Thank you, Mr. Chair.
I want to go immediately to talking about risk taking, because with the previous two witnesses, I didn't get a chance to ask them questions about it. Both of you touched upon it, and it's pretty much critical to how this is rolled out, because we are talking about hundreds of millions of dollars of taxpayer money being put aside.
Some witnesses in the past have talked about the portfolio, and how you shouldn't look at individual projects but look at it as a portfolio. In a portfolio you have a spectrum, and I've been looking at some of the different funds. I have the Swedish fund here on my iPad and I can see some of the projects they have been financing. In a portfolio if you try to manage your risk, as has been talked about—allowing the DFI to reinvest the money that it earns off the equity debt and put the financial support it gives out back into itself—that creates a spectrum. If we're going after those LDCs and high-risk programs that have a very high impact for the poorest, that means the portfolio manager will have to go after something like a luxury hotel with a very high return. So how do you balance the two? I have looked at these Swedish projects here and they have luxury hotels in Africa that they've helped get off the ground. Maybe Sierra Leone needs another one; I don't know. On the other end, they have also financed programs that seem to be hitting exactly the poorest of the poor who need the help. How do you balance the two? That is my first question.
What is the acceptable loss percentage, in your view, in year one, year three, and year five for the DFI if things don't go well?
There are also two parts to the risk. There is some talk about accepting below-market returns, and so there are two sides to it. The DFI could lose money on a project it invested in. It could reach all the goals but still lose money off it. Is that acceptable? Or if it invests in a project and earns below market returns, there is also that part of the loss it experiences.
Can I hear both of you expand on both of those?
Mr. Haga, you can go first.