1. Role of ATI in Zimbabwean Economy
May, 2018

2. Presentation Outline ATI Facts ATI Solutions Sample Transactions
Benefits to Zimbabwe

3. Part 1: ATI Facts

4. ATI’s Story
In 2001, seven African countries came together to understand how to attract more FDI. Their World Bank-backed study showed political risks to be the biggest single factor deterring inwards investments. This study led to the creation of the African Trade Insurance Agency (“ATI”). ATI is registered with the UN as a multilateral Organization. ATI offers a range of insurance products focused on increasing trade and investments. ATI has both a commercial and a developmental mandate aimed at profitability (with dividends paid back to member states) whilst simultaneously improving the business climate in ATI’s member countries. As of YE 2017, the combined population of ATI’s member states is 483 million and ATI insured annual trade and investments equal to US$2.4 B or c.1% of GDP in average member countries every year.

5. Milestones
Pooled capital structure sees ATI underwrite its first significant transactions
SACE, Italy’s Export Credit Agency (ECA) becomes the first European ECA member
The European Investment Bank partners with ATI on an energy initiative
UKEF, Ethiopia and Zimbabwe become members
2001
2006
2007
2009
2012
2013
2014
2016
2017
ATI reaches US$1 B exposure threshold & Kenya-Re becomes a member
Côte d’Ivoire becomes the 2nd W. African member country & ATI exposure exceeds US$2 B threshold
African Development Bank and Benin become members
ATI is created, 7 Presidents sign ATI’s treaty in Kampala
ATI receives S&P credit rating, A/Stable. ATI maintains the A rating to present

6. Current & Prospective ATI Member Countries
ATI Member states Benin Burundi Côte d’Ivoire Democratic Republic of Congo Ethiopia Kenya Madagascar Malawi Rwanda South Sudan Tanzania Uganda Zambia Zimbabwe Actively considering membership Angola Burkina Faso Cameroon Liberia Mali Mozambique Niger Nigeria Gabon Ghana Senegal Sierra Leone

7. Africa’s fastest growing economies
5 of the 10 fastest growing large economies in Africa are ATI member states
(Data from AfDB-2018, and IMF World Economic data for 2017)
On average ATI now insures trade & investments equal to around 1% of GDP annually in it’s member countries

8. Current Corporate Members
ATI also has non-country members who include
African Development Bank (AfDB)
African Reinsurance Corporation (Africa Re)
Atradius Participations Holding
Kenya Reinsurance Corporation
The Common Market of Eastern and Southern Africa (COMESA)
Trade and Development Bank (TDB)
Zep Re
SACE
UK Export Finance (UKEF)
As at YE ‘17 ATI’s total equity was US$ 242 M

9. 2017 Key Results As of 31 December, 2017 Shareholders’ Capital
(management accounts)
Gross Written Premium
US$ million (+ 52%)
Net Earned Premium
US$ 13.8 million (+ 20%)
Gross Exposure
US$ 2.4 billion (+ 26%)
Net Exposure
US$ 0.9 billion (+ 13%)
Profit
US$ 10 million (+ 31%) – on a comparable basis
Shareholders’ Capital
US$ million (+12%)

10. ATI gross exposure trends
ATI believes the best way to measure ATI’s impact is by looking at the gross exposure insured annually by ATI. In the last five years this has grown from US$1 billion annually to US$2.4billion in 2017 and the growth trend if anything is projected to accelerate
The product lines above show PRI being political risk (sovereign payment and breach of contract / expropriation risk), CRI being private sector credit risk (payment risk on corporates, NB this is a risk that MIGA cannot insure) and PVT&S being political violence & terrorism risk, which is the only declining exposure for ATI (due to sufficient private sector insurance capacity)

11. Part 2: ATI Solutions

12. The Risks That ATI Can Cover
ATI can insure the entire spectrum of debt or equity investments in African member states
Investment (Political) risks
Non-honouring of sovereign & sub sovereign obligations & debts
Confiscation, Expropriation, Nationalization
Arbitration award default
Currency inconvertibility
War, Civil War, Terrorism
Commercial risks
Insolvency
Non payment (“protracted default”)
Refusal to pay
Performance risks
Contract bonds (bid bonds, performance bonds etc.)

13. ATI’s Products Surety Bonds
Investment Risk Insurance
Protects against sovereign non-payment risks or unfair action or inaction by a government that would negatively affect business or investments (e.g. expropriation, breach of contract)
Credit Insurance
Non-payment or delayed payment to lenders or to suppliers of goods or services by a public or private buyer, whether in member states or with trade partners
Political Violence, Terrorism & Sabotage Insurance
Protects investors against financial losses in the event of political violence, war or terrorism
Surety Bonds
Bid bonds, Advance payment risks, Performance, Customs & Warehousing
Breach of Contract Insurance for Energy Projects
ATI has a large suite of dedicated products for the energy sector that insure against the non-honouring of sovereign obligations from a public utility

14. ATI’s Value Added for African Governments
ATI absorbs the risks of changing or uncertain regulatory regimes
Project investors are often wary of uncertain and changing regulatory risks in African countries, which can negatively impact investments.
ATI's cover helps mitigates these concerns.
ATI actively helps avoid claims or losses
ATI is a trusted government partner and advocates on behalf of private sector investors to improve structures & contracts and ultimately to prevent claims and losses.
In this way ATI acts as an intermediary, ultimately working to improve the investment climate in member states

15. ATI’s Value Added for African Govts. (cont’d)
ATI’s solutions can be used as an alternative to Sovereign Guarantees
Many ATI member states are restricted by an inability to issue sovereign guarantees because this increases their national debt.
ATI’s products can be used as an alternative to enhance or substitute for sovereign letters of comfort or guarantees
ATI insures loans to State-owned enterprises
Historically, some parastatals have had challenges impeding their ability to attract financing.
ATI’s products gives comfort to investors and lowers financing or investment costs.

