R T H A F R I C A’ S M A I N P R I VAT E E Q U I T Y P L AY E R TUNINVEST FINANCE GROUP (TFG, INTEGRA Partners Group), created in 1994, is the biggest private equity investment enterprise in North Africa. It manages nine generalist investment funds mainly targeting investment in medium enterprises in the Maghreb and Sub-Saharan Africa.

Since 1997 the partnership with TFG, via PROPARCO’s direct or indirect participation in 7 of these funds, has contributed to developing equity investment for small and medium enterprises in the Maghreb and subsequently in Sub-Saharan Africa.

This partnership is instrumental in creating a considerable financial and qualitative leverage effect due to the number of enterprises financed and the technical support they receive.

TFG, a management company controlled by its teams, has an approach which involves providing close support to the enterprises where it operates. It is in particular instrumental in improving governance, strengthening management teams, profit-sharing systems and defining development strategies which often include an international side. It is active in monitoring strategy implementation.

TFG, based in Tunis, Casablanca and Algiers, covers SubSaharan Africa via partnership agreements with local teams and manages a total of over 210 million euros. PROPARCO directly participates in 5 of the funds and holds an indirect stake in 3 of them via the Averroès Finance fund of funds.

In the Maghreb alone, the funds managed by TFG Group have supported over sixty enterprises in Tunisia, Algeria and Morocco with turnover totalling 650 million euros and 8 400 employees. For 1995-2002 the enterprises held by TFGmanaged funds have seen an average 45% growth in turnover, a rise in exports topping 100% and a 25% staff increase.

TFG has been working to develop best corporate standards in Maghreb for over fifteen years and directly participates in their regional integration.

Enhancing energy efficiency in emerging countries Climate change, loss of biodiversity and major pandemics are the main global challenges for the years to come.

The major emerging countries where activity and growth are booming may be the first victims, the main cause and the key to a solution.

They are issues for public policy on a global scale.

China has been the world’s biggest CO2 emitter since 2007 with over 6 000 million CO2 equivalent tons

[ 25 ]

GEOGRAPHICALLY

TAILORED

emitted during the year. Mitigating these emissions is a priority in combating climate change on a global scale.

Brazil, Indonesia and China’s biodiversity is also unique in the world by its wealth, territorial coverage and ecosystem complexity. These resources must be sustainably managed.

PRIORITIES

This strategy breaks down into five sectors of activity for PROPARCO: ◆ energy

issues (cleaner electricity generation, renewable energies, gas distribution…),

◆ support to “model” enterprises and banks in terms

of social and/or environmental standards,

Finally, the rise and densification of the world’s population, and its growing promiscuity with animal species in a context of globalised trade, increase the risk of the emergence and spread of new diseases. This new challenge can be faced by improving sanitary practices.

◆ financial intermediation on credit lines allocated to

PROPARCO is today active in Brazil, China, India, Indonesia, Pakistan and Thailand and focuses its operations in these countries on promoting Global Public Goods.

In 2007 almost 70% of PROPARCO’s financial commitments in major emerging countries focused on projects to develop clean energies.

projects with high social or environmental content or promoting best practices, ◆ global

and local environment, investment funds engaged upon SER actions or specialised in financing renewable energy or energy efficiency projects.

P R O M O T I N G E N V I R O N M E N TA L PROTECTION IN INDIA AND CHINA

The Kyoto Protocol aims to reduce greenhouse gas emissions by 5% by 2012 (from 1990 levels). Policies implemented in the major emerging countries, which generate more and more of such emissions, will be decisive in achieving this target.

The ALOE funds operate exclusively in the environmental sector. Projects are financed either directly in India and China or indirectly via equity investments in European enterprises which are active in Asia in the environmental sector.

PROPARCO has invested €5M in the Green Investment Asia Sustainability Fund I (GIASF). GIASF I will coinvest with the ALOE ENVIRONMENT (AEF) II Fund, a French-registered pooled fund in which some thirty investors have subscribed over EUR110M. AEF II, managed by the ALOE PRIVATE EQUITY team, aims to make 10 to 15 investments ranging from €10M to €15M. The targeted sectors are renewable energies, energy efficiency and waste recycling and treatment in Asia. In 2007 two investments were approved in India in the sectors of PET bottle recycling and renewable energy generation.

The Fund is instrumental in promoting sustainable development in emerging countries by supporting both enterprises which are pioneers in the environment sector and the implementation of SER practices in such enterprises.

[ 26 ]

GEOGRAPHICALLY

TAILORED

PRIORITIES

supply-demand deficit is put at 5 500 MW by 2010.

ENGRO CHEMICAL, via a project enterprise “ENGRO ENERGY LTD”, is investing in a power plant producing electricity from low BTU gas. BTU gas is a low-calorific-value residual gas which is currently burned or ejected into the atmosphere.

CO2 emissions are reduced by using this gas.

The project involves constructing, operating and developing a 217 MW gas-fired combined cycle power plant in Ghotki District located in Sindh Province. The power plant will operate using low BTU gas produced from gas exploitation at the Quadirpur Gas Field during the field’s lifecycle.

The energy produced will be sold by ENGRO ENERGY to the State-owned National Transmission and Dispatch Company (NTDC). NTDC is in charge of electricity transport and distribution in Pakistan.

D E V E L O P I N G AC C E S S TO E L E C T R I C I T Y BY M I T I G AT I N G C 0 2 E M I S S I O N S I N PA K I S TA N The national grid in Pakistan can only supply half the population in electricity. Without additional capacity the

PROPARCO is participating in the project financing structure which totals USD205M. The carbon budget carried out by PROPARCO estimates a substantial saving of between 15 and 20 million tons of CO2 over a 25-year period.

Altogether the project will generate around 120 million US dollars of additional annual tax revenue.

[ 27 ]

GEOGRAPHICALLY

TAILORED

PRIORITIES

Supporting growth in France’s Overseas economies The private sector plays a key role in the sustainable development of France’s Overseas economies.

PROPARCO is pursuing its direct or indirect financing to boost the competitiveness of French Overseas corporates and enable them to develop their activity in a stable regional context.

PROPARCO’s strategy is based on three main axes:

Overseas Local Authorities (tourism in particular), ◆ to

contribute to preserving the environment by financing renewable energy development and infrastructure projects.

PROPARCO also supports major AFD projects in these regions.

◆ to underpin economic growth by supporting banks

with a regional vocation in long-term economy financing, ◆ to

combat inequalities by contributing to job creation via support to the productive sector in the

SUPPORTING ECONOMIC DEVELOPMENT I N F R E N C H P O LY N E S I A SOCREDO Bank is French Polynesia’s leading commercial bank. The bank fosters economic and social development in the Polynesian archipelago by granting long-term financing to various players in the local economy. It is particularly active in the social housing sector through its range of preferential loans to modest households and through the financing of enterprises operating in the sector (construction, social housing). The bank is a longstanding partner of Agence française de Développement, one of its shareholders alongside the Polynesian government and BRED. In 2005 and 2006 PROPARCO granted two credit lines to SOCREDO to enable it to face a sharp increase in long-term financing activity. Indeed, the bank’s long-term lending activities are only partly covered by matching deposits. The new €20M credit line granted by PROPARCO in 2007 will contribute to developing several sectors including tourism, pearl farming, fishing and inter-island maritime transport.

[ 28 ]

S USTAINABLE

DEVELOPMENT : SECTOR - WIDE MAINSTREAMING

Integrating sustainable development and social and environmental responsibility in each sector of operations

[ 29 ]

S USTAINABLE

DEVELOPMENT : SECTOR - WIDE MAINSTREAMING

Creating high-performing infrastructure to boost growth Effective and low-cost infrastructure is a core prerequisite for growth and poverty reduction: ineffective infrastructure is indeed the most cited stumbling block for developing countries. The need therefore exists to enhance infrastructure in order to attract foreign investment, foster the emergence of a local corporate fabric and improve living conditions for populations, the poorest in particular. PROPARCO finances projects which give greater access to drinking water, energy and means of communication for enterprises and local populations.

PROPARCO also ensures the projects it finances are compatible with environmental preservation and the social promotion of local populations. More specifically, PROPARCO gives priority to projects which fall within the framework of the Kyoto Protocol Clean Development Mechanism or renewable energy and energy efficiency sectors. In emerging countries PROPARCO focuses on exemplary projects in these sectors in order to foster development with the highest possible level of sustainability.

In 2007 PROPARCO committed €222M for projects financing major basic infrastructure in 13 countries.

