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Export Development Canada Supporting Business in Africa May 2013
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Export Development Canada
Supporting Business in
Africa
May 2013
Table of Contents
1. About EDC …………………………………... Slides 3-7
2. EDC’s Products and Services……………… Slides 8-13
3. EDC in Africa…………………………………. Slide 14
4. EDC’s Partnership Approach………………. Slide 15-16
5. Contact Us…………………………………… Slide 17
6. Appendix 1 – Recent Transactions……….. Slides 18-20
Appendix 2 – Selected Value Chains…….. Slides 21-23
Appendix 3 – Upcoming events…………… Slides 24-25
2
About EDC
Canada’s Export Credit Agency
Crown corporation wholly owned by
Government of Canada
Financially self-sustaining
Operates on commercial principles
EDC notes are a direct and
unconditional obligation of Canada
3
Domestic Currency Foreign Currency
Long-term Short-term Long-term Short-term
Standard & Poor’s AAA A-1+ AAA A-1+
Moody’s Aaa P1 Aaa P1
JCR AAA AAA
DBRS AAA R-1 (high) AAA R-1 (high)
Canada Banking System Is World's Soundest, Economic Forum Says in SurveyCanada’s banking system was ranked the world’s soundest for the fifth consecutiveyear by the World Economic Forum. September 5, 2012
EDC’s Role
To support and develop
Canada’s export trade and
international business efforts
Financing and insurance
solutions for Canadian
exporters and investors
4
2012 Performance Highlights
Facilitated $87 billion in business carried out by
Canadian companies
Served 7,400 customers
Supported business in 195 countries
Facilitated $4.4 billion in lending volume in emerging markets
5
Connecting with Canadian Businesses Across Canada
EDC has offices across Canada
We do business where business
is done
Ottawa, Ontario
Montreal, Quebec
Quebec City, Quebec
Moncton, New Brunswick
Halifax, Nova Scotia
St. John’s, Newfoundland &
Labrador
Toronto, Ontario
Mississauga, Ontario
London, OntarioWindsor, Ontario
Winnipeg, Manitoba
Regina, Saskatchewan
Calgary, Alberta
Edmonton, Alberta
Vancouver, British Columbia
Ville St-Laurent, Quebec
Lima, Peru
Supporting Business Worldwide in 2012
EDC’s foreign representation
7
North America / Caribbean $46.5B (53%)
Asia-Pacific $19.0B (22%)
Europe $13.3B (15%)
South / Central America $5.3B (6%)
Africa / Middle East $3.9B (4%)
% = percentage of EDC’s total business facilitated
Location of EDC Representation
Monterrey, Mexico
Mexico City, Mexico
Santiago, ChileSão Paulo, Brazil
Moscow, Russia
Rio de Janeiro, Brazil
Abu Dhabi, UAE
Mumbai, India
New Delhi, India
Beijing,
People’s Republic of China
Shanghai,
People’s Republic of China
Singapore
Istanbul, Turkey
Panama
Düsseldorf, Germany
EDC Products & Services
Financing
Insurance
Bonding
Market Intelligence
8
Criteria for EDC support: Canadian benefits, Corporate Social
Responsibility, Credit worthiness of borrower or risk counterpart, exporter
financial and technical capabilities, etc.
