Seeking sustainable solutions info exchange Finding solutions Progressive approach Hundreds of specialists, academie experts and top government officials gathered in The Hague this month for the World Water Forum. Chaired by crown-prince Willem Alexander, it was former Russian president Mikhail Gorbachev who aptly summarized the theme running through the Forum:'an old Uzbek proverb has it that "where water ends, life ends" Water is the blood of life.' Active involvement Taking action Wh at S NewS Issue 2 March 2000 I Global water use has increased three- fold in the last 50 years and the avail- ability and quality of water is increasingly under strain. Even if conditions remain constant for the foreseeable future, ntuch of the world will find itself in a state of water-related pressure. To make the pressure stronger, population growth is most rapid in precisely those areas where water is already in scarce supply. Rabobank is acutely concerned with these developments. Water is fundamental to the entire F&A cyele and it is essential to the well-being of people. Without access to adequate supplies, our elients' busi- nesses would quickly wither away, taking with them the prosperity of the bank as well. An awareness of our mutual depen- dence on water thus stands at the core of what we do. At the santé time, a world- wide privatization trend boosts the need for private investment and a stronger role for private banks. Both phenomena are catalysts for the growing interest in the water sector throughout the Rabobank Group as a whole. This explains why we played a role at the World Water Forum, which was specifi- cally convened to discuss what steps need to be taken in order to avert a water crisis. The basis of the talks was a study, 'Vision and the Framework for Action,' which was painstakingly developed over the past two years by a host of international experts. An outgrowth of these discussions was an agreement that visionary ideas require concrete action before they can be translated into reality. Moreover, an awareness that the private sector, and the financial industry in particular, will play a crucial role in conceiving and executing eventual solutions. The Rabobank Group was represented at the meeting by Jean-Pierre Sweerts, manager (water sector) for the Rabobank Group. Sweerts underscored our commit- ment to deliver financial services to a host of elients in this sector including water companies, treatment operations, industry, and the F&A sector. These service are not limited to project finance alone hut include structured finance, mergers Gorbachev - fighting for water awareness acquisitions (M&A), tax-based structures and other related packages. The orienta- tion is both commercial and pragmatic, and the approach is to progressively move up the value change and deliver value to our elients, most of whont are banked by R1 and/or local banks, both in the Nether- lands and abroad. As Sweerts points out, 'ample supplies of clean water, waste water treatment, and water processing for food and other industries will all represent profitable, high-growth markets over the next 20 years, partieularly as populations and economies grow and the demands on our finite water resources increase. We aim to carve out a substantial role for ourselves as financiers in this field.' We have already developed close relations with many of the water companies and water boards in the Netherlands, have been actively involved in cross-border leases for waste treatment plants, and have been in the forefront of environmen- tally green funding schemes. This provides ample scope for growth to Rabobank Nederland affiliates including Interpolis, De Lage Landen, Robeco, and the local banks as well as Project Finance within RI, all of which can leverage knowledge- and relationship-intensive capabi 1 ities at a time when the water supply industry, following on the privatization trend in energy and telecom, emerges as a new field of opportunity. Substantial investments will be required to meet anticipated needs. For example, on the European market alone, annual investments of some USD 10 to 50 billion are forecast through the year 2010, and privatization will be accompanied by an acceleration in M&A activity as well as the formation of multi- utility conglomerates combining water with telecom, energy, transport, etc. Among the success stories in recent months is our formulation of a special sale and lease-back structure that delivered tangible fiscal benefits to a joint venture formed by Delta Nutsbedrijven for chemi- cal waste-water purification for Dow Benelux and IJS Filter. Acting together with other partner banks, we were a prime catalyst in the speedy closure of a deal that enabled AVR, a municipally-owned wastewater treatment company in the Netherlands, to syndicate its holdings and take them off balance sheet. AVR inciner- ates caustic water produced during the production of feedstocks for polyurethane, plastics, and rubber, as well as delivering distilled water, an important feedstock to the chemicals industry. Finally, as the traditional structures for delivering fresh water and water treatment give way to new methodologies, we are in the forefront of the prequalification phase (together with Vivendi and other Dutch companies) for a place in the Harnasch- polder project, an important but as yet unfinalized initiative that may well set an example for a new public/private sector cooperation in this field.

Rabobank Bronnenarchief

blad 'What's news' (EN) | 2000 | | pagina 15