• USTDA Orientation Visit Supports Development of the Private Banking Industry in Iraq

• USTDA Director Askey Travels to Afghanistan and Pakistan

Introduction

The U.S. Trade and Development Agency (USTDA), an independent U.S. Government agency, provides funding for U.S. companies to conduct feasibility studies on major projects in developing and middle income countries. By providing assistance in project planning, USTDA promotes economic development, while helping the U.S. private sector get involved in projects that offer significant U.S. export opportunities.

In late 1991, USTDA was authorized to operate in the former Soviet Union. Since that time, USTDA has approved funding of about $95 million for feasibility studies and other planning activities on over 225 major projects in the non-Baltic countries of the former Soviet Union. Exports of U.S. goods and services related to those projects already total over $1 billion. Because of its location and ethnic connection with many of the countries of the region, particularly in Central Asia and the Caucasus, Turkey plays an important role in this part of the world. For that reason, USTDA's Eurasia region includes Turkey, where USTDA has been active since the early 1980's. USTDA's Eurasia region also includes Afghanistan.

Feasibility Studies

USTDA provides grant funding for studies to determine the technical, economic, and financial feasibility of major projects. Historically, most USTDA projects have been public sector undertakings, planned and implemented by government ministries or agencies. Increasingly, however, developing countries, including the countries of Eurasia, have begun to promote private sector involvement in major infrastructure and industrial projects. Consequently, USTDA now provides funding for both public and private sector projects, including joint ventures in which U.S. companies plan to take equity.

To initiate consideration of a project, a request for assistance must be made directly to USTDA by the appropriate host country project sponsor (government or private sector). In cases where a specific U.S. company has been identified by the project sponsor as its partner on the project, that company must submit a detailed proposal to USTDA following a format which is available on USTDA's website at http://www.tda.gov/resources/feasibility.html.

If a project appears promising, USTDA hires its own technical consultant to review the proposal, through either a Desk Study or a Definitional Mission (DM). A Desk Study is a review of the proposal by the consultant in the United States, and is utilized when there already is information available on the project, so that a visit to the host country is not necessary. This is usually the case when USTDA receives a proposal from a U.S. company. By contrast, a DM involves a short visit by the consultant to the host country to gather additional information on the project and work with the project sponsor to develop terms of reference and a budget for the feasibility study.

The Desk Study or DM ascertains whether a project meets the following USTDA funding criteria: the project will have a positive developmental impact on the host country; financing for project implementation is available or likely to be available if the feasibility study confirms project viability; the potential for U.S. exports during project implementation is significant (in Eurasia, this generally means potential U.S. exports of at least $10-15 million); and USTDA has a facilitative role to play, such as overcoming subsidized foreign competition.

When USTDA provides funding for a feasibility study, it signs a Grant Agreement with the host country project sponsor (the Grantee), and it is the Grantee that selects the U.S. firm to conduct the study. In many cases, the Grantee already has identified that firm (typically the firm that submitted the proposal to USTDA). In other cases, the Grantee undertakes a competitive selection process. In either case, the selected U.S. contractor signs a contract with the Grantee to conduct the study.

While USTDA and the Grantee sign the Grant Agreement, no funds are actually transferred to the Grantee. Instead, the U.S. contractor conducts work under its contract with the Grantee and submits its invoices to the Grantee, who, if satisfied with the work, approves the invoices and forwards them to USTDA. USTDA then pays the contractor directly in the United States.

In many cases USTDA requires cost-sharing, i.e., USTDA only partially covers the cost of the feasibility study, with the remainder being borne by the U.S. firm conducting the study. USTDA's contribution varies according to a number of factors, including, among other things, the size of the firm, the potential follow-on benefit to the firm as supplier to or investor in the project, the costs the firm has already incurred in pursuing the project, and the risks associated with the project. In addition, in appropriate cases, USTDA may require the firm conducting the study to reimburse the USTDA funding if the project is implemented and the firm reaps a substantial economic benefit.

