FRENCH OVERSEAS

AFD and the French Overseas Communities 

AFD is the operator in charge of financing the development of the French Overseas Communities. It has consequently been helping both public and private actors face the crisis which affected the economies of these Communities in 2009. Its action is in line with the objectives defined by the Inter-ministerial Committee for the French Overseas Communities.

In 2010, AFD committed €957 million to finance actions in the French Overseas Communities out of a total of €6.8 billion.

AFD helps local authorities in these Communities define and finance their investment programs in priority sectors, including education, environment, health and transport. In 2010, it increased the amount of loans to local authorities by 27% to allow them to finance and implement their recovery plans.

Under the French Overseas Communities SME Plan, AFD scaled up its support to companies in these Communities by developing financial tools that give easier access to financing and help strengthen capital bases. The range of products offered to businesses has been extended thanks to the renewed partnership with Oseo.

AFD finances projects that aim to improve living conditions for residents in the French Overseas Communities. By being a shareholder in seven housing companies, it can directly support the construction of social and intermediate housing. It also helps these Communities’ economies to open up by promoting regional trade.

In 2010, AFD’s funding in the French Overseas Communities will help:

• Improve sanitation networks for 255 000 people
• Develop over 900 000 m² of business zones
• Build over 6 000 social housing units benefitting some 18 000 people
• Treat 330 000 tonnes of waste a year                                                                                   
  

Dov Zerah: “In the coming years, we will be focusing the State’s financial support on core infrastructure. We will also be developing direct financing for SMEs’ investment projects alongside our banking partners. The aim is to allow banks to share risks, boost innovative operations and support strategic sectors. AFD has agencies throughout the French Overseas Communities and regularly makes its experts available, meaning it is a long-term and responsive partner for stakeholders in the development of these Communities.”

►Download the Annual Report 2010 in French (PDF)

2010: a new year of growth to support development

With €832 million of budget resources allocated by the State, AFD provided €6.8 billion of project financing in 2010, i.e. an 11% rise on 2009. Its activity accounted for 28% of France’s official development assistance. AFD also paid back €104 million of dividends to the State.

Africa remains the priority with €2.1 billion of financing in 2010.

Two-thirds of the financing break down between infrastructure, urban development, productive sectors and agriculture.

In 2010, AFD’s financing will contribute to:

• Improving drinking water supply systems for 33 million people
• Getting 13.4 million children into primary school
• Upgrading or building transport hubs that will be used by 85.8 million passengers a year
• Supporting energy efficiency by saving 5 million tons of CO2 a year
• Providing access to electrification for 3 million people
• Allocating microfinance loans that will benefit just over 700 000 people
• Supporting agricultural or irrigation projects that will benefit 1.4 million people

2011: consolidation of economic model

Dov ZERAH, Chief Executive Officer of AFD: “AFD has experienced a veritable revolution over the past few years. It has become a key player in development with an activity that has tripled in five years. Today, a new phase is beginning with the consolidation of our model.”

In the coming years, AFD will be focusing its activity on three priority areas:

• Sub-Saharan Africa:  60% of resources allocated to AFD by the State will be earmarked for this region, particularly for the sectors of agriculture and agro-industries, infrastructure, education and health.
• The Mediterranean: AFD will be supporting the recent developments in the region by scaling up its operations in Mediterranean Basin countries, particularly in the productive and vocational training sectors.
• Emerging countries: AFD will be supporting these countries via loans with a low level of concessionality in order to encourage them to set out on a growth path that respects the environment more and is more inclusive.

Consolidating the model requires stabilizing AFD’s level of activity, which is expected to reach €8 billion by 2013. AFD set up a Risk Department in 2011 in order to improve risk management. It has also reinforced its human capital with 125 recruitments in 2010.

Dov ZERAH: “Beyond financing, it is our expertise that our partners are seeking. AFD will also be continuing to actively provide input to international debates through its knowledge production. We will, at the same time, be forging an increasing number of partnerships with other development players such as NGOs, local authorities, private foundations, or again multilateral banks. They help increase the outreach and effectiveness of our actions. In a globalized world, the only winning strategies are cooperation strategies.”

