AFD - 2019 Universal registration document

PRESENTATION OF AFD

AFD operations

Mandate-speci fi c operations Global Budget Support (GBS) on the basis of the Treasury’s resources (Programme 110) granted in the form of grants, primarily in the least developed countries (LDCs). 1.3.2.2 In the French Overseas Departments and Collectivities Since 2019, all financial tools available to AFD in respect of the Ministry for French Overseas Departments and Collectivities’ 123 budget programme (grants and subsidised loans) are part of the Trajectory 5.0 carried by the Ministry. This strategy is based on 5 priorities: “0 carbon”, “0 waste”, “0 pollutants”, “0 exclusion” and “0 vulnerability”. AFD’s overseas activities are mainly carried out via the following instruments: P Loans P financing public-sector investment in a spirit of partnership, especially thanks to the support given to local authorities for defining and implementing their development strategies. This activity is carried out through subsidised loans to the public sector (local authorities, EPCI, public institutions, public utility associations) for operations concerning priority sectors for Trajectory 5.0 Outre-mer (French Overseas Departments and Collectivities), or in the form of non-subsidised loans. AFD is today the leading financial partner for the overseas public sector covering almost 2/3 of its annual loan requirements (excluding social housing) and half of its debt (AFD debt outstanding amounts to €6bn); P moreover, AFD may grant short-term loans to local authorities in the form of EU or State subsidy pre-financing; P financing of the private sector through direct lending to companies at market rates, in a spirit of complementarity with the banking sector, and consistent with the climate commitments of the Group and Trajectory 5.0; P AFD also supports the development of microcredit institutions in the French Overseas Departments and Collectivities by contributing to their refinancing. P Subventions P in addition to its loan activity, AFD implements consulting and support actions for the overseas public sector. The agency thus reinforces public players’ abilities to complete their investment operations; P in 2019, these actions were mainly supported by two subsidy budgets delegated by the Ministry for French Overseas Departments and Collectivities: the General Contractor Support ( Appui à maîtrise d’ouvrage - AMO) DOM Green Fund (€2M) to initiate environmental projects (climate, biodiversity) and the Structural investments AMO (€2M) to initiate projects in priority sectors for the regions (water, sanitation, employment, young children in French Guiana, etc.);

P the creation of the Outre-mer 5.0 Fund, enacted at the end of 2019 by the Ministry for French Overseas Departments and Collectivities should amplify this intervention component over the next two years. Based on the priorities of Trajectory 5.0, the fund has a budget of €17.5M: €15M to finance grants for general contractor support and engineering on the one hand; and €2.5M to finance research projects. P Guarantees P AFD also carries out a significant medium to long- term bank loan guarantee activity to small and medium businesses in the French Pacific Collectivities through Sogefom, in which it is the majority shareholder; P it also manages housing guarantee funds on behalf of third parties in the French Overseas Departments as well as the Guarantee Fund for agriculture, fishing, aquaculture and forestry (FOGAP) created by the State in 2010. P Management or representation mandates in the French Overseas Departments and Collectivities P AFD is in charge of the extinction management of Crédit foncier de France’s operations in the French Overseas Departments and Collectivities. 2019 saw the end of the provision of services on behalf of Bpifrance Financement by AFD in the French Overseas Departments, as Bpifrance has created its own network; P AFD also acted to promote the development of social housing in the French Overseas Departments through equity investments in six real estate companies held on its own behalf and/or on behalf of the State. All of these equity investments were sold to CDC Habitat at the end of 2019. AFD has a stake on its own behalf in the share capital of the Société Immobilière de Nouvelle Calédonie (SIC); P lastly, it helps the economies of the French Overseas Departments and Collectivities develop within their respective regions. AFD ensures that the projects it finances integrate the development issues of the future. Through its research and development, AFD helps to construct the future sustainable development models and orientations. AFD relies on intellectual production through modelling, studies and assessments, the management of its network of experts and the publication of its research work to increase the added value of its operations. Through its experimentation processes, it also promotes research into new practices. All these activities are part of AFD’s strategic and operational orientations. They are carried out in partnership with French and international research centres, with a focus on the use and promotion of expertise of Southern countries. 1.3.3 Other AFD activities 1.3.3.1 Intellectual production

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UNIVERSAL REGISTRATION DOCUMENT 2019