Winning Aid-Funded Business
A training course delivered by Nigel
Peters, Director of the UKTI Aid-Funded
Business Service
UKCDS & UUK
London
5 November 2012
1
AFBS Presentations

What is Aid-Funded Business?
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Lunch break
Sector case-study : Education
The Bureaucratic Bits:
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
Why do it?
Who are the major potential clients?
Where and in what sectors do they work?
What sort of companies win work for them?
An overview of all the main international financial institutions (IFIs) and the United
Nations agencies (UN)
Where is the Project Information?
Registration Requirements,
Getting Shortlisted
Bidding
Follow-up support from UKTI in your region
2
What is Aid-Funded Business?
Commercial Opportunities created by development
& humanitarian aid programmes funded through
the multilateral & bilateral development agencies,
and the United Nations
WORTH APPROX US$70-100 BILLION
PER YEAR
The UKTI Aid-Funded Business Service is a dedicated
UKTI service to help UK companies win aid-funded
business
3
Broken down by IFI/Agency
Donor
Comittments latest FY
World Bank Group
US$35.3 billion
EC (EuropeAid & EIB)
US$26.4 billion (€19billion)
Asian Development Bank
US$17.5 billion
Inter-American Dev Bank
US$15.5 billion
United Nations
US$14.5 billion
EBRD
US$10.3billion (EUR7.9billion)
DFID
US$8.9 billion (£5.8billion)
African Development Bank
US$6.6 billion (UA4.1 billion)
Caribbean Development Bank
US$0.2 billion
TOTAL
US$135.2 billion (representing
c.US$70-100b of business opps)
Remember, apart from DFID this excludes untied bilaterals
4
So which Sectors are important?
World Bank Group Example
Water, Sanitation,
and Flood Protection
11%
Agriculture, Fishing,
and Forestry
Education
5%
4%
Energy and Mining
14%
Transportation
20%
Finance
2%
Health and Other
Social Services
16%
Industry and
Public
Administration, Law,
and Justice
22%
Information and
Communications
Trade
5%
<1%
5
Who are the organisations?
EC
EuropeAid: similar
function as World
Bank but grants not
loans
EIB: ta and long term
loans
EBRD
Investments in
private sector
(transition
economies)
United Nations
Peacekeeping, Famine,
Natural Disasters,
Emergency Aid
Aid/Development
Assistance for
Developing
Countries
Bilateral Donors
DFID, MCC, GIZ,
AusAID, SIDA etc
World Bank
Long term loans for
development projects
such as Bridges,
Dams, Hospitals,
Consultancy in areas
such as Good
Governance, Security,
Healthcare reform etc
(Similar to the
Asian, African,
Inter-American and
Caribbean
Development
Banks)
6
Where do I fit in?

Tenders and contracts are generally broken down into three
distinct areas:

Consultants (services) – for all stages of the project cycle,
but if getting in early beware conflict of interest rules.
Consortium/sub-contracts. Firms can supply individuals.

Contractors (works) - gradual move to project
management fee based contracts for large projects. For
traditional works contracting: project broken into small
packages, no short-listing, lowest price wins.

Suppliers of goods - cheapest bid according to specification.
Procurement agents sometimes used. Need to ensure your
product is known to project consultant, especially if innovative
7
Does the size of my company
matter?
 No, but it is horses for courses!
 You can win business as an individual, up to a
multinational
 But it is very different business:
e.g. in consultancy:
an individual consultant is frequently appointed by the Development Banks to
undertake project identification and evaluation
Price Waterhouse Coopers run a multi-million pound construction transparency
project for DFID
and in supplies:
a small company in Somerset supplies vehicle spare parts to the UN in Sudan
Pearson supply educational textbooks for EuropeAid projects across Africa
8
The 70:30 Guideline for UK Companies
For Development Aid (Multilateral Development Banks,
EuropeAid, EBRD, Bilaterals):


Roughly 70% of the business opportunities for UK companies
will be for consultancy
The other 30% will be for the supply of goods
For Humanitarian Aid (mainly the UN):


