annual report 2012

N O R D I C D E V E L O P M E N T F U N D

A n n u a l R e p o r t 2 0 1 2

Report of the Board of Directors 2012 03

Board of Directors 09

Control Committee 09

Management and Staff 09

Income Statement 11

Balance Sheet 12

Changes in Equity 13

Cash Flow Statement 13

Notes to the Financial Statements 14

Auditors’ Report 20

Grant Portfolio 23

Credit Portfolio 25

INDEX

02

Summary of 2012

During 2012, the Board approved grant financing for 11 projects for a total value of EUR 27.9 million.

Four credit projects were completed in the course of the year. A total of eight credit projects are still under implementation at the beginning of 2013.

Disbursements of credits amounted to EUR 14.1 million in 2012 (2011: EUR 26.9 million). The disbursements of grant aid amounted to EUR 27.1 million (2011: EUR 20.1 million).

The net result for the year before adjustments for currency exchange fluctuations and afterdisbursements of grant aid totalled EUR -25.0 million in comparison with EUR -13.7 million the previous year. The decrease is a result of higher disbursements to projects and lower income from the private sector projects.

The effects of currency fluctuations showed a result of EUR -5.1 million (2011: EUR 6.7 million). After hedging measures, the effects from currency fluctuations are EUR -3.5 million.

After three and a half years of climate change operations, NDF has, by the end of 2012, approved a total of EUR 134.5 million for altogether 50 projects in 14 countries.

In early 2012, an independent evaluation of NDF’s progress under the first two years of the climate change mandate concludes that NDF’s instruments and work fit well into the international climate financing agenda and states positive results regarding fulfillment of objectives, increased value added, streamlined procedures, and the organisation’s results orientation.

03

REPORT OF THE BOARD OF DIRECTORS 2012

Highlights of activities under NDF’s climate change mandate in 2012

During 2012, the Board approved grant financing for 11 projects for a total value of EUR 27.9 million. Under the climate change mandate, from 2009 to 2012, NDF has approved 50 projects for a total value of EUR 134.5 million for climate change projects. The reduction of greenhouse gases for all approved NDF mitigation projects has been estimated at 4 million tons of CO2 equivalents per year.

In early 2012, an independent evaluation of NDF’s progress under the first two years of the climate change mandate was performed by an external consultant, Vista Analysis AS. The evaluation report concludes that NDF’s instruments and work fit well into the international climate financing agenda and that NDF’s funding reaches the countries most in need. Furthermore, the report states positive results regarding fulfillment of objectives, increased value added, streamlined procedures, and the organisation’s results orientation.

NDF is fully committed to the internationally agreed principles on development effectiveness, as expressed in the Paris Declaration for Aid Effectiveness, and confirmed and supplemented thereafter at international summits in Accra, Ghana and Busan, South Korea. According to the independent external evaluation, NDF adheres well to these principles, and compares favourably when ranking aid agencies.

NDF’s operational mode of co-financing combined with its results-oriented approach provides a good basis for efficiency. Furthermore, NDF’s structure allows it to be flexible and act quickly with minimal bureaucracy. Through this operational model, NDF can add substantive value to its co-financed projects, for example, by enhancing climate aspects and components into the projects, providing specific knowledge or expertise or influencing its bigger co-financing partners.

NDF’s criteria for project identification and screening underwent further revision in 2012. Whereas the earlier criteria from 2010 tended to concentrate efforts on defining climate adaptation and mitigation criteria, the revised criteria includes more detail on multiple developmental issues aimed at a balanced focus on NDF’s dual mandate on climate and development.

During 2012, NDF has reviewed its approach on anticorruption in order to further improve its practices and procedures in this area. The work resulted in the approval of the new Policy on Anticorruption and Integrity and the Anticorruption Guidelines which entered into force on 1 October 2012. NDF’s cooperation and coordination on anticorruption issues with other international financial institutions, particularly with the World Bank, was continued and strengthened. NDF was also instrumental in bringing together in Helsinki, in December, anticorruption authorities of the World Bank, European Investment Bank, Transparency International, and the three Nordic financing institutions NIB, NEFCO and NDF, to discuss further cooperation and common approaches in these questions.

The current NDF Strategy covers the years 2012-2013. The strategy focuses on consolidation of experiences from on-going climate change-related interventions with special emphasis on implementation. The strategy also sharpens the focus on the selection of funding opportunities

for added value and synergy benefits. As a Nordic institution, NDF will continue to promote a broad scope of Nordic priorities in the area of climate change and development.

After three and a half years of climate change operations NDF has, by the end of 2012, approved a total of EUR 134.5 million for altogether 50 projects in 14 countries. Nearly half of the approved euro volume is allocated to countries in Sub-Saharan Africa (46%), and the rest for Asia and Latin America. The number of projects approved is noteworthy, especially taking into account the rigorous preparation that each operation undergoes prior to discussion at the Board of Directors.

Four projects with credits from NDF were completed in the course of the year. A total of eight credit projects are still under implementation at the beginning of 2013.

Disbursements of credits amounted to EUR 14.1 million in 2012 (2011: EUR 26.9 million). The disbursements of grant aid amounted to EUR 27.1 million (2011: EUR 20.1 million).

The net result for the year before adjustments for currency exchange fluctuations and afterdisbursements of grant aid totalled EUR -25.0 million in comparison with EUR -13.7 million the previous year. The decrease is a result of higher disbursements to projects and lower in-come from the private sector projects.

The effects of currency fluctuations showed a result of EUR -5.1 million (2011: EUR 6.7 million). After hedging measures, the effects from currency fluctuations are EUR -3.5 million.

In 2012, the Nordic Council passed a resolution recommending to the Nordic countries’ govern-ments that more capital be allocated to NDF to further enhance its climate change-related activities. A joint response to the recommendation is being prepared by the Nordic governments. The recommendation was also discussed at the Board of Directors meeting on 11 December 2012.

NDF’s climate change projects in 2012

Under the climate change mandate, from 2009 to 2012, NDF has approved 50 projects for a total value of EUR 134.5 million for climate change projects in 14 countries (eight countries in Africa, and three countries each in Asia and Latin America). Nearly half of the approved euro volume is allocated to countries in Sub-Saharan Africa (46%), and the rest for Asia and Latin America. Approximately 45% of the projects use parallel financing and 55% are jointly financed.

Approved Financing by Region - EUR 134,5m

NDF participated in the Rio+20 summit in Rio de Janeiro, Brazil in June 2012.


During 2012, the Board of Directors approved grant financing for 11 projects with a total value of EUR 27.9 million. NDF has been active in three broad clusters; infrastructure, natural resources and climate change capacity-building.

During 2012, NDF continued to approve and implement activities under the Small Grant Facili-ty (SGF) which is a financing frame of EUR 5 million to be allocated as small-scale financing for studies, project preparatory activities or small project components relating to climate change adaptation and/or mitigation.

Africa

Projects approved in Africa NDF financing EUR mRegional (E-Africa) Geothermal Exploration Project 5.0Mozambique Transforming Hydro-Meteorological Services 4.5Mozambique Coastal Cities and Climate Change 3.8Senegal Flood Risk Management 3.0Kenya Training in Geothermal Drilling 1.5Tanzania SGF - Hydropower Sustainability Assessment 0.5Tanzania SGF - Climate Smart Solutions for Water & Energy 0.5

In Africa, NDF’s activities were strengthened with seven new projects, six of which are co-financed with the World Bank, and one is with the Icelandic International Development Agency (ICEIDA).

With a grant of EUR 5 million, NDF is supporting the Geothermal Exploration Project in East Africa. The project is the initial phase of the Geothermal Compact Partnership, initiated jointly by the Icelandic Ministry for Foreign Affairs and the World Bank, in cooperation with the partner countries in the region, to increase the East Africa Rift Valley States (EARS) access to geothermal energy. The ICEIDA and NDF-financed Geothermal Exploration Project intends to assist the EARS countries in completing the exploratory phase of geothermal development and building required capacity in the field. The aim is to mitigate and distribute the risk associated with geothermal exploration, thus contributing to the acceleration of geothermal development in the region. At the end of the project, it is expected that participating countries will have i) a realistic assessment of their geothermal potential, ii) plans for further action where applicable, and iii) capacity to move forward on the basis of those plans and submit exploration drilling projects into funding pipelines.

In Mozambique, NDF is financing Transforming Hydro-Meteorological Services with a grant of EUR 4.5 million. The project objective is to strengthen hydrological and meteorological infor-mation services to deliver reliable and timely information that increases climate resilience, in turn lowering water and weather-related risks to local communities and economic development. The NDF component will be implemented by the National Institute for Meteorology (INAM). The NDF funding will be provided as parallel co-financing. The project is a sub-project to the World Bank National Water Resources Development Project, which aims to strengthen the development and management of national water resources. The World Bank project is under the

umbrella of the Strategic Program for Climate Resilience, a multi-donor long-term investment programme that will play a catalytic role in promoting climate-resilient growth strategies.

Also in Mozambique, NDF provides a grant of EUR 3.8 million to strengthen adaptive capacity of the coastal cities. The World Bank’s Cities and Climate Change Project has the general objective of strengthening municipalities’ capacity to provide sustainable urban infrastructure and environmental management, enhancing resiliency to climate-related risks. The focus of NDF support is on developing adaptive capacity at central level and in the municipalities of Beira and Nacala. This will generate experience and guidance for building climate resilience into coastal urban planning, vital infrastructure and development elsewhere in Mozambique. The NDF component will be implemented by the national Agency for Water and Sanitation Infrastructure.