Other Activities

In certain situations, USTDA may provide funding for an orientation visit to the U.S. for key host country procurement officials. USTDA also occasionally hosts conferences, which bring together host country project sponsors in a particular sector and U.S. companies that could supply goods and services for their projects. USTDA also offers funding for technical assistance that supports capacity-building initiatives, such as creation or modification of legal and regulatory structures in particular sectors.

Regional Office

The Caspian Finance Center (CFC), located at the U.S. Embassy in Ankara, Turkey, is a regional office that represents the three U.S. Government trade finance and investment agencies: USTDA; the Overseas Private Investment Agency (OPIC); and the Export-Import Bank of the United States (Ex-Im Bank). USTDA's Manager of Business Development at the CFC is Jennifer Snyder. She can be reached at: Tel (90) 312-466-6081; Fax (90) 312-466-6082.

Selected Projects
Afghanistan
Hotels- USTDA provided funding ($38,000) for a consultant to evaluate the opportunities for hotel development in Afghanistan.

Telecom - USTDA is providing funding ($246,408) for technical assistance to the Ministry of Communications. Network Associates is providing the assistance. USTDA also funded the September 2002 Orientation Visit to the U.S. by the Minister of Communications.

Oil and Gas - USTDA has approved funding ($200,000) for the first phase of an oil and gas resource assessment. The U.S. Geological Survey will be conducting the assessment.

Armenia
Water-USTDA provided funding ($422,661) for a study on water system upgrades to be financed by the World Bank. CH2MHill conducted the study.

Venture Capital Fund-USTDA is providing partial funding ($100,000) for a study on establishing a venture capital fund backed by the IFC. Shorebank Advisory Services conducted the study.

Sugar Refinery-USTDA is providing partial funding ($250,000) for a study on construction of a sugar refinery. Schaffer and Associates conducted the study.

Investment Conference-USTDA is providing partial funding for a conference on investment opportunities in Armenia. The conference, which was cosponsored by the World Bank, was organized by Koeppen, Elliott & Associates.

Azerbaijan
Chemicals-USTDA is providing partial funding ($400,000) for a study on construction of a complex to produce caustic soda, chlorine, and other chemicals. Eurasia Link conducted the study.

Refinery Modernization- USTDA has approved funding ($600,000) for a study on modernization of SOCAR's refineries to utilize imported crude. ABB Lummus is conducting the study.

MBA Program - USTDA has approved partial funding ($271,670) for a study on establishment of an American-style MBA program in Baku. The University of Kansas has been selected to conduct the study.

Belarus (USTDA is currently closed in Belarus)
Bank Automation-USTDA provided partial funding ($60,000) for a study on creation of a clearing system for the National Bank of Belarus. Digital Equipment Corporation conducted the study.

Engine Coproduction-USTDA provided partial funding ($750,000) for a study on coproduction of diesel engines. Navistar International conducted the study.

Georgia
Air Traffic Control-USTDA provided partial funding ($300,000) for a study on upgrading the Georgian air traffic control system. Northrup Grumman conducted the study.

Oil and Gas-USTDA is providing funding ($500,000) for a strategic advisor on oil and gas pipelines for the Government of Georgia. Edward Chow served as the strategic advisor.

Refrigerated Warehouse- USTDA provided partial funding ($178,500) for a study on construction of a cold storage facility near the port of Poti. Richmond Cold Storage conducted the study.

Kazakhstan
Dairy Modernization-USTDA provided partial funding ($492,000) for a study on establishment of modern dairy operations in Almaty Oblast. Koch Supplies Inc. conducted the study.

Gold Mine-USTDA has approved partial funding ($400,000) for a study on development of the Naimanjal gold mine. Frontier Mining Ltd. is conducting the study.

SCADA-USTDA has approved funding ($378,000) for preparation of the SCADA component of a World Bank-financed power transmission project. KEMA provided the assistance.