Roughly 30% of the business opportunities for UK companies
will be for consultancy (especially for individuals)
The other 70% will be for the supply of goods
And overall very little for works contractors, but there is the trend towards
project management for a fee...
9
The 70:30 rule for consultants
 Consultancy tenders are normally evaluated
according to a technical: price matrix based on a two
envelope system
 The first envelope that is opened is the technical offer
 70% of the marks are awarded for the technical
quality of the tender
 Only those reaching a certain threshold then have
their price envelopes opened
 The prices are combined with the technical marks
such that the overall weighting of the bid is 70:30
technical: price (80:20 is also commonly used)
 Although price is the minor component, you will still
not win the bid if your price is outside of the project
budget (some agencies tell you this budget, others
do not!)
10
How the Banks work

Provide loans and grants to Developing countries

REMEMBER – Beneficiary Government is normally your client,
not the Bank itself

Though the Banks employ Consultants directly for feasibility
studies, project evaluation etc

Capitalisation was increased as a response to the global
financial crisis leading to record levels of loans, but this will
decrease…
11
Role of the Bank in procurement
– Who is responsible for the award of contracts?
“Your Client”
The Lender
Loan/Credit
e.g. World Bank
E.g. Ministry of Finance
Procurement
Interface
Suppliers
The Borrower
Implementation
Implementing Unit
Implementation
Assistance
Reporting Relationships
Contractual Relationships
Consultants
12
The Project Cycle
1. Identification
2. Preparation
6. Evaluation
3. Appraisal
5. Implementation
4. Negotiation
13
So, Why should I do it?
1. Springboard into new markets or regions and it offers
opportunity to internationalise your business
2. Test a new, difficult market whilst cash is coming in
3. You are being paid, though you need to understand the cash
flow/invoicing arrangements which will vary by agency
4. You can take control of this business stream (planning,
planning, planning)
5. Allows you to build local contacts and establish a local
presence
6. It’s a good reference
14
...and the points to remember
 Development projects often have long lead times
 Payment while guaranteed can sometimes be slow
 Most contracts are subject to competitive tendering on a fairly
global basis
 For consultants especially early information is essential
 If the first you see of a project is the tender notice you are
normally too late!
 Companies based in developing countries will sometimes
have a preference (price based for goods, experience based
for consultants)
 It is important to work out where the purchasing decision is
being taken and market accordingly. The trend is for
decision making to be devolved to the recipient country
and/or IFI country office
15
Am I ready for Aid-Funded
Business?
Do you have:
 An international track record and a commitment to
international growth
 Management capability
 Marketing skills
 Good Financial standing, and normally a minimum of 3 years
audited accounts
 Market knowledge
 Operational capabilities – skills in delivering products or
services and working in cross-border
partnerships.................... ??????
 Experience of working for other large clients
If you don’t have all of these, but the will is there...UKTI can
provide help in many of these areas
16
Tips for SMEs new to AidFunded Business (AFB)


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
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
Find out who is winning AFB projects and look for sub-contracting
opportunities. Most IFIs have lists of awarded contracts on their
websites.
For consultants, identify the Framework consortia and offer your
services to them.
Both DFID and EBRD are based in UK and offer easy access.
Both EBRD and CDB offer a good range of small contract sizes which
are often below the limit for ICB
ADB advertise small value staff consultancies and other TA on their
website and procure from HQ in Manila
For goods and equipment, the UN offer small contract sizes often
below $30,000, which means they can negotiate with 3 preferred
suppliers.
Contact the 3 procurement agents listed on the DFID website , who
will also be procuring goods and equipment for other IFIs.
AFBS missions are a very cost-effective way of starting off!
17
The World & Regional
Development Banks
 World Bank Group
 Asian
 Inter-American
 African
 Caribbean
18
Regional Donors
EBRD
ADB
CDB
AfDB
IADB
ADB
19
Does the size of the client
matter?
Bank
Disbursements (US$ billion)
World Bank Group
Asian
Inter-American
African
European (EBRD)
Caribbean
43
16
16
12
10
0.4
20
WBG & RDB’s: some general
points
 Project Cycle is the same
 Loans not grants
 Borrowing Country will be your client and will procure
according to guidelines (main exception is ADB Technical
Assistance which is procured by ADB)
 Websites will have a 3 year country lending plan (slightly
different names for each Bank)
 Typically 2-3 project documents growing in information as
the project develops (again slightly different names)
 Tender notices on their website
 70:30 consultancy/goods for UK companies
 70:30 technical/price matrix consultancy evaluation
 Registration: DACON useful but not obligatory for WBG, not
used by IDB. Others have their own systems
21
World Bank

HQ in Washington D.C. (www.worldbank.org)

Committed US$35.3 billion in loans, credits and grants to its
members in FY2011

Majority of opportunity for Consultants however most projects have a
requirement to procure equipment

Works in all the developing and transitional economies

Project Information & Advice available from British Embassy on a biweekly basis including procurement notices

UKTI Liaison Officers, Stuart Baird & Justin Kersey, based at the
British Embassy in Washington D.C.
22
World Bank

The World Bank Group (WBG) comprises 5 organisations of which IDA and IBRD offer
the main procurement opportunities:
PROCUREMENT

IDA: International Development Association, very concessional loans to the least
developed countries (e.g. Bangladesh, Tanzania). 35-40 year repayment period, 10 year
grace period. Funds from donors such as the UK (DFID).

