IFC as implementing entity of the GAFSP and IDA-PSW BFF is expected to provide up to €40 million (€10 million, and €30 million, respectively), in the form of concessional unsecured corporate loans (“blended finance co-investment”), to support the working capital financing to SUCDEN to promote sustainable cocoa sourcing in Cote d’Ivoire. Without the support of the blended finance co-investment, the Project will not go ahead due to heightened project risk, political risk, and low expected return. As a result, the Project would not be carried out as planned and the subsequent benefits for the smallholder farmers, well as on the market competitiveness will not be achieved. 

The level of concessionality (i.e., “subsidy”) provided by the blended concessional finance co-investment is estimated to be [1.2%] of the total project cost. The total cost of the project is €100 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 is the case with all of IFC’s blended concessional finance co-investments, this project has been assessed against the Enhanced Blended Concessional Finance Principles for DFI Private Sector Operations adopted by IFC and more than 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 engage with other eligible market players in the sector developing projects that seek to achieve similar impact.

The investment provides IFC with the opportunity to assess the E&S performance of SUCDEN Cote d’Ivoire and identify potential gaps for alignment with international best practices.