Catalyzing International Finance
Financial Support to Counter the International Economic Crisis

JBIC Guarantee for Samurai Bonds Issued by the Government of Indonesia

In July 2009, the Japan Bank for International Cooperation (JBIC) signed a set of agreements to provide a guarantee for yen-denominated foreign bonds (Samurai bonds) totaling ¥35 billion issued by the Government of the Republic of Indonesia. This was the first issue of Samurai bonds by the Indonesian government. JBIC provided a guarantee for the principal and part of the interest.

The provision of a guarantee by JBIC is intended to support the Indonesian Government's funding efforts in the Japanese bond market which will diversify the Indonesian Government's funding sources, thereby contributing to the stable economic growth of Indonesia and eventually of the Asian region. It is also expected to stimulate the Samurai bond market.

The guarantee program is based on policies of the Japanese government, which intends to continue supporting the issuance of Samurai bonds by countries in Asia.

Financing Measure for the Korea Development Bank, under the Japanese Government's Trade Finance Initiative

In September 2009, JBIC signed a loan agreement on a trade finance facility totaling up to ¥20 billion with the Korea Development Bank (KDB), a public financial institution of Korea.

This loan will finance trade transactions for Japanese exports to Korea, and thus is expected to help bolster as well as stabilize trade between Japan and Korea.

The Government of Japan launched and expanded a trade finance initiative in February and April 2009 to support trade transactions. This loan was realized as a specific measure constituting part of this initiative. JBIC will continue to implement steadily its measures under this initiative to support trade finance.

Energy and Natural Resources
Seminar: "Business Opportunities in Mexico's Energy Sector"

In September 2009, JBIC and the Embassy of Mexico in Japan co-organized a seminar to provide information on business opportunities in Mexico's energy sector.

This seminar focused on the Energy Reform Law passed in the National Congress in October 2008 and the business opportunities it has created in Mexico's energy sector for Japanese businesses. Speakers from Mexico and Japan gave presentations during the seminar.

Vice-Minister for Energy Planning and Technical Development Jordy Herrera of the Ministry of Energy pointed out that, to meet growing demands for oil and natural gas, there is vast capital investment needed to develop oil and natural gas fields and expand oil refineries. Further, he pointed out that his government has taken a range of measures under the Energy Reform Law to meet those financing needs. He also stated that his government has instituted a policy of raising the ratio of renewable energy to power generation, as part of measures to mitigate climate change and improve energy efficiency.

Mr. Alturo Delpech, Associate Managing Director of Finance of Petróleos Mexicanos (PEMEX), gave a presentation on "PEMEX, a New Starting Point" and explained the overall business activities of PEMEX, the reform of its business practices in the wake of the legislation of the Energy Reform Law, and its future business strategy.

JBIC will continue to support further expansion of Japanese business opportunities in Mexico by holding seminars and business matching events.

International Business Development
Support for Electric Power Infrastructural Development in India, and Promoting Investment in Africa

Loans for Thermal Power Generation Using Supercritical Pressure Technology for Coal in India

In July 2009, JBIC signed loan agreements for construction of manufacturing facilities related to thermal power generation with two joint venture companies established primarily by Mitsubishi Heavy Industries, Ltd. (MHI), a Japanese corporation, and Larsen & Toubro Limited, one of the largest heavy machinery manufacturers in India.

In this business project, two joint-venture companies will manufacture high-efficiency, high-performance boilers and steam turbines for power generation by using advanced supercritical pressure technology provided by MHI, and then sell them in the Indian market. The proceeds of the loan will primarily be used for the construction of manufacturing facilities.

While power demand is increasing in India, a lagging growth in power supply is causing chronic power shortages. The plan drawn up by the Government of India envisages large-scale expansion in the capacity of the power sector. There are especially high expectations for building supercritical coal-fired power plants that can achieve a stable power supply using the abundance of coal in India while decreasing the burden on the environment. This business project is expected to contribute to removing bottlenecks in India's power infrastructure and improving the country's investment climate and economic growth.

Policy Proposals to Improve Nigeria's Investment Climate

JBIC presented the Blue Book on Best Practices for Investment Promotion and Facilitation to President Umaru Yar'Adua of the Federal Republic of Nigeria in August 2009. The Blue Book is a set of policy proposals prepared to improve the country's investment climate.

The Blue Book was prepared jointly by JBIC and the United Nations Conference on Trade and Development (UNCTAD) to encourage direct investment by Japanese firms in Nigeria. It contains an effective and realistic action plan which proposes 15 actionable measures over a short period (12 to 18 months), including those to facilitate investment approval procedures and establish a pilot Multi-facility Economic Zone. As a lead-up to its presentation, JBIC and UNCTAD held a workshop in Nigeria in March 2009, inviting Nigerian government officials and locally-operating Japanese firms, and the outcome of this workshop has been incorporated into the Blue Book.

Environment
Public Seminar on Biodiversity, Economy and Business

The "Public Seminar on Biodiversity, Economy and Business: International Market-based Instruments to Finance Biodiversity Conservation" was held in August 2009, co-organized by JBIC, EcoTopia Science Institute of Nagoya University, the Institute for Global Environmental Strategies (IGES), ResponsAbility, Inc. (RAI) and the Japan Overseas Investment Institute (JOI).

The Seminar served as a forum for vibrant discussion on the green development mechanism (GDM), an innovative international financing mechanism for conserving biodiversity, and biodiversity offset, which implement a biodiversity conservation plan to offset impacts on biodiversity by a development project. Attention is turning worldwide to the role corporations should play in protecting biodiversity, and the importance placed on biodiversity is now also reflected in the JBIC Guidelines for Confirmation of Environmental and Social Considerations, the revised version of which went into effect in October 2009.