Madrid, 15 July 2019.- The Compañía Española de Financiación del Desarrollo, S.A. (COFIDES), S.M.E, has approved its new Strategic Plan for the period 2019-2021, during which it contemplates investing around €1 billion in international projects. Together with COFIDES's historical leverage of cofinancing, this will serve to mobilise a total of €10 billion in foreign investments.
The COFIDES Chairman, José Luis Curbelo, stated that “it means an ambitious but realistic projection based on the application of the company's new Strategic Plan and the activities that it has carried out in the last few years, as well as the new lines of business that it will launch”. These new lines, he explained, enable the mobilisation of "the resources of its European counterparts, the European Union and the United Nation's Green Climate Fund", in addition to its own resources and FIEX and FONPYME funds for internationalisation. Likewise, "COFIDES will boost its commitment to being a priority stakeholder in Spanish financial cooperation in developing countries".
The variety of funding sources allows “the activities of COFIDES to be directed towards the different axes in the Strategic Plan: internationalisation, development and sustainability, with a special mention to climate financing and the firm commitment to contribute towards achieving the Agenda 2030 and the Sustainable Development Goals (SDG)”, stated Curbelo.
SUPPORTING SUSTAINABLE DEVELOPMENT
With this financing, COFIDES seeks to promote sustainable development in both Spain and in the countries receiving the investment. In line with the projections of the Strategic Plan, the company plans to contribute towards the generation of 55,000 direct jobs abroad in 2019, invest some €100 million in infrastructure and participate in the construction of at least 200 MW of power in renewable energy projects for the fight against climate change and its effects. The ambition of these objectives will progressively increase each year by committing ever increasing resources to sustainable development both in Spain and in the countries receiving the investment.
TAILOR-MADE FINANCING FOR CLIENTS
COFIDES provides financing companies for the conduct of all types of foreign investment transactions, from the creation of sales offices to production facilities, via the establishment of a subsidiary, its enlargement or the purchase of a foreign company. The financing may be available for the subsidiary or the headquarters itself, provided that there is a commitment to internationalisation, indicated the Director General of COFIDES, Rodrigo Madrazo.
Other types of operations in which COFIDES will emphasise are Public Private Partnerships (PPP) for financing all types of infrastructure, sometimes structured as project finance.
WIDE VARIETY OF FINANCE PRODUCTS
In addition, Rodrigo Madrazo added that “COFIDES will continue to offer its wide range of financial instruments: equity and quasi-equity instruments, straight or subordinated debt transactions, underwriting of corporate bonds and project finance. This responds to the principle of additionality, in other words, the provision of solutions that are hard to find in the market with the ultimate aim of supplementing trade and multilateral financing".
“In order to gain fluidity," noted Madrazo, "COFIDES will also support the taking-out of fund shares throughout the next three years that they will invest in companies whose business plans include significant investment in third world countries”.
The activity of pass-through funding will be aimed at private equity funds that are predominantly international and, in particular, venture capital funds in technological sectors, with a high propensity to early internationalisation.
The pass-through funding will be completed with investment in impact funds, in order to improve the opportunities for the financing of sectors, companies or projects that have been traditionally excluded from the financial sector that have no access to capital markets, creating a positive impact in the countries receiving the investment on employment, tax revenues, the environment and other objectives that are not strictly financial.
GEOGRAPHICAL AREAS AND STRATEGIC ALLIANCES
COFIDES hopes to continue financing projects in countries where it already has a significant presence and in those where new investment opportunites have been identified such as the United States, Mexico, Colombia, Chile and China. It will equally seek opportunities in other countries with growth potential. India, Indonesia, Egypt, Morrocco, Russia and Brazil are some examples. On the other hand, the company is aligned with the Spanish government's priorities for the African continent.
The performance of COFIDES's Strategic Plan will only be possible if, in keeping with Agenda 2030, its action is coordinated via strategic national and international alliances. Among these, the Plan pays special attention to the establishment of alliances with the Autonomous Communities in order to access a greater wealth of companies, add to capacity for action, open up the possibilities of managing automatic funds and, eventually, examining possibilities of cofinancing.
COFIDES, accredited by the European Commission and the United Nations for the management of its funds, maintains active partnership programmes, the exchange of good practices and coinvestment with other counterpart companies in the rest of Europe and with different multilateral banks. The company is also a key stakeholder in the Combined Funding and European Investment Plan programmes–the so-called Blending and EIP programmes–of the European Union.
COFIDES is a public-private company which has been offering financial support to Spanish companies investing abroad since 1988. It is accredited with the EU to manage Community budgets, allowing it to structure transactions with a high impact on development. It is also accredited with the UN’s Green Climate Fund and can structure operations on climate change mitigation and adaptation with the GCF. It is the exclusive manager of FIEX and FONPYME funds on behalf of the Secretariat of State for Trade attached to the Ministry of Industry, Trade and Tourism and supports AECID in managing FONPRODE funds. Shareholders include Banco Santander, Banco Bilbao Vizcaya Argentaria (BBVA), Banco Sabadell and CAF-Development Bank of Latin America.