In Senegal, NDF is supporting Flood Risk Management with a grant of EUR 3 million. The project is under the Senegal Storm Water Management and Climate Change Adaptation Project (PROGEP), which is supported by the World Bank. The objective of PROGEP is to improve storm water drainage and flood prevention in peri-urban Dakar for the benefit of local residents. With NDF’s contribution, the climate change adaptation aspects of the project are strengthened; flood risk reduction and adaptation measures are designed and integrated into communal action plans. Furthermore, NDF is supporting climate resilience-related capacity-building, public awareness-raising, knowledge dissemination as well as preparing the ground for extending climate change adaptation initiatives to other cities in Senegal.

With a grant of EUR 1.5 million, NDF is financing an extensive geothermal drilling training programme under the World Bank’s Electricity Expansion Project in Kenya. The main objective of the Training in Geothermal Drilling is to accelerate the development of Kenya’s geothermal resources by taking the already available and incoming drilling equipment into efficient use. The programme will consist of two parts: a training needs assessment and training in drilling operations. The total cost of the project is estimated at EUR 2.7 million. Developing the country’s own human resources will be cost-effective and, in the long run, benefit the whole East African region.

In Tanzania, NDF is financing a Hydropower Sustainability Assessment with EUR 500,000. The general objective of the project is to assess the sustainability of existing and identified hydropower schemes in Tanzania. More specifically, the study will assess the impacts of climate change on the future production of hydropower, assess the impacts of upstream human activities on power generation, and propose concrete adaptation investments and capacity development. The project has the potential to change the current fossil fuel-based energy generation practice towards a more hydro-based system by providing information and advice on how to adapt to future change in hydrological conditions.

Another project in Tanzania is the Climate Smart Solutions for Water and Energy. The project will introduce the LifeLink™ water system in rural and urban areas of Tanzania with special focus on rural pastoral communities. Through the installation of 20 LifeLink™ systems, the project seeks to further utilise the off-grid solar power production by developing additional features that will allow users to not only fetch water but also charge mobile phones and household LED lamps, thereby boosting revenue and allowing full cost recovery.

04

Asia

Projects approved in Asia NDF financing EUR mRegional (Asia) SGF - Resilient Cities in the GMS: Adapting Cities to Climate Change 0.5

In co-financing with the Asian Development Bank, NDF approved in 2012 financing for one new project in Asia.

In the Greater Mekong Subregion (GMS), NDF provides financing to Resilient Cities in the GMS: Adapting Cities to Climate Change, a project that aims to assist GMS cities to develop tools and processes that will enhance their ability to adapt to climate change in an efficient and equitable manner. The project will result in a handbook and a series of high-level policy dialogue events, such as seminars and workshops, to be conducted between national and local governments and the private sector.

Latin America

Projects approved in Latin America NDF financing EUR mNicaragua Adaptation to Climate Change in Road Transport Sector 4.4Bolivia Rural Electrification with Renewable Energy 4.0 In Latin America, two new projects will benefit from NDF financing in collaboration with the Inter-American Development Bank (IDB).

With a grant of EUR 4.4 million, NDF is supporting Adaptation to Climate Change in Road Transport Sector in Nicaragua. The project is part of the Road Sector Support Program financed by IDB. The general objective of the program is to make road transport in Nicaragua more efficient in order to stimulate economic activity and contribute to the well-being of the population, while facilitating integration within the country and with the rest of Central America. The NDF contribution will focus on development of adaptive capacity in key institutions and furthermore, integrate climate change aspects into the maintenance, planning and design of road transport infrastructure. The NDF component will be implemented by the Ministry of Transport and Infrastructure.

In Bolivia, NDF is supporting Rural Electrification with Renewable Energy with a grant of EUR 4 million. The project is part of an on-going IDB Rural Electrification Program which aims to assist the Government of Bolivia to achieve its targets of universal access to electricity in urban areas by 2015 and in rural areas by 2025. NDF-financed activities will mitigate climate change by replacing fossil fuels with renewable energy in rural areas and at the same time increase the access to energy and the reliability of the energy supply.

Global

Projects approved Globally NDF financing EUR mGlobal SGF - Social Analysis and Adaptation to Climate Change in Developing Countries 0.2

Under the Small Grants Facility, NDF approved a grant of EUR 200,000 for the financing of a study on Social Analysis and Adaptation to Climate Change in Developing Countries. The main purpose of the study is to demonstrate the role of social analysis in designing effective and equitable responses to climate change in developing countries. The main result of the project will be a book and a policy workshop. The project will examine the human and social dimen-sions of climate change in the context of development, with a focus on vulnerability, adaptation and the potential for transformation. The project will use Nordic research and provide insights from the social sciences to enhance our understanding of what is at stake in a changing climate, and what constitutes equitable and sustainable adaptation in response to this challenge. The main audience will be people working in the field of development and development cooperation both on a policy and practical level. The coordinating institution is the Fridtjof Nansen Institute in Norway and the editorial committee includes three central IPCC authors. Through this project, it may be possible to also explore areas for NDF´s future strategic and value-adding role.

Nordic Climate Facility

The Nordic Climate Facility (NCF) is financed by NDF and implemented in cooperation between NDF and the Nordic Environment Finance Corporation (NEFCO). Through the facility, NDF provides grants to development projects that have the potential to combat climate change and reduce poverty in low-income countries. It encourages innovation and promotes technological transfer in sectors susceptible to climate change. The facility is based on calls for proposals and each call has specific themes. By the end of 2012, NCF has received funding for three calls for proposals, in total EUR 18 million. The latest allocation was approved in 2011.

Each call for proposals focused on one or two specific themes relating to climate change, and the budget for each call amounted to EUR 6 million. The themes covered by the three calls included energy efficiency and water resources, urban adaptation to climate change and renewable energy, as well as innovative low-cost climate solutions with a focus on local business develop-ment. Since the start of NCF, a total of 442 proposals have been received.

After a screening and selection process, at the end of 2012, 39 proposals had been selected, and were thereby in various stages of implementation in 17 countries, mostly in Africa. Many of the projects operate in an interesting area between the public and private sectors, thereby aiming to strengthen NDF´s value-adding, innovative and risk-sharing role in this area.

05


ProClimate Facility

The ProClimate Facility, established in 2010, has undergone a major restructuring during 2012. The partial guarantee and technical assistance facility is designed to support small and medium-sized climate friendly investment projects and amounts to EUR 10 million. The proposal for the restructuring of the facility was approved by the Board of Directors in September 2012. The detailed design of the facility took place during 2012 in collaboration with the Inter-American Development Bank. The facility will enable financing, through partial guarantees, for energy efficiency investments to be made by companies in the region based on energy audits financed earlier by a separate NDF grant. The facility is expected to be operative in early 2013.

Signing of agreements and dialogue with larger co-financing partners

During 2012, NDF entered into agreements regarding financing of five new projects in Africa, two new projects in Asia and six new projects in Latin America.

In April 2012, the World Bank and NDF signed an amended and restated Cooperation Agreement, which provides the general framework for cooperation between the institutions. The agreement also reflects the co-financing modalities used today and is an update of the initial agreement from 1991.

In September, NDF signed a Memorandum of Understanding (MoU) with the Integrity Vice Presidency of the World Bank Group. The objective of the MoU is to facilitate cooperation between the institutions in matters relating to prevention, detection and investigation of fraud and corruption and in other activities of common interest.

Regular policy and operational level dialogue with the Asian Development Bank and the Inter-American Development Bank were continued during the year. Dialogue with the African Development Bank (AfDB) was enhanced, most notably through two visits to AfDB (January and December) where possibilities for concrete cooperation and co-financing were explored.

Credits

At the end of 2012, NDF had entered into 188 credit agreements, the total value of which, including additional financing and adjusted for cancellations and calculating the EUR/SDR currency exchange rate as at 31 December 2012, amounted to EUR 914.8 million (2011: EUR 924.4 million). Of these agreements, 160 were credits to public sector projects (EUR 873.3 million), 25 were loans with equity features or equity investments (EUR 29.3 million) and three were other loans (EUR 12.1 million).

As at 31 December 2012, disbursements under signed agreements amounted to EUR 829.3 million; approximately 57.9% of this amount is denominated in SDR. As a result of the weakening of the SDR against the euro, the value of the outstanding SDR credits decreased by EUR 5.1 million. After the hedging measures, the decrease in value is EUR 3.5 million. The costs for hedging 35% of the SDR-denominated credits for a period of ten years was EUR 3.73 million. Furthermore, SEB is charging about EUR 20,000/year for managing the collateral that Nordea has placed with NDF.

06

NDF’s participation in the HIPC Initiative

Since the World Bank and the International Monetary Fund adopted the “Debt Initiative for Heavily Indebted Poor Countries” (HIPC), NDF has participated in the initiative through the HIPC Trust Fund, which is administered by IDA. By the end of 2012, NDF had made allocations to the HIPC Initiative for debt relief to nine of the Fund’s borrowing countries.

The allocations made in previous years from NDF’s accumulated net income before foreign exchange differences amounts to EUR 29.6 million to cover the obligations of the Fund under the enhanced HIPC initiative. This amount has been paid into the HIPC Trust Fund. Nordic cooperation

NDF has close contact and maintains a dialogue on mutually interesting issues both with the Nordic Council and the Nordic Council of Ministers.

NDF also has a close cooperation with the Nordic bilateral development institutions. NDF strives to promote the cooperation with relevant institutions through dialogue on topics of common interest, and in some cases through co-financing. During 2012, representatives of such institutions have also been invited to seminars and events arranged by NDF and its partners.

During the year, NDF has continued its cooperation with NEFCO through the Nordic Climate Facility, and also other dialogue on mutually interesting topics.

