:Types of International Financing Methods
Non-risk financing methods are all investment methods in which the funder expects the expected return of the invested resources from the economic performance of the activity or investment plan, while accepting the risk arising from the use of financial resources in the activity or plan. What characterizes these methods, no matter what the financing framework, is that they do not guarantee repayment of foreign funds by the government or commercial banks, and include foreign direct investment, public-private partnerships, civil partnerships and contractual arrangements. Which are defined as follows:
Foreign Direct Investment: If the financing is of foreign origin and the investor considers the permanent interest and the funder expects the return of the invested resources from the economic performance of the activity, expecting the return of the invested resources from the economic performance of the activity. Either the plan is invested and there is no guarantee from the government or commercial banks to repay the principal and the profits of capital, this way is called foreign direct investment financing.
Public-Private Partnership: The way in which the private sector establishes a company in which the government has no stake, and long-term contractual arrangements for the delivery of infrastructure or services between the public and private parties take place, with each party taking on responsibilities that are better than its own. It comes out and every risk is allocated to a person who can manage it at a lower cost.
Civic Participation: A foreign investor's share capital investment in an Iranian company, whether new or existing, whose shareholder or foreign investor stake in such a company is not subject to restriction, and the investor can play a role in managing and managing its affairs.
Contractual Arrangements: The set of ways in which the use of foreign capital is solely subject to agreements made between the parties to the contract. In other words, the rights of the foreign investor do not arise as a result of his direct participation in the capital of the Iranian venture capital firm. Rather, it relies solely on the parties' contractual agreements. Foreign investment in this framework can be done in all sectors. The return of capital and the benefits of such investments are also derived from the economic performance of the investment plan, without the assurance of the government, banks and state-owned companies.
Services offered by the Investment Services Center to foreign investors as pre-licensed and post-licensed services are as follows:
Before Obtaining Foreign Investment License:
Informing and advising investors on matters relating to the acceptance and support of foreign investment
Maintain necessary coordination and support in obtaining necessary investor permits, including Declaration of Establishment, Environmental License, Water, Electricity, Gas and Telephone Divisions, Exploration and Extraction of Mines and other related equipment prior to issuance of Investment License Foreign
Maintain the necessary coordination and follow-up with the executives of the units related to foreign investment requests
Acceptance of investment applications in the province and follow up on investment issues through the relevant executive agencies
Receive the request of foreign investors along with other documents required and coordinate with the organization in order to issue the investor license.
After obtaining the investment license:
Make the necessary adjustments in capital matters
The methods used to repay the principal and the interest received from the banking system or the government (Ministry of Economic Affairs and Finance) on repayment of the loan without any connection with the execution or non-execution of the plan apply, both internal and external. Externally it includes loans from international institutions as follows:
The main purpose of the World Bank is to lend money to develop and expand production projects for those developing countries that are members of the Bank. These loans are for purposes such as carrying out pipeline projects for drinking water, education as well as implementing general development plans, including the importation of industrial goods. Instead of emphasizing the economic-development needs of the borrowing countries, the World Bank is more concerned with their repayment power. The World Bank consists of five independent institutions, in line with the overall policies of the Bank, including the International Bank for Development and Restoration (IBRD), the International Development Agency (IDA), the International Monetary Fund (IFC), the Multilateral Investment Guarantee Agency (MIGA) and the Center. International Settlement of Investment Disputes (ICSID), which is the principal constituent of the World Bank, two lenders of the International Bank for Reconstruction and Development, and the International Development Organization, and the World Bank is further referred to as the International Bank for Reconstruction and Development. Iran is a member of all bank institutions with the exception of ICSID, and the current objective is to reduce global poverty.
The sum of the loans granted by the bank shall not exceed 100% of the capital paid out and its reserves. Financial facilities are provided in various ways in the form of long-term loans, long-term loans and financing of technical assistance, consulting services or project preparation. It only lends to governments. The stages of each project include identifying, preparing, evaluating, negotiating, and reporting to the Board of Directors, monitoring and implementing and evaluating.
How to use World Bank External Credit Facility:
1.Project submission as well as submission of a full technical, economic and financial feasibility study report in English by the facility applicant (head of facility) and submission to the Country Planning and Management Organization.
2. Approval of the plan by the Management and Planning Agency and exchange of agreements with the organization, including the Riyal portion of the budget required for the plan's annual budget, as well as the Rial Forecast to repay the principal and the subordinate costs of the facility's annual budget.
3. Formal presentation of the plan to the Ministry of Economic Affairs and Finance (Investment Organization) by the Management and Planning Agency along with the project implementation timetable and the documents (1) and (2) above.
4. Approval of the Economic Council for this plan.
5. Obtaining Certificate of Foreign Currency Blocking from the Central Bank of the Islamic Republic of Iran.
6. Obtain the approval of the Cabinet on the authorization of the facility to use the World Bank facilities, the authorization to sign and exchange the facility agreement by the applicant, as well as the authorization of the Ministry of Economic Affairs and Finance to issue guarantees.
7. Signing a loan agreement with the World Bank, issuing a guarantee and entering into force of the agreement.
Islamic Development Bank:
The Islamic Development Bank is one of the major international development finance institutions and specialized bodies of the Organization of the Islamic Conference established to promote economic development and social development of member states and non-member Muslim communities around the world on the basis of Islamic Shariah principles in Jeddah, Saudi Arabia. . The Islamic Development Bank, once every three years by sending delegations to designate priority government projects in the country, while meeting with various ministries and government agencies, sets up a three-year Bank Partnership Document with our country, which acts as a measure to finance priority projects in the country. It will be in the next three years. According to the Bank's terms and conditions, all project implementation steps including the preparation of tender documents for contractor selection, project management consultant, supervisor consultant, project auditor and related tenders should be supervised by the bank and the contractor and its consultants not previously selected. In addition, Islamic Development Bank financing of the project is subject to the required land acquisition prior to the start of the project implementation process. Therefore, if a priority project is submitted by the highest authority of the relevant agency or ministry to the Deputy of Planning and Budget and the Ministry of Economic Affairs and Finance and then project feasibility report including technical and economic justification is presented in English, if the project is accepted And round