IFC, partner of Municipalities for a succesfull introduction of the private sector in waste management services - presentation held within the Capital Summit 2015 organized by NALED and City of Belgrade, with the support of Elnos group, Star Refrigeration&Emerson Techologies and Siemens.

1. IFC, partner of Municipalities for a
successfull introduction of the private
sector in waste management services
April 2015, Belgrade
Creating opportunity where it’s needed most

2. Agenda
1. Who we are
2. What we do
3. Sector Experience

3. International
Bank for
Reconstruction
and
Development
1945
Lends to governments
of middle income
developing countries.
International
Finance
Corporation
1956
Provides loans, equity
and technical
assistance to
stimulate private
sector investment in
developing countries.
International
Development
Association
1960
Provides
concessional loans
to governments of
the poorest
countries.
Multilateral
Investment
Guarantee
Agency
1988
Provides
guarantees to
foreign investors
against non-
commercial risk
International
Centre for
Settlement of
Investment
Disputes
1966
Settles investment
disputes between
foreign investors
and host
countries.
WORLD BANK GROUP
IFC is the private sector arm of the World Bank Group, with a mission to reduce poverty by promoting
private sector investment in developing countries

4. IFC’s Global Reach
100+ country and regional advisory services offices worldwide
Dakar
Nairobi
Johannesburg
Cairo
Washington
Mexico City
Bogota
Beunos Aires
Sao Paulo
Port-of-Spain
Moscow
IFC HQ/Hub Offices
IFC Operational Centers
IFC Country Offices
Hong Kong
New Dehli
Almaty
Istanbul

5. IFC also provides technical assistance and advice to
governments and businesses
Investments Advisory
IFC is the world’s largest multilateral provider of
financing for private enterprises with over US$26
billion in outstanding investment commitments
•Loans
•Equity
•Guarantees
Environment &
Social
Sustainability
Access to
Finance
Business
Environment
PPP Transaction
AdvisoryEnterprise
Assistance
IFC’s Main Business Lines
IFC has two business lines: Investments and Advisory

6. Investment (“Buy-side”) Advisory (“Sell-side”)
• We advise governments on how attract private sector
investment in infrastructure
• To date, we have advised on 165 projects in over 60
countries, mobilizing over $8 billion of private sector
investment
IFC’s Main Business Lines
• We lend to and invest equity in private-sector
businesses.
• Europe and Central Asia represent 22% of the global
portfolio of $12.2bn, or approximately $2.7bn in
commitments
IFC is an investor for its own account and a service provider to third parties.
Consumer &
Social Services
4%
Infrastructure
13%
Manufacturing
7%
Other Sectors
1%
Telecommunications
& Information Technology
3%
Agribusiness & Forestry
4%
Financial Markets
25%
Funds
4%Oil, Gas & Mining
2%
Trade Finance
38%
Investments by Industry, FY11
Sub-Saharan
Africa 25%
East Asia and Pacific
13%
South Asia 11%
Latin America
and Caribbean 9%
Global 17%
Europe and
Central Asia 17%
Middle East and
North Africa 8%
Advisory Services by Region, FY11

7. • IFC’s PPP Transaction Advisory Services department specializes in advising public
sector on the introduction of private sector participation in the delivery of
infrastructure services . We work on the following types of transactions:
 Structuring Public-Private Partnerships (e.g. concessions, BOFT)
 Disposal of publicly owned assets
 Upstream advisory work (regulatory, legal framework)
• Covering the following sectors: roads, rail, power, airports, ports, water, waste,
mining, education and health.
• The IFC PPP Transaction Advisory is organized regionally within the following 6 main
regions and the HQ in Washington, USA: Latin America & Caribbean, East Asia,
East Asia and Pacific, Middle East and Northern Africa, Africa and Europe &
Central Asia.
IFC PPP Transaction Advisory

8. Agenda
1. Who we are
2. What we do
3. Sector Experience

9. Options for Private sector participation
Full Divestiture
Technical
Assistance
Service
Contract
Management
Contract
Lease
Contract
Concession
Contract
BFOT
3-5 yrs
5-15 yrs
1-3 yrs
15-25 yrs
Risktransferredtoprivatesector
As the contract term increases, an increasing amount of risk can be allocated to the private sector
Contract Duration
Limited risk transfer
Government control
Full risk transfer
No government control
Substantial risk transfer
Government control
Most
common
PPP model
1
2
3
4
5
7
Design
Build
Operate
6
15-20 yrs

10. Equipment providers
Insurance Companies
Lenders
City / Households
Government
Operator
Shareholders
ConstructorSub-Constructors
Typical PPP Projects: the BFOT structure, and…
Banks
Project
Company
Sub-contracts
Guarantees
Incomes
Concession
Building Contract
Shareholders Agreements

11. ... its financing, or…
Public Sector
Special Purpose
Vehicle
Investors
Equity
Bank (s)Debt Financing
Planning/Construction/
Refurbishment
Operation/Maintenance
Construction Company
Sub-Contracts
Facility Management - Provider
Sub-Contracts