Financing Services
9
Adresses the need of Canadian investors, Canadian exporters and foreign
buyers of Canadian goods and services
Structures
Corporate Financing, with well established and credit-worthy buyers of Canadian goods and
services
Bank on-lending through lines of credits with banks, funds are disbursed to Canadian
exporters
Project Financing*, with well established sponsors and in partnership with other financial
institutions
Leasing (loan to lessor of asset e.g. plane)*
EDC mandate
Direct export by Canadian company, subject to OECD ECA guidelines
Canadian direct investment abroad*, subject to EDC’s guidelines
Pull transaction* , based on existing and future procurement from Canada
Protocols with Foreign multinationals, based on their operations in Canada and contribution to
Canada’s economy
Foreign Direct Investment into Canada*, subject to 50% of the Canadian operations be
exported from Canada and investment bringing tangible benefits to Canada
* Solely under commercial terms
Financing Eligibility Criteria for Buyer Financing
10
Business operating in Canada
Technically, financially capable
Deal demonstrates benefits to Canada
Credit worthy, from acceptable country, including local regulations permitting
cross-border financing
Exporter
Buyer/Borrower
Project
Technically, commercially viable
Corporate Social Responsibility
Anti-corruption declarations; Public disclosure of information
Environmental review; Human rights assessment
EDC provides credits insurance to exporters to protect them against the risk that their buyer
do not pay them for a variety of commercial or political reasons.
Account Receivable Insurance provides coverage of non-payment of short-term export
receivables. Key benefits:
Covers 90% of losses when foreign buyers don’t pay
Increase working capital by using it as collateral against operating lines
Allows exporters to offer more competitive payment terms and accept large offers
Improved balance sheet positions by freeing up capital normally provisioned for losses
Increases market penetration opportunities with EDC-backed credit decisions
Documentary Letters of Credit Insurance provides insurance coverage to Canadian
banks for letters of credit provided to foreign banks in emerging markets. This allows the
Canadian banks to add confirmation or to provide credit facilities against those letters of
credit.
EDC Products & Services – Short Term Insurance
11
Political Risk Insurance
EDC covers private sector investments and loans, coverage can be provided to investors and/or
banks. PRI coverage addresses:
Expropriation and Creeping Expropriation
Political Violence
Transfer & Conversion
Arbitration Award Default
Public Sector Credit Risk: provides a comprehensive insurance for non payment from
Sovereign / quasi Sovereign obligors. Often used to structure buyer financing in
partnership with a commercial bank
Of the total PRI insurance facilitated by EDC in 2011, 42% was in Africa with Infrastructure &
Environment and Extractive as the top sectors
Contract Frustration Insurance and Bonding
EDC provides a guarantee to the Exporter Bank so it can issue guarantees to the buyers and
suppliers, adding capacity to the Exporter’s balance sheet without tying up cash
EDC can also protect from wrongful calls
Type of Guarantees considered include: Performance Bonds, Advance Payment
Guarantees, Retention Money Guarantees and Warranty Bonds
EDC Products & Services – Insurance
12
EDC can add valuable capacity and flexibility to your financing
packages
Because EDC is an ECA, its borrowers may benefit from elements
such as withholding tax exemption
As an ECA, EDC may be able to co-lend with other ECAs and in
longer-tenor, ECA specific tranches of debt packages
EDC has many reinsurance partners that enable us to front insurance
policies of varying size and scope
Introduces new suppliers to your firm
Strong Corporate and Social Responsibility representation
Benefits of Working with EDC
13
EDC in Africa
14
Extractive25%
Information & Communication
Technology19%
Infrastructure & Environment
29%
Light Manufacturing
3%
Resources6%
Transportation18%
Business Volume by Sector, 2012
In 2012, EDC supported 474 Canadian companies in
46 African countries worth C$ 2.13 billion in
transactions:
Sub-Saharan Africa: C$ 1.6bln
North Africa: C$ 496mln
In 2012 the top three countries EDC supported
in terms of volume were: South Africa
(C$ 428mln), Angola (C$ 299mln) and Ivory
Coast (C$ 213mln)
In 2011, EDC supported 457 Canadian companies in
46 African countries worth C$ 2.39 billion in
transactions:
Sub-Saharan Africa: C$ 1.7bln
North Africa: C$ 682mln
In 2011 the top three countries EDC supported
in terms of volume were: South Africa
(C$ 803mln),Angola (C$ 281mln) and Egypt
(C$ 46mln)
0.00
250,000,000.00
500,000,000.00
750,000,000.00
1,000,000,000.00
1,250,000,000.00
2007 2008 2009 2010 2011 2012
Business Volume by Product, 2007-2012
Contract Insurance and Bonding
Financing
Political Risk Insurance
Short Term Insurance
African Export – Import Bank is a international multilateral Bank established in 1993
and headquartered in Cairo, Egypt. The Bank is a major player in the continent and
has a broad objective of promoting and financing intra- and extra- African trade.
