IFC in Agribusiness Funds

October 14, 2010

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IFC has invested over $100 billion in Emerging Markets since 1956

• Largest multilateral source of loan/equity financing for the emerging markets private sector

• Founded in 1956 with 182 member countries

• AAA rated by S&P and Moody’s

• Equity, quasi-equity, loans, risk management and local currency products

• Takes market risk with no sovereign guarantees

• Promoter of environmental, social, and corporate governance standards

• Resources and know-how of a global development bank + flexibility of a merchant bank

• Holds equity in over 800 companies worldwide

IFC FY10 Highlights

Portfolio * $48.8 billionCommitted * $18.0 billionMobilized $ 5.3 billion# of companies 1776# of countries (portfolio) 129# of countries (committed) 104* Includes for IFC’s own account and mobilization

Composition of FY10 Transaction Volume

IFC’s Goal: Deliver development impact along the global agri-supply chain,

through investments and advisory services with the private sector, to create opportunities and improve peoples’ lives

FinancialInstitutions

Market Infrastructure

Farm Production

Inputs Collection Processing Marketing Distribution

Risk Sharing Facilities

Pre-Harvest Finance Trade Finance

Fertilizers and other Chemicals

Land

Project/Corporate Finance

Retail

Infrastructure/Logistics

CIT – Access to Markets

IFC invests across the Agribusiness Value Chain - US$2.0 billion in FY 2010

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IFC has significantly increased its agri-financing in recent years..

The active portfolio of agri-related investments was $3.9 billion at FYE09 (excludes Trade Finance)

The active portfolio of agri-related investments was $3.9 billion at FYE09 (excludes Trade Finance)

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… and developed a strategic response to food crisis

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• Provide liquidity throughout the value chain

• Trade finance

• Working capital

• Wholesaling finance

• Supply side response through global agricommodity players

• Emphasize productive land investments and productivity gains

• Improve supply chain infrastructure

• Trade finance

• Technical programs on the ground: access to finance, access to markets-linkages, productivity support

• Improve logistics, product-to-market efficiencies

• Reform agenda: regulatory / land / trade policy

• Drive integration of small farmers into global agrisupply chain

… which also entails to increase productivity in agriculture through investments in funds!

… which also entails to increase productivity in agriculture through investments in funds!

SE EuropeSE Europe

IFC`s recent experience in Productive Land Projects

Global LandAgri Fund

Global LandAgri Fund

Land Real Estate Investment Trust (REIT)

Business Model:• Acquire small agri-land

plots within the same municipality

• Rent out to modern farming company

• Realize value through higher land productivity translating into higher land prices for REIT

• IFC to invest equity to scale up operations

EUR 15 millionEUR 15 million

USD 75 millionUSD 75 million

Land Development - South America -

Land Development - South America -

Large-Scale Farm Operator

Business Model:• Farms large tracts of

purchased or leased land, creating economies of productive scale.

• Provides technical expertise, including use of best-in-class techniques and inputs

• Intent on rapidly increasing size of managed areas

USD 50 millionUSD 50 million

Agri-Land Focused Fund Manager

Business Model:• Identify and invest in

regional agricultural farming and production companies.

• Build companies into scalable platforms by providing growth capital, increasing productivity and yields

• Geographic and product diversification in strategic areas.

Regional Land Fund

- South America -

Regional Land Fund

- South America -

USD 50 millionUSD 50 million

Regional Fund for Land Consolidation & Farm Development

Business Model:• Consolidates large

tracts of land (primarily grazing land) and develops for farming purposes.

• Provides technical expertise, including use of best-in-class techniques and inputs

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Investment RationalInvestment Rational

IFC`s Rational and Role in Investing in Funds

Why is IFC considering investments in funds?

• Reach smaller agribusiness companies which IFC is not able to target directly;

• Support funds who aim to increase land productivity, improve agricultural practices and have a demonstration effect in agriculture sector; and

• Support emerging fund managers to secure the targeted fund size at closing.

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IFC Value AddedIFC Value Added

What value does IFC add to the funds in agriculture?

• Provide stamp of approval by assisting the fund manager in structuring the Fund according to international best practices;

• Disseminating of Corporate Governance and E&S best practices; and

• Provide industry and regional expertise to assist the funds.

IFC does not invest in funds with (i) an objective of land speculation, (ii) a narrow focus (biofuel or single crop), and (iii) no relevant experience or management team.

IFC does not invest in funds with (i) an objective of land speculation, (ii) a narrow focus (biofuel or single crop), and (iii) no relevant experience or management team.