IBRD: International Bank for Reconstruction & Development, market based loans
to middle income countries (such as Brazil, Mexico). Funds from the international
capital markets (AAA rated).
However, for INVESTORS………………….

IFC: International Finance Corporation, loan and equity financing for private sector
projects. Investment maximum of 25% of project cost. Limited due diligence type
consultancy opportunities, identification of private sector investors as clients.

MIGA: Multilateral Investment Guarantee Agency, insures investors against noncommercial risk (similar to ECGD) and ICSID: International Centre for the
Settlement of Investment Disputes
23
IBRD Top 10 Borrowers
Fiscal 2011
The World Bank Annual Report 2011
4.0
3.5
$ Billions
3.0
2.5
2.0
1.5
1.0
0.5
India
Mexico
Brazil
Indonesia Argentina
China
Turkey
Poland
Romania Vietnam
24
IDA Top 10 Borrowers
Fiscal 2011
The World Bank Annual Report 2011
2,500
2,000
$ Millions
1,500
1,000
500
0
25
IBRD and IDA Lending by
Region Fiscal 2011
The World Bank Annual Report 2011
Africa
16%
South Asia
24%
Share of
Total lending
of $43 Billion
Middle East and
North Africa
East Asia and
5%
Pacific
19%
Latin America and
Europe and
the Caribbean
Central Asia
22%
14%
26
% of total prior review contract
awards
UK Performance on WB
Procurement Contracts
UK Performance on WB Prior Review
Contract Awards
FY 2006 - 2012
4.00%
400,000,000
3.50%
350,000,000
3.00%
300,000,000
2.50%
250,000,000
2.00%
200,000,000
1.50%
150,000,000
1.00%
100,000,000
0.50%
50,000,000
0.00%
0
2006
2007
Amount (USD)
2008
2009
2010
% of total amount
2011
2012
27
% of total contracts
Asian Development
Bank

HQ in Manila, Philippines (www.adb.org)

Last year the ADB approved $17.5 billion in loans.

Working Language is English

All procurement notices posted on ADB website and you can receive
email alerts

New Consultant Management System

Goods/Equipment often bought locally – companies should check
‘Opportunities’ section of ADB website

