The FINANCIAL — IFC, a member of the World Bank Group, has agreed to provide a long-term financing package of $60 million to support the expansion plan of the Singapore subsidiary of leading Chinese agribusiness company New Hope Liuhe Co. The deal will boost the company’s investment in agriculture and food businesses across 10 countries in South and Southeast Asia.
The project is expected to create more than 1,500 new jobs, supply agricultural products to help improve the productivity of an additional 50,000 farmers, and provide more high-quality animal protein in Bangladesh, Cambodia, India, Indonesia, Lao People’s Democratic Republic, Myanmar, Nepal, the Philippines, Sri Lanka, and Vietnam. IFC Vice President for Global Partnerships Karin Finkelston and New Hope Group Co. Chairman Liu Yonghao attended a signing ceremony in Beijing, according to IFC.
One of China’s largest agribusiness players, New Hope Liuhe, the listed entity of New Hope Group, works with more than 80,000 breeding farms and produces 2.2 million metric tons of poultry products a year.
Liu said Chinese companies should work together to expand into global markets under China’s “One Belt, One Road” national strategy. By deepening collaboration with IFC, he said New Hope could tap into IFC’s global network and partner with other businesses to upgrade the global supply chain. The national strategy aims to increase Chinese exports overseas and focus on connectivity and cooperation among primarily countries in Europe and Asia.
“Globalization is one of New Hope’s key strategic priorities and we are determined to enhance our operation in Asia and further increase our footprint in Europe and Africa through our overseas headquarters in Singapore,” said New Hope Liuhe President Li Bing. “IFC’s funding and commitment to high environmental and social standards will help us build our capacity in international markets, improve our operation, and benefit more farmers.”
IFC will provide a $40 million loan from its own account and $20 million from the IFC Managed Co-Lending Portfolio Program, a new syndications platform that offers institutional investors the ability to passively participate in IFC’s future senior-loan portfolio.
Speaking of the strategic partnership between New Hope Liuhe and IFC in China, Karin Finkelston noted that the two institutions have worked together to promote food safety and sustainable agribusiness in the country for more than a decade. “Now IFC is supporting the company to grow regionally, helping create opportunity for farmers in other countries,” Finkelston said.
“Our financing to New Hope fits perfectly with IFC’s strategic priorities in promoting agribusiness development,” said IFC Director for Global Corporate Coverage Vipul Prakash. “It will strengthen agribusiness supply chains, link farmers to markets, and support investments in rural infrastructure.”
Promoting agribusiness is a priority for IFC in Asia and globally. In fiscal 2014, IFC invested $4 billion across the agribusiness supply chain – from farm to retail – to help boost production, increase liquidity, improve logistics and distribution, and expand access to credit for small farmers.
Discussion about this post