12. …the design, build and operate structure (“DBO”)
The private sector brings its expertise in the design (choice of
technology), management of the construction / site rehabilitation,
and operations, while…
The public sector provides financing.
The advantages for the contracting public authorities are:
- Have access to the best available currently available and proven technological solution
and operation practices (optimization of O&M costs)
- Have access to the best practices in term of financial and procurement management.
- Lower the cost of finance by beneficiating from the credit standing of the public sector.
Therefore having a positive impact on the user tariff, while:
- Having access to all best practices in term of environmental and social responsibility
- Beneficiating from knowledge transfer
•Presentation Title

13. IFC’s Two Phased Implementation Approach
PREPARATION PHASE
Technical
Review
Financial/
Operational
Review
Legal Review
Preliminary Memo/
Research
Market sounding
Agree the PPP
structure
Phase 1:
Diagnostic and
Strategic Review (DSR)
(Legal Consultant)
(Technical Consultant)
IMPLEMENTATION PHASE
Info Memo –
Marketing/
Road show
Bidder
Prequalification
Valuation
Report
Discussions with
bidders
Bidders’ Due
Diligence
Bid, Evaluation &
Closing
Negotiate Bid
Documents
Phase 2:
Restructuring and
Implementation
3-6 months 10-14 months
PPP Transaction Advisory does not only produce reports, our role does not finish until a suitable private
investor has committed to execute a project*
* Note: PPP transaction advisory only charges a portion of the project costs, if the project is not successfully closed (i.e. IFC loses
money if our advise does not bring you a suitable investor)

14. Typical Timeline in PPP Process
Define
Project
Review of
PPP
options
Market
sounding
Project
Approval
Planning
Phase
Marketing
Phase
Solicitation &
Evaluation Award
(3 months)(2-4
months)
(3-6 months) (1-4 months)
RfQ
Issuance
Information
Memorandum
Issue
RfP
Marketing
And
Short
listing
Tender
Period
Tender
Evaluation
Select
Preferred
Bidder
Contract
Negotiation
Fund
Approval
Financial
Close
DIAGNOSTIC PHASE IMPLEMENTATION PHASE

15. Why IFC PPP Transaction Advisory?
Experience
Investors
(private
sector and
IFI)
Transparent
tender
process
• IFC guarantees a clean and transparent tender
process ensuring political cover from potential
accusations from opposition parties;
• IFC has committed relationships with investors
and other international financial institutions (e.g.
World Bank, EBRD, IMF etc.);
• IFC is in direct contact with all the key solid
waste operators and understands how the project
should be structured to raise interest;
• Excellent access to debt providers; debt
providers know that IFC will structure a bankable
transaction;
• IFC has extensive experience in the sector and
similar environments with reputable and top quality
operators.

16. • Do not be prescriptive in the choice of technology and collection cycle.
• Temper any expectation that a PPP solution will not require a gate fee…
• Ensure there is appropriate political support for the proposed project.
• Realistic risk allocation matrix is of utmost importance - what are the risks and who is
the best party to handle those risks?
• Review the regulatory framework’s soundness.
• Get the key stakeholders to agree on key items before the tender process, not after.
• Speak to investors early to gauge their interest.
• Engage in a sustainable solution.
Lessons Learned
WHAT’S IMPORTANT FOR SUCCESSFUL PPP?

17. IFC Solid Waste Management Projects

18. Agenda
1. Who we are
2. What we do
3. Sector Experience

19. Water and Waste
Recent activity in the water and waste sectors
Loan
Construction facility
and preferred shares
in desalination
complex in Tianjin,
China
IFC Principal Division
Loan
€25m to fund
expansion into Middle
East and Africa
IFC Principal Division
Privatization
Privatization of Water
and Electricity
sectors in Gabon
IFC mandated as
Financial Adviser
Reconstruction
Reconstruction of Sao
Paulo water supply in
Brazil
IFC mandated as
Financial Adviser
Advisory
Advisory Services of
ACB-BOT Water in
Cambodia
IFC mandated as
Financial Adviser
Advisory
Water and other
waste treatment in
the Gambia
IFC mandated as
Financial Adviser
Investment
$25m of Investment
in Chennai Water in
India
IFC Principal Division
Concession
Dakar Long-term
water supply in
Senegal
IFC mandated as
Financial Adviser
PPP
Private Sector
Participation in
Mauritius Water and
Sanitation
IFC mandated as
Financial Adviser
Privatization
Lagos State Water
Privatization in
Nigeria
IFC mandated as
Financial Adviser
Privatization
Privatization of New
Cairo Water Utility in
Egypt
IFC mandated as
Financial Adviser
Investment
$200,000 for
Clearwater fishing
Project in Guinea
Bissau
IFC Principal Division

20. Contacts
Cesar Vargas
PPP Transaction Advisory Europe,
xxxx
xxxxxxx
Web Site: www.ifc.org
Bernard Atlan
Sector Leader– Waste management
PPP Transaction Advisory
Bul. Kralja Aleksandra 86-90 - 3rd Floor
11000 Belgrade, Serbia
Tel: (381) 11 330 8948
Fax: (381) 11 3023 740
E-mail: BAtlan@ifc.org
Web Site: www.ifc.org