Afreximbank is rated by all major Credit Agencies: BBB-/stable (Fitch), BBB-/stable
(S&P) and Baa2/stable (Moody’s) (as of December 31st 2012).
In November 2012, EDC and Afreximbank entered into a USD 30 million line of
credit arrangement to facilitate trade between Canada and Africa. Eligibility
criteria include:
Beneficaries should be entities based in member countries of Afreximbank.
Transactions must meet Afreximbank and EDC eligibility criteria which include
among others: Canadian benefits, Credit worthiness of the borrower, Exporter
financial and technical capabilities, compliance with environmental, corporate
and social responsibility policies.
Further information can be obtained from Afreximbank’s website -
www.afreximbank.org
The line of credit is designed to support mid-size transactions (minimum amount of
USD 5 million) over a maximum tenor of 5 years, with a special focus on private
sector borrowers.
EDC partnership with Afreximbank
15
EDC – Africa Trade Insurance & IFC
Africa Trade Insurance
EDC entered into a MOU with Africa Trade Insurance (‘ATI’, www.ati-aca.org) to
facilitate trade and foreign direct investment between Africa and Canada. ATI is a
multilateral financial institution providing export credit insurance, political risk
insurance, investment insurance and other financial products to help reduce the
business risks and costs of doing business in Africa. ATI has expanded
membership to more than a dozen African countries with plans to attract non-
African member states by 2011.
International Finance Corporation (IFC)
In 2012, EDC entered into a strategic partnership with IFC, signing both a Master
Cooperation Agreement (MCA) and MOU. The two organizations are working
together to bring additional capacity to emerging market transactions and projects
where Canadian interests and developmental benefits intersect
EDC and IFC are working together in the areas of Infrastructure and Clean
technology, Renewable power, Agribusiness and Manufacturing (Supply chain
financing)
The MCA ensures a streamlined and efficient lending process on IFC mandated
syndicated transactions where EDC is a parallel lender16
Contact Information
Patricia Bentolila
Chief Representative – Africa
Tel: (613) 598-3219 Fax: (613) 598-2503
Email: [email protected]
Diane Belliveau
Regional Manager – Africa
Tel: (613) 597-8846 Fax: (613) 598-2503
Email: [email protected]
Anna Popov
Associate – Africa
Tel: (613) 597-8036 Fax: (613) 598-2503
Email: [email protected]
Keilah Louch
Associate – Africa
Tel: (613) 598-6864 Fax: (613) 598-2503
Email: [email protected]
17 www.edc.ca
Appendix 1: Selected recent Transactions in Africa (1/3)
Financing
CAD 25-50 million
Sale of aircraft, spare parts and
services
Rwanda
October 2012
Financing
CAD 50-100 million
Participation into a USD 350
million Syndicated credit
facility for General Corporate
Purposes
Gabon
November 2012
Financing
CAD 25-50 million
Sale of aircraft engine
Tanzania
November 2012
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Financing
CAD 50-100 million
Sale of aircraft
Ethiopia
September 2012
Financing
CAD 100-250 million
In support of future
procurement of various
Canadian goods & services
South Africa
June 2012
Financing
CAD 25-50 million
Support for future procurement
of various Canadian goods and
services
Egypt
November 2012
NHS Insurance Provider
CAD 75-100 million
In support of sale of
Canadian goods & services
Kenya
November 2012
Financing
CAD 50-100 million
Sale of telecommunications
equipment
Nigeria
April 2013
Appendix 1: Selected recent Transactions in Africa (2/3)
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NHS insurance provider
CAD 250- 300 million
In support of the financing of
SNC-Lavalin for the
rehabilitation of the Matala
Dam
Angola
May 2011
Mandate Lead Arranger
US$ 100 million Senior
Secured RBL Facility
Egypt
July 2010
Financing
USD 100-250 million
