Exploring Opportunities in Emerging Markets. Opportunities in the Agribusiness sector June 14, 2012

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Debra Taylor
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1 Exploring Opportunities in Emerging Markets Opportunities in the Agribusiness sector June 14, 2012

2 Agribusiness: Supporting the Entire Value Chain Goal : deliver development impact along the global agri-supply chain, through investments and advisory services with the private sector, to create opportunities and improve peoples lives Project/Corporate Finance Inputs Farm Production Collection Processing Marketing Distribution Financial Institutions Market Infrastructure Pre-Harvest Finance Trade Finance Risk Sharing Facilities 2

years (US$ in millions) The active portfolio of

3 Agribusiness an IFC Strategic Priority IFC has significantly increased its agri financing in recent years (US$ in millions) The active portfolio of agri-related investments was $4.5 billion at FYE11 (excl. Trade Finance) 3

4 Project Examples in the Agribusiness Value Chain Direct Finance Inputs Farm Production Sourcing Processing Marketing Distribution Retail Infrastructure/ Logistics CJSC Rise (Ukraine) GOPDC (Ghana) Conaprole (Uruguay) Wadi (Egypt) Wings Noodles (Indonesia) Finatrade (West Africa) ADA-Ticaret (Azerbaijan) Jain Irrigation (India) US$10 million loan to support a leader in farmer services and inputs (fertilizer, seeds, equipment, etc) in Ukraine. $10 million loan + US$3 million equity to plant oil palm trees, upgrade plantation infrastructure, and support over 7,000 outgrowers US$ 60 million in loans for US$108 million and US$62.5 million expansions of dairy product facilities to efficiently utilize global competitive advantages of Uruguay s largest dairy cooperative, and one of its largest employers. US$25 million loan to support a poultry producer to expand its feed milling and pelleting capacity, diversify through olive and grape farms, and expand its glass containers capacity US$19 milion loan to support a rising competitor in the production, marketing, distribution of instant noodles, which support an informal kiosk sector and provide low-cost foods to the public. US$20 million investment to support the leader in West Africa soft commodity (rice, sugar and vegetable oils) and fast-moving consumer goods (FMCG) distribution. US$18 million investment in state-of-the-art grocery retail chain enabling direct purchases from suppliers and wholesalers, efficient handling, storage and distribution. US$30 million loan to provider of micro irrigation systems to increase efficient water delivery and reach over 2,000 farmers. Pre Harvest Finance Ecom (Latin America) Indirect Finance Corporate loan facility to a leading supply chain manager of coffee, to be on lent by local subsidiaries to farmers for capital expenditures and crop financing 4

5 Products IFC can offer a wide range of products based on client needs Resource Direct Investments Mobilization Wholesale Finance Advisory Services Short-term Finance Senior Debt Mezzanine / Quasi- Equity Working capital financing Trade Finance Corporate and Syndicated Loans Project Finance Expansion, Greenfield (only with sponsors with strong financial capability and relevant experience) Subordinated loans Income participating loans Convertibles Other hybrid products Syndication IFC Asset Management Company Risk Sharing Facility (guarantee on portfolio) Partial Credit Guarantee Investment in Private Equity Funds Securitization Investment Climate Access to Finance Sustainable Business Advisory (Environment, Linkages, IFC Against AIDS, Corporate Governance) Public-Private Partnerships Up to 20% shareholding Equity Long term investment horizon Common and Preferred shares 5

6 IFC Value Addition Long-term Competitive Financing Regional Knowledge Global Sector Expertise Country Risk Mitigation Environmental & Social Risk Management Sustainability Toolkit Equity Fixed/Floating Rates, Local Currencies Up to 15 year Loan Maturity Flexible Amortization Profile Catalyst for other Investors and Lenders Equity Participation Capital Mobilization Extensive Local Office Network Local Transaction Experience Strong bank partnerships through client networks and B loan participants World Bank Synergies Joint Venture partnership management 40+ Years of Sector Expertise Industry Specialist Advice and Benchmarks Greenfield Expansion/ Modernization Corporate Strategy Access to International Investors Government Relations Neutral broker Role Reduced Risk of Expropriation, Breach of Contract, Convertibility World Bank Synergies Witholding Tax Benefit Advice on Environmental and Social Best Practices Energy and Water Use Management / Cleaner Technologies Equator Principles Modeled after IFC Standards Local Consultation and Disclosure Local Supplier Development Environmental/ Social Advice Corporate Governance Local Economic Development HIV/AIDS Prevention Community Development Funding 6

7 IFC s Global Reach IFC is present in 100+ country and regional advisory services offices worldwide Moscow Washington Dakar Cairo Istanbul New Delhi Hong Kong Nairobi Rio de Janeiro Johannesburg IFC Hubs IFC Offices 7

8 IFC Contacts Team Member Position Contact Info Arnaud Dupoizat Sadia Sajjad Senior Investment Officer Global Agribusiness Senior Investment Officer UK & Ireland Coordinator Paris, France London, UK 8

IFC Agribusiness Department. Dr. R. John Hatton Senior Industry Specialist, IFC Agribusiness Department

IFC Agribusiness Department. Dr. R. John Hatton Senior Industry Specialist, IFC Agribusiness Department IFC Agribusiness Department Dr. R. John Hatton Senior Industry Specialist, IFC Agribusiness Department OIE Conference, Cairo October 2008 IFC Work to Support Implementation of Animal Welfare Standards