U P G R A D I N G I N T E R N AT I O N A L A I R P O R T S IN CAMBODIA The tourism sector is an engine for Cambodia’s economy.

It is an important source of foreign currency for the country and has been booming in past years with a GDP share rising from 5.4% in 2000 to over 15% in 2005.

International airports are core infrastructure for Cambodia for their capacity to welcome tourists and to develop a sector which generates employment, foreign currency and growth. Current airport upgrading demonstrates Cambodia’s willingness to open up the country. It also contributes to attracting private investors in the country.

Société Concessionnaire des Aéroports (SCA), the airport concessionaire, was founded in 1995 to manage Phnom Penh airport. In 2000 it also became in charge of managing Siem Reap airport, which provides access to the Angkor temples, and Sihanoukville airport in 2006.

PROPARCO’s financing includes two facilities: a USD7.5M loan set up in 2007 and a USD10M standby facility that the enterprise can call upon between 2008 and 2010 to cover possible financing needs resulting from large investments in Sihanoukville. These financings will be used to renovate and extend the three airports.

The airport infrastructure has a sizeable long-term development impact as it will catalyse tourism and industrial development all over the country.

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M O B I L E P H O N E S E C TO R : O P E N I N G U P T E R R I TO R I E S A N D P O P U L AT I O N S The mobile phone market is booming in developing countries.

Its dynamism is based on sharply increasing demand and a global reduction in access costs.

The development of mobile phone infrastructure is a prerequisite for growth as it contributes to opening up spaces and populations.

The sector, besides providing populations with basic services, attracts investors.

In 2007 PROPARCO financed investments for mobile phone network extension and service quality enhancement in four Sub-Saharan African countries and Lao PDR. PROPARCO, by providing reliable long-term financing likely to attract other investors, is instrumental in creating effective and low-cost infrastructure.

A USD25M loan was granted to MILLICOM GHANA, Ghana’s second mobile phone operator. With 1.7 million subscribers the company plays a key role in developing basic telecom services for populations.

MILLICOM TCHAD, Chad’s second mobile operator, is on the way to becoming the market leader and has benefited from an €11M loan to cover remote rural areas and continue to provide quality low-cost services.

In Malawi and Uganda PROPARCO is participating in financing CELTEL’s investment program for up to USD7M. The program targets infrastructure quality enhancement and network extension to currently uncovered rural areas.

Finally, MILLICOM LAO, Lao PDR’s third mobile operator with a 14% market share, entered into a USD13.5M loan with PROPARCO for coverage enhancement in the country’s south provinces. MILLICOM LAO is also working on developing the marketing aspect of customer services, not yet widespread in the country’s mobile phone market.

Operators financed by PROPARCO make a direct contribution to improving the economies in which they operate via their investments and tax contributions. These five projects will contribute to creating or securing 3 600 jobs, connecting over eleven million people to a phone network and will generate an estimated annual €29M contribution to the relevant States.

KEY FIGURES FROM THE I N F R A S T RU C T U R E D E V E L O P M E N T P R O J E C T S F I N A N C E D BY P R O PA R C O I N 2 0 07 ◆ 22.5 million people connected to phone networks, ◆ a 50% rise in Uganda’s energy capacity at project

completion, ◆ a 50% rise in access to electric energy in Uganda, ◆ 1.8 million CO2 equivalent tons saved, ◆ 376 million euros in annual contributions to the income

of the States concerned.

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Modernising, deepening and securing financial markets

In Least Developed Countries the developmental legitimacy of the banking sector as an engine for economic growth is unquestionable. Private sector growth is dependent upon improved efficiency in banking and financial markets to ensure the best possible use of capital and access for enterprises to suitable medium and long-term financings.

Indeed, in a number of developing countries neither the level of savings nor institutional investors are lacking. The problem is that the range of banking products for enterprises is often limited to a few short-term products due to a lack of private risk prioritisation and that financial markets, when they exist, remain shallow. There is therefore limited allocation of savings to long-term investments which, unlike in developed and emerging countries, often account for a very small percentage of gross domestic product.

In emerging countries, which have a much broader range of banking services and where markets play an

increasingly important role in financing the private sector, the integration of sustainable development problematics (combating climate change in particular) is still in its infancy, but is to become a major concern.

In this context PROPARCO provides a wide range of financing tools (equity, credit lines in foreign currency, or in local currency in some countries, guarantees and off-balance sheet instruments) firstly to meet all the needs of banks and financial institutions in developing or emerging economies and, secondly, to complement banking intermediation by deepening financial markets.

This range of financing tools not only targets banks’ long-term SME financing, it also aims to structure and improve the performance of a sector which is considered to have a sustainable impact on loan supply. Similarly, equity investment is a priority for PROPARCO in particular to facilitate the creation, consolidation and development of emerging banking or insurance groups and give local banks – whatever

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their nationality – access to international markets.

PROPARCO can also, via trade finance programs, develop guarantee products for foreign trade financing projects for South financial institutions, in partnership with international banks.

SUPPORTING THE DEVELOPMENT O F A PA N - A F R I C A N BANKING GROUP

Investment financing via financial markets remains very limited or is nonexistent in many countries within PROPARCO’s geographical area, whereas institutional investors and savers seeking short or long-term investments cannot find products tailored to their needs, with sufficient liquidity or security. PROPARCO consequently strives to deepen financial markets and increase their effectiveness by developing off-balance sheet mechanisms to immunise local and international players against risks where the risk-yield ratio does not comply with traditional private sector standards. For instance, PROPARCO can provide structures to help raise the number of issuers or operations by issuer, by boosting demand via the creation and securisation of collective savings vehicles and insurance products.

These financing structures to promote financial markets are mainly based on guarantee and credit enhancement tools which PROPARCO has been developing since the 1990s.

In 2007 BMCE Bank, one of Morocco’s leading banks and a shareholder of PROPARCO, took a 35% stake in the Bank of Africa Group. PROPARCO is one of Bank of Africa Group’s historic capital partners. This agreement is a milestone in the development of the two banking groups and seals their pan-African ambitions. The Bank of Africa Group, whose creation dates back to the creation of BOA Mali in the early eighties, followed by BOA Benin and the African Financial Holding 1989 (now BOA Group), is nowadays present in over ten countries with a balance sheet totalling 1.5 billion euros and over 160 branches. PROPARCO has always supported the capital development of the Group. The majority of the Group’s shareholders are African based. PROPARCO has been a shareholder and director of the holding company right from its first incorporation and, thanks to its close ties with BMCE Bank, took an active part in the negotiation of this agreement. The investment aims to bring a reference banking partner into BOA Group. The specificity of Bank of Africa Group’s shareholding combined with the sound financial base of BMCE Bank, means a rapid development can be expected for both partners all over Africa. BMCE Bank is already active in other African countries such as Congo-Brazzaville, Senegal, Gabon, Tunisia, soon Algeria and also France and Great Britain with its merchant bank Medicapital Bank, Spain and Italy. In parallel, at the end of 2007 PROPARCO granted a €50M subordinated loan to BMCE Bank to help finance this specific investment.

This alliance seals the creation of a truly African banking group applying the best international standards and linking up Sub-Saharan Africa, the Maghreb and Europe.

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Participating in investment funds dedicated to corporate financing The SME sector is a core sector for the development of a sustainable and dynamic economic fabric. The apparent reluctance of banks to grant loans to SMEs in developing countries, or in certain investment sectors in emerging countries, has led to actions to promote alternative mechanisms to bank financing.

PROPARCO, in parallel to its efforts in favour of banking systems and with the same targets of intermediation and to create private sector knock-on effects, acquires stakes in investment funds dedicated to financing corporates in expansion.

By entrusting fund management to independent local teams intermediation has a dual leverage effect.

The first quantitative effect is that PROPARCO financing reaches a sizeable number of local enterprises seeking alternative resources to debt in order to finance their development. In 2007 the investment funds where PROPARCO acquired stakes plan to invest in over 100 enterprises and impact 10 000 jobs.

The second qualitative effect is the direct involvement of these highly-skilled teams in the management of financed enterprises. This entails making a selection within the local corporate fabric and gradually upgrading management practices and social and environmental standards which are essential for these enterprises to open to regional and international markets.

The presence of PROPARCO and development institutions in these funds has a knock-on effect for other investors and catalyses private funds. PROPARCO also supports the funds by setting up procedures for anti-money laundering and combating the financing of terrorism.