UKTI Liaison Officer, Fidel Ventura, based at the British Embassy in
Manila
28
Asian Development Bank
Commitments 2011
Country
US$ amount (millions)
Vietnam
3,604.6
India
3,126.7
Pakistan
2,886.0
Bangladesh
2,292.5
China P.R.
1,592.9
Uzbekistan
1,398.7
Thailand
1,090.8
Indonesia
805.0
Azerbaijan
643.6
Nepal
344.0
29
Asian Development
Bank
The ADB long-term plan: Strategy 2020, lists 5 core specialisations for
ADB to focus on:
•
Infrastructure
•
Environment & Climate Change
•
Regional Cooperation & Integration
•
Financial Sector Development
•
Education & Training
By 2020 the aim is for 50% of investments to be in the private sector,
often by PPPs, where there are very good consultancy opportunities
30
Asian Development
Bank
2010
2011
Cumulative (as of 3112-2011)
Item
Amount ($
million
% of total
Amount ($
million
% of total
Amount ($
million
% of total
Goods & Works
5.73
.09
2.12
.03
877.14
.8
Consulting
Services
25.47
6.13
22.15
5.21
959.65
11.71
Top UK Firms (Procurement 07-12)
Individual Consultants - $33.75 million (543 contracts)
Scott Wilson - $18.07 million
Roughton International - $9.73 million
GHK Consulting - $8.86 million
31
Asian Development
Bank
Consultancy tenders
Consultancy winners by country of origin
Loan Projects
Technical Assistance
India
USA
Indonesia
India
Australia
Australia
Vietnam
UK
Bangladesh
Philippines
32
Asian Development
Bank
Consultancy Summary
•
Tenders open to companies from ADB member countries only.
Companies must also only employ nationals from member
countries
•
ADB want more competition in the Pacific islands (will accept
Caribbean experience), Afghanistan, Cambodia & Pakistan
•
Newly introduced Indefinate Delivery Contracts (similar to
Framework Contracts)
•
Companies can also be awarded individual consultancies
33
Inter-American
Development Bank
 HQ in Washington D.C. www.iadb.org
 The IADB Group approved a record $15.5 billion in
new financing operations.
 Covers Central and South America and the
Caribbean islands (including The Bahamas,
Barbados, Dominican Republic, Haiti, Jamaica and
Trinidad and Tobago)
 UKTI Liaison Officers, Stuart Baird & Justin Kersey,
based at the British Embassy in Washington D.C.
34
48 IDB member countries
Finland
Norway
Sweden
Canada
United Kingdom
Denmark
Netherlands
Germany
Belgium
Austria
France Switzerland Croatia
Slovenia
Italy
Portugal
United States
Spain
South Korea
Israel
Japan
China
Bahamas
Mexico
Jamaica
Haiti
Belize
Honduras
El Salvador
Nicaragua
Dominican
Republic
Trinidad and Tobago
Guatemala
Costa
Rica
Panama
Barbados
Venezuela
Columbia
Guyana
Suriname
Ecuador
Peru
Brazil
Bolivia
Paraguay
Argentina
Chile
Uruguay
•26 Borrowers
• 22 Non-Borrowers
(China, South Korea are new members)
35
Five strategy pillars for high
development impact focus
Social
inclusion
Broadening
access to
services
Institution
building
health,
education,
housing, food
and nutrition,
base of the
pyramid, job
creation
promoting
infrastructure
(power,
transportation,
telecom, water,
tourism) and
finance (MFIs,
SMEs, capital
markets, etc.)
financial and
advisory
support for
private and subnational clients
Integration
trade, natural
resources,
cross border
investments
Climate
change
renewable
energy, energy
efficiency,
recycling
industries,
biofuels
36
Priority areas
 Poverty reduction
 Opportunities for the Majority
 Education and Innovation
 Water and Sanitation Initiative
 Sustainable Energy and Climate
Change Initiative (SECCI)
37
IADB Loans & Guarantees
Approved 2011
Country
US$ (millions)
Brazil
$4,656.5
Mexico
$3,009.7
Argentina
$1,682.7
Peru
$1,594.4
Colombia
$785.2
Ecuador
$609.5
...and don’t forget..........
Jamaica
$328.0
Trinidad & Tobago
$290.0
Bahamas
$131.0
Barbados
$70.0
38
African
Development Bank

HQ in Tunis, Tunisia (www.afdb.org)

In 2011, Bank Group loan, grant, and other approvals totalled approx UA
5.72 billion. The UK, through DFID committed £567 million for 2011-2013

UK holds a 1.7% share in the Bank

Working Languages are English and French

All procurement notices posted on AfDB website in the Business Bulletin.

Consultants: Register on AfDB DACON Database

UKTI Liaison Officer, Alan Morrison, based at the British Embassy in Tunis
39
African Development Bank Group
Loans & Grant Approvals 2010
Country
UA millions (1UA = c.£1)
Egypt
651
Morocco
519
South Africa
404
Tunisia
297
Ethiopia
224
DR Congo
158
Tanzania
130
Kenya
116
Ghana
109
Senegal
70
40
Medium Term Strategy
Stronger Sectoral Emphasis on:
– Governance
– Infrastructure
– Private sector development
– Higher education
Special Applicability to:
– Fragile States
– Regional Integration
– Agriculture
Better integration of:
– Gender
– Environment
– Climate Change
New Long-Term Strategy to 2020 under preparation, but for 20122014 the above will be still be prioritised but with a greater focus on
inclusive growth, including promotion of entrepreneurship and job
creation
41
AfDB: % Lending by Sector 2011
Environment
Ag & RD
0%
4%
Industry/Mining
7%
Social
11%
Infrastructure
38%
Finance
19%
Multi-sector
21%
42
Caribbean
Development Bank
43
Caribbean
Development Bank

HQ in Barbados (www.caribank.org)

In 2011 the CDB approved $165.0 million in loans, a decrease of
40% on the previous year reflecting concerns over regional debt
levels

