This press release has been issued by the Royal Netherlands Embassy

12 May 2003

On Monday 12 May 2003 Secretary Charitha Ratwatte of the Ministry of Policy Development and Implementation and Ambassador of The Netherlands, Her Excellency Susan Th. Blankhart, signed a Memorandum of Understanding on the Programme for Cooperation with Emerging Markets (PSOM).

The Dutch Ministry of Foreign Affairs has initiated the Programme for Co-operation with Emerging Markets (PSOM) in order to share some of the initial financial risks that companies face when investing in new products and/or technologies in emerging markets in developing countries.
As of January 2003 the PSOM has been revised and will be continued on a more structural basis, aiming at some 60 investments per year in 17 countries.

PSOM co-finances pilot projects, which are to catalyse long-term investments and a lasting trade relation between the parties. PSOM funds are made available to consortia of Dutch companies and companies of the host country interested to undertake such an investment and trade project. A typical PSOM-project involves a mix of technical assistance, hardware supply and installation, marketing, demonstration and training. PSOM projects usually try out -on a pilot scale- a new line of production or production technology to see whether it is commercially feasible in the country concerned and whether (export) quality standards can be attained. Investors are expected to observe a high standard of corporate social responsibility.

The legal basis for PSOM is provided by a Memorandum of Understanding (MoU) between the Dutch government and the Government of Sri Lanka, in which the priority sectors for PSOM have been identified. The Ministry has appointed Senter, an executing agency of the Dutch government, to implement PSOM.

The overall goals of the PSOM are:

• To encourage investments in the selected developing countries and promote lasting investment and/or trade relationships between Dutch and local companies. 
• To contribute to the alleviation of poverty in the developing countries through transfer of knowledge and technology and strengthening and diversifying the local private sector.

The PSOM-programme will pay 50% of the costs of the projects, which most likely lead to long term investments and lasting trade relations in the selected countries and have the largest impact on poverty alleviation. Project are selected based on a call for proposals. The purpose of the pilot investment projects is to assess the commercial feasibility of investments in the PSOM country.

Parties interested in a more extensive introduction of the programme are most welcome to visit the public presentation on 19 May 2003, at the "public presentation on the economic development facilities of the Dutch government for Sri Lanka", (04.00 PM - 05.30 PM, at the Auditorium of the Sri Lanka Institute of Tourism and Hotel Management, Sirimavo Bandaranayake Memorial Building, No. 78, Galle Road, Colombo 3).