MOBILISING PRODUCTIVE INVESTMENT IN T H E I N D I A N O C E A N A R C H I P E L AG O S PROPARCO is supporting the I&P Management (Indian Ocean) team for the second time. The I&P Management team currently manages two investment funds dedicated to financing enterprises in Mauritius, Madagascar, Comoros and the Seychelles. PROPARCO participates directly in these funds.

Since beginning its activity, the I&P Management team has assessed over 150 projects in the region. Its strategy is based on totally independent investment choices in terms of reference equity investments which gives the fund real leeway. It also actively supports the management of holding companies.

The first €10M investment fund launched in 2003 (I&P Capital) is now 100% invested. It has made 7 investments in the region and satisfactory profitability is expected.

Such a sound initial experience has enabled the team to raise a higher amount of investment for the second fund I&P Capital (II), with 30% of the shareholding financed by the private sector.

PROPARCO subscribed up to €5M in this second €30M fund. I&P Capital (II) aims to invest in existing medium enterprises, for instance candidates for capital development or transfer operations.

The investment activity of both funds has a dual impact on growth and the dynamism of the region’s economy by directly impacting employment and mobilising local and international private coinvestors.

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STRENGTHENING MEDIUM ENTERPRISES I N T H E M AG H R E B PROPARCO is investing â‚Ź2M along with AVERROES finance in the Capital North Africa Venture Fund (CNAV). CNAV is managed by the Capital Invest team which is based in Morocco and already manages the Capital Morocco fund.

The fund has already reached EUR36.6M and aims to finance medium enterprise equity.

These enterprises are essential to Morocco’s development and economic transition, in particular in sectors such as agribusiness, chemicals, pharmaceuticals, specialised retailing and services to enterprises and the general public. Investments will also be possible in Algeria and Tunisia.

The fund specifically targets equity transfer or development capital operations.

This instrument meets two additional objectives: to develop productive and job-creating activity in Africa and the Mediterranean and also to focus investments on sectors which contribute to protecting biodiversity and combating climate change in major emerging countries.

Supporting productive and service sectors PROPARCO provides long-term resources which match the lifecycle of financed assets and are often lacking on local banking markets. PROPARCO strives to finance investments by large and medium enterprises seeking to develop their industrial equipment, subsidiaries under restructuring and requiring modernisation investments, or borrowers diversifying their activity in order to face increased competition.

These financings are allocated either in foreign currency for enterprises with export income or in local currency via guarantees.

The main traditional sectors of activity are: plantations and primary agribusinesses, livestock farming and seaproduct packaging, the modernisation and expansion of heavy industries, transportation, education and the tourism industry.

These projects must contribute to disseminating and promoting Social and Environmental Responsibility, in particular via the systematic integration of environmental protection, biodiversity preservation and enhanced corporate governance.

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P R O M O T I N G AC C E S S TO H I G H E R E D U C AT I O N IN LEBANON Saint Joseph University in Lebanon is a non profit-making scientific and cultural private establishment with a public mission for higher education and research. In this fragile country it fosters greater access to higher education for modest social categories. Almost 10 000 students attends the University.

Saint Joseph University holds and manages 15 faculties, 23 institutes, a school of engineering, four university campuses in Beirut and three regional university centres covering a large part of Lebanon.

The University has engaged upon an extension and modernisation process which includes the creation of a Campus for Innovation, Economy and Sport. The new campus will house: a medical research unit, a modern sports centre, new

reception capacities for the Faculty of Economics and new living areas for University students and staff. The new facilities will be housed in the same building and will have the capacity to receive almost a thousand students, professors and researchers.

In a difficult context for the country, PROPARCO is granting the University a long-term loan, which would not be available in the Lebanese banking market, and is thus making the project possible.

AFD is also participating in financing this extension.

All in all, the AFD Group, by financing almost 30% of the project, is supporting Saint Joseph University in a modernisation process which will confirm its position as a university of reference in Lebanon.

Scaling up projects contributing to corporate Social and Environmental Responsibility PROPARCO, having enhanced its own practices in this sector (environmental assessment of projects, antimoney laundering, corporate governance…), aims to support its clients in Social and Environmental Responsibility upgrading by focusing on eight of its components: the integration of local environmental constraints, the fight against climate change, biodiversity protection, compliance with social rights, access to education and health, the fight against financial crime and improving corporate governance.

EXTENDING A CEMENT PL ANT IN KIRENE, SENEGAL: A MODEL E N V I R O N M E N TA L P R O C E S S The demand for construction materials in Senegal, boosted by a booming construction and public works sector and annual urban growth at 4%, rises every year.

Ciments du Sahel (CDS) was founded in 1999 by a private Senegalese group with support from major donors, in order to meet rising demands for cement from the local market. Five years later, CDS’s business plan was to triple its cement production capacity to reach 3 million tons a year. The total project cost stands at €162M and includes the construction of a second kiln and two additional grinding units.

PROPARCO is contributing €20M to the financing structure with an additional €1.2M financed through EFP, the European Development Finance Institutions’ investment vehicle.

Since inception CDS has committed to a voluntarist social and environmental strategy and has deployed high-level technology which goes beyond the local and international environmental standards in force. A sizeable portion of investments

[ 36 ]

is devoted to reducing dust and oxide discharge, groundwater and rainwater management, waste management and to improving living conditions on the production site and in surrounding villages.

The socioeconomic impact is considerable for Senegal. In addition to the positive effect on the local and subregional markets due to improved product quality and export competitiveness, the project will also contribute to creating 200 direct jobs and 800 indirect jobs.

TAILORING

AND EXTENDING OUR RANGE OF FINANCIAL PRODUCTS

Tailoring and extending our range of financial products PROPARCO is positioned on risk areas with the highest market flaws. It must therefore be able to provide a range of financing instruments to meet three main types of needs expressed by private enterprises willing to invest in emerging countries:

◆ access

to long term financings,

◆ hedging or mitigation for certain risks, in particular

political, ◆ tailored solutions to specific problematics in developing countries.

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TAILORING

AND EXTENDING OUR RANGE OF FINANCIAL PRODUCTS

Extending the range of financing Access to Long term resources

Risk sharing/hedging

Tailored solutions

➜

➜

➜

Extending the range of long term financing

Develop guarantees and risk hedging tools

Financial engineering for development

➔

➔

➔

LT loans (incl. for 3rd parties) Higher Volumes Equity Local currency

ARIZ Issue guarantee Subparticipation credit line Local currency guarantee

Repayment indexed on raw materials EDFI package Syndication Participative loans (rates indexed on results)

Strengthening corporate equity PROPARCO, via its equity and quasi-equity investments and priority exit strategies, directly contributes to the development of private enterprises and boosting financial markets. PROPARCO is either active via equity investments in investment funds or via direct equity investments in enterprises or financial institutions.

PROPARCO always acquires minority investment stakes which are destined to be transferred to other shareholders, or to the financial market in the case of negotiable securities, after a 5 to 7 year support period when the enterprise has reached a sustainable level of maturity.

PROPARCO provides support via equity and quasiequity investments: capital provision, shareholder current accounts, convertible bonds, participative loans, subordinated loans. These direct investments mainly, but not exclusively, concern financial institutions and corporates with regional vocations.

PROPARCO, with the objective of intermediation and to create private sector knock-on effects, also acquires stakes in investment funds. The resulting leverage effect means PROPARCO can contribute to financing local small and medium enterprises. PROPARCO is therefore a key player in establishing the private

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TAILORING

AND EXTENDING OUR RANGE OF FINANCIAL PRODUCTS

equity investment industry in Africa and the Maghreb by promoting the creation of local teams, some of which have today become continental players.

PROPARCO generally invests in multi-country funds which are sectoral generalists in order to diversify risk. They generally invest in enterprises which have already achieved a certain level of maturity.

DIRECT SUPPORT TO T H E D E V E L O P M E N T O F A N E G Y P T I A N C O M PA N Y

ITWorx is Egypt’s main software developer and informatics service provider. The company is also present in Saudi Arabia, the United Arab Emirates and the USA. A Euromena-led consortium acquired 79% of ITWorx in 2007. The Euromena fund, VC Bank and PROPARCO were amongst the financiers. With this investment, PROPARCO will work with other investors to consolidate the enterprise’s internal structures and finance its international development.

In particular, the acquisition of ITWorx should mean the enterprise will be able to conquer new markets in the Persian Gulf, Europe and the USA, develop new products and attract new talent.

ITWorx will continue to contribute to creating skilled employment by recruiting 300 engineers from 2007-2010.