NDF cooperates closely with the Nordic Investment Bank (NIB) through shared office premises, staff administration, IT services, accounting and liquidity management. The limited overlap in partner countries does not allow extensive co-financing between NIB and NDF. However, NIB, NDF and the Inter-American Investment Corporation share a Memorandum of Understanding aimed at facilitating joint activities in the area of energy efficiency and renewable energy in Latin America.

Capital and accounting currency

In 2000, the Nordic Council of Ministers decided that the Fund should change its capital and accounting currency from SDR to EUR as from 1 January 2001. In the annual reports for previous years, the Board of Directors has paid attention to the fact that, since NDF will have outstanding credits denominated in SDR for many years to come, fluctuations in the SDR-EUR exchange rates may lead to substantial variations in financial results, positive or negative, from one year to another. Therefore, and based on the Board of Directors earlier authorisation, during 2012 hedging measures were taken to decrease the effect from the SDR-EUR exchange rate fluctuations. About 35% of the credits denominated in SDR are hedged against these effects.

The Fund’s financial result for 2012 shows a foreign exchange difference of EUR -5.1 million before hedging and EUR -3.5 million after hedging (2011: EUR 6.7 million). This difference is to a large extent due to the fact that the US dollar represents 41.9% of the SDR currency basket and the ensuing decrease of the purchasing power of the US dollar during 2012 against NDF’s capital and accounting currency, the euro.


07

Liquidity and capital

The liquid assets of NDF are managed by the Nordic Investment Bank on behalf of NDF. The average interest rate has been approximately 0.05% (2011: 0.8%). NDF’s deposits are relatively short-term (up to 6 months). The liquidity as per 31 December 2012 was EUR 93.1 million (2011: EUR 93.6 million). During 2012, the Board of Directors authorised NDF to also use commercial banks for its liquidity management.

During the year, disbursements amounted to EUR 41.2 million (2011: EUR 47.0 million), EUR 27.1 million on grants and EUR 14.1 million on credits. At the end of the year, accumulated disbursements on grants amounted to EUR 55.8 million (2011: EUR 28.7 million) and EUR 829.3 million (2011: EUR 815.1 million) on credits. Upon request by the Board, member countries paid in EUR 25.5 million of Fund capital in 2012 (2011: EUR 8.2 million and SDR 25.0 million).

During 2012, NDF received repayments under disbursed credits amounting to EUR 14.3 million.

Board of Directors

The Chair of the Board for the period 1 January to 30 April 2012 was Satu Santala (Finland), with Egill Heiđar Gislason (Iceland) as Deputy Chair. As from 1 May 2012 Egill Heiđar Gislason took over the chair with Harald Tollan (Norway) as Deputy Chair. The chair will pass on to Norway’s board representative on 1 May 2013 and Sweden’s representative will then become Deputy Chair. Jukka Pesola was appointed the new Finnish alternate member as of 26 January 2012, succeeding Riikka Laatu. On 29 March 2012, Anna Westerholm succeeded Tomas Danestad as the Swedish member of the Board.

A list of NDF Board members and their alternates can be found on page 9.

Administration

The NDF office has, along with the NIB headquarters, been certified as a Green Office by WWF Finland since 2009. The biggest share of NDF’s carbon footprint comes from air travel, which in 2012 amounted to 180 tons of CO2 equivalents.

Pasi Hellman, a Finnish national, was appointed Managing Director of the Fund from 1 November 2012 succeeding Helge Semb. As of 31 December 2012, thirteen people were employed by NDF (2011:12 employees). In addition, NDF has a long-term agreement with an in-house consultant. A summary of the employees can be found on page 9. Control Committee

The Control Committee ensures that the Fund’s operations are conducted in accordance with its Statutes and is responsible for its audit. The Committee presented its annual auditor’s report to the Nordic Council of Ministers in March 2012. The Control Committee met twice in 2012. A list of the members of the Committee can be found on page 9.

Financial results and allocation

NDF’s total assets as of December 31, 2012 amounted to EUR 874,716,461 (2011: EUR 877,660,600). This amount includes outstanding credits to public sector projects, other loans with equity features and equity investments to the amount of EUR 769,053,590 (2011: EUR 776,031,567) and placements with credit institutions to the amount of EUR 93,141,728 (2011: EUR 93,594,470). An increase of provisions against possible losses on other loans, loans with equity features and equity investments amounting to EUR 132,816 was made in the accounts of 2012. The previous year showed a reversal of EUR 830,439.

Commitments under credits, signed but not yet disbursed, were distributed as follows:

MEUR 2012 2011 Credits 33.0 50.3

As of December 31, 2012, NDF’s capital consisted of SDR 515 million and EUR 271.4 million in paid-in fund capital (2011: SDR 515 million and EUR 245.9 million) and EUR -88,497,429 (2011: EUR -60,032,975) in accumulated net income after adjustments for currency exchange fluctuations.

The Fund’s income during 2012, amounting to EUR 5,369,001 (2011: EUR 8,344,227), con-sisted of income from credits to the public sector to the amount of EUR 5,993,800 (2011: EUR 5,871,278), interest on placements with credit institutions of EUR 50,880 (2011: EUR 653,299) and EUR -677,034 (2011: EUR 1,808,650) as remuneration on equity loans and other loans. Zimbabwe continues to be in arrears to NDF. All of its accrued, outstanding obligations towards NDF were therefore placed in non-accrual status.

Administrative expenses were EUR 3,198,647 (2011: EUR 2,853,216). The largest single item of expenditure consists of salaries and ancillary expenses of EUR 1,887,806 (2011: EUR 1,692,811).

The net income for the year, which after adjustments for currency exchange fluctuations and hedging measures of EUR -3,458,513 (2011: EUR 6,738,503), amounts to EUR -28,464,455 (2011: EUR -6,934,254), is carried forward to the new account.

The income statement, balance sheet, changes in equity, cash flow and notes can be found on pages 11-13.

Helsinki, 6 March 2013

EGILL HEIĐAR GISLASON Chair of the Board

CHRISTOFFER BERTELSEN SATU SANTALA

LARS ROTH HARALD TOLLAN

PASI HELLMANManaging Director


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BOARD OF DIRECTORS *)

DENMARKChristoffer Bertelsen, Senior Adviser, Ministry of Foreign Affairs

Deputy: Flemming Winther Olsen, Senior Adviser, Ministry of Foreign Affairs

FINLANDSatu Santala, Deputy Director General, Ministry for Foreign Affairs

Deputy: Jukka Pesola, Director, Ministry for Foreign Affairs

ICELANDEgill Heiđar Gislason, Advisor, Chair of the Board

Deputy: Anna Karlsdóttir, Assistant Professor, University of Iceland

NORWAYHarald Tollan, Senior Adviser, the Royal Ministry of Foreign Affairs, Deputy Chair of the Board

Deputy: Hans Olav Ibrekk, Policy Director, the Royal Ministry of Foreign Affairs

SWEDENAnna Westerholm, Deputy Director, Ministry for Foreign Affairs

Deputy: Lena Kövamees, Senior Programme Manager, Sida

Observer:Johan Ljungberg, Senior Director, Nordic Investment Bank

*) As of 31 December 2012

CONTROL COMMITTEE *)

CHAIRMANBill Fransson, Managing Director

DENMARKThomas Jensen, Member of Parliament

FINLANDTuula Peltonen, Member of Parliament

ICELANDRagnheiđur Ríkharđsdóttir, Member of Parliament

NORWAYHans Frode Kielland Asmyhr, Member of Parliament

SWEDENÅsa Torstensson,Member of Parliament

AUDITORS APPOINTED BY THE CONTROL COMMITTEE

Sixten Nyman, Authorised Public Accountant, KPMG, Finland

Per Gunslev, State Authorised Public Accountant, KPMG, Denmark

Secretary to the Control CommitteeBirgitta Immerthal, KPMG, Finland

*) As of 31 December 2012

MANAGEMENT AND STAFF

Pasi Hellman, Managing Director (from 1 November 2012)

Helge Semb, Managing Director (until 31 October 2012)

Leena Klossner, Deputy Director

Juhani Annanpalo, Country Program Manager

Hannu Eerola, Country Program Manager

Martina Jägerhorn, Country Program Manager

Aage Jørgensen, Country Program Manager

Linda Lundqvist, Country Program Manager and Chief Counsel

Emeli Möller, Country Program Manager

Johanna Palmberg, Country Program Manager (from 1 May 2012)

Mats Slotte, Manager, Financial Administration

Jessica Suominen, Financial Administrator

Ann-Christin Lundin, Secretary

Maria Talari, Administration and Information Officer

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INCOME STATEMENT (amounts in EUR)

Note 1.1 - 31.12.2012 1.1 - 31.12.2011 INCOMEService charges from credits 5,789,489.64 5,478,779.84Income from loans with equity features -677,033.75 1,808,650.45Fee and commission income 204,310.79 392,498.63Interest income from placements with credit institutions 50,880.21 653,298.74Interest income from cash and balances with banks 1,353.61 999.78Total income 5,369,000.50 8,334,227.44

EXPENSESGrant financing for climate projects 27,118,799.56 20,089,507.43Refund of grant financing -89,637.28 -116,900.37Fee and commission expenses 2,380.28 2,462.88Commission expenses, derivative instruments 1,213.71 -General administrative expenses (9) 3,198,646.68 2,853,215.86Depreciation/amortisation on tangible and intangible assets (7) 10,723.59 9,138.20Changes in provision for credit losses, write-down of loans and reversals (6) 132,815.59 -830,439.49Total expenses 30,374,942.13 22,006,984.51

Net result for the year before foreign exchange differences and SDR hedging -25,005,941.63 -13,672,757.07