In support of sale of aircraft
Ethiopia
April 2010
NHS insurance provider
CAD 100- 250 million
In support of the financing of
Canadian goods and
services for the construction
of the Takoradi power plant
Ghana
November 2009
Financing
CAD 100- 250 million
In support of the sale of
Telecommunication
Equipment and Services
South Africa
February 2009
Financing
CAD 15-25 million
In support of sale of
technology for various
Canadian exporters
Ghana
May 2012
Appendix 1: Selected recent EDC Transactions Worldwide (3/3)
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Financing
CAD 250-500 million
Sale of various Canadian goods
and services
Russia
March 2012
20
Project Financing
CAD 100-150 million
In support of sale of various
Canadian goods and services
Saudi Arabia
June 2010
Financing
CAD 5-20 million
Support for future procurement
of various Canadian goods and
services
China
January 2012
Financing
CAD 750-1,250 million
In support of procurement for
various Canadian goods and
services
Brazil
October 2010
Financing
CAD 250-500 million
In support of sale of various
Canadian goods and services
United Kingdom
April 2012
Financing
CAD 250-500 million
In support of sale of oil & gas
field equipment
Mexico
June 2012
Financing
CAD 50-100 million
Support for future procurement of
various Canadian goods and
services
India
November 2011
Financing
CAD 50-100 million
Re-financing of existing EDC
exposure
Spain
March 2012
Appendix 2: Selected Value Chains – Mining & Metals, Extractive (1/3)
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Appendix 2: Selected Value Chains – Oil & Gas, Extractive (2/3)
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Appendix 2: Selected Value Chains – Wireless Technology, ICT (3/3)
Other value chains available upon request
Appendix 3: Selected Events for 2013 (1/2)
EDC attends Trade mission and a a number of Canadian and International trade shows and
conferences, which are an excellent way to connect with EDC sector experts, Canadian
exporters and other Canadian agencies. EDC – Africa team will be present at the following
Trade shows and conferences:
Trade Mission to Nigeria and Ghana organized by the Department of Foreign Affrairs
and International Trade of Canada – January 27 to February 1
Mining Indaba 2013 – Cape Town - February 3 to 7 (http://www.miningindaba.com/2013-
mining-indaba-preview/) Mining Indaba is the world’s largest gathering of the most influential stakeholders
– financier, investors, mining professionals, government officials, etc- in African mining regularly attended by
over 7,000 participants.
PDAC 2013 – Toronto – March 3 to 6 (http://www.pdac.ca/pdac/conv/) PDAC International
Convention, Trade Show & Investors Exchange is the world’s leading Convention for people, companies and
organizations in, or connected with, mineral exploration. It’s attended by over 27,000 participants from 120
countries, with opportunities to attend technical sessions, short courses as well as social and networking
events.
Trade Mission to Angola organized by the Department of Foreign Affairs and
International Trade of Canada – March 11 to 13
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Appendix 3: Selected Events for 2013 (2/2)
Infrastructure Trade Mission to Morocco organized by the Department of Foreign Affairs
and International Trade of Canada – March 24 to 28
Africa Energy Forum 2013 – Barcelona – June 18 to 21
(http://www.energynet.co.uk/aef/index.html) The Africa Energy Forum (AEF), launched in 1999, is
Africa's premier annual power and gas investment and business forum, where governments and state utilities
address the international energy community on opportunities available in Africa's power and gas sectors.
More information on certain events is available at:
http://www.edc.ca/events/en/pages/upcoming-events.aspx or please contact our Africa Team
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