TechnoServe is a reputable international NGO with 40 years of experience in rural economic development. It operates in 30 countries across Africa, Latin America and Asia and is active in agricultural sectors including coffee, horticulture, dairy, tea, cocoa and cashew. Technoserve is funded by various public and private donors including the Bill and Melinda Gates Foundation, USAID, and Rockefeller Foundation.
NIB is a licensed commercial bank in Ethiopia with interest in expanding its agribusiness portfolio especially to small farmers producing coffee, Ethiopia’s main export commodity. It is the 4th largest private sector bank in the country by size of equity, and it currently operates 86 branches across Ethiopia.

IFC’s exposure will be to farmer cooperatives most of which are legally incorporated in Ethiopia.

The total size of the financing program or maximum portfolio balance will be of ETB 300M. IFC’s participation will be in the form of a Risk Sharing Facility with a maximum risk amount of ETB 180M (60% of the overall portfolio).

9.01 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee	9.01
Loan
Equity

* These investment figures are indicative

The Project targets coffee farmers in rural areas of Ethiopia, especially Jimma and Limmu. Processing of the “cherry” coffee would take place in wet mills located in these rural areas. After processing, the “washed” parchment coffee will be transported to warehouses of the Coffee Service Providers (“CSP”) in Addis Ababa, for dry milling and packaging for exports as “washed” green bean coffee.

The Project is expected to continue to have the following development impact:
(i) Strengthen the competitiveness of the Ethiopian coffee sector;
(ii) Support economic livelihoods in the Ethiopian coffee supply chains, particularly small farmers and household labor;
(iii) Develop a commercially sustainable model of long-term and short-term financing for the Ethiopian coffee supply chain, with potential for expansion to other countries/sectors dominated by small scale suppliers;
(iv) Establish the credit worthiness of selected cooperatives;

Indicators to be tracked include: Farmers Reached, MSMEs Reached, Employment and Female Employment, Number of wet mills financed, and Volume of coffee processed annually by financed cooperatives.

Local currency financing: IFC provides a credit enhancement structure that allows coffee farmer cooperatives to access local currency working capital financing that is not otherwise available to them.
Long-term partnerships: IFC build long term partnership with Nib Bank that encourages the bank and potentially new banks to support the coffee sector in Ethiopia.
Stamp of Approval: IFC provides a stamp of approval that attracts other investors to take the risk of financing farmer cooperatives in Ethiopia for coffee and other crops.
Financial structuring and Advisory Services: IFC advises Nib Bank and other participating banks on how to structure innovative and creative facilities to finance smallholder farmers and mitigate risks. IFC Access to Finance provides capacity building support to the participating banks alongside the IFC investment.
Environmental and social standards/implementation: IFC introduces best practices in environmental risk management to the farmer cooperatives.

Indicator	Metrics	Comments	Calendar Year 2022	Calendar Year 2023	Calendar Year 2024
Farmers Reached	Farmers Reached (#)		Not Available	Not Available	Not Available

Key environmental and social issues applicable for this investment are: (i) TNS’s environmental, health and safety (EHS) management systems, including coffee cherries wet processing and agronomy best practices, and capacity to have same implemented consistently at all the selected cooperatives; (ii) labor and working conditions during construction and operation of the wet mills, including that related to occupational health and safety (OHS); and (iii) management of process effluent, including lagoon security to prevent inadvertent access by both humans and animals, and management of organic solid waste (coffee hull).



The proposed intensification of coffee yields on existing lands of cooperatives members and the installation of the wet mills and related ancillary structures will have limited impacts on the biophysical and social environment. The screening process established by TNS for site selection and the planning of and technology selection for wet mills also identifies and assesses the potential environmental and social impacts during the construction and operation phases of the project. Mitigation measures for these impacts are continuously being incorporated into the project design.



The impacts are generally site-specific and temporary and none are regarded to be significant. Those impacts can be avoided or mitigated by adhering to generally recognized performance standards, procedures, guidelines, technology selection and design criteria. Thus, this is a Category B project according to IFC’s Environmental and Social Sustainability Policy.

Please refer to the related Environmental and Social Review Summary (ESRS) document for this project.

Please refer to the Environmental and Social Action Plan (ESAP) tab in the related Environmental and Social Review Summary (ESRS) document for this project.