Foreign exchange differences -5,087,507.87 6,738,503.48Unrealised gains/losses on fair value of derivative instruments (2) 1,624,595.00 -Realised gains/losses on derivative instruments (2) 4,400.00 -Foreign exchange differences, net -3,458,512.87 6,738,503.48

Net result for the year -28,464,454.50 -6,934,253.59

11

BALANCE SHEET (amounts in EUR)

Note 1.1 - 31.12.2012 1.1 - 31.12.2011 INCOMEService charges from credits 5,789,489.64 5,478,779.84Income from loans with equity features -677,033.75 1,808,650.45Fee and commission income 204,310.79 392,498.63Interest income from placements with credit institutions 50,880.21 653,298.74Interest income from cash and balances with banks 1,353.61 999.78Total income 5,369,000.50 8,334,227.44

EXPENSESGrant financing for climate projects 27,118,799.56 20,089,507.43Refund of grant financing -89,637.28 -116,900.37Fee and commission expenses 2,380.28 2,462.88Commission expenses, derivative instruments 1,213.71 -General administrative expenses (9) 3,198,646.68 2,853,215.86Depreciation/amortisation on tangible and intangible assets (7) 10,723.59 9,138.20Changes in provision for credit losses, write-down of loans and reversals (6) 132,815.59 -830,439.49Total expenses 30,374,942.13 22,006,984.51

Net result for the year before foreign exchange differences and SDR hedging -25,005,941.63 -13,672,757.07

Foreign exchange differences -5,087,507.87 6,738,503.48Unrealised gains/losses on fair value of derivative instruments (2) 1,624,595.00 -Realised gains/losses on derivative instruments (2) 4,400.00 -Foreign exchange differences, net -3,458,512.87 6,738,503.48

Net result for the year -28,464,454.50 -6,934,253.59

Note 31.12.2012 31.12.2011

ASSETSCash and cash equivalents (1) 92,915,353.02 93,369,448.38Other long-term financial placements (1) 226,374.89 225,021.28 93,141,727.91 93,594,469.66

Other assets 5,966,596.30 6,771,657.58Derivative instruments (2) 5,354,595.00 -Accrued income 1,174,737.33 1,241,410.06Credits with government guarantee oustanding (3) 758,785,662.23 762,887,426.65Other loans outstanding (4) 6,149,829.76 6,697,189.92Loans with equity features and equity investments outstanding (5) 4,118,098.15 6,446,950.12Intangible assets (7) 222.05 277.53Tangible assets (7) 24,992.21 21,218.49

Total assets 874,716,460.95 877,660,600.02

LIABILITIES AND EQUITY

LiabilitiesOther liabilities 377,409.60 357,094.17

Equity (8)Fund capital SDR 515,000,000Fund capital EUR 330,000,000Paid-in fund capital 962,836,480.71 937,336,480.71

Accumulated net result -88,497,429.36 -60,032,974.86

Total equity 874,339,051.35 877,303,505.85

Total liabilities and equity 874,716,460.95 877,660,600.02

12

CHANGES IN EQUITY (amounts in EUR 1,000)

Paid-in fund capital Accumulated net income Result for the year TotalEquity as of 1 January 2011 901,147 -53,099 0 848,049Transfers between equity items -6,934 6,934 0Paid-in fund capital 36,189 36,189Result for the year -6,934 -6,934Equity as of 31 December 2011 937,336 -60,033 0 877,304Transfers between equity items -28,464 28,464 0Paid-in fund capital 25,500 25,500Result for the year -28,464 -28,464Equity as of 31 December 2012 962,836 -88,497 0 874,339

CASH FLOW STATEMENT (amounts in EUR 1,000)

31 Dec 2012 31 Dec 2011 Cash flow from operating activities:

Net result for the year -28,464 -6,934Depreciation/amortisation on tangible and intangible assets 11 9Foreign exchange differences 5,088 -6,739Fair value of derivative instruments -1,625 0Changes in derivative instruments -5,355 0Changes in accrued income 67 31Changes in provision for credit losses and write-down of loans 133 -830Cash flow from operating activities -30,146 -14,463

Cash flow from investing activities:

Credits disbursed -14,095 -27,058Amortisations of credits 12,938 15,556Disbursed other loans, equity loans and equity investments -5 -18Repayments of other loans, equity loans and equity investments 3,795 1,001Amortisations of other loans and equity loans 547 1,643Changes in placements with a maturity longer than 6 months -1 -225Changes in other assets and liabilities 825 -2,846Changes in tangible and intangible assets -14 -13Net cash flow from investing activities 3,989 -11,960

Cash flow from financing activities:

Paid-in fund capital 25,500 36,189

Foreign exchange differences 203 -138

Changes in cash and cash equivalents -454 9,629

Cash and cash equivalents consist of: 31 Dec 2012 31 Dec 2011

Cash and balances with banks 4,469 3,387Placements with a maturity of less than 6 months 88,447 89,983

Total cash and cash equivalents 92,915 93,369

13

General operating policiesThe purpose of the Nordic Development Fund (NDF, “the Fund”) is to promote economic and social development in developing countries through participation in financing, on concessional terms, of projects of interest to the Nordic countries. The headquarters of the Fund are in Helsinki, Finland, at the premises of the Nordic Invest-ment Bank. On 9 November 1998, a new Agreement regarding NDF was signed by its member countries. The new Agreement, which replaced the earlier Agreement of 3 November 1988, entered into force on 18 September 1999. The new Agreement contains provisions concerning the Fund’s immunity and the exemption of the Fund’s assets and income from all taxation. The Fund has the legal status of an international legal person, with full legal capacity. A Headquarters Agreement between NDF and the Government of Finland was signed on 14 October 1999. This agreement is connected to the 1998 Agreement regarding NDF. Pursuant to the recommendation of the NDF Board of Directors to the Nordic Council of Ministers, the Nordic Cooperation Ministers approved amendments to NDF’s bylaws in 2009. These amendments give NDF a new mandate to support interventions aimed at adaptation to and mitigation of the negative effects of climate change. The capital of NDF shall in the future be utilised in the form of grant aid for climate-related interventions in low-income countries. This capital, approximately one billion euros over a period of 35 years consists of repayments on the 188 credits NDF granted during 1989-2005 The last repayment is due in 2045.

Summary of significant accounting policies

Basis of preparation of financial statementsThe Financial Statements have been prepared in accordance with methods of valuation and recognition of income and expenses as described below. As from 1 January 2001, the Fund’s Financial Statements are presented in euro in accordance with the decision of the Nordic Coun-cil of Ministers of 24 August 2000 to replace SDR with EUR. The paid-in fund capital has been converted into euro. The Fund’s Financial Statements are presented in euro. With the exceptions noted below, they are based on historical cost.

Assessments in preparation of financial statements The preparation of financial statements requires management to make assessments and esti-mates that affect the result, financial position and additional disclosures. Such assessments and estimates are based on available information. Actual results may differ materially from the assessments made.

Foreign currency translationMonetary assets and liabilities denominated in currencies other than euro are translated into euro at the rate quoted by the European Central Bank (see Note 11). Any gain or loss arising from the valuation appears in the Income Statement as “Foreign exchange differences” and are mainly related to the SDR rate. As NDF will for many years to come have outstanding credits denominated in SDR, changes in the SDR-euro rate may lead to the Income Statement showing substantial foreign exchange differences since these currency positions are not hedged against

changes in foreign exchange rates. However, in 2012, measures were taken to reduce the effects from the foreign exchange differences by hedging 35% of the credits denominated in SDR. Non-monetary assets are recorded in euro at the euro rate prevailing on the date of their acquisition.

Cash and cash equivalentsCash and Cash Equivalents consist of monetary assets and placements with an original matu-rity of up to 6 months.

Derivative instrumentsApproximately 35% of the SDR portfolio is protected against exchange rate effects through currency options. The derivative instruments are valued at fair value at the end of the year and the change in fair value is recognised in the income statement.

Placements with credit institutionsNDF has invested its monetary assets with the Nordic Investment Bank at current market interest rates. The placements are mainly in EUR and are initially recognised at cost (normally nominal value) at settlement date. Placements are also recorded at cost in the Annual Report. Accrued interest on placements is recorded within Accrued Income in the Balance Sheet. In 2012, the Board authorised NDF to place a maximum of 50% of its cash and cash equivalents with Nordic commercial banks. Placements with credit institutions longer than 6 months are shown as investments in the Cash Flow Statement. The amount is included in the Balance Sheet as Other long-termfinancial placements.

Credits with government guarantee outstanding The recipient countries for NDF credits are low-income developing countries. The credit period for credits with government guarantee is 40 years, including a 10-year grace period. The loans are interest-free. The credits are initially recognised at cost at settlement date. For payments which are more than 180 days overdue, the Fund places all credits to the borrower in question in non-accrual status, whereupon the Fund stops recording accrued service charges and fee and commission revenue as income on the Income Statement. All accrued but unpaid income in respect of the borrower in question that had been recorded as income is then deducted from the Income State-ment. As of 31 December 2012, Zimbabwe was more than 180 days overdue with payments. There is a considerable concessionality in the credits from NDF as they are interest-free and have very long maturities.

Provision for loan lossesNDF’s lending conditions allow for a long-term view to be taken of the repayment capacity of recipient countries. In the event of debt consolidation, it is assumed that credits from NDF will be treated in the same manner as loans from other multilateral institutions. Credits outstanding are recognised in the Balance Sheet at their recoverable amount. Loans with government guarantee outstanding are recorded net of provisions for possible loan losses and actual loan losses. Provision for possible loan losses is established based on the assessment of the nature and maturity structure of the credit portfolio.