It therefore ensures young qualified graduates are both trained and recruited. With this strategy, the company supports the Egyptian government’s policy for the IT and information technologies sectors which aims to make Egypt a regional hub for IT services and thus contribute to reducing the digital divide between North and South countries. More generally, the development of ITWorx contributes to the economic dynamism of the region by diversifying production structures towards export activities and services with high added value.

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TAILORING

AND EXTENDING OUR RANGE OF FINANCIAL PRODUCTS

Providing loans tailored to each project The focus for lending activity is on strengthening infrastructure, both physical (energy, telecoms, transportation) and financial (banks), and project financing in industry and services which create high employment or are structuring for a region (agribusinesses and tourism in particular). Volumes allocated for the Infrastructure and Mining sector and Banks and Financial Markets sector rose respectively from €116M in 2006 to €222M in 2007 and from €72M in 2006 to €181M in 2007.

In 2007 PROPARCO increased its ability to provide loans thanks to a subparticipation agreement signed with AFD. PROPARCO is now able to provide loans for amounts between €5M and €100M by using AFD balance sheet resources.

PROPARCO has a wide range of medium and long-term loans: ◆ senior

loans, loans, ◆ mezzanine loans, ◆ subordinated loans. ◆ junior

These loans may be denominated, as the case may be, in euros, dollars or certain local currencies such as the South African rand. They may have maturities which reach between fifteen and twenty years, with a capital repayment grace period where appropriate.

D E V E L O P I N G L O N G -T E R M I N V E S T M E N T FINANCING IN NIGERIA Nigeria is one of Africa’s most dynamic economies yet available long-term resources for the local private sector remain limited.

The Nigerian authorities have been extremely successful in restructuring the country’s banking sector. One of the consequences is that the number of banks has fallen from 80 to 24 over the past four years. Nigerian banks have become influential players all over the African continent despite remaining dependent on long-term external foreign currency resources to finance local investments.

In this context, PROPARCO granted a 25 million US dollar seven year credit line to ZENITH Bank, one of the country’s leading banks. The facility, in hard currency, will mainly finance investments made by Nigerian exporting enterprises.

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TAILORING

AND EXTENDING OUR RANGE OF FINANCIAL PRODUCTS

Loans are tailored to the environment and needs of PROPARCO’s clients:

Moreover, PROPARCO uses financial engineering tools to set up financial solutions tailored to the main problematics of under-development.

◆ direct

In addition to more traditional participative or subordinated loans, other examples of PROPARCO’s loans include loans with margins partly indexed on results, loans in terms of Social and Environmental responsibility, or loans with debt service indexed on raw material rates.

loans to enterprises can be combined with bank or real guarantees or rights of limited recourse,

◆ project

loans are generally made in cofinancing with other bilateral or multilateral financial institutions,

◆ loans

to banking establishments are tailored to market needs and the specific request of the establishment: credit lines earmarked for specific projects or for refinancing making it possible to extend the average maturity of bank resources and therefore develop its medium-term loan activity.

Working in local currency and providing a wide range of risk- hedging tools A large number of projects require financing in local currency. PROPARCO meets these needs via guarantees or direct loans in local currency.

PROPARCO, through its signature, provides a guarantee of solvency and facilitates resource mobilisation in local currencies by private sector borrowers (banks or private enterprises), by guaranteeing subscribers the repayment in capital and interest of the relevant loans. In doing so, PROPARCO makes it possible to reduce exchange risks and sometimes country risks: ◆

to savers (institutional investors or private individuals) which lend to a bank issuing borrowings to refinance itself, or to an enterprise seeking resources to invest in a specific project, ◆ interbank loan guarantee: PROPARCO guarantees performance on loans that banks with liquidities can make to other institutions to finance private sector enterprises, ◆ local currency guarantee: PROPARCO guarantees performance on loans granted in local currency by banks to industrial and commercial enterprises to finance their productive investment programs,

bond guarantee: PROPARCO provides a guarantee

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TAILORING

AND EXTENDING OUR RANGE OF FINANCIAL PRODUCTS

liquidity guarantee for mutual funds, investment funds and local savings mobilisation funds: PROPARCO provides a liquidity guarantee for the various long-term resource mobilisation instruments to finance productive investment which directly contribute to activating financial markets.

◆

PROPARCO’s range of loans, in particular loans with repayments indexed on borrower cash flows or operational results or loans in local currency, also completes its range of guarantees, in particular for exchange risk-hedging.

Moreover, in 2007 PROPARCO developed direct loans in local currency. In the CFA zone this is provided via adapted resources. In other zones PROPARCO is able to use the TCX multi-donor initiative, a counterpart fund whereby currency swaps can be offered in countries where financial markets are not yet deep enough to offer this type of product long-term.

Film « Microfinance in Morocco » www.proparco.fr

most modest populations without access to traditional banking services, in particular women, and has thus contributed to creating 120 000 jobs.

In 2007, in order to meet growing demand for its products, the association strengthened its capital via a 100 million dirham (€12.5M) subordinate loan contracted from the Société Générale Marocaine de Banques with a guarantee from PROPARCO.

SUPPORTING MICROCREDIT IN MOROCCO Al Amana is one of Morocco’s leading microcredit associations. Since its creation in 1997, it has granted 1.5 million loans totalling 6.7 billion dirhams (€610M) to the

Al Amana will now be in a better position to pursue its diversification policy for financial services. The association is in particular considering developing rural solidarity microcredit, individual loans, housing loans and loans to support very small enterprise start-ups. This includes supporting client capacity building via training in management and marketing.

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OPERATIONAL

Operational and financial results

[ 43 ]

AND FINANCIAL RESULTS

OPERATIONAL

AND FINANCIAL RESULTS

Operational results In FY 2007 PROPARCO’s total commitments in equity investments, loans and guarantees reached €597.9M, up 49% on 2006.

Offer range (in % of approved amounts) Guarantees

9%

Offer range (in % of approved transactions) Guarantees

Equity

Equity

8%

13 %

34 %

58 % 78 % Loans

Loans

EQUIT Y ACTIVIT Y

Investment approvals and disinvestments

Sectoral and geographical breakdown

Seventeen equity investments were approved in 2007, the same figure as in 2006, accounting for an investment volume of €78M, i.e. an average of €4.6M per operation.

Paid-up capital, including on behalf of third parties, stood at €95.7M at 31 December 2007 against €68.1M at 31 December 2006.

Nine direct investments were approved in 2007 totalling €26.9M (twelve in 2006), in particular in a bank and insurance company in Côte d’Ivoire, microfinance institutions in Cambodia and Algeria and an agribusiness in Madagascar.

Equity investments: sectoral breakdown (outstanding amounts)

Eight equity investments were made in investment funds in 2007 against five in 2006.

Infrastructure and mining

13 % Corporates

26 %

18 %

In 2007 investments (approved in 2007 or prior to 2007) were made in five investment funds, two financial companies, a bank, an IT company and a water and wastewater company.

Equity portfolio structure

Financial sector

43 % Investment funds

Equity investments: geographical breakdown (outstanding amounts)

At 31 December 2007 the gross value of PROPARCO’s equity portfolio stood at €135.2M (including operations on behalf of third parties) and included 79 shareholdings in ten banking establishments, thirty-seven investment funds, sixteen financial establishments or insurance companies, twelve industrial or commercial enterprises and four infrastructure and mining enterprises. Total provisions for equity investments reached €5.44M, i.e. 4% of the gross portfolio and 5.72% of paid-up investments excluding investments made on behalf of third parties.

Central and Southern Africa and Indian Ocean

Multi-country

15 %

30 %

26 % 13 % 5%

11 %

Overseas France

Asia

Mediterranean West Africa

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OPERATIONAL

AND FINANCIAL RESULTS

LENDING OPERATIONS

Approvals and disbursements

and stood at €61.5M against €41.9M in 2006. Due to higher total commitment levels in 2007, the percentage of financing allocated in this sector stood at 13.2% compared with 14.8% in 2006.

Twenty-nine loans were approved during FY 2007 amounting to €464.2M in gross approvals, i.e. an average €16M per transaction. Total disbursements stood at €186.5M.

Sectoral breakdown

Loans: sectoral breakdown (approvals)

The percentage of loans granted to banking establishments stood at 39.0% against 41.9% in 2006. The amount of commitments in this sector (€180.8M) included €40M of financing granted to banking establishments in French Overseas Territories.

