II - (PDF, 101 mb) - USAID
II - (PDF, 101 mb) - USAID
II - (PDF, 101 mb) - USAID
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Geographic Diversification<br />
The fund is coml11lllpd to investing in promising com<br />
pilnies throughout the IWO Hl'publlcs, notwlthslilndlng Ihe<br />
increased cost in lentls of tmvel and communicalions The<br />
Fund seeks to invest where Ihe multiplier effeci can be the<br />
greiltest. In Ihe Czech Hepublic, the- Fund Is inneasing its<br />
ilCllvity in rl'gions distam from Prague thill have benefited<br />
Ie'ss from the overall economic impr'ovement. In Siovakiil,<br />
the Fund sl'eks inveslment in areas of high unemployment.<br />
The lociltion of Ihe investment is pilrticularly important<br />
since, in the aftermath of the Communist housing policies,<br />
labor mobility remains difficult in the Hepublics. The geo<br />
graphic spread of the Fund's ilctivities is evident on the maps<br />
on pages 4 and 5·<br />
industry<br />
The Fund remilins diversified by industry ilS shown<br />
below (all amounts are based upon current Board<br />
approvals):<br />
CZECH REPUBLIC<br />
Areil<br />
Manufacturing<br />
Food Related<br />
Energy Relilled<br />
Services<br />
Total<br />
SLOVAK REPUBLIC<br />
Area<br />
Manufacturing<br />
Food Related<br />
Energy Related<br />
Services<br />
Total<br />
Nu<strong>mb</strong>er of<br />
Investments<br />
<strong>II</strong><br />
6<br />
22<br />
Amount<br />
$ fl,029,OOO<br />
1,IJHl),ooO<br />
l,071J,oOO<br />
32B,ooo<br />
? 11,122,000<br />
Nu<strong>mb</strong>er of<br />
Investmenls Amount<br />
18 $ '4,4lJ:;,OOO<br />
B l,6:;s.ooo<br />
723,0(1)<br />
1,2qB,ooo<br />
30 $ 20,171,000<br />
Percent of<br />
Invesll1tent<br />
Manufacturing includes a wide range of companies,<br />
such as metal products (gaskets, gasoline Cims), plastics and<br />
fire extinguishers. Food related investments include the<br />
introduction of new cattle breeds as well as bakeries and<br />
7 2<br />
15<br />
10<br />
100<br />
Percent of<br />
Investment<br />
72<br />
IB<br />
4<br />
IJ<br />
100<br />
ollwr fooel procl'ssors. Investll1enls relaled to energy<br />
incluell' sevl'f'ill low-head hydroelectric power transactions,<br />
wlll're entreprenl'urs are rebuilding sill'S Ihill were 0pl'rill<br />
ing before the (il('illtil's were nillionaliwd and closed by the<br />
Communists.<br />
The Fund finds that the mosl illtractive businesses ilre<br />
in industries in which the Czechs and Slovaks have tradition<br />
ally excelled - milchinery, fabriciltion, food processing <br />
when' there is a high skilled-labor content relative to the<br />
capital or technology required.<br />
The avemge Fund investment is approXimately $12,000<br />
for every job supported by the business. Approximately<br />
2,.200 employees work or Illanage the fifty-two companies<br />
where the Board hilS authorized investment, and seveml<br />
hundred more i1re employed by compilnies participating in<br />
Ihe joint lending programs. The effect of the Fund on<br />
employment In the Hepublics is reflected not only in the<br />
nu<strong>mb</strong>er of people employed directly in companies where the<br />
Fund has an investment, bUl also in the jobs of their suppli<br />
ers, distributors, and services.<br />
Size<br />
In fulfilling its mandate to meet the needs of small and<br />
medium-sized businesses, the average nll<strong>mb</strong>er of employees<br />
in each of the companies where the Fund has authorized an<br />
investment is 43 (similar for eilch Republic), with only 6<br />
authorized investments exceeding 100 employees.<br />
Excluding Cilnceled transactions, the average size of<br />
BoanJ authorized amounts for new investments in FY94 was<br />
$1,036,000, up from $565,000 in FY93 and $470,000 in FY9.2.<br />
The Fund focllsed its investment actions during its<br />
first two years of operations on the type of transaction most<br />
readily ilVailable-start-ups or expansion of very young<br />
enterprises. Now thill much of the economy is in private<br />
hands and many businesses started after the Velvet<br />
Revolution ilre ready to expand, the Fund's averilge invest<br />
ment Ciln be expected to increase. Additionally, smaller<br />
investments Ciln now be made through the joint lending pro<br />
grams.<br />
15