NOTES TO THE FINANCIAL STATEMENTS

14

15

Other loans outstandingOther loans outstanding consist of loans with financial liability features to the private sector. The loans are initially recognised at cost at settlement day. In the Balance Sheet, other loans outstanding are recorded net of provisions for actual and possible loan losses. A provision for possible loan losses is established based on the assessment of the nature and maturity structure of the loan portfolio.

Loans with equity features and equity investmentsThe statutes of NDF enable the Fund, as an integrated and permanent part of its operations, to provide financing to private sector activities in developing countries without government guarantee. Loans with equity features and equity investments are recognised in the Balance Sheet at cost after write-down. The value of outstanding loans with equity features and equity invest-ments are continuously revalued by the Fund. If the book value exceeds the valuation made, a corresponding write-down is made. Write-downs are presented separately in the Income Statement.

Intangible assetsIntangible assets mainly consist of investments in software and software licenses for IT-systems. The investments are carried at historical cost and are amortised over the assessed useful life of the assets, which is estimated to be between 3 and 5 years. The amortisations are made on a straight-line basis.

Tangible assetsTangible assets are recognised at historical cost, less any accumulated depreciation based on their assessed useful life. The depreciation period for tangible assets is determined by assessing the individual item, usually 3 to 5 years.

Write-downs and impairment of intangible and tangible assetsThe Fund’s assets are reviewed annually for impairment. If there is any objective evidence of impairment, the impairment loss is determined based on the recoverable amount of the assets.

EquityIn August 2000, the Nordic Council of Ministers passed a resolution to increase the capital of NDF by EUR 330 million. After this replenishment, the capital of the Nordic Development Fund amounted to SDR 515 million and EUR 330 million. As of 31 December 2012, SDR 515 million - the equivalent of EUR 691.4 million- and EUR 271.4 million, totalling EUR 962.8 million has been paid in by the owners. Payment of the remainder of the subscribed capital will take place upon request by the Fund’s Board of Directors. Since the World Bank and the International Monetary Fund (IMF) initiated the “Debt Initiative for Heavily Indebted Poor Countries” (HIPC) in 1996, NDF has participated in this debt relief initiative through the HIPC Trust Fund which is administered by IDA. The enhancement of the initiative carried out in 1999 called for further financial commitments by NDF. To this end, the Nordic Council of Ministers in 2000 approved the amendment of NDF’s statutes in order to provide a general authorisation for the Fund to provide its part of shared contributions under debt relief initiatives in the framework of internationally co-ordinated initiatives in which other multilateral organisations participate.

The allocated funds for HIPC were a total of EUR 29.6 million. These funds have been paid in to the HIPC Trust Fund between 1999 and 2010.

Income from service and commitment charges, loans with equity features and equity investmentsThe Fund’s long-term lending with government guarantee is interest-free, but a service charge of 0.75% per annum is collected on outstanding amounts. A commitment charge of 0.5 % per annum is collected on any undisbursed balance one year after the loan agreement has been signed. Income from other loans is presented within Service charges from credits in the Income Statement. Income from loans with equity features is normally related to the return received by the shareholders of the company. Income from service charges on lending and income from loans with equity features and equity investments are presented as separate items in the Income Statement. Commitment charges are presented within Fee and commission income.

Grant financingAs a disbursement is made to a climate project, the cost is accounted under “Grant financing for climate projects” in the income statement. Upon completion of a project or cancellation of a grant, any refund is written back as a reduction of the total costs for the year under “Refund of grant financing”.

General administrative expensesNDF receives a host country payment from the Finnish government equal to the tax levied on the salaries of the Fund’s employees. The host country payment, which the Fund received in 2012, amounted to EUR 413,584 (2011: EUR 363,076). The payment is accounted for as a reduction in the Fund’s administrative expenses.

Employees’ pensions and insuranceThe Fund is responsible for offering pension protection to its personnel. In accordance with the host country agreement between the Fund and the Finnish Government, the Fund has adopted the Finnish government employee pension plan for the Fund’s personnel. The Fund’s liability in respect to pension rights is completely covered. Contributions to the pension plan, which are paid to the State Pension Fund, are calculated as a percentage of the salaries. The Finnish Government determines the basis for the contributions, and the Republic of Finland State Treasury establishes the actual amount of the contributions. Under the Finnish pension system at present, the usual age of retirement is 63-68. NDF has also introduced an additional pension system for its permanent employees. The additional pension insurance is a group pension insurance plan that is based on a defined contribution plan. In addition to the Finnish social security system for its employees, NDF has subscribed to a comprehensive life, accident, health, disability and travel insurance programme.


16

Notes to the Income Statement and the Balance Sheet

(Note 1) Cash and cash equivalents and placements with credit institutions

(EUR 1,000) 31 Dec 2012 31 Dec 2011 Cash and cash equivalents Cash and balances with banks 4,469 3,387Placements with credit institution 88,447 89,983Total, cash and cash equivalents 92,915 93,369 Placements with credit institution Placements with credit institution 226 225Total, placements with credit institutions 226 225 Total, cash and cash equivalents and placements with credit institutions 93,142 93,594

The remaining maturity of placements, counted from the balance sheet date to maturity, is as follows:

(EUR 1,000) 31 Dec 2012 31 Dec 2011Up to and including 3 months 88,447 89,983

(Note 2) Derivative instruments

(EUR 1,000) 31 Dec 2012 31 Dec 2011Purchased option contracts 3,730 0Fair value of option contracts at end of year 5,355 0Change in fair value 1,625 0

NDF has received adequate collateral that covers the derivative instruments’ market value.

(Note 3) Credits with government guarantee outstanding

Credits according to lending currency:

(Face value in EUR 1,000) 31 Dec 2012 31 Dec 2011EUR-credits 468,996 461,547 SDR-credits 289,790 301,340Total, outstanding credits 758,786 762,887

Credits outstanding:

(EUR 1,000): 31 Dec 2012 31 Dec 2011 Bangladesh 28,586 29,168Benin 18,721 18,920Bolivia 30,341 31,354Botswana 4,862 5,120Burkina Faso 10,204 10,204Cambodia 9,262 9,262Cape Verde 2,007 2,091China 4,559 4,670Colombia 1,179 1,227Dominican Republic 7,666 7,987Ethiopia 26,429 27,145Ghana 47,338 45,882Honduras 31,562 30,170Indonesia 11,385 12,070Jamaica 5,721 5,961Kenya 25,969 25,969Kyrgyz Republic 4,497 4,598Lao PDR 52,557 53,587Malawi 22,185 23,023Maldives 9,275 9,581Mauritius 2,761 2,924Mozambique 61,319 62,693Mongolia 25,441 26,226Namibia 1,656 1,696Nepal 19,366 18,885Nicaragua 45,820 47,254Pakistan 10,151 10,579Philippines 14,469 14,983Rwanda 12,499 12,499Senegal 48,998 50,552Sri Lanka 20,298 21,026Tanzania 23,079 23,068Tunisia 5,182 5,305Uganda 55,596 51,387Vietnam 24,408 24,601Zambia 20,704 17,832Zimbabwe 16,010 16,295Credits outstanding 762,066 765,797Credits in default (Zimbabwe) 3,280 2,909Total, credits outstanding 758,786 762,887

In addition, agreements have been signed on a further EUR 33.0 million (2011: EUR 50.3 million) in credits not yet disbursed.


17

Amortisations on credits outstanding as at 31 December 2012 show the following maturity profile:

(EUR 1,000) 31 Dec 2012 31 Dec 20112012 13,9612013-2015 53,490 53,6092016-2020 120,039 119,5662021-2025 150,054 149,1482026-2030 165,754 163,5312031-2035 142,161 139,8172036-2040 93,535 90,7142041-2045 33,752 32,540Total, credits outstanding 758,786 762,887

(Note 4) Other loans outstanding

Other loans outstanding are distributed as follows: (EUR 1,000) 31 Dec 2012 31 Dec 2011East African Development Bank 6,150 6,697Total, other loans outstanding 6,150 6,697

Amortisations on other loans outstanding as at 31 December 2012 show the following maturity profile:

(EUR 1,000) 31 Dec 2012 31 Dec 20112012 5472013-2015 957 9572016-2020 1,366 1,3662021-2025 1,366 1,3662026-2030 1,366 1,3662031-2035 1,093 1,093Total, other loans outstanding 6,150 6,697

(Note 5) Loans with equity features and equity investments outstanding

Loans with equity features and equity investments are distributed as follows:

(EUR 1,000) 31 Dec 2012 31 Dec 2011China 0 2,049Mekong Enterprise Fund 1,103 1,434Nepal 2,913 2,913ECP 5 0Central American Small Enterprise Investment Fund 765 911Aureos Southern Africa Fund 602 1,742Aureos West Africa Fund 102 231Total, loans with equity features and equity investments outstanding 5,489 9,279Write-down -1,371 -2,832Total, loans with equity features and equity investments outstanding after write-down 4,118 6,447

As at 31 December 2012, the write-down for impairment totalled EUR 1,370,982 (2011: EUR 2,831,907) based on assessment of the risk of losses which exists or may exist. The reversals for 2012 of previously made provisions for credit losses amounted to a total of EUR 1,460,926.

(Note 6) Loan losses, write-down of loans and reversals

The total net loan losses, write-down on loans and reversals during 2012 totalled EUR 132,816 (2011: EUR -830,439). Provisions for loan losses and reversals amounted to EUR 1,460,926 in 2012 (2011: EUR -830,439) and realised loan losses amounted to EUR 1,593,742 in 2012 (2011: EUR 0).