Financial sector

Corporates

13 % 39 %

Financing committed in the infrastructure and mining sector rose sharply: €221.9M against €122.9M in 2006, i.e. 47.8% against 43.3% in 2006.

48 %

Infrastructure and mining

Commitments in the corporate sector in 2007 also rose sharply

Geographical breakdown Commitments in foreign countries covered twenty-three countries, the largest being Turkey (€80M), Nigeria (€54.6M), Ghana (€39.1M), Indonesia (€37.3M) and Kenya (€26.1M).

Moreover, PROPARCO granted three financings to French Overseas Territories French Polynesia (€20M), New Caledonia (€20M) and Reunion (€1.7M).

Sub-Saharan Africa, PROPARCO’s traditional activity area, remained the main sector for new activity with 48.5% in 2007. The most important operations in this region were infrastructure financing in Ghana and corporate financing in Kenya.

Loans: sectoral breakdown (approvals)

Loans: sectoral breakdown (foreign countries approvals)

Asia, Caribbean

Overseas France

9%

West Africa

Asia, Caribbean

West Africa

25 %

22 %

28 %

20 % 9% 22 %

Maghreb and Mediterranean

15 %

Southern Africa and Indian Ocean

16 % Maghreb and Mediterranean

Central and East Africa

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10 %

24 %

Central and East Africa

Southern Africa and Indian Ocea

OPERATIONAL

AND FINANCIAL RESULTS

Outstanding loans as at 31 December 2007 Sectoral breakdown Gross outstanding loans (4) at 31 December 2007 totalled €736.5M (€706.6M at year end 2006) with 57.2% for loans to banking establishments and 42.8% to non-financial corporates.

Outstanding amounts from banking establishments were made up of 162 credit lines granted to 50 clients for a total of €421.3M at 31 December 2007 (€379.3M at year end 2006). The remaining outstanding amounts totalled €315.2M (€327.3M at year end 2006) broken down into the infrastructure and mining sector (€219.9M) and corporates (€95.3M). It was made up of 79 loans granted to 64 clients.

Outstanding amounts in foreign countries, excluding French Overseas Territories, stood at €286.5M at 31 December 2007: infrastructure and mining clients accounted for €202.0M and corporate clients €92.5M.

Loans: sectoral breakdown (foreign countries outstanding amounts) Infrastructure and mining

Financial clients

35 % 49 %

Loans: sectoral breakdown (outstanding amounts)

16 % Infrastructure and mining

Financial clients

Corporates

30 % 57 % 13 %

Corporates

Geographical breakdown Outstanding loans were equally split between PROPARCO’s geographical areas, excluding French Overseas Territories. The eight largest foreign countries for outstanding loans were, in

descending order: Turkey, Tunisia, South Africa, China, Ghana, Mozambique, Nigeria and Vietnam, making up 42.9% of total outstanding amounts

Loans: geographical breakdown (outstanding amounts)

Loans: geographical breakdown (foreign countries outstanding amounts)

Overseas France

21 %

West Africa

16 % 11 %

Asia and Caribbean

Southern Africa and Indian Ocean

West Africa

22 %

20 %

14 %

17 % 10 % 25 %

31 %

Central and East Africa

Mediterranean

(4)

Asia and Caribbean

Mediterranean

Outstanding amounts do not include accrued interest or loans on behalf of third parties.

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13 %

Central and East Africa

Southern Africa and Indian Ocean

OPERATIONAL

AND FINANCIAL RESULTS

GUARANTEES

Four project guarantees were approved in 2007 for a total commitment level of €55.7M against €57.2M in 2006.

Guarantees issued in 2007 totalled €7.6M against €12.9M in 2006.

The geographical breakdown shows that 9.1% of guarantees were issued in West Africa, 52.6% in Central and East Africa, 14.5% in Asia, 11.9% in the Mediterranean zone, 5.2% in French Overseas Local Authorities and 6.7% were Multicountry.

PROPARCO’s guarantee commitments included thirty-five operations totalling €44.9M and break down into 37% for banking establishments and 63% for non-financial clients.

Financial Statements Analysis BALANCE SHEET The 2007 balance sheet rose from €950.2M to €987.5M compared with 31 December 2006, i.e. a 4% rise. This increase reflects various factors: ◆ the rise in loans to banking establishments (from €382.7M

at year end 2006 to €425.1M at year end 2007) and the fall in loans to corporates (from €340.2M to €319.7M), ◆ the rise in the equity portfolio from €109.5M at year end 2006 to €135.2M at year end 2007 and the 9.6% fall in PROPARCO’s short and long-term treasury.

In constant dollars at 31 December 2006 the balance sheet would have risen by 7.8%.

In view of the convergence of French and IFRS standards, and to implement Group standards, PROPARCO made a provision for collective risks at 31 December 2007. It was estimated on the basis of an analysis of all types of historic disasters on homogeneous assets by sector and type of country which de facto include disasters for country risks.

INCOME STATEMENT Net banking income reached €34.7M, up 29.4% on 2006 (€26.8M).

Gross operating income stood at €21.2M at 31 December 2007, up 38% on 2006 (€15.4M).

The cost of risk is again this year in net provision for €0.2M against €1.1M in 2006.

The effects of the change in estimation relative to the provision for collective risk have been carried by an exceptional expense of €10.8M corresponding to the allocation of the provision

at 1 January 2007 and a €1.0M allocation corresponding to the net variation in risk in 2007. A recovery of funds for general banking risks (FGBR) was made for a matching amount and this allocation has no impact on the net result.

The net result for the financial year stands at €23.7M against €10.3M in 2006.

OFF BALANCE SHEET Commitments

Commitments received

Financing and guarantee commitments reached €219.7M at the end of the financial year (against €205.5M in 2006).

Financing commitments which correspond to undisbursed amounts on agreements signed reached €174.8M (against €163.7M at year end 2006). Commitments were divided between banking establishments (40%) and other nonfinancial companies (60%). They do not include provision for any doubtful outstanding loans.

Outstanding guarantees made by PROPARCO stood at €44.9M against €71.8M at year end 2006.

Financing commitments firstly from AFD and EIB and, secondly, guarantee commitments from other banking establishments to support loan production, respectively totalled €196.5M and €545.7M against €237.4M and €638.1M at year end 2006.

[ 47 ]

OPERATIONAL

AND FINANCIAL RESULTS

Balance sheet assets as at 31 December 2007 (thousands of Euros)

ASSETS

31/12/2007

31/12/2006

27 359 27 182 177

25 195 24 803 392

LONG-TERM related parties

525 341 100 276

498 826 116 180

TRANSACTIONS WITH NON-FINANCIAL on behalf of third parties

302 098 386

318 892 9 233

INVESTMENTS AND OTHER LONG TERM SECURITIES on behalf of third parties

129 744 641

104 766 845

9

19

49

1

OTHER ASSETS related parties

1 435 0

1 320 0

PREPAYMENTS AND ACCRUED INCOME related parties

1 427 70

1 195 69

987 462

950 214

31/12/2007

31/12/2006

FINANCING COMMITMENTS in favour of financial institutions in favour of non-financial institutions

174 770 69 416 105 354

163 655 98 366 65 289

ENGAGEMENTS DE GARANTIE in favour of financial institutions in favour of non-financial institutions

44 915 16 600 28 315

41 864 9 154 32 710

219 685

205 519

RECEIVABLES FROM FINANCIAL INSTITUTIONS SHORT-TERM related parties on behalf of third parties

INTANGIBLE ASSETS PROPERTY, PLANT AND EQUIPMENT

TOTAL ASSETS

OFF-BALANCE SHEET

TOTAL COMMITMENTS GIVEN

[ 48 ]

OPERATIONAL

AND FINANCIAL RESULTS

Balance sheet liabilities as at 31 December 2007 (thousands of Euros)

LIABILITIES

31/12/2007

31/12/2006

SHORT-TERM related parties

0 0

1 571 1 571

LONG-TERM related parties

723 133 712 226

693 016 676 582

43 584 1 189

52 012 10 457

3 376 1 256

4 637 2 743

18 981

7 923

3 993

15 787

EQUITY EXCLUDING FGBR

194 395

175 269

Capital subscribed

142 560

142 560

Legal reserve

3 005

2 489

Other reserve

6 160

6 160

0

0

Retained earnings

18 944

13 759

Income for the year

23 726

10 301

987 462

950 214

31/12/2007

31/12/2006

FINANCING COMMITMENTS received from financial institutions related parties

196 546 196 546 191 546

237 364 237 364 232 364

GUARANTEE COMMITMENTS received from financial institutions related parties

545 744 545 744 468 640

638 058 638 058 540 942

TOTAL COMMITMENTS RECEIVED

742 290

875 422

BORROWINGS OWED TO FINANCIAL INSTITUTIONS

OTHER LIABILITIES on behalf of third parties PREPAYMENTS AND ACCRUED INCOME related parties PROVISIONS FOR CONTINGENCIES AND LOSSES FUND FOR GENERAL BANKING RISKS (FGBR)