Borrowing-member countries: Anguilla, Antiqua and Barbuda, The
Bahamas, Barbados, Belize, British Virgin Islands, Cayman Islands,
Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat, St. Kitts and
Nevis, St. Lucia, St. Vincent and the Grenadines, Trinidad and
Tobago and the Turks and Caicos Islands

Consultants Register on CDB Website

UKTI Liaison Officer, Hadford Howell, based at the British High
Commission
44
Caribbean
Development Bank

Exclusive focus on the Caribbean (only IADB lends more to the
region)

Largest projects in 2011 were in Barbados $35m (education
sector), and in St Kitts & Nevis $12m (debt restructuring)

Clear understanding of the problems and dynamics of the region

2010 increase in CDB’s capital by US$1billion, will enable a
doubling of lending during 2010-19 if the economic situation
allows

New strategy 2010-14, priority sectors:
Education & Training; Agriculture & RD; Economic & Social
Infrastructure; Private Sector Development; Social protection;
Environmental Sustainability & Disaster Management; Climate
Change; Good Governance
45
EU external aid (i.e. outside of the EU)
• Grants delivered by DG DEVCO
“EuropeAid”
• Loans delivered by the European
Investment Bank (EIB)
• Both also deliver technical assistance
46
EuropeAid

HQ in Brussels, Missions Worldwide
(http://ec.europa.eu/europeaid/index_en.htm)

Procurement totaled almost €11 billion in 2011 and will
increase to €13 billion by 2013

Approx 80/20 split between procurement of Services/Goods &
Works

UKTI Liaison team based at UKREP (i.e. the British Embassy to
the EU) in Brussels can provide information on upcoming
projects, project pipelines, assistance with finding consortium
partners, help with bidding tactics and strategy,
project/procurement design and management and assistance
with dispute settlements
47
About EuropeAid
Size & Scope




The EU (27+1 donors) accounts for 60% of all development aid
The European Commission is the third largest donor in the world
Disbursements and commitments will continue to grow at least until
2013, the figures below show procurement by programme in 2010
Aid provided to 150 countries and territories on a grant basis
IPA :
Turkey, Western Balkans; €1.4 b
ENPI: Neighbours of the enlarged EU; €1.5b
DCI:
Asia and Latin America; €2.4 b
EDF:
Africa, Caribbean, Pacific; €3.65 b
48
EuropeAid 2014-20
Size & Scope for the next budgetary period of 2014-20:

Subject to Parliamentary and Council approval the following budgets
are proposed:
IPA :
Turkey, Western Balkans; €14.1 b
ENPI: Neighbours of the enlarged EU; €18.2 b
DCI:
Asia and Latin America; €23.3 b
EDF:
Africa, Caribbean, Pacific; €34.27 b
49
EuropeAid: Priority
Sectors
Priority sectors of EU Aid-Funded business:
-
Infrastructure and transport
Private sector development
Institutional, administrative reform
Education and training
Environment
Water
Health
Social sector / employment
50
Service contracts
About 70% of EuropeAid’s are service-based
Examples for service contracts:
Capacity Building in Support of Rule of Law in Georgia
Budget: € 2.7m
Capacity building support to the African Forum for Utility
Regulators (AFUR) - South Africa
Budget: € 1.3m
Support for the establishment of Tax Administration
Contact Centre - Serbia & Montenegro
Budget: € 1.79m
51
Supply contracts
About 30% of the EU’s external aid tenders
are works and supplies contracts
Supplies regularly requested:
1. IT equipment incl. software, hardware
2. Vehicles and spare parts
3. R&D material (laboratory equipment, material for
specialised appliances)
4. Border control equipment
5. Environmental technology
52
European Investment Bank
(EIB)

The EIB was created in 1958 under the Treaty of Rome to be
the long-term financing institution of what later became the
EU. See: www.eib.org

The EIB is a non-profit, EU policy-driven public bank which
only invests in projects that further EU policy objectives. It
provides loans not grants (that is the area for EuropeAid).
Lends up to 50% of project cost, with a minimum value of
EUR 25 million.

In 2010, 12% of EIB financing went to projects in countries
outside of the EU (EUR 8.8 billion).

