MDLF launches world's first investment product to support free press
Wednesday, Jan. 18, 2006 - New York – Media Development Loan Fund, a New York nonprofit organization providing low-cost financing to independent news businesses in emerging democracies, has launched Free Press Investment Notes, the world's first investment vehicle to support independent media in developing countries.
This innovative financial product in the nonprofit world will allow individuals and institutions to invest as little as $1,000, while selecting their interest rate (0, 1, 2, 2.5 or 3 per cent) and the length of their investment (1, 3, 5, 7 or 10 years).
"This is the first time the general public can invest in the development of the independent press in emerging democracies," said Sasa Vucinic, Media Development Loan Fund (MDLF) Managing Director. "Funds invested in Free Press Investment Notes will provide crucial financing for independent news companies in places like Guatemala, South Africa and Indonesia, helping brave journalists build sustainable businesses that are able to hold governments to account, expose corruption and fight for justice for all."
Free Press Investment Notes, the brain-child of Mr. Vucinic, is a financial tool designed to address the press freedom deficit in the world. Mr. Vucinic said: “Obviously there are plenty of investors willing to finance the U.S. budget deficit for returns of 7 to 8 per cent per year. I am convinced that there is an even bigger number of individual and socially responsible investors eager to invest in press freedom and, in addition to social benefits created, earn up to 3 per cent interest on their investment.”
MDLF financing is typically used to invest in printing presses, new TV and radio transmitters and broadcasting equipment, helping independent news outlets reach more people, generate more revenue and stay clear of government monopolies. It is often the only way an independent media company can access the capital it needs to strengthen and expand while staying free from state control or vested interests.
Funds raised will be allocated to a revolving loan pool that recycles repayments, enabling them to be used over and over to support independent news media around the world. MDLF supports each loan with intensive financial monitoring, management training and technology assistance. In its 10-year history, MDLF has provided over $40 million in affordable financing to almost 50 media companies in 17 countries, with loan losses of only 2 percent.
"The needs are immense," said Mr. Vucinic. "More than 80 percent of people live in countries without a free press. In other words, more than 5 billion people can't trust what they read in the newspaper, hear on the radio or see on TV, and do not really know what is happening in their own country."
Individuals and corporations in New York, California, the District of Columbia and 21 other U.S. states can buy Free Press Investment Notes, with registration pending in many more states. Designed as a flexible means for social investing, the Free Press Investment Notes program lets buyers choose the term of their investment – between 1 and 10 years – and the interest rate, ranging from 0 percent to 3 percent. And unlike any other product, investors can also expect a high rate of social return from helping remarkable journalists play a key role in building truly democratic societies.
Free Press Investment Notes currently may be purchased by residents of Alaska, California, Connecticut, Delaware, District of Columbia, Florida, Hawaii, Illinois, Maine, Maryland, Massachusetts, Mississippi, Nebraska, New Jersey, New Mexico, New York, North Dakota, Rhode Island, South Dakota, Texas, Utah, Vermont, Washington and Wyoming.
Free Press Investment Notes are administered by Calvert Foundation, which has more than 10 years' experience of managing community investment schemes. Investment kits and prospectuses can be ordered from Calvert Foundation, P.O. Box 30622, Bethesda, MD 20824-9912, or by telephoning 1-800-239-5911.
Although Free Press Investment Notes are not federally insured, they benefit from credit enhancements including portfolio diversification, rigorous due diligence, portfolio monitoring and MDLF's 10 years of experience. And MDLF backs its entire portfolio with a generous loan loss provision and net assets of more than $15 million.
MDLF, founded in 1995, pioneered a new model of media support, focused on developing self-sustainable independent media outlets.
From 1996 to 30 June 2005, MDLF has:· financed 80 projects, for 47 independent media companies, in 17 countries;· provided $42.5 million in low-cost financing;· collected $13.4 million in principal repayments;· collected $3.5 million in interest and dividends;· written off as losses only 2% of the total loaned and invested;· ended June 2005 with a $28.5 million portfolio of outstanding loans and investments.
Inquiries to: United States: Harlan M. Mandel, Deputy Managing Director, MDLF, 37 West 20th Street, Suite 801, New York, NY 10011. Phone: (212) 807 1304. Email harlan.mandel@mdlf.org.
United Kingdom: Peter Whitehead, MDLF Director of Communications, 45 Carr Lane, York, YO26 5HT. Phone: (44) (0)7763 175 332. Email peter.whitehead@mdlf.org.Website: www.mdlf.org.
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