Special reserve for long term capital gains

TOTAL LIABILITIES

OFF-BALANCE SHEET

[ 49 ]

OPERATIONAL

AND FINANCIAL RESULTS

Income statement as at 31 December 2007 (thousands of Euros)

INCOME STATEMENT

31/12/2007

31/12/2006

INTÉRÊTS ET PRODUITS ASSIMILÉS FINANCIAL INSTITUTIONS related parties ON TRANSACTIONS WITH NON-FINANCIAL INSTITUTIONS ON BONDS AND OTHER FIXED INCOME SECURITIES

29 676 5 795 24 594 0

27 140 5 961 22 983 -1

INTEREST AND SIMILAR CHARGES FINANCIAL INSTITUTIONS related parties

-31 891 -31 286

-29 850 -29 063

INCOME FROM VARIABLE INCOME SECURITIES

8 716

2 915

FEE INCOME

2 745

2 368

FEE EXPENSE

-302

-138

OTHER BANKING OPERATING INCOME ITEMS related parties

1 208 761

1 435

OTHER BANKING OPERATING EXPENSE ITEMS

-5

-4

NET BANKING INCOME

34 741

26 848

OTHER ADMINISTRATIVE EXPENSES related parties

-13 533 -10 424

-11 425 -9 449

-14

-10

21 194

15 413

-178

-1 114

21 016

14 299

9 211

748

INCOME FROM ORDINARY ACTIVITIES BEFORE TAX

30 227

15 047

ALLOCATIONS/RECOVERIES OF FGBR

11 794

0

EXCEPTIONAL ITEMS EXCEPTIONAL REVENUE EXCEPTIONAL EXPENSES

21 -10 777

0 -42

CORPORATE INCOME TAX

-7 539

-4 704

23 726

10 301

ALLOCATION TO DEPRECIATION & AMORTISATION

GROSS OPERATING INCOME COST OF RISK OPERATING INCOME GAINS AND LOSSES ON PROPERTY AND EQUIPMENT GAINS LOSSES

NET INCOME

[ 50 ]

OPERATIONAL

AND FINANCIAL RESULTS

Projects approved in 2007 West Africa

Southeast Asia and China

Côte d’Ivoire ◆ €6.6M investment in FCFA in the capital of an Ivorian bank within the framework of State disengagement

Pakistan ◆ $27.4M granted to a natural gas exploitation and electricity generation enterprise. ◆ $10M equity investment in an investment fund aiming to develop clean energies and SMEs.

Ghana ◆ Two loans granted to a mobile phone operator for a total of $25M. ◆ $5M credit line to a financial institution dedicated to financing local enterprises.

Cambodia ◆ €1.6M equity investment and $4M credit line to a microfinance institution.

Nigeria ◆ Three credit lines totalling $75M granted to three local banks for enterprise financing.

China ◆ $10M loan granted to a poultry raising enterprise for farm extension. ◆ €5M equity investment in an investment fund.

Multi-country ◆ €20M credit line to a regional African development bank. ◆ €5M equity investment in the capital of a West African insurance player.

Central and East Africa

India ◆ $10M equity investment in an investment fund dedicated to financing infrastructure.

Indonesia ◆ $50M loan to finance the extension of a geothermal power plant.

Congo ◆ FCFA8.2bn loan in favour of a mobile phone operator.

Lao PDR ◆ $13.5M loan to a mobile phone operator for the extension of its network in the country.

Kenya ◆ $35M loan to a sugar producing enterprise.

Vietnam ◆ €10M equity investment in an investment fund dedicated to financing enterprises.

Tanzania operator.

◆

$25M loan to a Tanzanian mobile phone

Multi-country ◆ $5M equity investment in an investment fund dedicated to financing environmental protection in the region.

Chad ◆ $15M loan to a Chadian mobile phone operator.

Multi-country ◆ €30M guarantee financing granted to a leasing enterprise for its refinancing from banks and insurance companies.

Indian Ocean Madagascar ◆ €2.9M granted for the development of a shrimp farm ◆ €2M equity investment in the capital of an agro-industrial enterprise and a guarantee for a €3M loan granted to this enterprise by local banks.

Southern Africa South Africa ◆ €10M loan to a BEE fund infrastructure sector player.

Multi-country ◆ $40M to a regional mobile phone operator for network development.

Other countries

Maghreb and Mediterranean

Sainte Lucie ◆ Loan to a mobile phone operator to develop the network on the island.

Brazil ◆ $15M loan guarantee granted to a local bank.

Algeria ◆ €1.6M equity investment in the capital of a microfinance institution.

French Overseas Local Authorities

Egypt ◆ €17M loan granted to a tourism sector group to finance a hotel resort on the Red Sea. ◆ $5.2M equity investment in the capital of a new technologies sector enterprise.

Lebanon ◆ $8M loan granted to a university to finance its extension.

New Caledonia ◆ €20M credit line to a local bank.

French Polynesia ◆ €20M credit line to the archipelago’s main development bank.

Réunion ◆ €1.7M granted to a wind energy promoter on the island.

Morocco ◆ MAD14M equity investment in the capital of a private higher education group. ◆ Guarantee for a €12.5M subordinated loan granted by a local bank to the country’s main microfinance institution.

Turkey ◆ Two credit lines totalling €60M granted to a local bank to finance enterprises and the development of student loans. ◆ €20M loan granted to a player in the telecommunications sector.

Multi-country ◆ €15M equity investment in a fund of funds dedicated to financing enterprises.

[ 51 ]

Publications

Websites

Videos

www.proparco.fr Coordinated and drafted by: Benoît Verdeaux Designed and published by: MH Editions PROPARCO, AFD, Michel Hasson, Getty Image, ©IRD. Cover photo: Michel Dukhan ©IRD ISSN: 1276-2156 Copyright deposit April 2008-05-13

[ 52 ]

COUVERTURE-PROPARCO-2007ANGLAISE+clair:Mise en page 1

9/06/08

12:04

Page 1

Contacts

Pékin Paul de la Guérivière 7 Floor, Block C, East Lake Villas, 35 Dongzhimenwai Avenue, Dongcheng District, Beijing 100027 Tél : (8610) 84 51 12 00 Fax : (8610) 84 51 13 00 afdpekin@groupe-afd.org Sao Paulo (Brazil, Suriname) Christophe Blanchot Edificio Parque Cultural Paulista Avenida Paulista, 37-4° endar 01311-902 – Sao Paulo – Brasil Tel : + 55 11 22 46 27 91 Fax : + 55 11 22 46 27 99 New Delhi (India, Pakistan) Jean-Pierre Barral 1A Jan Path Delhi 11001 - India Tel + 91 11 23 79 37 47 Fax : + 91 11 23 79 37 38 Lagos (Nigeria, Benin, countries of the Economic and Monetary Community of Central Africa) Charles-André Le Pape Melrose Office suites Phoenix House Plot 26E Abdulrahman Okene Close Off Ligali Ayorinde Street Victoria Island - Lagos Nigeria Tel : + 234 12705740 Johannesbourg (South Africa, Zambia, Mozambique, Angola) Laurent Klein Ballywoods Office Park 1st Floor Block I 29 Ballyclare Drive Bryanston 021 P.O. Box 786555 Sandton 2146 Afrique du Sud Tél (27 11) 540 7100 Fax (27 11) 540 7117 afdjohannesbourg@groupe-afd.org Nairobi (Kenya, Tanzania Ouganda) Patrick Abbes Royal Ngao House - Hospital Road P.O Box 45995 Nairobi, Kenya Tel : (254 20) 271 84 52 Fax : (254 20) 271 79 88 afdnairobi@groupe-afd.org Tunis Ghislain de Valon Immeuble Miniar - Bloc B 3rd and 4th floor Rue du Lac d'Ourmia 1053 Les Berges du Lac Tel : 71 861 799 Fax : 71 779 825 afdtunis@tn.groupe-afd.org

