IFC as implementing entity of the Canada FRFS may provide a concessional loan of up to €1 million (“blended concessional finance co-investment”), subject to obtaining the necessary internal approvals. The project requires long-term financing to provide it with adequate time for execution and ramp-up of operations. However, the high country and project-specific risks lead to a mismatch of risk and return, limiting the?project’s ability to secure the required long-term financing. Without the risk mitigation provided by Canada FRFS, the project would not move forward. By supporting the project, Canada FRFS would help promote domestic value addition, job creation and improved consumer access to safe, quality, and affordable food products in the country, and therefore contribute to improving food security in an IDA and FCS country. The level of concessionality (i e., “subsidy“) provided by the blended concessional finance co-investment is estimated to be approximately 7% of the total project cost. The total cost of the project is €2.4 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 Canada FRFS loan. 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 can also be found at www ifc.org/blendedfinance.

1.04 million (USD)

Product Line	IFC Investment (million USD)
Risk Management	0.0
Guarantee
Loan	1.04
Equity

* These investment figures are indicative

(i) Economywide effects: Economy-wide: Competitive local manufacturing of beverage products will support domestic value addition and job creation through up-and downstream linkages in the dairy and fruit juice value chains (The Project will create more full time direct jobs and support indirect jobs in the supply chain).

(ii) Stakeholder - Customers: The Project is expected to increase access to affordable, safe, quality (hygienically packed) and protein-rich dairy products which contribute to improving nutrition and health in the country. Consumers will also benefit from increased access to fruit juice.

(iii) Contribution to market creation- competitiveness: The Project could serve as a catalyst in showcasing the potential of domestic vertical integration to other investors in the FMCG industry via demonstration effect of business models to increase competitiveness via local processing of beverage products.

Financial additionality:

Financing structure: IFC will provide a long-term loan with a sufficient grace period, which is not readily available to agribusiness in the local market. The loan will be structure to fit the project that needs sufficient time for preparation.

Non-financial additionality:

Knowledge, Innovation and Capacity building: IFC will provide technical, environmental, and social (E&S), health, and safety expertise to improve overall environmental and safety performance, to align the company’s operation with IFC performance standards and industry best practices. IFC could also provide support in financial management through advisory services.

Indicator	Metrics	Comments
Direct Employment (#) Operations And Maintenance	individuals

This is a Category B project as per IFC's 2012 Policy on Environment and Social (E&S) Sustainability due to limited and site-specific E&S risks and impacts associated with the upgrade of an existing dairy and juice processing plant. These can be avoided or mitigated by adhering to Good International Industry Practices (GIIPs). Key E&S risks and issues for this proposed investment are (i) FAC’S E&S management capacity/ competency to implement a PS-compliant E&S Management System (ESMS); (ii) assurance of safe and healthy working conditions, including implementation of HR policies/procedures in line with IFC PS2 for employees and contractors; (iii) emergency preparedness and response; (iv) resource efficiency and GHG emissions; (v) management of air emissions, effluent, noise, solid/hazardous waste; (vi) community safety risks, including traffic; (vii) stakeholder engagement plan and community grievance mechanism, especially with neighboring houses.

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.