(Note 7) Intangible and tangible assets (Amounts in EUR) 2012 2011 Computer Computer Intangible assets software software Acquisition value at beginning of year 5,527 5,527Acquisitions during the year 270 0Acquisition value at end of year 5,797 5,527Accumulated amortisation at beginning of year 5,249 4,027Amortisation according to plan for the year 325 1,222Accumulated amortisation at end of year 5,575 5,249Net book value 222 278 Office Office Tangible assets equipment equipmentAcquisition value at beginning of year 33,498 20,168Acquisitions during the year 14,172 13,330Acquisition value at end of year 47,670 33,498Accumulated depreciation at beginning of year 12,280 4,364Depreciation according to plan for the year 10,398 7,916Accumulated depreciation at end of year 22,678 12,280Net book value 24,992 21,218 Intangible and tangible assets total 25,214 21,496

(Note 8) Equity

The total Fund capital amounts to SDR 515.0 million and EUR 330.0 million. Of this, the paid-in capital as of 31 December 2012 amounted to SDR 515.0 million*) (equivalent to EUR 691.4 million) and EUR 271.4 million i.e. a total of EUR 962.8 million. The payments by the member countries in 2012 amounted to EUR 25.5 million.

*) The EUR value of SDR is based on the historic EUR/SDR currency rate on the date of payment


18

The member countries have subscribed the following amounts of the total Fund capital: Subscribed fund capital as at 31 December 2012

(EUR 1,000) SDR % EUR % Denmark 115,067 22% 82,500 25% Finland 96,726 19% 58,740 18% Iceland 5,453 1% 3,300 1%Norway 101,591 20% 74,250 23%Sweden 196,163 38% 111,210 34% Subscribed fund capital 515,000 100% 330,000 100%

The member countries have paid in the following amounts of the total fund capital: Fund capital Fund capital Fund capitalPaid-in fund capital (EUR 1,000) 31 Dec 2011 in SDR Translated into EUR 31 Dec 2011 in EUR 31 Dec 2011 Total %Denmark 115,067 153,858 61,483 215,341 23%Finland 96,726 130,592 43,776 174,368 19%Iceland 5,453 7,303 2,458 9,761 1%Norway 101,591 136,354 55,336 191,689 20%Sweden 196,163 263,299 82,878 346,177 37%Paid-in fund capital 515,000 691,405 245,931 937,336 100%

Paid-in fund capital (EUR 1,000) Paid-in during 2012 in SDR Translated into EUR Paid-in during 2012 in EUR Paid-in total during 2012Denmark 0 0 6,375 6,375Finland 0 0 4,539 4,539Iceland 0 0 255 255Norway 0 0 5,738 5,738Sweden 0 0 8,594 8,594Paid-in fund capital 0 0 25,500 25,500

Fund capital Fund capital Fund capital Paid-in fund capital (EUR 1,000) 31 Dec 2012 in SDR Translated into EUR 31 Dec 2012 in EUR 31 Dec 2012 Total %Denmark 115,067 153,858 67,858 221,716 23% Finland 96,726 130,592 48,315 178,907 19% Iceland 5,453 7,303 2,713 10,016 1%Norway 101,591 136,354 61,073 197,427 20% Sweden 196,163 263,299 91,472 354,771 37%Paid-in fund capital 515,000 691,406 271,431 962,837 100%


19


(Note 9) General administrative expenses including compensation for the Board of Directors, the Control Committee and the Managing Director

General administrative expenses 2012 2011 (EUR 1,000) Personnel costs 1,671 1,472 Pension premiums in accordance with the Finnish state pension system 340 281 Other pension premiums 53 30 Office premises costs 160 143 Other general administrative expenses 1,099 998 Cost coverage, NIB 289 293 Total 3,612 3,216 Host country reimbursement according to agreement with the Finnish Government -414 -363 Net 3,199 2,853

Compensation for the Board of Directors and the Control Committee is set by the Nordic Council of Ministers. Compensation for the Fund’s Managing Director is set by the Board of Directors and is paid in the form of a fixed annual salary and usual salary-based benefits.

The Managing Director is permitted to borrow from a commercial bank at interest rates that are the same for all of the Fund’s employees. The rates are set with reference to the so-called base rate determined periodically by Finland’s Ministry of Finance.

The pension benefits for the Managing Director are based on the Finnish State pension system, with certain additions.

Professional staff (including the Managing Director) who move to Finland for the sole purpose of taking up employment in the Fund, are entitled to certain expatriate benefits, such as an expatriate allowance and a spouse allowance. In addition, NDF assists the expatriate in finding a residence and in other practical arrangements. Such staff members are required to reimburse the Fund part of the rent equivalent to the minimum tax value of the accommodation benefit received. The tax value is determined annually by the Finnish tax authorities.

Compensation for the Chairman of the Board of Directors, the Board, the Control Committee and the Managing Director appears from the table below:

2012 2011 Compensation/ Compensation/(amounts in EUR) taxable income taxable incomeChairman of the Board of Directors 5,325 5,325Other members of the Board 18,624 16,647Managing Director 332,331 336,478Control Committee 1,969 1,921

During 2012, NDF paid a total of EUR 110,205 (2011: EUR 111,054) in pension premiums for the Managing Director.

(Note 10) Transactions between closely related partners

NDF receives services and enters into transactions with NIB. The outstanding claims and debts between NDF and NIB as well as interest charged during the year are presented in the table below. The interest charged corresponds to the normal market rate (EUR 1,000): Interest collected NDF’s outstanding debt to NIB NDF’s outstanding claim on NIB2012 51 2 88,4502011 653 11 90,013

(Note 11) Currency exchange rates

EUR rate on 31 Dec 2012 EUR rate on 31 Dec 2011 DKK Danish krone 7.461 7.4342 ISK Icelandic króna 170.2 158.65 NOK Norwegian krone 7.3483 7.754 SEK Swedish krona 8.582 8.912 USD US dollar 1.3194 1.2939 SDR Special Drawing Rights 0.85776* 0.84279*

* The exchange rate is calculated in such a way that the market rate for USD/relevant currency provides the EUR/relevant currency rate. The exchange quotation USD/relevant currency is per 31 December 2012.

20

AUDITORS’ REPORT

INDEPENDENT AUDITORS’ REPORT TO THE CONTROL COMMITTEE OF

THE NORDIC DEVELOPMENT FUND

Independent Auditors’ report on the financial statements

In our capacity as auditors appointed by the Control Committee of the Nordic Development

Fund we have audited the accompanying financial statements of the Fund, which comprise

the balance sheet as at 31 December 2012, and the income statement, statement of changes in

equity and statement of cash flows for the year then ended, and a summary of significant

accounting policies and other explanatory notes.

The Board of Directors’ and the Managing Director’s responsibility for the financial statements

The Board of Directors and the Managing Director are responsible for the preparation of the

financial statements in accordance with the accounting principles described in the notes to the

financial statements and for such internal control as they determine is necessary to enable the

preparation of financial statements that are free from material misstatement, whether due to

fraud or error.

Auditor’s responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We

conducted our audit in accordance with International Standards on Auditing. Those standards

require that we comply with ethical requirements and plan and perform the audit to obtain rea-

sonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and dis-

closures in the financial statements. The procedures selected depend on the auditor’s judgment,

including the assessment of the risks of material misstatement of the financial statements,

whether due to fraud or error. In making those risk assessments, the auditor considers internal

control relevant to the entity’s preparation and fair presentation of the financial statements

in order to design audit procedures that are appropriate in the circumstances, but not for the

purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit

also includes evaluating the appropriateness of accounting policies used and the reasonableness

of accounting estimates made by management, as well as evaluating the overall presentation of

the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a

basis for our audit opinion.

Opinion

In our opinion, the financial statements, which comprise the balance sheet as at 31 December

2012, and the income statement, statement of changes in equity and statement of cash flows for

the year then ended, and a summary of significant accounting policies and other explanatory notes,

are prepared in all material respects in accordance with the accounting principles described in

the notes to the financial statements.

Report on the other requirements

In accordance with the Terms of Engagement our audit also included a review of whether the

Board of Directors’ and the Managing Director’s administration have complied with the Statutes

of the Fund. It is our opinion that the administration of the Board of Directors and the Managing

Director complied with the Statutes of the Fund.


Sixten Nyman

Authorised Public Accountant

KPMG Oy Ab

Mannerheimintie 20 B

00100 Helsinki

Finland

Per Gunslev

State Authorised Public Accountant

KPMG, Statsautoriseret Revisionspartnerselskab

Osvald Helmuths Vej 4

2000 Frederiksberg

Denmark

AUDITORS’ REPORT

STATEMENT BY THE CONTROL COMMITTEE OF THE NORDIC DEVELOPMENT FUND ON

THE AUDIT OF THE ADMINISTRATION AND ACCOUNTS OF THE FUND

To the Nordic Council of Ministers

In accordance with section 9 of the statutes of the Nordic Development Fund, we have been

appointed to ensure that the operations of the Fund are conducted in accordance with the

Statutes and to bear responsibility for the audit of the Fund. Having completed our assignment

for the year 2012, we hereby submit the following report.

The Control Committee met during the financial year as well as after the Fund’s financial

statements had been prepared, whereupon the necessary control and examination measures

were performed. The Fund’s Annual Report was examined at a meeting in Helsinki on 7 March

2013, at which time we also received the Auditor’s Report submitted on 7 March 2013 by the

authorised public accountants appointed by the Control Committee.

Following the audit performed, we note that:

•theFund’soperationsduringthefinancialyearhavebeenconductedinaccordance

with the Statutes, and that

•thefinancialstatements,whichcomprisethebalancesheetasat31December2012,

and the income statement, statement of changes in equity and statement of cash

flows for the year then ended, and a summary of significant accounting policies and

other explanatory notes, are prepared in all material respects in accordance with

the accounting principles described in the notes to the financial statements. The

financial statements show a loss of EUR 28,464,454.50, which will be carried

forward to new account.

