IFC, as the implementing entity of the IDA Private Sector Window Blended Finance Facility, is expected to provide up to €80 million in the form of a concessional subordinated loan (“blended concessional finance co-investment”). The subordinated loan helps de-risk the project for IFC and other senior lenders, overcoming a mismatch in the risk and return profile that constrains IFC and other lenders’ participation. The concessional subordinated loan also helps in filling a financing gap. Without the support of the blended concessional finance co-investment, the expected job creation and economic transformation through local value addition will not be achievable due to risks related to construction and ramp-up in multiple markets and first mover cost disadvantages, leading to a financing gap. The concessional level (i.e., “subsidy”) provided by the blended concessional finance co-investment is estimated to be 1.5% of the total project cost. The total cost of the project is €870 million. This estimate is based on the difference between (i) a “reference price” (either a market price if available; the price calculated using IFC’s pricing model, which comprises three main elements: risk, cost, and profit; or a negotiated price) and (ii) the “concessional price” being charged by the blended concessional finance co-investment. As with all of IFC’s blended concessional finance co-investments, this project was assessed against the Enhanced Blended Concessional Finance Principles for DFI Private Sector Operations adopted by IFC and over 20 other DFIs in 2017. Further information on these Enhanced Principles and IFC’s blended finance approach and governance and details and historical information on estimated subsidy levels in IFC’s blended finance portfolio can be found at www.ifc.org/blendedfinance. IFC is open to engaging with other eligible market players to develop projects that seek to achieve a similar impact.

Through the proposed investment, IFC will support ARISE, a company with a unique business model that goes beyond providing Industrial real estate but also deploys several core operational offerings and services to accelerate the industrialization of its host countries. The African continent remains the least industrialized part of the world despite being a global source of raw commodities- such as agro products, solid minerals, and fuels for energy. The region continues to export most of its commodities in unprocessed raw forms, losing significant opportunities to add value locally, create jobs, capture wealth, and increase economic complexity. ARISE provides a complete package\ecosystem of services to increase value addition on local commodities across Africa -by offering industrial real estate, commodities sourcing, investment promotion, one-stop-shop regulatory support, export market linkages, skills development of local communities, etc. ARISE’s zones are therefore set up to industrialize value chains and facilitate domestic processing of raw commodities, such as soya, cashews, cotton, and wood, amongst others (rather than continue raw exports of commodities). The most significant expected project-level outcomes are stakeholder effects through increased access to high-quality industrial spaces for tenants and supply chain development. The Project is expected to have significant economy-wide effects by providing high-quality formal jobs and contributing to GDP via value addition in agricultural commodities. Beyond the Project, IFC anticipates the investment has the potential to promote greater integration of agricultural value chains in the target countries via demonstration and replication channels. The large-scale nature of this project will provide an obvious demonstration case, which could have a catalytic impact on the industrial property market in the target countries.

IFC’s involvement is expected to bring both financial and non-financial additionality. IFC will provide scarce long-term financing that better matches the cash flow of the underlying businesses, improves the Company’s debt profile, and enhances its access to complementary capital. IFC will also help build the company's capacity in food safety management to support tenants within its zones, smallholder farmer financing, and green building standards.

This is a Category A project as per IFC’s Policy on Environmental and Social Sustainability as the company's business operations have the potential to cause significant adverse E&S risks and/or impacts that are diverse, irreversible, or unprecedented. Key E&S risks are: (i) identification of E&S risk and mitigation measures, including conducting an Environment and Social Impact Assessment (ESIA) for the project as per IFC Performance Standards (PSs) requirements; (ii) company’s E&S organizational capacity and management systems for construction and operations in line with IFC PSs; (iii) provision of fair and safe working conditions including life and fire safety (L&FS) design and implementation, in line with local labor laws and IFC PS requirements; (iv) resource (energy and water) use/efficiency and management of solid, liquid and hazardous wastes; (v) land acquisition and involuntary resettlement, including past, government-led land acquisition activities; (vi) stakeholder engagement and community grievance mechanism; (vii) supply chain risk management; and (viii) biodiversity and cultural heritage management.

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.