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Hans Christian JacobsenHans Christian Jacobsen
Recent developments in Agribusiness in EBRDRecent developments in Agribusiness in EBRDRome 2005Rome 2005
Agribusiness in EBRD in 2004Agribusiness in EBRD in 2004
• Total EBRD commitments in 2004: €4.133bn
• Including €701m in the Agribusiness sector
• Record number of Agribusiness Projects: 53
• In 18 out of 26 countries of operations
• Co-financing: €343m (including unfunded risk participation)
EBRD & Agribusiness: Annual InvestmentsEBRD & Agribusiness: Annual Investments
To date: EUR 3.25 bn invested in over 220 projects
Growing annual commitments
209246
193
419
360
500
701
630
210
277
100150200250300350400450500550600650700750
95 96 97 98 99 00 01 02 03 04
EBRD annual investments in Agribusiness (million €)
EBRD & Agribusiness: Sector DistributionEBRD & Agribusiness: Sector Distribution
Commodities & Banks
Beverages 11%
Brewery
17%
27% Confectionery
6%
Dairy products 5%
Edible Oil 9%
Other and food processing
14%
Retail
3%
Food Distribution 8%
EBRD & Agribusiness: Country DistributionEBRD & Agribusiness: Country Distribution
CENTRAL ASIA 3%
BALTICS & UKRAINE &
BELARUS 11%
REGIONAL 18%
BALKANS 20%
CENTRAL EUROPE19%
RUSSIAN FEDERATION
28%
CAUCASUS 1%
Selected investments in 2004 Selected investments in 2004 Retail GetroRetail Getro
• Second largest retailer in Croatia.
• Two projects financed by EBRD€25 million (2002) & € 35 million (2004)
• Modern distribution and retail improves price transparency, competition and quality standards throughout the Croatian food chain.
• The projects offer reliable market outlets to farmers and local agro-processing enterprises
Retail in Agribusiness in 2004Retail in Agribusiness in 2004
Retail continues to be a strategic focus for the agribusiness sector.
• Strong linkages throughout the food chain
• Promotes quality improvement
• Promotes competitiveness • Offers better, cheaper products to consumers
• Other retail transactions in 2004 included: Cora, Boliari, Migros and Getro
Selected investments in 2004 Selected investments in 2004 Early Transition Countries:Early Transition Countries: M-ProM-Pro
• Largest dairy company in Azerbaijan
• US$ 5.7 million debt and equity financing
• Improving corporate governance through EBRD 25% equity stake and seat on the board.
• Contribution to backward linkages through improving the standards of milk collection through additional tanks and premium payments to farmers for better quality milk.
• Development of higher hygienic and quality standards through greater range of consistently packaged and presented dairy products for the consumer.
ETC in Agribusiness in 2004ETC in Agribusiness in 2004
Early Transition Countries have been and continue to be priority countries for the Bank.
• New instruments have been developed
• Additional resources have been allocated, including Technical Cooperation
• Other ETC projects in 2004 included: Iberia Refreshments and Teliani Valley wine in Georgia, Trans Oil in Moldova and Berad-Agro in Uzbekistan
Selected investments in 2004 Selected investments in 2004 Commodity Financing: EvrotekCommodity Financing: Evrotek
USD 10 m participation in USD 20 million working capital loan arranged by HVB Ukraine
Evrotek -one of leading Ukrainian edible oil companies, dynamic and fast growing
Facility is secured on the warehouse receipts, a newly established instrument actively promoted by EBRD
Financing is for procurement of the sunflower seeds for further processing (STOZHAR brand).
Commodity Financing in Agribusiness in 2004Commodity Financing in Agribusiness in 2004
Commodity financing continues to play an important role
• Grain Receipt law is now in place in main agriculture countries (Kazakhstan, Ukraine, Romania, Poland, but not Russia yet)
• Role of the Bank is changing– more risk sharing with local banks– more direct cooperation with large local traders/processors
• Other examples of commodity financing projects in 2004 included: Regional Commodity Programme, ATF, BTA and Bank Caspian in Kazakhstan, Aval and Toepfer in Ukraine
Selected investments in 2004 Selected investments in 2004 working with local entrepreneurs - Marboworking with local entrepreneurs - Marbo
EUR 10 m long-term debt
One of Serbian success stories in the agribusiness sector
Works with potato growers
Constant capacity increase which leads to increased demand of quality potatoes
Growing quantities of potatoes purchased and produced – over 25k t in 2004
Local Enterprise and Agribusiness in 2004Local Enterprise and Agribusiness in 2004
Local businesses represent growing investment opportunities.
• Companies become more transparent with improved corporate governance
• They have a performance track record
• Integrity remains an issue to consider carefully
• Other transactions with local enterprises in 2004 included: Frikom, Fresh & Co, Boliari, Evrotek, Cherkizovsky & Lenta
ConclusionConclusion
Bank is moving East
Working role with local businesses but higher risks
Finding different ways to continue to provide liquidity to
farmers
Emphasis on retail starting to pay off
Still a long way to go……..
How to contact the EBRDHow to contact the EBRD
Hans Christian Jacobsen Director, Agribusiness
Tel: +44 207 338 6669
E-mail: [email protected]