Abidjan - IVORY COSTE, LIBERIA Tel. : (225) 22 40 70 40 Fax : (225) 22 44 21 78 afdabidjan@groupe-afd.org Accra - GHANA Tel. : (233) 21 77 87 55 Fax : (233) 21 77 87 57 afdaccra@gh.groupe-afd.org Addis-Abeba - ETHIOPIA, ERITREA, SUDAN, SOMALIA Tel. : (251) 11 442 59 01 Fax : (251) 11 442 59 04 afdaddisabeba@groupe-afd.org Alger - ALGERIA Tel. : (213) 21 69 43 00 Fax : (213) 21 48 41 20 afdalger@groupe-afd.org Amman - JORDANIA Tel. : (962 6) 46 04 702 Fax : (962 6) 46 04 705 afdamman@groupe-afd.org Antananarivo - MADAGASCAR Tel. : (261) 20 22 200 46 Fax : (261) 20 22 347 94 afdantananarivo@groupe-afd.org Bamako - MALI Tel. : (223) 221 28 42 Fax : (223) 221 86 46 afdbamako@groupe-afd.org Bangui - CENTRAL AFRICAN REP. Tel. : (236) 61 03 06 Fax : (236) 61 45 78 afdbangui@groupe-afd.org Beyrouth - LEBANON Tel. : (961) 1 420 192 Fax : (961) 1 611 099 afdbeyrouth@groupe-afd.org Brazil - BRASILIA Tel. : (55) 61 33 22 43 20 Fax : (55) 61 33 21 43 24 afdbrasilia@groupe-afd.org Brazzaville - DEM. REP. OF CONGO Tel. : (242) 81 53 30 Fax : (242) 81 29 42 afdbrazzaville@groupe-afd.org Bujumbura - BURUNDI Tel. : (257) 25 59 31 afd-burundi@usean-bu.net Casablanca - MOROCCO Tel. : (212) 22 29 53 97 Fax : (212) 22 29 53 98 afdprocasablanca@groupe-afd.org Cayenne - GUYANA, SURINAM Tel. : 05 94 29 90 90 Fax : 05 94 30 63 32 afdcayenne@groupe-afd.org Colombo - SRI LANKA Tel. : (94) 11 250 23 20 Fax : (94) 11 250 52 23 afdcolombo@groupe-afd.org Conakry - GUINEA, SIERRA LEONE Tel. : (224) 30 41 25 69 Fax : (224) 62 66 12 66 afdconakry@groupe-afd.org Cotonou - BENIN Tel. : (229) 21 31 34 53 Fax : (229) 21 31 20 18 afdcotonou@groupe-afd.org Dakar - SENEGAL, CAP-VERDE, GAMBIA, GUINEA-BISSAU Tel. : (221) 849 19 99 Fax : (221) 823 40 10 afddakar@groupe-afd.org

Djibouti - DJIBOUTI, ERITREA, SUDAN, YEMEN Tel. : (253) 35 22 97 Fax : (253) 35 48 09 afddjibouti@groupe-afd.org Douala - CAMEROON Tel. : (237) 342 50 67 Fax : (237) 342 99 59 afddouala@groupe-afd.org Fort-de-France - MARTINIQUE, PETITES ANTILLES Tel. : 05 96 59 44 73 Fax : 05 96 59 44 88 afdfortdefrance@groupe-afd.org Hanoï - VIETNAM Tel. : (844) 823 67 64 Fax : (844) 823 63 96 afdhanoi@groupe-afd.org Hô Chi Minh-Ville - VIETNAM Tel. : (84) 8 824 72 43 Fax : (84) 8 825 06 25 afdhochiminhville@groupe-afd.org Islamabad - PAKISTAN Tel. : (92) 51 265 51 96 Fax : (92) 51 265 51 97 afdislamabad@groupe-afd.org Istanbul - TURQUEY Tel. : (90) 212 283 31 11 Fax : (90) 212 283 31 51 afdistanbul@groupe-afd.org Jakarta - INDONESIA Tel. : (62) 21 25 50 23 00 Fax : (62) 21 25 50 23 23 afdjakarta@groupe-afd.org Est-Jerusalem - PALESTINIAN TERRITORIES Tel. : (972) 2 54 00 423 Fax : (972) 2 54 00 227 afdjerusalem@groupe-afd.org Kinshasa - DEM. REP. OF CONGO Tel. : (243) 99 86 82 598 Fax : (243) 99 99 75 381 afdkinshasa@groupe-afd.org Cairo - EGYPT Tél : (20) 2 735 17 88 Fax : (20) 2 735 17 90 afdlecaire@groupe-afd.org Libreville - GABON, ANGOLA, SAO TOME AND PRINCIPE Tel. : (241) 74 33 74 Fax : (241) 74 51 25 afdlibreville@groupe-afd.org Lome - TOGO Tel. : (228) 221 04 98 Fax : (228) 221 79 32 afdlome@groupe-afd.org Mamoudzou - MAYOTTE Tel. : 02 69 61 05 05 Fax : 02 69 61 05 02 afdmamoudzou@groupe-afd.org Maputo - MOZAMBIQUE Tel. : (258) 21 30 43 00 Fax : (258) 21 30 37 47 afdmaputo@groupe-afd.org Mata-Utu - WALLIS AND FUTUNA Tel. : (681) 72 25 05 Fax : (681) 72 20 03 afdmatautu@groupe-afd.org Moroni - COMOROS Tel. : (269) 73 29 10 Fax : (269) 73 22 88 afdmoroni@groupe-afd.org

Niamey - NIGERIA Tel. : (227) 20 72 33 93 Fax : (227) 20 73 26 05 afdniamey@groupe-afd.org Nouakchott - MAURITANIA Tel. : (222) 525 25 25 Fax : (222) 525 49 10 afdnouakchott@groupe-afd.org Noumea - NEW-CALEDONIA, VANUATU - SOUTH PACIFIC ISLAND STATES Tel. : (687) 24 26 00 Fax : (687) 28 24 13 afdnoumea@groupe-afd.org Ouagadougou - BURKINA FASO Tel. : (226) 50 30 60 92 Fax : (226) 50 31 19 66 afdouagadougou@bf.groupe-afd.org Papeete - FRENCH POLYNESIA Tel. : (689) 54 46 00 Fax : (689) 54 46 01 afdpapeete@pf.groupe-afd.org Phnom-Penh - CAMBODIA Tel. : (855) 23 426 360 Fax : (855) 23 426 243 afdphnompenh@groupe-afd.org Pointe-à-Pitre - GUADELOUPE Tel. : 05 90 89 65 65 Fax : 05 90 83 03 73 afdpointeapitre@gp.groupe-afd.org Port-au-Prince - HAITI Tel. : (509) 22 45 40 07 Fax : (509) 22 44 02 51 afdportauprince@groupe-afd.org Port-Louis - MAURITUS Tel. : (230) 213 64 00 Fax : (230) 213 64 01 AFDPortLouis@groupe-afd.org Rabat - MOROCCO Tel. : (212) 37 63 23 94 Fax : (212) 37 63 23 97 afdrabat@ma.groupe-afd.org Saint-Denis - REUNION, SEYCHELLES, LAND AND SOUTHERN FRENCH ANTARCTIQUES Tel. : 02 62 90 00 90 Fax : 02 62 21 74 58 afdstdenis@re.groupe-afd.org Saint-Domingue - REP. DOMINICAN BAHAMAS, CUBA, JAMAICA Tel. : (809) 547 12 89 Fax : (809) 381 05 92 afdstdomingue@groupe-afd.org Saint-Pierre - SAINT-PIERRE & MIQUELON Tel. : 05 08 41 06 00 Fax : 05 08 41 25 98 iedom-spm@iedom-spm.fr

PROPARCO

Sanaa - YEMEN Tel. : (967) 712 65 77 93 Fax : (967) 1 269 068 afddjibouti@groupe-afd.org Vientiane - LAOS Tel. : (856) 21 24 32 95 Fax : (856) 21 24 32 98 afdvientiane@groupe-afd.org Yaounde - CAMEROON, CENTRAL AFRICAN REPUBLIC, EQUATORIAL GUINEA Tel. : (237) 222 00 15 Fax : (237) 223 57 07 afdyaounde@cm.groupe-afd.org

Agencies and offices of the AFD in foreign countries Agencies and offices of the AFD in Overseas INTERVENTION IN OTHER COUNTRIES ARE TAKEN DIRECTLY TO HEADQUARTERS.

