Urban Transportation: French Development Agency

8 April 2011

French Development Agency

Urban transportationp

AFD in a nutshell1.1

French ODA agency , 7 Billion Euros (USD 10 billion) commitments in 2010 in 60+ t i60+ countries

Provides sovereign, non sovereign loans, grants

S b idi d di t d t fi i th P i t t PROPARCO Subsidiary dedicated to financing the Private sector: PROPARCO

Untied financing

Frequent co financing with WB EIB ADB IDB etc Frequent co-financing with WB, EIB, ADB, IDB, etc.

Mandate centered on Growth Poverty alleviation and inequalities Global public goods

About 20 AFD-supported urban transport projects currently in progress or

Titre de la présentation 2

under consideration: BRT, cable, LRT, Metro…

AFD offices in the world1.2

DamascusDamascus2009 Bagdad

2010

Mexico City2009

Bogota2009


Rapidly increasing urbanisation 2.1

Sub‐Sahara

ASIA

2008: 1.6 BillionLatin America

Global Urban Population

1970: 1 BillionUrban Population

2050: 1.2 Billion 2050: 3.5 Billion75‐90% en 2020

2020: 4.5 Billion Urban PopulationX 2 in 15 years

Consequences A world‐wide phenomenon: urban pdevelopment Great mismatch between needs and

+ ‐

Titre de la présentation 4DJIBOUTI

resources

Global strategy contributing to sustainable cities2.3 sustainable cities

Strengthening Targeting LA’s financial sustainabilityStrengthening capacities of LAs Improving urban management

1

Improving urban living conditions and

Improving housing conditionsGeneral access to basic public services

Promoting urban mobility2

Preserving local environment

productiveness

Promoting territorial

Promoting urban mobilityEconomical activities and local employment

gUsing urban policies for climate change

adaptationPreserving urban heritageFighting urban diseases

Promoting territorial development with

global public goods preservation

3


Fighting urban diseasespreservation

The AFD approach for transport3.1

Integrated, at three main levels Level 1 – Structured and integrated development of public transport options Level 2 – Integrated management of all urban transport options Level 3 – Interdependent planning in transport and urban development

Pragmatic, concerning implementation

Diversified, in financing and partnerships


Level 1 – Structured and integrated development of public transport

3.2development of public transport options Strong and visible improvement of supply of public transport options Without a priori technological preferences or assumptions with respect to

public transport options (ie available to the public: taxis, buses, BRT, trams, light rail, metro, trains, boats, etc.) depending on local demand and links

Without a priori institutional preferences or assumptions with respect to status of operators (public, private, public-private)

Integration of tariffs, ticketing, and functionality across the whole range of public transport options Attentiveness to changing points/junctions and hubs within the transport

chainchain Multi-modal regulation by a public authority, with responsibility over a

pertinent area


Level 2 – Integrated management of all urban transport options3.3 all urban transport options

Coordination across the whole urban area of all transport options, public and i t f i d t i d t i d iprivate, for moving persons or goods, motorised or non-motorised, moving or

stationary

Selective and optimal management of car use and private transport options, di t ti d t f t i < > t faccording to purpose, time and zone, to favour certain uses <-> system of

traffic flow and parking, selective application of toll, speed limits, etc.,

Promotion of soft transport options (walking, cycling), clean motors, slow traffic and new technologies as well as special measures for children andtraffic, and new technologies, as well as special measures for children and disabled;

Extending responsibility of public transport authorities to include all urban transport optionstransport options


Level 3 – Interdependent planning in transport and urban development3.4 transport and urban development

Coherence of urban development and transport master plans, including di t d t t f h bli t t t d b d ifi ticoordinated strategy for heavy public transport routes and urban densification.

S h f t f d l t f b bli t t Search for recurrent resources for development of urban public transport: assessmement of property/land values, selective tolls for road and parking infrastructure, employer contributions, etc.

Coordination of sector strategies at the relevant territorial (inter-community) level within an integrated framework to manage urban energy and climate footprintfootprint.