Gas Utilization-USTDA has approved funding ($600,000) for a gas utilization master plan for Kazakhstan. Gustavson Associates conducted the study.

Air Traffic Control-USTDA has approved funding ($110,080) for a study on upgrading the communications portion of Kazakhstan's air traffic control system. Dors International conducted the study.

Trans-Caspian Oil-USTDA is providing funding $346,000 for assistance in evaluating potential oil export routes across the Caspian for oil from Western Kazakhstan. Gulf Interstate Engineering conducted the study.

Kyrgyzstan
Telecom-USTDA provided funding ($100,000) for evaluation of tenders for an EBRD-financed telecom project and for preparation of a new Kyrgyz telecom law. Margus Co. Inc. conducted the tender evaluation, while Debevoise and Plimpton prepared the telecom law.

E-government-USTDA is providing funding ($246,800) for a study on establishment of an e-government system for Kyrgyzstan. Telecom/Telematique is conducting the study.

Moldova
Agribusiness-USTDA provided funding ($111,000) for a program to promote U.S. investment in the Moldovan agribusiness sector, in cooperation with the Agriculture Department.

Customs-USTDA has approved funding ($189,000) for study on upgrading the telecom system for the Moldovan Department of Customs. KUPS International has been selected to conduct the study.

Russia
Housing-USTDA provided partial funding ($400,000) for studies on establishing joint ventures in Moscow and St. Petersburg for manufactured housing. The Ryland Group conducted the studies.

Grain Terminal-USTDA provided partial funding ($275,000) for a study on construction of a grain terminal at the Port of Vostochny. Burlington Northern Railroad and Paul Soros conducted the study.

Telecommunications-USTDA provided partial funding ($600,000) for a study on upgrading network management systems for Rostelecom. EDS conducted the study.

Shipyard Conversion-USTDA provided partial funding ($400,000) for a study on conversion of the Komsomolsk-na-Amur Shipyard from submarine production to production of civilian products. McDermott International conducted the study.

Seismic Stratigraphy-USTDA provided partial funding ($610,000) for a study on the use of seismic stratigraphy to confirm oil reserves for Tatneft. EG&G; conducted the study.

Refinery Upgrade-USTDA provided partial funding ($300,000) for a study on the modernization of the Perm oil refinery. Lummus Crest conducted the study.

Hardware/Building Products-USTDA provided partial funding ($150,000) for a study on establishing a distribution system for American hardware and building products. Ace Hardware conducted the study.

Airline Reservations-USTDA provided funding ($265,000) for a study on establishing a computerized airline reservation system. Coudert Brothers conducted the study.

Repowering-USTDA provided partial funding ($325,000) for a study on repowering of Lenenergo's TEC-21 Power Plant. Joseph Technology conducted the study.

Aircraft-USTDA provided partial funding ($1,000,000) for studies on coproduction of the IL-96M, with Pratt & Whitney engines, Rockwell avionics, and other U.S. components. Morgan Grenfell conducted the studies.

Land Cadastre-USTDA provided funding ($610,000) for a study on the establishment of a land cadastre program for the Russian Federation. Infotec Development, Inc. conducted the study.

Air Traffic Control-USTDA provided partial funding ($1,350,000) for a study on upgrading the air traffic control system in the Russian Far East. Booz-Allen & Hamilton conducted the study.

Fasteners-USTDA provided partial funding ($200,000) for a study on production in Cherepovets of fasteners for pneumatic fastening systems. Senco Fastening Systems conducted the study.

Gas Turbine Coproduction-USTDA provided partial funding ($600,000) for a study on coproduction of large gas turbines in St. Petersburg. General Electric conducted the study.

Nizhnekamsk Refinery Upgrade-USTDA provided partial funding ($200,000) for a study on rehabilitation of the Nizhnekamsk refinery. Lummus Crest conducted the study.