We recommend to the Nordic Council of Ministers that:

•theincomestatementandthebalancesheetbeadopted,and

•theBoardofDirectorsandManagingDirectorbedischargedfromliabilityfor

the administration of the Fund’s operations during the accounting period

examined by us.


Bill Fransson

Thomas Jensen Hans Frode Kielland Asmyhr Åsa Torstensson

Tuula Peltonen Ragnheiður Rikhardsdóttir

21

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Distribution by Lead Agency

Regional Distribution of Approved Financing

Signed Grant Agreements; Volume mEUR and number (cumulative)

Country/ Lead Investment Year ofProject Agency million, NDF signing Benin Increased Access to Modern Energy Project - Modernizing Biomass Energy Services IDA 1.5 EUR 2010 Ghana Studies on Landfill Gas Capture and Utilization IDA 2.0 EUR 2011 Greater Accra Septage Digesters Project IDA 2.5 EUR 2013* Kenya Electricity Expansion Project IDA 4.0 EUR 2012 Training in Geothermal Drilling IDA 1.5 EUR 2013* Mozambique Coastal Cities and Climate Change IDA 3.8 EUR 2012 Transforming Hydro-Meteorological Services IDA 4.5 EUR 2013* Rwanda Promotion of Solar Water Heaters IDA 4.0 EUR 2011 Senegal Transport and Urban Mobility Project - Environmental Activities IDA 4.0 EUR 2011 Water and Sanitation Millennium Project - Cambérène Climate Change IDA 4.0 EUR 2011 Senegal Biomass IDA 3.0 EUR 2011 Flood Risk Management IDA 3.0 EUR 2013* Tanzania Impacts of Climate Change in Coastal Areas IDA 0.8 EUR 2012 SGF - Hydropower Sustainability Assessment IDA 0.5 EUR 2013* SGF - Climate Smart Solutions for Water and Energy IDA 0.5 EUR 2013* Uganda Increasing Access to Modern Energy Packages in Rural Areas IDA 3.0 EUR 2010 Regional (Afica) Africa Regional - Addressing the Vulnerability of Africa’s Infrastructure IDA 0.6 EUR 2012 SGF - Insurance Instruments for Africa Climate Adaptation IDA 0.5 EUR 2012 SGF - Technologies for Low Carbon Development in Africa IDA 0.5 EUR 2012 Geothermal Exploration Project in East Africa Iceida 5.0 EUR 2012

Cambodia Adaptation Approaches for the Transport Sector ADB 4.2 EUR 2011 Water Resources Management ADB 3.0 EUR 2011 Lao PDR Pakse Urban Environmental Improvement Project ADB 0.4 EUR 2009 Capacity Enhancement for Coping with Climate Change ADB 2.0 EUR 2010 Vietnam Support for the National Target Program on Climate Change ADB 2.21 EUR 2011 Vietnam Climate Proofing of Roads ADB 2.0 EUR 2012 Pilot Programme for Mitigation Action in the Cement Sector NOAK/Nefco 1.5 EUR 2013*

Regional (Asia) Mekong Energy and Environment Partnership (EEP) UM Finland 3.0 EUR 2010 GMS Bioenergy ADB 3.1 EUR 2011 Gender and Climate Change ADB 2.0 EUR 2011 SGF - Resilient Cities in the GMS: Adapting Cities to Climate Change ADB 0.5 EUR 2012

Country/ Lead Investment Year ofProject Agency million, NDF signing

AFRICA ASIA

GRANT PORTFOLIO

24

*) tentative

Bolivia Rural Electrification with Renewable Energy IDB 4.0 EUR 2013* Honduras Indigenous Peoples and Climate Change IDB 3.5 EUR 2012 Nicaragua Sustainable Electrification and Renewable Energy Program IDB 4.5 EUR 2011 Programme for Disaster Management and Climate Change IDB 2.5 EUR 2011 Biogas Market Facilitation Program IDB/MIF 1.5 EUR 2011 Adaptation to Climate Change in Road Transport Sector IDB 4.4 EUR 2012 Regional (LAC) GreenPYME: Energy Efficiency for Small and Medium-sized Enterprises IIC 2.2 EUR 2010 Climate Proofing and Review of Infrastructure Investments IDB 1.5 EUR 2011 Central America: Adaptation to Climate Change in Honduras and Nicaragua IDB 0.5 EUR 2011 Regional Microfinance and Climate Change Programme IDB/MIF 1.5 EUR 2011 Central America - Regional Centre for Geothermal Energy IDB 1.5 EUR 2012 Economics of Climate Change IDB 0.5 EUR 2012 GreenPyme II IIC 3.0 EUR 2012 Latin America - Climate Change and Sustainable Cities IDB 2.1 EUR 2012

Nordic Climate Facility 1 n/a 6.0 EUR 2010 Nordic Climate Facility 2 n/a 6.0 EUR 2011 Nordic Climate Facility 3 n/a 6.0 EUR 2011 SGF - Social Analysis and Adaptation to Climate Change None 0.2 EUR 2012 Pro Climate Facility IDB/IFC 10.0 EUR 2013*



LATIN AMERICA GLOBAL

GRANT PORTFOLIO

25


Public Sector Projects Benin Transport Sector Investment IDA 4.7 SDR 1997 Energy Services Delivery IDA 13.8 EUR 2005 Burkina Faso Power Sector Development IDA 10.2 EUR 2005 Botswana Mochudi-Molepolole Groundwater Exploitation NIB 1.1 EUR 1990Trans-Kgalagadi Road AfDB/NIB 0.5 EUR 1992Transmission Line Francistown-Maun NIB 5.0 EUR 1993

Cape Verde Integrated Fisheries Development ICEIDA 2.0 SDR 1994

Ethiopia Addis Ababa Airport Improvement EIB 5.0 SDR 1998Energy II IDA 7.0 SDR 1998Road Sector Development IDA 4.8 SDR 1998Road Sector Development II IDA 8.6 EUR 2003

Ghana Urban II IDA 5.2 EUR 1994National Electricity IDA 6.1 EUR 1994Accra Tema Water Supply Rehabilitation AfDB 5.2 EUR 1994 Urban Environment Sanitation IDA 2.6 EUR 1996 Mining Sector Development and Environment IDA 4.0 SDR 1996 Health Sector Support IDA 5.0 SDR 1998 Urban V IDA 2.1 SDR 2000 Health Services Rehabilitation III AfDF 8.3 EUR 2003 Land Administration IDA 7.0 EUR 2004 Urban Water Project IDA 6.0 EUR 2004 Urban Environment Sanitation II IDA 6.8 EUR 2004 Kenya Northern Transport Corridor Improvement IDA 16.0 EUR 2004 Energy Sector Recovery IDA 10.0 EUR 2004

Malawi Fisheries Development IDA 2.8 EUR 1991 National Water Development IDA 5.3 SDR 1995 Power V IDA 5.0 SDR 1997 Preparatory Programme to Support the Telecommunications Sector Danida 5.1 EUR 1998 Road Maintenance and Rehabilitation (ROMARP) IDA 4.8 SDR 1999 Mauritius Environmental Investmentfor Sustainable Development IBRD 4.1 EUR 1990 Mozambique Urban Household Energy IDA 5.6 EUR 1989 Cahora Bassa Interconnection NORAD 4.6 EUR 1994 Semi Industrial Fisheries Danida/ICEIDA 3.6 SDR 1996 National Water Development IDA 5.2 SDR 1997 Municipal Development IDA 3.4 SDR 2001 Mineral Resources Management Capacity Building IDA 12.6 EUR 2001The Roads and Bridges Management and Maintenance IDA 11.7 EUR 2001Agricultural Sector Public Expenditure (PROAGRI) IDA 7.2 EUR 2002Energy Reform and Access (ERAP) IDA 10.1 EUR 2003

Namibia Seaflower - Whitefish Corporation NIB 2.0 EUR 1994

Rwanda Urgent Electricity Rehabilitation IDA 7.5 EUR 2005Urban Infrastructure and City Management IDA 5.0 EUR 2005

Senegal Women’s Groups Support AfDB 4.3 EUR 1992Water Sector IDA 6.1 EUR 1995Integrated Health Sector Development IDA 5.0 SDR 1997Second Transport Sector IDA 2.1 SDR 1999Long Term Water Sector Project - Water Resources Management IDA 3.7 SDR 1999Poverty Alleviation AfDB 7.5 SDR 1999Quality Education for All IDA 1.9 SDR 2000


AFRICA

CREDIT PORTFOLIO

26

Long Term Water Sector Project - Urban Sanitation, Thiès IDA 11.5 SDR 2000Urban Mobility Improvement IDA 5.3 SDR 2002

Tanzania Electricity IV AfDB 6.1 EUR 1993Power VI IDA 6.0 EUR 1995Mineral Sector Development Technical Assistance IDA 6.7 SDR 1999Songwe River Stabilisation Study IDA 1.3 EUR 1999Central Transport Corridor Roads IDA 4.1 EUR 2004The Lake Tanganyika Integrated Regional Development (PRODAP) AfDF 6.0 EUR 2005

Tunisia Second Forestry Development IBRD 4.4 EUR 1994Water Supply and Sewerage IBRD 1.8 EUR 1996

Uganda Second Power - Installation of SCADA System IDA 4.9 EUR 1990First Urban IDA 5.8 EUR 1991Third Power - Owen Falls Extension IDA 5.8 EUR 1994Transport Rehabilitation IDA 4.4 EUR 1994Northern Reconstruction - Telecommunications component IDA 5.0 SDR 1998Second Economic and Financial Management (EFMP2) IDA 3.2 SDR 2000Roads Development Program, Phase II (RDPPII) IDA 7.0 SDR 2001Fourth Power IDA 12.7 EUR 2002Sustainable Management of Mineral Resources (SMMRP) IDA 5.9 EUR 2005Farm income Enhancement and Forest Conservation Project AfDF 5.0 EUR 2006

