ETC SME Local Currency Programme Technical Cooperation Framework: Capital Market Development Strategy for Mongolia

Country: Mongolia
Language: EN
Number: 442567
Publication date: 02-03-2017
Source: The European Bank for Reconstruction and Development (EBRD)

Description

Country:

Mongolia

Business sector:

Financial institutions

Project number:

68284

Funding source:

JPNF00 - Japan-EBRD Coop

Contract type:

Consultancy Services

Notice type:

Invitation for expressions of interest (CSU)

Issue date:

01 Mar 2017

Closing date:

22 Mar 2017 at 23:59 London

Access eSelection

Project Description: The Early Transition Countries (ETCs) SME Local Currency Programme Technical Cooperation (TC) Framework (the Framework) is being implemented by the European Bank for Reconstruction and Development (EBRD or the Bank) within its key Local Currency and Capital Markets Development (LC2) Initiative and funded by the Japan-EBRD Cooperation Fund. The Framework supports necessary capital market reforms to 1) make ETCs more resilient, 2) develop access to alternative sources in local currency for the domestic market participants, and 3) facilitate local currency funding by the EBRD and others in ETCs under the EBRD’s SME Local Currency Programme (LCYP).

The Framework covers 5 areas with TC work:

1) Reforming the legal and regulatory environment to support modern capital market activities, instruments, and infrastructure.

2) Providing capacity building programmes for central banks, market participants and regulators.

3) Developing capital market products by providing a feasibility study, implementation roadmaps, and education on the new or uncommon instruments such as corporate bonds, covered bonds, basic securitizations, repos, basic derivatives (e.g. FX or interest rate swaps), and equity listing support programs for SMEs.

4) Reforming capital market infrastructure, covering exchange, clearing, settlement, and depository entities, as well as relevant market infrastructure areas of the central bank (e.g. money market systems, government bond trading platforms and registries, and payment and settlement systems).

5) Developing the local and international institutional investor base including pension funds.

The capital markets in Mongolia are still underdeveloped; the Mongolian banking sector dominates the financial system with more than 95% of total assets. Although Mongolian policy makers recently implemented several measures to develop local capital markets, challenges still remain in the capital markets overall. There is no corporate bond market in Mongolia and the equity market today is a relatively limited trading venue for few shares and does not play a significant role in providing financing to the broad economy. The Mongolian financial market also lacks long-term financing sources, as there are no substantial institutional investors, such as life insurance providers and pension funds, which can invest in long term financial products.

In the efforts to overcome the overall economic and financial difficulties faced in Mongolia and to stabilise the economy, the Economic Recovery Programme was created as part of the Action Plan of the Government 2016-2020 and approved by the Cabinet on the 28th of December 2016. The Ministry of Finance of Mongolia (MoF) is mandated to develop a Financial Sector Strategy 2025 which will include a road map plan for creating an active secondary market of government securities and improving capital market infrastructure.

Thus, the EBRD wishes to engage a consulting company (the Consultant), under the SME LCY Programme Framework to support MoF to develop a capital market strategy that will form part of the Financial Sector Strategy 2025 and to propose the necessary capacity building programmes for policy makers and market participants.

Assignment Description: The EBRD now intends to engage a Consultant to assist the MoF in its capital market development by:

1. Identifying barriers to capital market development in Mongolia.

2. Identifying improvement levers and providing recommendations.

3. Providing a comprehensive implementation roadmap for the identified measures and recommendations.

4. Designing the necessary capacity building programmes for policy makers and market participants to achieve the milestones that are defined in the implementation roadmap.

The selected Consultant is expected to carry out the following activities:

Activity 1: Identifying barriers to capital market development in Mongolia. The aim of the Activity 1 is to conduct as assessment and identify the barriers that prevent the development of the capital market.

Activity 2: Identifying improvement levers and provision of recommendations. Based on the findings of Activity 1, industry trends and the Consultant’s capital market expertise, the Consultant will identify improvement levers and provide recommendations for the development of capital markets in Mongolia. The Consultant will provide the rationale, justifications and a clear set of arguments for each retained specific solution. Recommendations will cover a capacity building and training needs assessment for market participants based on identified skills and knowledge gaps.

Activity 3: Drafting an implementation roadmap.

The Consultant will prepare an implementation roadmap, where measures are divided into short-term actions with immediate impact, and medium-term actions to ensure sustainable development after the end of the TC Assignment. The implementation roadmap will be a comprehensive 5-year step-by-step action plan covering recommendations and required reforms described in the Activity 2.

Activity 4: Designing the necessary capacity building programmes for policy makers and market participants to achieve the milestones that are defined in the Implementation Roadmap.

Activity 5: Organising the final workshop to present the findings and proposed Implementation Roadmap to the stakeholders.

The Terms of reference for the assignment are available through this link.

