ETHIOPIA – The European Bank for Reconstruction and Development (EBRD) is bolstering Egypt’s agribusiness sector with a US$20 million loan to Afia International, a prominent manufacturer of edible vegetable oils and ghee in the country.
Afia International is a fully owned subsidiary of Savola Foods, ultimately owned by Savola Group, a publicly listed company headquartered in Jeddah and one of Saudi Arabia’s leading agribusiness companies with a strong presence in the Middle East and North Africa region and Türkiye.
According to Ecofin Agency, this financing project has been under review since December 2022, within the EBRD.
The board of directors of the financial institution finally agreed, deciding to release the funds requested by the Egyptian firm. Through this initiative, the EBRD intends to support the oilseed sector, whose prices have increased considerably on world markets, due to the Russian-Ukrainian conflict.
In addition, the EBRD is helping Afia International raise its inclusion standards by promoting a gender-sensitive internship program that will increase women’s access to employment and training.
This financing will primarily support Afia International to boost its working capital needs and raw material procurement, including bulk crude vegetable oil, thereby contributing to diversifying the company’s funding sources.
According to EBRD, the financing will also help the company diversify its financing sources by providing approximately 15 percent of what it needs annually.
The company engaged in the refining of crude and semi-refined vegetable oils intends to maintain its production, in the face of disruptions in global supply chains, and improve its standards to expand into new export markets abroad.
It has pushed up global food prices, particularly in the southern and eastern Mediterranean, which relies heavily on food imports and commodities from these two countries, hence the financing is timely.
Since 2012 the EBRD has invested €10.4 billion (US$11.1 billion) in 167 projects in Egypt, with almost 57% of this amount allocated to projects carried out by the Egyptian private sector.