The European Bank for Reconstruction and Development (EBRD) is lending €4 million to fruit-processing company Frulact to support the expansion of its activities in Morocco. The loan will provide financing to develop a new processing factory for strawberries, peaches and other fruits in the Larache region, in the north of the country. This project will support local fruit producers as Frulact increases its purchases to meet accelerating demand for fruit-based yoghurts.
Frulact Group, founded in Portugal in 1987, has grown from a small local enterprise into one of Europe’s five leading fruit-processing companies. Longstanding clients include Danone, Senoble, Lactalis and Yoplait. The international expansion of the group started in 1998 when it entered the Moroccan market. The Bank’s investment will help Frulact to increase its fruit-processing capacity in Morocco by 75 percent.
“Morocco benefits from an excellent location, thanks to its proximity to Europe and links with the countries of North Africa and the Middle East. This enables Frulact to boost synergies with our value chain and gives us greater proximity to our target markets,” said João Miranda, President and co-founder of Frulact Group. He continued: “Greater integration of first-stage fruit processing into upstream activities, through the building of this new plant, is evidence of our successful integration into global markets and of confidence in the Moroccan economy.”
Laurent Chabrier, EBRD Director for Morocco, said: “The region around Larache is one of Morocco’s largest fruit cultivation areas, and Frulact provides an important link in the value chain between local agricultural producers and large dairy companies. Local fruit producers benefit directly from Frulact’s high quality standards and know-how.”
Gilles Mettetal, EBRD Director, Agribusiness, said: “Yoghurt consumption in Morocco is growing rapidly, partly driven by increasing health awareness. Frulact has been at the forefront of producing innovative fruit preparations for Moroccan dairy producers ever since it entered the market, and we are very happy to support the group’s expansion in the country.”
Financing for Frulact Morocco was arranged under the EBRD’s Local Enterprise Facility (LEF), which supports small and medium-sized enterprises (SMEs) by providing long-term financing in the Balkans, Turkey and the southern and eastern Mediterranean region. The LEF is supported by the SEMED Multi-Donor Account.
To date, the EBRD has invested €329 million in 16 projects in Morocco, in addition to €130 million worth of trade-facilitation credit lines with local banks. It has also provided technical assistance support to more than 110 Moroccan SMEs.