Status of Selection Process: Interested firms or groups of firms are hereby invited to submit their expressions of interest.

Assignment Start Date and Duration: The Assignment is expected to start in 2Q 2017 and has an estimated overall duration of 6 (six) months.

Maximum Cost Estimate Available for the Assignment: EUR 185,000.00 (exclusive of VAT). The Consultant must determine whether any VAT would be chargeable on the services and the basis for that determination, without taking into consideration the special status of the Bank as an IFI and state this to the Bank in their response to the Invitation for Expressions of Interest. To the extent that a Consultant incurs input VAT on goods and services purchased in connection with the provision of services (e.g. VAT on airline ticket) which is not otherwise recoverable by the consultant from the local tax authority, the gross cost to the consultant of such expenses shall be treated as a reimbursable expense.

Funding Source: It is expected that the Assignment will be funded by Japan-EBRD Technical Cooperation Fund. Please note selection and contracting will be subject to the availability of funding.

Eligibility: There are no eligibility restrictions with respect to consultant nationality.

Consultant Profile: Corporate services are required. The Consultant will be a firm or a group of firms specialized in capital market development. The company should preferably have previous experience in working with market participants and authorities on similar consulting assignments. The Consultant will form a project team of experts to carry out the assignment. The provided expertise should cover all areas as defined in the scope of work. The Consultant may associate to enhance their qualifications.

As a minimum, it is expected that the Consultant"s team will comprise of the following key expert(s):

a. Key Expert(s) 1: The Consultant Team Leader and capital markets expert

b. Key Expert(s) 2: Capital market infrastructure expert

c. Key Expert(s) 3: Legal and regulatory expert

Submission Requirements: In order to determine the capability and experience of Consultants seeking to be selected for the Assignment, the information submitted should include the following:

a) Overview of the firm/group of firms including company profile, organization and staffing (max. 2-4 pages);

b) Brief description of the project’s methodology and approach (max 5 pages);

c) Details of previous project experience of firm or group of firms and related assignments undertaken in the previous five years, including information on contract value, contracting entity/client, project location/country, duration (mm/yy to mm/yy), expert months provided, assignment budget, percentage carried out by consultant in case of association of firms or subcontracting, main activities, objectives;

d) CVs of key experts who could carry out the Assignment detailing qualifications, experience in similar assignments, particularly assignments undertaken in the previous five years, including information on contracting entity/client, project location/country, duration (mm/yy to mm/yy), expert months provided, assignment budget, main activities, objectives.

e) Completed Consultant Declaration Form and Contact Sheet, the template for which is available at the following web-link:

http://www.ebrd.com/pages/workingwithus/procurement/notices/csu/contact_sheet.doc.

f) Financial Proposal in the format set out in the Terms of Reference provided via the link above.

The above information should not exceed 30 pages, excluding CVs and Consultant Declaration Form and Contact Sheet.

The complete expression of interest (including CVs and Contact Sheet) shall be one file (pdf or Word), not exceeding 4MB, to be uploaded to eSelection. The EBRD reserves the right to reject applications of firms submitting more than one file. Only if the permissible file size is exceeded, the Consultant may split the expression of interest into further files.

Expressions of interest shall be submitted in English through eSelection and not directly to the contact person given below, to reach the Bank not later than the closing date for submissions indicated above.

Bank Contact Person:

Larissa Gosling
Technical Cooperation
European Bank for Reconstruction and Development
One Exchange Square
London EC2A 2JN
Tel: Fax: +44 20 7338 7451
E-mail: goslingl@ebrd.com

(Submissions should be sent through eSelection and NOT to this email address)

Notes:

1. The selection will normally be made from responses to this notification only. Consultants will not be asked to submit a proposal. The highest-ranked Consultant will be selected from a shortlist and be invited to negotiate the contract, subject to availability of funding.

2. Depending on the quality of applications received the EBRD may invite the highest-ranked (up to 6) Consultants for interviews to be conducted via videolink or a conference call.

3. The evaluation criteria and weightings are as follows:

a) Consultants’ previous consultancy project experience in delivering a capital market development roadmap for national authorities (30%);

b) Consultant’s proposed methodology and approach (25%);

c) CV of the key expert 1 - Consultant Team Leader and capital markets expert (15%);

d) CV of the key expert 2 - Capital market infrastructure expert (15%);

e) CV of the key expert 3 - Legal and regulatory expert (15%).

Following the above referenced technical evaluation an additional 20 points will be allocated to the firm’s financial proposal submitted as part of the firm’s expression of interest.

The methodology for calculating scores for financial proposals is as follows: The lowest evaluated Financial Proposal (Fm) is given the maximum financial score of 20 points. The formula for determining the financial scores of all other Proposals (Sf) is calculated as follows: Sf = 20 x Fm/ F, in which "Sf" is the financial score, "FM" is the lowest price, and "F" the price of the proposal under consideration.