Internationalisation funding and international procurements
The Ministry for Foreign Affairs provides funding for Finnish companies for sustainable development partnerships and business opportunities in the emerging markets. It also advises companies on how to make best use of international development funding.
Brochure: Support for different phases of sustainable business in developing countries (PDF)
Internationalisation funding
Emerging markets present vast opportunities for Finnish companies. The Ministry therefore provides them with funding for sustainable partnerships and business opportunities in emerging markets. Such funding is conditional on adherence to responsible business conduct and on promoting sustainable development in the target country.
Finnpartnership provides advice, project funding and contacts for Finnish companies that pursue business activities in emerging markets. The key service available, Business Partnership Support, is like a kick off grant awarded to companies aspiring to pursue business activities in emerging markets. These grants typically amount less than EUR 100,000, covering up to 85% of the costs of a project in its early stages. Addressed to companies, civil society organisations and educational institutions, Finnpartnership services are free of charge.
The Developing Markets Platform (DevPlat) provides funding, information and contacts for Finnish-based companies seeking opportunities in the emerging markets. DevPlat funding is available to companies which are in the process of designing innovative and scalable solutions for identified market opportunities in their target countries and wish to deepen their cooperation with local partners. The Platform also encourages companies to apply for funding from the World Bank Group and from regional development banks, which annually make over EUR 100 billion available for procurement and projects in developing countries. The DevPlat will also advise companies on procurement opportunities within UN projects and share relevant contacts with them.
Finnfund invests in responsible companies that operate in developing countries. Its investment loans and capital investments typically range between EUR 2—10 million. Loans and investments are awarded to companies who already show strong proof of responsible and profitable business activities that are designed to promote sustainable development. Finnfund mostly makes investments in the fields of renewable energy generation, infrastructure, the financial sector, sustainable forestry, agriculture and digital solutions.
The Public Sector Investment Facility (PIF) for developing countries can be used for funding a transaction when the customer of a Finnish-based company is a public sector operator, such as a public enterprise, government agency or ministry. Investment aid means in practical terms that the interest on a commercial loan taken out by the customer for procurement plus a share of the other expenses will be funded out of Finland’s development cooperation appropriations. Companies will thus be better placed to close deals, which typically amount to EUR 10—30 million.
The FUIF instrument (Finland-Ukraine Investment Facility) is designed to support public sector investments in Ukraine in line with the priorities for the country’s reconstruction and following Finland’s national plan for it. Another requirement is that such investment projects must make use of Finnish products and services and Finnish expertise and technology.
The FUIF instrument is based on the same legislation as the Public Sector Investment facility (PIF) for developing countries. It can be used to finance a transaction when the customer of a Finnish-based company is a public sector operator, such as a public enterprise, government agency, municipality or ministry. In practical terms, a FUIF investment subsidy means that Finland will pay out of its development cooperation funds a share of the price of the transaction plus the interest on the commercial loan taken out by the customer to finance the acquisition. The target size for such projects is EUR 10–20 million. At least one third of the project content must be produced in Finland.
Internationalisation funding is also available from the following Team Finland organisations:
Finnvera strengthens the operating potential and competitiveness of Finnish companies by offering loans, domestic guarantees, export credit guarantees and other services associated with the financing of exports. Finnvera gives guarantees against political or commercial risks associated with the financing of exports. Covering the risks are particularly important in the case of exports directed to the emerging markets. [SJ1]
Business Finland is a Finnish public-sector organization offering innovation funding and internationalization services as well as promoting tourism and investments in Finland.
International development funding
Development banks
Finland is member of several international development finance institutions, such as the World Bank, the Asian Development Bank, the African Development Bank and the Inter-American Development Bank, major infrastructure financiers in the emerging markets.
Their private-sector programmes and investment companies (IFC, IDB Invest) finance private-sector investments and provide direct funding for companies. They also have programmes to finance innovations and early-stage companies (including IDB Lab, ADB Ventures). Investments in the emerging markets are also funded by the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD).
The Nordic Development Fund (NDF) and the Nordic Environment Finance Corporation (NEFCO), both based in Helsinki, provide companies with grants and credits. Companies in Finland have a home advantage, for the offices of these Nordic and European finance institutions are located next to one another, making it easier to build connections. Finland regularly provides funding for the activities of development finance institutions.
The Ministry for Foreign Affairs and its missions abroad can help open doors towards these finance institutions. Finland often has its representatives at the offices of the boards of investment banks. The Finnish Embassy in Washington DC will facilitate access to funding from the World Bank Group and the Inter-American Development Bank (IDB) Group.
International procurements
Development financiers, including the UN, the World Bank, regional development banks and the EU, fund public and private sector projects in developing countries for an estimated EUR 150 billion annually. Their decisions on grants, loans and investments are based on multiannual cooperation programmes, to be implemented in sectors jointly identified by the financier and the recipient.
A large share of this type of financing goes for tendered procurement for the acquisition of various kinds of commodities, devices and services. Such procurements are mostly put out to tender by the country or company that has received funding from a development bank. The emerging markets need innovative and sustainable solutions that ideally have already been tested in practice and will help developing countries reach the global Sustainable Development Goals (SDGs). There is demand for reliable contractors, equipment suppliers, providers of digital and innovative services and platforms, and planning and consultancy services.
Working in collaboration with international organisations, the Ministry for Foreign Affairs shares information about their procurement processes and contact persons. Finland’s missions abroad provide general information and contact details of key persons in their host-country organisations and they also arrange for companies to meet with public authorities.
For more information on international procurements, please contact the Department for Development Policy at keo-01(at)gov.fi.
Global Gateway, an EU project
The Global Gateway is an initiative of the European Union aimed at improving the economic and social development of developing countries by promoting smart, sustainable and secure solutions in the fields of digitalisation, energy and transport and by strengthening the health, education and research sectors. Various funding options will be considered before publishing calls for tenders to select implementers for projects based on the needs of partner countries.
The funding channels available in Finland include Finnfund, Finnvera and Finnpartnership. Among the transnational finance providers are the European Investment Bank (IEB) and the European Bank for Reconstruction and Development (EBRD). Finland primarily promotes the participation of Finnish-based companies in Global Gateway joint projects that include digitalisation, education, climate or energy solutions.