International Finance Corporation (IFC), the private sector arm of the World Bank, has provided a $50 million loan to Adeco Agropecuaria and Pilaga designed to support efficient farming and food processing in Argentina.
IFC provided a $25 million facility to the local subsidiaries of South American agroindustrial company Adecoagro and mobilized the additional $25 million from Rabobank and Banco Itau.
The funds will be used to implement water-efficient rice farming; switch away from diesel to power for water pumps; implement no-till technology for oilseed production, designed to conserve water and reduce soil erosion; and add new equipment and breeding facilities to dairy operations.
The investment comes amid broader foreign investor interest in Argentina as relationships improve following the election of centre-right Maurico Macri late last year.
“Though in the past it was completely off the radar, foreign investors are starting to look to Argentina as a potential country to invest in,” IFC’s principal agribusiness investment officer, Guillermo Foscarini, told Agri Investor.
A decrease in export taxes on key crops, the elimination of export permit requirements and a relaxation of restrictions on foreign land ownership are among the measures the new government has implemented.
At a panel on emerging markets at the Agri Investor Forum in Chicago last month, FMO director of Agribusiness Suzanne Gaboury, recalled how a recent trip to Argentina revealed a mixture of optimism and apprehension in the agricultural sector.
“There’s a lot of pent up demand, there are a lot of pent up projects and initiatives that people are doing,” she said. “There will be a number of large announcements in the coming months, a number of very, very large transactions that some of the big global players are involved in.”