42144 - GWFP SOFITEX 5

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Summary of Investment Information

Project Number

42144

Company Name

GWFP BURKINA FASO COTTON

Date SPI Disclosed

Dec 20, 2018

Country

Burkina Faso

Region

Africa

Projected Board Date

Jan 20, 2019

Environmental Category

FI-1 - Significant

Status

Completed

Last Updated Date

Sep 22, 2019

Department

Regional Industry - MAS ME & Africa

Industry

Agribusiness and Forestry

Previous Events

Approved : Sep 21, 2010
Signed : Jan 24, 2019
Invested : Mar 26, 2019

Sector

Natural Fibers (Cotton, Sisal, Jute, etc.)

Project Description

The Project is a funded risk participation for up to EUR 28.5 million by IFC in a EUR 65 million one-year offshore secured pre-export facility provided by Societe Generale (“SG”) to finance the purchase of seed cotton and provide working capital to a cotton company in Burkina Faso.

Associated Advisory Engagement

IFC with support from WB’s Global Partnership for Output Based Aid (GPOBA), designed the Burkina Faso Smallhoder Water Management and Irrigation program, a four-year advisory project. This advisory project seeks to help farmers to: (i) reduce soil erosion by introducing contour planting and water collection lines, thereby retaining rainwater (and fertilizer, organic matter, etc.) in the soil; (ii) collect runoff water in small reservoirs for later usage, using irrigation equipment; and (iii) promote good agricultural practices in soil and water management.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee	50.0
Loan	150.0
Equity

Development Impact

The most significant, expected project-level outcome is continued access to markets and finance for over 273,000 farmers and increases in productivity for 1,000 farmers. Beyond the project, IFC anticipates the investment will increase integration and resilience in the cotton sector in Burkina Faso, a low-income/IDA country, through capacity building and demonstration and replication effects.

E&S Category Rationale / Risks and Mitigation

This project has been categorized as an FI-1 in accordance with IFC's Policy on Environmental and Social Sustainability. The proposed investment is a fully secured, funded risk participation with Societe Generale, Paris in a pre-export cotton finance facility of up to EUR 28.5 million to finance the purchase of seed cotton and provide working capital to a cotton company in Burkina Faso. The obligor purchases raw cotton from smallholder farmers in Burkina Faso. Its business activity also includes the ginning and marketing of cotton lint. There are environmental and social (E&S) risks in the cotton supply chain related to conservation of biodiversity, health and safety risks, and working conditions including forced and harmful child labor which are considered high risk. The obligor, as a leading cotton company in Burkina Faso, plays a central role in the development, competitiveness and sustainability of the cotton sector in the country and is required to address those risks in its supply chain. For this participatory facility, the obligor will be required to maintain compliance to national legislative requirements on E&S issues and IFC Performance Standards.

The main E&S risks and impacts associated with the activities of the obligor are management of child labor concerns in the Burkina Faso cotton sector, biodiversity loss, waste management, effluent treatment, air emissions, and disposal of hazardous materials. Societe Generale has a well-established E&S policy and implementation procedures to mitigate E&S risks in its investments. The obligor) has an E&S officer and Environmental and Social Management System (ESMS) outlining the procedures, responsibilities and tools for undertaking E&S issues associated with its business activities. The company also has stakeholder engagement plan (SEP) that identifies key stakeholders and ongoing information and communications plans relating to the cotton sector in the country. The SEP will include a grievance redress mechanism (GRM) to address any concerns that people living in its cotton producing region might have. To manage the child labor and biodiversity concerns in its supply chain, the company shall consistently update its ESMS with regards to child labor management and monitoring as well as a biodiversity management. Societe Generale and IFC will be required to monitor the action plan for the cotton company under the facility.

Contacts

For Inquiries About the Project, Contact

Societe Generale
Contact: https://wholesale.banking.societegenerale.com/en/contact/

FR-RELATIONS-MEDIAS@SOCGEN.COM
17 cours Valmy 92800 Puteaux France
https://wholesale.banking.societegenerale.com/en/

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IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

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Online form: available at https://www.cao-ombudsman.org/
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Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

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Task Title & Description	Anticipated Completion Date
Finalization and implementation of External Grievance Mechanism	06/30/2019
Child Labor Management & Monitoring in the supply chain	06/30/2019
Biodiversity Conservation Management & Monitoring in the supply chain	06/30/2019

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Summary of Investment Information

Project Description

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Development Impact

E&S Category Rationale / Risks and Mitigation

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