Zambia Environment Support IDA 0.9 EUR 1997Power Rehabilitation IDA 6.1 EUR 1999Copperbelt Environment IDA 9.6 EUR 2003Road and Rehabilitation and Maintenance Project - In Support of ROADSIP II (Phase I) IDA 8.0 EUR 2004

Zimbabwe Urban Sector and Regional Development IBRD 4.4 SDR 1990Cahora Bassa Interconnection NORAD 3.5 SDR 1994Pungwe Mutare Water Transfer Sida 5.9 SDR 1996

Private Sector Projects Loans with equity features

Benin Cimbenin S.A. Swedfund 0.7 SDR 1996

Ghana Paper Conversion Company Ltd. Swedfund 0.5 SDR 1995Ghana Emulsion Company Ltd. IFU 0.4 SDR 1996Danafco Ltd. IFU 0.2 SDR 1998

Mozambique Maputo Port Privatisation and Rehabilitation Swedfund 0.9 SDR 2003

Namibia Seaflower Whitefish Corporation Ltd. NBVF 0.7 SDR 1999

South Africa Nielsen Tap (Pty) Ltd. IFU 0.1 SDR 1995Princeton Computing Training Solutions (Pty) Ltd. IFU 0.02 SDR 1996New Africa Signs and Graphics (Pty) Ltd. IFU 0.04 SDR 1997Danforge Engineering (Pty) Ltd. IFU 0.04 SDR 1998

Tanzania Sao Hill Timber Ltd. NORAD 0.3 SDR 1997

Uganda MTN (Uganda) Ltd. Swedfund 1.5 SDR 1999

Zimbabwe Imperial Derby Refrigeration Ltd. IFU 1.0 SDR 1995Oscars Fine Foods IFU 0.1 SDR 1995Frese (Zimbabwe) (Pvt) Ltd. IFU 0.3 SDR 1996Powervision (Pvt) Ltd. IFU 0.1 SDR 1997

Regional African Infrastructure Fund Swedfund 1.5 SDR 1999Aureos Southern Africa Fund (ASAF) Norfund 3.4 EUR 2003Aureos West Africa Fund Norfund 3.0 EUR 2004

Credit Lines Fifth Line of Credit and Technical Assistance to the East African Development Bank AfDB 6.8 EUR 1995Second NDF Credit Line to the East African - Develpment Bank (EADB) n/a 4.2 EUR 2003



CREDIT PORTFOLIO

27


Public Sector Projects Bangladesh KAFCO IFU 4.0 SDR 1993Jamuna Bridge Access Roads ADB 1.5 SDR 1997Urban Primary Health Care ADB 1.2 SDR 1998Southwest Road Network Development ADB 2.7 SDR 2000West Zone Power System Development ADB 10.0 EUR 2002Dhaka Clean Fuel Project ADB 9.4 EUR 2003Power Sector Development ADB 8.3 EUR 2004

Cambodia Greater Mekong Subregion (GMS) Transmission ADB 9.3 EUR 2004

China Beishigiao Wastewater Treatment Plant, Xi’an City NIB 1.6 EUR 1993Hedong Wastewater Treatment Plant, Urumqi City NIB 3.1 EUR 1993Tanggu Geothermal Plant NIB 0.8 EUR 1994

Indonesia Central Nurseries Establishment NIB 3.9 SDR 1990Indonesia/Nordic Forestry NIB 3.8 SDR 1993Digital Marine Mapping NORAD 5.0 SDR 1995

Kyrgyz Republic Power and District Heating Rehabilitation ADB 5.1 EUR 1997

Lao PDR Highways Improvement IDA 4.8 EUR 1991Airports Improvement ADB 5.7 EUR 1994Bridge Construction Sida 6.0 EUR 1994Theun Hinboun Hydropower ADB 6.0 EUR 1995Third Highway Improvement IDA 3.9 SDR 1997Power Transmission and Distribution ADB 6.4 EUR 1997Road Maintenance IDA 4.5 SDR 2001Northern Area Rural Power Distribution ADB 12.3 EUR 2003Roads For Rural Development ADB 7.4 EUR 2004

Maldives Third Fisheries IDA 4.2 EUR 1992Male-Water and Sewerage IFU 2.1 EUR 1995Third Power System Development ADB 4.7 EUR 1998

Mongolia Telecommunications ADB 4.9 SDR 1994Power Rehabilitation ADB 3.9 SDR 1995Transport Infrastructure Development IDA 3.8 SDR 2001Social Security Sector Development, SSSDP ADB 4.4 EUR 2001Second Education Development ADB 8.5 EUR 2002

Nepal Power Sector Efficiency IDA 5.1 EUR 1992Fifth Telecommunication IDA 5.8 EUR 1993Biratnagar II Multifuel Power Plant Extension Finland 5.4 EUR 1996Khimti Power Transmission Finland 1.7 EUR 1997Melamchi Water Supply ADB 7.5 EUR 2001

Pakistan NLC - Radio Link NIB 3.3 EUR 1993WAPDA Twelfth Power Sector ADB 6.9 EUR 1993Provincial Highway ADB 4.3 EUR 1994


ASIA

ok!

CREDIT PORTFOLIO

28

Philippines Industrial Restructuring IBRD 2.8 EUR 1992Leyte-Cebu Geothermal IBRD 4.2 EUR 1995Local Government Units (LGU), Urban Water and Sanitation IBRD 0.6 SDR 1998Mindanao Basic Urban Services Sector ADB 4.3 SDR 2000Technical Education and Skills Development ADB 5.0 SDR 2000

Sri Lanka Second Power Distribution and Transmission IDA 5.4 EUR 1996Southern Transport Development ADB 3.7 SDR 1999Skills Development ADB 6.3 SDR 1999Secondary Education Modernization ADB 4.5 SDR 2000

Vietnam Song-Hinh Hydropower Sida 7.4 EUR 1996Vocational and Technical Education ADB 4.3 SDR 1999Bai Bang Paper Mill Sida 5.9 EUR 2001Central Region Transport Network ADB 11.6 EUR 2005




Bangladesh Scancement International Norfund 1.4 SDR 2000

China Scana Leshan Machinery Company Limited IFC 1.6 SDR 1999

Nepal Khimti Hydropower ADB / IFC 2.1 SDR 1996

Thailand Thailand Research Test Center (TRTC) Norfund 0.3 SDR 1998

Regional Mekong Enterprise Fund Ltd. (MEF) ADB 3.4 EUR 2002

CREDIT PORTFOLIO

29


Public Sector Projects Bolivia Energy Generation, Transmission and Distribution IDB 4.8 EUR 1991Environment, Industry & Mining IDA 5.0 SDR 1995National Land Administration IDA 5.0 SDR 1996Ventilla - Tarapaya Highway IDB 2.6 SDR 1999Institutional Reform Project (IRP) IDA 1.3 SDR 2000Bolivian Epidemiological Shield and Support for Health-Sector Reform Program IDB 5.0 SDR 2000 Road Rehabilitation and Maintenance IDA 4.8 EUR 2002Environmental and Social Protection in the - Santa Cruz-Puerto Suàrez Corridor IDB 3.5 EUR 2002 Colombia Pacific Coast Sustainable Development IDB 1.4 SDR 1997

Dominican Republic Energy Control Center / SCADA System IDB 5.1 SDR 1993Health Sector Modernization and Restructuring IDB 2.7 SDR 1998

Honduras Road Reconstruction and Improvement IDA 7.8 SDR 2000Potable Water and Sanitation Investment IDB 1.5 SDR 2000National Education Reform IDB 7.0 EUR 2001Three National Sustainable Development Program for - Upper Lempa River Basin IDB 3.4 EUR 2002 Land Administration IDA 5.6 EUR 2005Support for Rural Electrification and the Energy Sector IDB 5.6 EUR 2005

Jamaica Primary Education Improvement IDB 2.0 SDR 1993Multisectoral Pre-investment IDB 1.8 SDR 1994Airport Reform and Improvement IDB 2.0 SDR 1997

Nicaragua Electric Power System Rehabilitation IDB 2.7 SDR 1992Rehabilitation of the Water Supply & Sewerage Systems IDB 4.8 SDR 1992Rural Road Rehabilitation and Upgrading IDB 4.0 SDR 1993Forestry Resource Management and Conservation IDB 3.2 SDR 1996Management of Lake Managua IDB 6.9 SDR 1997Atlantic Biological Corridor IDA 2.3 SDR 1997Health Sector Modernization II IDA 2.5 SDR 1999Road Yalag¸Ìna-Las Manos, Rehabilitation and Improvement Sida 3.0 SDR 2000 Socioenvironmental and Forestry Development Program II - (POSAF II) IDB 2.5 EUR 2002Land Administration IDA 4.6 EUR 2003Transport Program for Improved Competition IDB 9.5 EUR 2004


Colombia Owens Corning Andercol TuberÌas S.A. NORAD 1.4 SDR 1996

Regional Central American Small Enterprise Investment Fund (CASEIF) Norfund 3.1 EUR 2003


LATIN AMERICA AND THE CARIBBEAN

CREDIT PORTFOLIO

NordicDevelopmentFund•AnnualReport2012•Lay-out:Kubikadvertising•Photos:MikkelØstergaard,Lehtikuva,AageJørgensenandJørgenSchytte•PrintedbyLibris,Finland

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annual report 2012

Documents

total of eur

climate change projects

result of eur

total value of eur

credit projects

ndfs climate change

board approved grant

evaluation report