In 2011, AFD will be celebrating the 70th anniversary of its creation in 1941 by General de Gaulle. AFD will be marking the occasion by organizing events to meet the French public in order to raise their awareness of North-South issues and allow them to learn more about development results. A travelling open-air exhibition called “Objectif Développement”, designed in partnership with Magnum Photos, will be launched in Bordeaux on 21 May 2011. It will be travelling to all the major cities in France throughout the year.

 
Agence Française de Développement (AFD) is a public development finance institution that has been working to fight poverty and support economic growth in developing countries and the French Overseas Communities for 70 years. It implements the development policy defined by the French Government.
With agencies in over 50 countries, AFD finances and supports projects that improve people’s living conditions, promote economic growth and protect the planet: getting children into school, support for farmers and small businesses, water supply, tropical forest preservation, fight against climate change…

French Polynesia: financing Socredo’s activity

AFD approved €35m of funding to Socredo to finance its activity.

Socredo is French Polynesia’s leading commercial bank. It is a semi-public limited company with 50% of its share capital held by Polynesia, 35% by AFD and 15% by BRED. Its status and shareholding give it a special role in the economic and social development of the Polynesian islands. Indeed, the bank has made a decisive contribution to the development of several core industry sectors, such as the tourist industry, pearl growing, fishing or inter-island maritime transport. With 28 branches, Socredo has the most extensive network in Polynesia. This network has helped open up the archipelagos and give a large part of the population access to banking services. This generalist bank offers the entire range of classic banking products and services and covers all client segments.

Agence Française de Développement (AFD) is a public development-finance institution that has been working to fight poverty and support economic growth in developing countries and France’s Overseas Communities for nearly 70 years. AFD executes the French government’s development aid policies.

It is active in nine French Overseas Communities where it finances and supports projects that improve living conditions for populations, promote economic growth and protect the planet. These projects may be led by local public authorities, public companies, the private sector or associations. In 2009, AFD committed nearly a billion euros to finance activities in France’s Overseas Communities (out of a total of 6.2 billion) in four intervention areas: support for public policies, SME financing, preserving the environment and regional cooperation. These funds have made investment facilities available to 20 000 businesses from which 14 000 jobs will benefit, will improve sanitation networks for 82 000 people and will finance the construction and rehabilitation of classrooms which will benefit 22 500 pupils.

Press relations

Laure Weisgerber, weisgerberl@afd.fr - Tel.: 01.53.44.30.57

Natacha Dreux, ndreux@hoptscotch.fr – Tel. : 01.58.65.01.42

http://outremer.afd.fr

OSEO's "mezzanine" products will now be distributed by AFD in the French Overseas Communities and will finance business development alongside banks. The OSEO range of products distributed by Agence Française de Développement has now been extended to include:

- Innovation Development Contracts, which facilitate financing for intangible investments made by SMEs implementing an innovation program.
- International Development Contracts, which facilitate financing for intangible investments made by SMEs developing an export activity or establishing themselves abroad.
- Participative Development Contracts, which shore up the financial structure of businesses implementing a development program.
- Participative Loans for Hotel Refurbishment (PPRH), which finance hotel refurbishments. 
- Participative Loans for Modernization and Transfers in Catering (PPMTR), which finance refurbishments or transfers in the catering business.
- Green loans to finance investments made by SMEs that integrate environmental protection issues.
- Export Loans (PPE), which finance intangible expenditure.

These "mezzanine" products facilitate financing for intangible investments made by businesses and their resulting working capital requirements thanks to a grace period and the fact that neither a guarantee nor a personal surety is required.

This new agreement is in line with the general partnership agreement signed by OSEO and AFD in June 2009, which itself renewed a partnership that began back in the 1970s. It aims to facilitate support for business development in the French Overseas Communities (French Guiana, Martinique, Guadeloupe, Réunion, Saint-Martin, Saint-Barthélemy, Mayotte and Saint-Pierre-et-Miquelon) and promote business investments. It completes the financial products for client accounts and innovation that are already distributed in the French Overseas Communities. 

Press contacts

OSEO
Vanessa Godet      Sabina Cristova
Tel: 33 1 41 79 84 33     Tel: 33 01 41 79 98 85
vanessa.godet@oseo.fr     sabina.cristova@oseo.fr

AFD
Laure Weisgerber
Tel: 33 1 53 44 30 57
weisgerberl@afd.fr