The 2009 Lisbon Treaty changed the statutes to allow EIB to
undertake technical assistance as a core function

UKTI Liaison Officer, Jan Soeltenfuss, based at UKREP in
Brussels
53
European Investment Bank
Mandates outside of the EU
 Pre-Accession: EUR8.7 billion over 5 years
EU integration e.g. transport, urban infrastructure, health, education.
Technical assistance is a substantial part of this programme.
 Neighbourhood: EUR 6 billion in next 3 years
Mediterranean (FEMIP): Energy security & renewables, Water & Waste
water; Transport Infrastructure; PPP’s; SME development.
Eastern: Water, Energy, Transport, telecomms, FDI
 ACP – based on EU development priorities.
Africa Infrastructure Trust Fund, EUR 400m for trans-border regional
projects in energy, transport, water, telecomms. Includes technical
assistance. See: www.eu-africa-infrastructure-tf.net
 Asia & Latin America: FDI support
54
EBRD

International financial institution, promotes transition to market
economies in 29 countries from central Europe to central Asia. In
2011 agreed to extend operations to the southern & eastern
Mediterranean (initially Egypt, Morocco, Tunisia and Jordan)

Capital base of €20 billion

Remit to promote transition to market economies by investing mainly
in the private sector, mobilise significant foreign direct investment,
support privatisation, restructuring and better municipal services to
improve people’s lives and encourage environmentally sound and
sustainable development

HQ in London. English is the working language. UKTI AFBS can give
some commercial help via the UK Executive Directors Office
55
EBRD’s objectives achieved
through financing the private
sector


€9.0bn invested in
2010 in 380 projects
Private sector > 78%
of EBRD finance
Debt 81%, Equity
19% of EBRD finance
€ billion
Net cumulative business volume

Invested over
€61.8bn in more than
3,164 projects since
1991
Annual business volume (ABV)

56
Reconciled as at 31 March 2011
EBRD Finances diverse
range of enterprises
57
Unaudited as at 31 March 2011
Regional focus 2011
58
What is new
The expected – SEI 3


New phase of the Sustainable Energy Initiative
Energy efficiency at the forefront – marrying
together private sector and public policy.

All projects screened for potential.

25% of portfolio (29% in 2011)

Greater emphasis on climate change
adaptation and resilience.
59
The unexpected: SEMED –
How?
Next steps




Lengthy governance process in three stages.
 Bank working with TC now;
 Lend through a `Special Fund’ Q3 onwards
 Full access Q1 2013?
Tailored response to each country
Potential of €2.5bn by 2015
Uncertainty both from governance process
and region
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EBRD’s Operations and
Consultancy Services
 EBRD finances projects in both private and
public sector, providing direct funding for
financial institutions, infrastructure and other
key sectors.
 The Bank’s investments also help to develop
skills, improve efficiency and strengthen
institutions.
 Within this framework consultancy services are
provided to support the Bank’s operations and
projects.
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Goods & Works
Procurement
Examples of goods and works procured under EBRD
funded projects:
 Municipal Infrastructure
Waste water treatment plants, pipes, meters, pumping stations, sewage
plants, process plants, incinerators
 Transportation
Rail track maintenance equipment, locomotives, signal systems, trams,
buses, road construction
 Power
Transmission lines and substations, distribution control systems, power
stations, meters, energy efficiency equipment
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Middle East Donors

The Gulf States are major donors for investment and poverty reduction
programmes in the Middle East, Africa and Asia. They are particularly
influential in Afghanistan, Yemen, Pakistan, Somalia and Sudan. Saudi
Arabia, Kuwait, Qatar and the UAE have substantial bilateral aid
programmes.

The Islamic Development Bank (IDB) is the region’s multilateral
development bank. Based in Jeddah, Saudi Arabia, it approved
projects worth $8.3 billion in 2011. IDB’s overall objective is to foster
the economic development and social progress of the 26 borrowing
member countries and also Muslim communities in non-member
countries.

UK is not a member, but UK companies can win business by entering
into a JV with a member country company. Also there are a number of
sectors where IDB accepts no member state companies have the right
expertise, so procurement is then untied.
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What is bilateral aid?

Bilateral = Aid from one country. The UK gives aid through the Department
for International Development (DFID)

Most countries give “untied” aid, i.e. procurement can be from any country,
not just from the country giving the aid or the country receiving it.

The two main exceptions are USA (“USAID”) and Canada (“CIDA”), though the
US also gives untied aid through the Millennium Challenge Corporation (MCC).
If you want to tender for USAID and CIDA you must open an office in USA or
Canada.

