The proposed project will support the Company’s efforts to develop its own storage capacities by developing a new grain storage facility in Ukraine, which will improve the quality of grains under storage, reduce reliance on third parties and substantially cut operating costs. The project is part of the integrated primary agriculture production facility put in place in Ukraine by the Sponsor and currently including 22,500 ha of arable land. Furthermore the Project will facilitate the Company’s primary agriculture activities as well linkages with local farming community.
Transition impact derives from supporting a cross border investment into an agricultural sector in Ukraine, including primary agriculture and silo facility. In addition, backward linkages will be created and strengthened by increased relationship with the local farming community. Furthermore, forward linkages will be strengthened through increase of the quality and quantities of the agricultural crop through development of the modern primary agriculture. Finally, the Bank will continue to assist in a policy dialogue in order to assist in implementation of the warehouse receipt programme.
Agroinvest, a company incorporated in Ukraine and owned by the Sponsor-Agriholding, a part of MK Group. Agroinvest will be involved in managing agricultural land, primary agriculture, grain trading and silo operations.
EUR 10 million.
EUR 39 million.
The project is screened B/1. Environmental impacts associated with the construction and operation of modern silo storage facilities are limited and can be readily identified through an environmental analysis. However, the Company is involved in primary agriculture and there may be potential ESHS issues such as excessive use of water resources for irrigation; soil degradation due to poor soil management; use of pesticides and fertilisers; soil and groundwater contamination due to storage of pesticides, fertilisers or other hazardous chemicals; - Genetically Modified Organisms (GMOs); - generation of crop residues and solid waste; fire risk; and - labour issues. Therefore, an environmental audit is needed to establish the potential risks and liabilities associated with the current operations and assets of the Company particularly in relation to primary agriculture. ED will be visiting the site for due diligence.
Zeljko Erceg, Agroinvest,
Tel/Fax: +380 44 522 97 80
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