US$ 100 million credit line to support activities across the Bank’s regions, strengthen food security
A US$ 100 million loan facility provided by the European Bank for Reconstruction and Development (EBRD) will finance the regional expansion of Louis Dreyfus Company (LDC), a leading global merchant and processor of agricultural goods.
The new facility will finance the working capital needs of LDC in eight countries: Bulgaria, Egypt, Kazakhstan, Poland, Romania, Tajikistan, Turkey and Ukraine.
Founded in 1851, LDC is at the heart of the agricultural industry, with a diversified portfolio covering the entire value chain, from origination to distribution. The company works in collecting, storing, processing, exporting and importing agricultural goods.
The final portion of the guarantee documentation was signed today by EBRD First Vice President, Phil Bennett, and by global CEO of LDC, Gonzalo Ramirez Martiarena, in the EBRD’s London headquarters.
Phil Bennett said: “The EBRD is very pleased to deepen its cooperation with Louis Dreyfus Company, our longstanding strategic partner.”
Gonzalo Ramirez Martiarena commented: “Thanks to the EBRD’s sustained support over the past ten years we continue to expand the geographical scope of our operations in line with our strategy and increase the efficiency and breadth of our supply chain, in order to meet the need for our products and services in this part of the world and provide even better service to our growing customer network.”
Gilles Mettetal, EBRD Director for Agribusiness, said: “This project is bringing agricultural producers in eastern Europe closer to consumers in North Africa to strengthen global food security. The Bank is happy to continue supporting the expansion of Louis Dreyfus Company’s operations, which are strongly engaged in the region.”
In Ukraine, the company and the EBRD have been working together since 2000. This strategic partnership is now extended from eastern Europe to Central Asia and North Africa, making the best use of synergies where applicable.
One example of these synergies is in Egypt, the largest wheat importer in the world. The country is the main export destination for wheat from Ukraine, and Ukraine is also the main supplier of corn imported by Egypt. Making export-import operations between these two countries more efficient will help strengthen global food security. The Egyptian subsidiary of Louis Dreyfus Company will have the flexibility to use the funds in US dollars or Egyptian pounds, depending on its needs.
The EBRD and Louis Dreyfus Company will continue cooperating on policy dialogue in Egypt and Ukraine, to improve regulations and public-private dialogue in the grain sector in Ukraine and private sector competitiveness in Egypt.
The loan facility will also allow the company to enter Tajikistan for the first time, focusing on the cotton industry which supports about half the country’s rural population. Under a previous EBRD-financed project, Louis Dreyfus Company worked in the cotton sector in Kazakhstan, where it is the leading cotton exporter and is also implementing higher industry standards under the umbrella of the global Better Cotton Initiative.
To date, the EBRD has invested €10.6 billion in the agribusiness sector through 608 projects. In 2016 alone the Bank invested €840 million in 55 agribusiness projects.