International Finance Corp (IFC) is providing a financing package of $60 million to the Singaporean arm of Chinese agribusiness company New Hope Liuhe to boost its investment in agriculture and food businesses across ten countries in South and South-East Asia.
The $60 million financing package comprises a $40 million loan from IFC’s own account and $20 million from the IFC Managed Co-Lending Portfolio Program (MCCP), a new syndications platform that offers institutional investors the ability to passively participate in IFC’s future senior-loan portfolio.
New Hope Liuhe is one of China’s largest agribusiness players. It’s a listed entity of New Hope Group, which produces and sells feed, meat, egg, and dairy products in China. It aslo offers breeding, animal feed, planting, technology services, slaughtering and meat processing, and animal epidemic prevention.
With the help from IFC, New Hope’s Singaporean arm plans 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,” the statement says.
The ten countries that will benefit from this investment are Bangladesh, Cambodia, India, Indonesia, Laos, Myanmar, Nepal, the Philippines, Sri Lanka, and Vietnam, according to the press release.
“Globalisation 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.
“Our financing to New Hope fits perfectly with IFC’s strategic priorities in promoting agribusiness development,” Vipul Prakash, IFC director for global corporate coverage, said in a statement. “It will strengthen agribusiness supply chains, link farmers to markets, and support investments in rural infrastructure.”
According to IFC, it invested $4 billion, about 18.2 percent of its total fiscal year investment, across the agribusiness supply chain in 2014 – from farm to retail – to help boost production, increase liquidity, improve logistics and distribution, and expand access to credit for small farmers.
IFC last week made its first investment into Nepali agribusiness, a $3.8 million for a Nepalese poultry feed producer. Back in April, IFC invested $110 million into Cambodia. Both investments are through IFC’s Global Agriculture and Food Security Program (GAFSP).