Data Transmission-USTDA provided partial funding ($450,000) for a study on establishment of a packet switched data transmission network. Hughes Network Systems conducted the study.

Railway Shock Absorbers- USTDA provided partial funding ($300,000) for a study on coproduction of railway shock absorbers. Keystone Industries conducted the study.

Helicopter Coproduction-USTDA provided partial funding ($300,000) for a study on coproduction of the KA-226 helicopter with U.S. engines. Allison Engine Company conducted the study.

Construction Equipment-USTDA provided partial funding ($120,000) for a study on establishing a construction equipment leasing joint venture. Hoffman Intl. conducted the study. In connection with the study, USTDA provided partial funding ($130,000) for visits of Russian highway officials to the U.S.

K-26 Replacement-USTDA provided partial funding ($780,000) for a study on replacement of power and steam resulting from the shutdown of the Krasnoyarsk-26 plutonium reactor. Parsons Power conducted the study.

Housing Energy Efficiency-USTDA provided funding ($1,100,000) connected with a World Bank project for energy efficiency in the housing sector. Battelle Northwest Laboratory conducted the work.

Brick Production-USTDA provided partial funding ($150,000) for a study on a joint venture to manufacture brickmaking machines. Castone International conducted the study.

Yaroslavl Refinery- USTDA provided partial funding ($150,000) for a study on installing a mild hydrocracker at the Yaroslavl refinery. Stone & Webster conducted the study.

Pharmaceutical Lab -USTDA provided partial funding ($400,000) for a study on establishing a lab to test and certify pharmaceutical products. Fisher Scientific conducted the study.

Power Distribution-USTDA is providing partial funding ($800,000) for a study on upgrading the electric power distribution system. Cooper Power Systems conducted the study.

Boilers-USTDA is providing partial funding ($300,000) for a demonstration of gas-fired boilers in individual apartment buildings. Dunkirk Radiator conducted the demonstration.

Tax Automation-USTDA is providing funding ($328,200) for a study on automation of the State Tax Service. Price Waterhouse Coopers conducted the study.

Coal-USTDA provided partial funding ($420,000) for a combustion study on the use of Alaskan coal in a power plant in Magadan. Usibelli Coal conducted the study.

Oil Spill Association-USTDA is providing partial funding ($350,000) for a study on creation of an association to provide coordinated response to oil spill emergencies. OMS Environmental Corp. is conducting the study.

Renewable Energy-USTDA is providing partial funding ($137,500) for a study on construction of biomass plants utilizing sawmill waste for power in the Arkhangelsk region. Ecotrade is conducting the study.

Roller Bearings-USTDA is providing partial funding ($450,000) for a study on coproduction of tapered roller bearings for Russian Railways. Brenco International is conducting the study.

Environmental Remediation-USTDA is providing partial funding ($375,000) for a study on environmental remediation at the Mayak Chemical Plant. RedZone Robotics is conducting the study.

Energy Efficiency- USTDA has approved partial funding ($112,500) for a study on energy efficiency and climate control upgrades at Avtovaz. Honeywell is conducting the study.

Yaroslavl Water- USTDA provided funding ($344,589) for study on rehabilitation of Yaroslavl's water distribution network and construction of a water treatment facility. CH2Mhill conducted the study.

Komsomolsk Refinery- USTDA provided partial funding ($160,000) for a study on upgrading the Komsomolsk Refinery. Lummus Global conducted the study.

Toll Road- USTDA has approved partial funding ($300,000) for a study on construction of a toll road in Novgorod. Novtrans conducted the study.

E-procurement- USTDA is providing partial funding ($316,686) for study on establishment of a web-based system for government procurement. C-WIN is conducting the study.

Tajikistan
Mining and Minerals-USTDA provided funding ($10,000) for a Definitional Mission to evaluate mining and minerals opportunities in Tajikistan. The U.S. Geological Survey conducted the DM.

Turkey
Water Loss Management-USTDA provided funding (430,000) for a study and pilot project for the Ankara Municipal Water Authority for a water loss management system. Harza Engineering conducted the work.