16. ATI’s Value Added for Zimbabwean Domestic Banks
ATI works on both sides of the risk spectrum for local banks (insuring their risk, and loans they make)
ATI can insure the default risk of local banks and thus allow them improved access to international hard currency finance
ATI also works with local lenders to de-risk their balance sheet
ATI’s insurance solutions can be used as alternative/additional collateral - easier to realize than land & buildings & frees up liquidity
Basel regulations allow lenders to substitute the risk of the borrower with ATI’s risk and this frees up capital
For local banks, this levels the playing field allowing them to compete with international banks
ATI products allow local banks to expand their lending portfolio and ATI also has dedicated SME lending products

17. ATI’s Value Added for Exporters
ATI can insure exports
Whilst ATI’s primary focus is inwards investment (FDI), ATI also works as a potential ECA
ATI helps exporters expand to new markets & customers
ATI can insure an exporter’s Whole Turnover (i.e. accounts receivables) or single transaction risk
The same is true for exporters to Zimbabwe who face local credit risk: ATI’s products can mitigate these risks allowing trade to flow

18. Part 3: Sample Transactions

19. Projects: Support to Mining Sector
Minerals backed receivable financing
Lending by two African DFIs to the Central Bank to support the mining sector:
- Revolving Gold Export Receivables-Backed Facility to support RBZ’s procurement of gold;
- Resource-Backed Facility for procurement of mining equipment and consumables to retool and re-equip qualifying mining companies;
Cumulative Transaction Value: USD715 M

20. Projects: Financial Services
Distressed Banks Portfolio
Lending by one African DFI to rehabilitate the distressed Banks’ portfolio by the Reserve Bank and the Government of Zimbabwe.
Total Insured Loan = USD45m

21. Projects: Energy Power Stations Rehabilitation
Facility to finance capex/refurbishment of both Kariba South Power Station and Hwange
Power Station.
ATI insured an African DFI and an African commercial bank against the risk of nonpayment of the loan
Total Transaction Value: USD60m

22. Part 4: Benefits to Zimbabwe

23. Benefits to Zimbabwe Access to competitive financing
ATI: A Powerful Partner
Benefits to Zimbabwe
Access to competitive financing
Help local banks, companies & SMEs access finance
Insurance cover reduces interest rates on sovereign financing, reducing debt costs
Critical factor for many equity investments
Economic diversity
Insurance cover increases investor confidence, helping diverse sectors access goods and capital to expand
More easily realize priority projects
With ATI support from the start of a project, member states can access a network of international partners
ATI insurance policy
Lowered cost of investment / finance
Better investment proposition with reduced chance of default
Good performance track-record encourages further investment
Equity Investment or Financing
ATI’s
Virtuous
Circle

24. ATI could be a significant partner
Country
Share Capital
Cumulative Insured
Exposure
GDP (2017)
Cumulative Values
Current Exposure
Equity / Cumulative Exposure
(at YE '17) US$ '000
(at YE'17) US$ '000
US$ BN
as % of 2017 GDP
as % of GDP
Benin*
13,900
47,883
37,432
8.8
0.5%
0.4%
344%
Burundi
15,300
142,954
6,535
3.4
4.2%
0.2%
934%
Cote d'Ivoire*
13,500
5,000
36.9
0.0%
37%
DRC
19,200
992,541
157,710
41.1
2.4%
5,169%
Ethiopia*
6,900
280,000
121,125
78.3
4,058%
Kenya
29,300
11,899,794
855,389
75.1
15.8%
1.1%
40,614%
Madagascar
1,000
86,460
2,177
10.4
0.8%
8,646%
Malawi
17,200
1,048,447
124,108
6.2
16.9%
2.0%
6,096%
Rwanda
8,700
649,862
153,311
8.9
7.3%
1.7%
7,470%
S. Sudan*
7,800
4.8
0.1%
64%
Tanzania
12,700
1,317,329
154,010
51.2
2.6%
0.3%
10,373%
Uganda
22,900
3,547,781
213,476
27.2
13.0%
15,492%
Zambia
16,900
2,601,430
316,875
23.1
11.3%
1.4%
15,393%
Zimbabwe*
12,800
334,866
166,676
15.3
2.2%
2,616%
Total
198,100
22,959,346
2,318,824
390.7
Average (excluding recent member countries)
8.3%
0.9%
12,243%
* Recent ATI member countries, thus excluded from averages

25. ATI West African Regional Headquarters ATI Southern Africa Office
ATI Contacts
ATI Headquarters
Kenya-Re Towers | Upperhill, Nairobi
ATI West African Regional Headquarters
Cotonou, Benin - pending
ATI Tanzania Office
1st Floor, Private Sector Hs. | Mwaya Rd.
Dar es Salaam
ATI Uganda Office
Workers House, 9th Floor
Southern Wing Plot 1 Pilkington Rd Kampala
ATI Southern Africa Office
Kwacha House Annex | Cairo Road
Lusaka