British consultants have a good track record of winning work from the
Scandinavian donors (Finland, Sweden, Denmark, Norway), MCC and Australia
(AusAID).

All EU member state’s aid is untied but you often have to bid in their language
(e.g. French, German)

Both MCC (USA) and AusAID are PROACTIVELY seeking to widen their range
of suppliers and are very keen to have more UK companies working on their
projects
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DFID

UK Bilateral Aid to Developing Countries : www.dfid.gov.uk

Review of aid policy, both multilateral and bilateral, March 2011

Goods bought by contracted Procurement Agents (Crown Agents, Charles
Kendall, IPA)

In 2010/11 spent £7.8billion (up to £10.6billion by 2014/5). A cumulative
growth of 27% . Ring-fenced budget but because of slow-down in economy,
0.7% of GDP for aid target means cutting £1.1b from original targets

Operational plans 2011-15 for all country programmes now on the website

If you are considering an investment in a developing country and/or have an
innovative product or service, talk to DFID’s Private Sector Department
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Bilateral Aid
Review
 The review has focussed UK bilateral aid on fewer
countries (27) so that support can be targeted where it
will make the biggest difference and where the need is
greatest
 In 2012-13, the top ten aid recipients will be:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Ethiopia - £300m: water, school & healthcare
India - £280m: supporting private sector to deliver jobs
Pakistan - £267m: building peace & stability
Bangladesh - £210m: social services
Nigeria - £210m: making better use of oil revenues
Afghanistan - £178m: peace, security & political stability
DR Congo - £165m: stopping illegal exploitation of minerals
Tanzania - £160m: private sector development
Sudan - £140m: reducing hunger & extreme poverty
Kenya - £110m: more jobs for young people
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
The Australian Agency for International Development (AusAID) is the
principle Australian Government agency responsible for managing
Australia's overseas aid program.

The objective of the Australian aid program is to assist developing
countries reduce poverty and achieve sustainable development, in line
with Australia's national interest.

The Aid programme is organised around the following key themes:
seeking faster progress towards the Millennium Development Goals;
promoting economic growth; ensuring environmentally sustainable
development; building long-term partnerships; strengthening partner
countries own systems; using evidence-based approaches to
demonstrate results.

2011 procurement review showed the need to improve AusAID’s
global market base for international development consultancy work
67
Countries
68
Australia's aid programme focuses on the Asia Pacific region. They are
internationally recognised for their leading role in the region,
particularly in PNG and the Pacific. Their aid is even more important
given two-thirds of the world’s poor—some 800 million people—live in
the Asia Pacific, yet they receive less than one third of global aid.
Australia also provides assistance to Africa, the Middle East, Latin
America and the Caribbean. Aid to Africa has increased significantly
in recent years and now represents around five per cent of the aid
programme.
The Australian aid programme has doubled over the past 5 years to
AUD 4.84 billion in 2011-12 and on current projections is likely to
increase to AUD 8.6 billion by2015/16 to reach the Government’s
0.5% ODA/GNI commitment.
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Please contact PSI@MCC.GOV to explore further
70
Where MCC Operates
71
Compact Funding by Sector,
in Million USD
72
The United Nations Family
73
UN PROCUREMENT
2011
 Total procurement : US$14.3 billion
 UK share: US$417 million (10th position)
 Overall 50:50 goods/services, but
remember the 70:30 rule, for UK companies the
focus is more on goods and equipment for
Humanitarian Aid/Disaster Relief
 50% spent in developing countries
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UN CENTRES






Nairobi - Environment, Habitat
Vienna – Industrial Development
New York – Peacekeeping, UNDP, UNPD
Copenhagen - UNICEF
Rome - Food and Agriculture
Geneva - Health, Emergency Relief & Rehabilitation
UKTI have liaison officers in each of these centres, and
procurement of goods and services likely to be of
interest to UK companies is often done from here
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NGO’s
 Oxfam are the only UK based NGO with significant UK based
purchasing, worth c.£5m p.a. (other NGO’s are more
decentralised)
 Water & sanitation is their key sector, plus they also use freight
forwarders a lot
 Website: oxfam.org.uk has all tenders including an ethical supply
questionnaire
 Innovation – they will talk to companies with innovative products
but they will always end up tendering
 Important to get your equipment into their Equipment catalogue
(which is non-branded); e.g. water/sanitation equipment; tents;
vehicles; radios etc
 They do have framework contracts for products they regularly
need but there are no guaranteed orders
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