Light Rail-USTDA provided funding ($345,000) for a study on constructing a light rail system for the Municipality of Antalya. Bechtel conducted the study.

Oil Pipeline-USTDA provided funding ($1.3 million) for financial and legal assistance to BOTAS in negotiation of the Baku-Tbilisi-Ceyhan Oil Pipeline project agreements. CC Pace Consulting provided the assistance.

GIS-USTDA is providing partial funding ($136,860) for a study on a GIS system for the Water and Sewage Administration of Izmir. Intergraph Corporation is conducting the study.

Turkmenistan
Port Development-USTDA provided funding ($450,000) for a study on expansion of the Port of Turkmenbashi. Louis Berger International conducted the study.

Aluminum Smelter-USTDA is providing partial funding ($450,000) for a study on construction of a smelter at Mery. Bechtel Corporation conducted the study.

Ukraine
Spent Fuel-USTDA provided partial funding ($300,000) for a study on construction of a spent fuel facility at Zaporozhye Nuclear Power Plant. Duke Engineering & Services conducted the study.

Coal Recovery-USTDA provided partial funding ($375,000) for a study on recovery of coal from slurry ponds. A consortium headed by Oxbow Coal and Carbon conducted the study.

Air Traffic Control - USTDA is providing funding ($500,000) for a study on upgrading the ATC system in Ukraine. ARINC is conducting the study.

Aluminum Smelter-USTDA is providing partial funding ($240,900) for a study on conversion of the ZALK smelter to pre-bake technology. Kaiser Aluminum and Chemical Corp. conducted the study.

Biodiversity-USTDA is providing partial funding ($197,500) for a study on the establishment of a biodiversity protection zone along the Azov-Black Sea corridor. ERIM conducted the study.

District Heating-USTDA is providing funding ($535,000) for a study on upgrading the Kharkiv district heating system. Parson Power is conducting the study.

Uzbekistan
Air Traffic Control-USTDA provided partial funding ($300,000) for a study on a system linking ATC radars and providing cellular telephone coverage. California Microwave conducted the study.

Fiber Grading-USTDA provided funding ($77,355) for assistance in procurement of a World Bank-financed country-wide fiber grading system. Glen Ratliff and Francis Kenefick conducted the work.

Hospital-USTDA is providing partial funding ($386,065) for a study on construction of an emergency hospital medical center in Tashkent. V&S; is conducted the study.

Fertilizer-USTDA is providing partial funding ($500,000) for a study on reconstruction of a fertilizer complex at Almalyk. Texuna International conducted the study.

Irrigation-USTDA is providing funding ($525,000) for a study of rehabilitation of the Amu-Bukhara Irragation System. The contrator selection process is under way.

Railways Electrication-USTDA is providing partial funding ($462,731) for a study on electrification of several segmetns of the Uzbek rail network. Lemna International is conducting the study.

Aviation Security-USTDA has approved funding ($549,995) for s study on upgrading security systems at Uzbekistan's international airports. The contractor selection process will begin soon.

Regional
Telecom-USTDA provided partial funding ($165,000) for the preparation of a telecom equipment certification handbook for the NIS. The Federal Communications Commission coordinated the work.

Health Care-USTDA is providing funding ($350,000) for a June 2000 conference in Tashkent on health care project opportunities in the Caspian Region. TRI organized the conference.

Information Technology-USTDA provided funding ($350,000) for a June 2001 regional information technology conference in Brussels. MFM Group organized the conference.

Printing, Publishing, and Converting-USTDA has approved funding ($147,640) for a visit of Russian, Ukrainian, and Uzbek officials to participate in the Print 01 exhibition in Chicago in September 2001. NPES organized the visit.

Air Traffic Control-USTDA is providing partial funding ($300,000) for a regional study on upgrading the air traffic control system in the Caucasus. Northrup Grumman conducted the study.