2007

N’Djamena - CHAD Tel. : (235) 52 70 71 Fax : (235) 52 78 31 afdndjamena@groupe-afd.fr

A N N UA L R E P O R T 2 0 07

Bangkok (Cambodia, Indonesia, Laos, Thailand et Vietnam) Antoine Vigier 14 F Abdulrahim Place 990 Rama IV Road, Silom, Bangkok 10500, Thailand Tel : +662 636 12 35 Fax : +662 636 12 47 afdbangkok@groupe-afd.org

Annual report

AFD GROUP AGENCIES

P R O PA R C O

PROPARCO OFFICES

Groupe Agence Française de Développement

PROPARCO 5, rue Roland Barthes 75598 Paris Cedex 12 - FRANCE Tel. +33 1 53 44 37 37 - Fax +33 1 53 44 38 38 www.proparco.fr

Investing in a sustainable future

Contacts

Pékin Paul de la Guérivière 7 Floor, Block C, East Lake Villas, 35 Dongzhimenwai Avenue, Dongcheng District, Beijing 100027 Tél : (8610) 84 51 12 00 Fax : (8610) 84 51 13 00 afdpekin@groupe-afd.org Sao Paulo (Brazil, Suriname) Christophe Blanchot Edificio Parque Cultural Paulista Avenida Paulista, 37-4° endar 01311-902 – Sao Paulo – Brasil Tel : + 55 11 22 46 27 91 Fax : + 55 11 22 46 27 99 New Delhi (India, Pakistan) Jean-Pierre Barral 1A Jan Path Delhi 11001 - India Tel + 91 11 23 79 37 47 Fax : + 91 11 23 79 37 38 Lagos (Nigeria, Benin, countries of the Economic and Monetary Community of Central Africa) Charles-André Le Pape Melrose Office suites Phoenix House Plot 26E Abdulrahman Okene Close Off Ligali Ayorinde Street Victoria Island - Lagos Nigeria Tel : + 234 12705740 Johannesbourg (South Africa, Zambia, Mozambique, Angola) Laurent Klein Ballywoods Office Park 1st Floor Block I 29 Ballyclare Drive Bryanston 021 P.O. Box 786555 Sandton 2146 Afrique du Sud Tél (27 11) 540 7100 Fax (27 11) 540 7117 afdjohannesbourg@groupe-afd.org Nairobi (Kenya, Tanzania Ouganda) Patrick Abbes Royal Ngao House - Hospital Road P.O Box 45995 Nairobi, Kenya Tel : (254 20) 271 84 52 Fax : (254 20) 271 79 88 afdnairobi@groupe-afd.org Tunis Ghislain de Valon Immeuble Miniar - Bloc B 3rd and 4st floor Rue du Lac d'Ourmia 1053 Les Berges du Lac Tel : 71 861 799 Fax : 71 779 825 afdtunis@tn.groupe-afd.org

Abidjan - IVORY COSTE, LIBERIA Tel. : (225) 22 40 70 40 Fax : (225) 22 44 21 78 afdabidjan@groupe-afd.org Accra - GHANA Tel. : (233) 21 77 87 55 Fax : (233) 21 77 87 57 afdaccra@gh.groupe-afd.org Addis-Abeba - ETHIOPIA, ERITREA, SUDAN, SOMALIA Tel. : (251) 11 442 59 01 Fax : (251) 11 442 59 04 afdaddisabeba@groupe-afd.org Alger - ALGERIA Tel. : (213) 21 69 43 00 Fax : (213) 21 48 41 20 afdalger@groupe-afd.org Amman - JORDANIA Tel. : (962 6) 46 04 702 Fax : (962 6) 46 04 705 afdamman@groupe-afd.org Antananarivo - MADAGASCAR Tel. : (261) 20 22 200 46 Fax : (261) 20 22 347 94 afdantananarivo@groupe-afd.org Bamako - MALI Tel. : (223) 221 28 42 Fax : (223) 221 86 46 afdbamako@groupe-afd.org Bangui - CENTRAL AFRICAN REP. Tel. : (236) 61 03 06 Fax : (236) 61 45 78 afdbangui@groupe-afd.org Beyrouth - LEBANON Tel. : (961) 1 420 192 Fax : (961) 1 611 099 afdbeyrouth@groupe-afd.org Brazil - BRASILIA Tel. : (55) 61 33 22 43 20 Fax : (55) 61 33 21 43 24 afdbrasilia@groupe-afd.org Brazzaville - DEM. REP. OF CONGO Tel. : (242) 81 53 30 Fax : (242) 81 29 42 afdbrazzaville@groupe-afd.org Bujumbura - BURUNDI Tel. : (257) 25 59 31 afd-burundi@usean-bu.net Casablanca - MOROCCO Tel. : (212) 22 29 53 97 Fax : (212) 22 29 53 98 afdprocasablanca@groupe-afd.org Cayenne - GUYANA, SURINAM Tel. : 05 94 29 90 90 Fax : 05 94 30 63 32 afdcayenne@groupe-afd.org Colombo - SRI LANKA Tel. : (94) 11 250 23 20 Fax : (94) 11 250 52 23 afdcolombo@groupe-afd.org Conakry - GUINEA, SIERRA LEONE Tel. : (224) 30 41 25 69 Fax : (224) 62 66 12 66 afdconakry@groupe-afd.org Cotonou - BENIN Tel. : (229) 21 31 34 53 Fax : (229) 21 31 20 18 afdcotonou@groupe-afd.org Dakar - SENEGAL, CAP-VERDE, GAMBIA, GUINEA-BISSAU Tel. : (221) 849 19 99 Fax : (221) 823 40 10 afddakar@groupe-afd.org

Djibouti - DJIBOUTI, ERITREA, SUDAN, YEMEN Tel. : (253) 35 22 97 Fax : (253) 35 48 09 afddjibouti@groupe-afd.org Douala - CAMEROON Tel. : (237) 342 50 67 Fax : (237) 342 99 59 afddouala@groupe-afd.org Fort-de-France - MARTINIQUE, PETITES ANTILLES Tel. : 05 96 59 44 73 Fax : 05 96 59 44 88 afdfortdefrance@groupe-afd.org Hanoï - VIETNAM Tel. : (844) 823 67 64 Fax : (844) 823 63 96 afdhanoi@groupe-afd.org Hô Chi Minh-Ville - VIETNAM Tel. : (84) 8 824 72 43 Fax : (84) 8 825 06 25 afdhochiminhville@groupe-afd.org Islamabad - PAKISTAN Tel. : (92) 51 265 51 96 Fax : (92) 51 265 51 97 afdislamabad@groupe-afd.org Istanbul - TURQUEY Tel. : (90) 212 283 31 11 Fax : (90) 212 283 31 51 afdistanbul@groupe-afd.org Jakarta - INDONESIA Tel. : (62) 21 25 50 23 00 Fax : (62) 21 25 50 23 23 afdjakarta@groupe-afd.org Est-Jerusalem - PALESTINIAN TERRITORIES Tel. : (972) 2 54 00 423 Fax : (972) 2 54 00 227 afdjerusalem@groupe-afd.org Kinshasa - DEM. REP. OF CONGO Tel. : (243) 99 86 82 598 Fax : (243) 99 99 75 381 afdkinshasa@groupe-afd.org Cairo - EGYPT Tél : (20) 2 735 17 88 Fax : (20) 2 735 17 90 afdlecaire@groupe-afd.org Libreville - GABON, ANGOLA, SAO TOME AND PRINCIPE Tel. : (241) 74 33 74 Fax : (241) 74 51 25 afdlibreville@groupe-afd.org Lome - TOGO Tel. : (228) 221 04 98 Fax : (228) 221 79 32 afdlome@groupe-afd.org Mamoudzou - MAYOTTE Tel. : 02 69 61 05 05 Fax : 02 69 61 05 02 afdmamoudzou@groupe-afd.org Maputo - MOZAMBIQUE Tel. : (258) 21 30 43 00 Fax : (258) 21 30 37 47 afdmaputo@groupe-afd.org Mata-Utu - WALLIS AND FUTUNA Tel. : (681) 72 25 05 Fax : (681) 72 20 03 afdmatautu@groupe-afd.org Moroni - COMOROS Tel. : (269) 73 29 10 Fax : (269) 73 22 88 afdmoroni@groupe-afd.org

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PROPARCO

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Agencies and offices of the AFD in foreign countries Agencies and offices of the AFD in Overseas INTERVENTION IN OTHER COUNTRIES ARE TAKEN DIRECTLY TO HEADQUARTERS.

2007

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A N N UA L R E P O R T 2 0 07

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Annual report

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