Financing3.5

Long term finance for long term use

Analysis of the financial scheme

A l i f th j t d h fl Analysis of the projected cash flow

Debt profile designed accorder to the project profitability (grace period )period,…)

Repayment are fixed according to the cash generation capacity

Debt supported directly by the municipality or through a satellite body or through other mechanism…


Main questions PPP3.6

PPPs are not a source of funding; rather a mechanism to “raise funds” for a j t ( d tti th l d / it id itt d t j tproject (and getting the lender/equity provider committed to project

implementation)

Why opt for PPP: reduce recourse to public investment shared risks benefit from performance of private sector, procurement environment, financial

expertise (albeit not conditions)

Prerequisites guarantees on commercial revenue necessary clarity of legal environment c a ty o ega e o e t fundamental economic viability strong public monitoring

Question: who borrows the funds?


Question: who borrows the funds?

4. Some examples


Amman Rapid Transit, Jordan4.1

Project: 2 stages until 2025, 2 t h l itechnologies: LRT 40 km BRT 52 km

Objectives: modify tendencies in terms of mobility and support the city planning policy

Target: 590 000 travelers/day

Project’s cost: US$ 2.6Bn

AFD lended US$ 166m (sovereign) + €2.2m grant


Medellin, Colombia4.2

Project: urban transformation with social and i t l t i i t t denvironmental components in an integrated

manner

Objectives: Transport: 1 tramway line and 2 metrocable to

link the center of the city with center-East neighborhoods

In parallel, improvement of the center-East part of the city with public areas organised for socialthe city with public areas organised for social enhancing

Partnership with the French city of Nantes

Projec’s cost: € 400m

AFD financed € 200m


CENTRORIENTAL

Titre de la présentation 15Parque Bicentenario BEFORE

CENTRORIENTAL

Titre de la présentation 16Parque Bicentenario AFTER

CENTRORIENTAL

Titre de la présentation 17Paseo Ayacucho BEFORE

CENTRORIENTAL

Titre de la présentation 18Paseo Ayacucho AFTER

Curitiba, Brazil4.3

Project: sustain the municipality’s policy for transport and biodiversity

C itib Objectives: Reduce GHG due to transport Protect biodiversity by creating an ecological

fence

Curitiba

fence

Content: Improvement of the linha verdeNorth part, 7th BRT axis of the city on an former highway turned into and urban

Paraná

g yavenue

Targets: 25 000 tCO2 eq

SETOR ESTRUTURALZR 4

ZR 4

ZR 3

ZR 2ZR 3

ZR 1ZR 1 ZR 2

Protection and reintegration of native species

Exchanges with the city of Lyon

P j t’ t € 72 AFD fi d € 36


Project’s cost: € 72m, AFD financed € 36m

5. AFD in Turkey


AFD in Turkey5.1

The Istanbul office was opened in 2005 ith 2 ti iti Loans granted in Turkey 2005 with 2 activities: Private and banking sector Municipal sector

30%

g y

since 2004

About €1bn of loans granted since 2004

These financings were granted to 70%SMEs through banks, to the private sector and to municipalities (including SKİs) Private and banking sector

Municipal sector


How we work with municipalities5.2

The way we workWe propose

AFD finances municipalities’ projects and investment programs (LT maturities, in €or TL)

Municipalities are the project owners and managers

Financial assessment of repayment Develop partnerships between Turkish

and French municipalities and local institutions

Financial assessment of repayment capacity

Availability of detailed feasibility of the transportation project

With or without Treasury guarantee

Attractive financial conditions in terms of interest rates and maturities of the loans

transportation project

Consistency with the transport master plan

interest rates and maturities of the loans

Possibility of co-funding with other donors and commercial banks when needed

Approval of the Treasury and the SPO

Untied aid


Report on transport financing5.3

Handbook good practices for financing urban transport

(AFD MEEDDM) 2009(AFD-MEEDDM) 2009

Link:

http://www.afd.fr/jahia/webdav/site/afd/shared/ELEMENTS_COMMUNS/pdf/Handbook-good-practices-for-financing-urban-transport-AFD-MEEDDM-2009.pdf


Thank you for your attention

Contact:D id WillDavid Willecomme

[email protected]

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Urban Transportation: French Development Agency