MULTINATIONAL - Subscription to ETG Sustainability Linked Loan (AFDB-P-Z1-AAG-057)

Regions
  • Africa
Geographic location where the impacts of the investment may be experienced.
Countries
  • Benin
  • Burkina Faso
  • Ethiopia
  • Ghana
  • Ivory Coast
  • Kenya
  • Malawi
  • Mozambique
  • Nigeria
  • Senegal
  • Tanzania
  • Uganda
  • Zambia
  • Zimbabwe
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • African Development Bank (AFDB)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Approved
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
A
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Oct 30, 2024
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
ETC Group Limited
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Agriculture and Forestry
  • Industry and Trade
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 65.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Loan Amount (USD)
$ 65.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Project Cost (USD)
$ 550.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Bank Documents
Primary Source

Original disclosure @ AFDB website

Updated in EWS Mar 17, 2025

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

According to the AfDB, the project consists of an up to USD 65 million participation in the Sustainability Linked Loan ("SLL") Facility of the ETC Group Limited ("ETG" or the "Group"), Mauritius for its core value chain financing: to support its integrated value chain and strengthen the small holder farmers ecosystem in Africa. ETG is raising up to USD 550 million to finance its core value chain under the two tranches -Development Finance Institutions ("DFI") term tranche and commercial revolving credit facility. ETG is currently reaching 4 million smallholder farmers active in 48 countries worldwide, trading in excess of 80 commodities. The Group is purchasing crops from farmers as close to farmgate as feasible, aggregating and transporting to port warehouses and selling cargo to end-buyer across the world, after processing and value addition. At the same time, ETG purchases and imports fertilizers and agro-inputs from across the world for distribution to dealers and farmers in Africa. The Group's value chain backed up by its own hub-and-spoke logistics network requires funding to be renewed every season, permanent in nature. The Bank's financing will be deployed to ETG's core value chains in Africa (including Benin, Ghana, Ivory Coast, Senegal, Nigeria, Burkina

The main development outcomes stem from: (i) contribution to food security by increasing agricultural production and enhancing logistical capacity to strengthen distribution mechanisms; (ii) contribution to food import substitution by processing and packaging agricultural products locally while increasing value addition of export-oriented products, which decrease the current account deficit in African countries (iii) job creation for men, youth and women throughout various agriculture commodity value-chains;(iv) fiscal contribution to RMCs through import/export duties, corporate tax, value-added tax; and (v) explicit support for women enterprises to enhance their business management skills and promote inclusive growth in the agriculture and food sectors where a large number of women can be employed.

Based on the sustainability KPIs and annual targets, it is expected that 600,000 supply chain farmers (1 million by 2032) would receive extension services by 2027, 25% will be women farmers by 2027 (50% by 2030). Additional gender-oriented support services will be provided to 9,000 women farmers (by 2027) and 25,000 by 2030. The ETG project has demonstrated significant growth in job creation, with full-time positions expected to increase from 2,949 in 2024 to 5,474 by 2031, reflecting a substantial impact on employment in target countries. Notably, the proportion of full-time jobs held by women is projected to rise from 17.5% in 2024 to 30% by 2031, highlighting a positive trend towards gender inclusivity in the workforce. Simultaneously, the total number of farmers participating in the supply chain is projected to grow from 186,681 in 2024 to 188,224 in 2031, with the majority being smallholder farmers.

Investment Description
Here you can find a list of individual development financial institutions that finance the project.
Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

ETC Group is an agricultural commodities trader which is partly owned by Mitsui & Co..

Private Actor 1 Private Actor 1 Role Private Actor 1 Sector Relation Private Actor 2 Private Actor 2 Role Private Actor 2 Sector
Mitsui & Co., Ltd. Undisclosed Finance invests in ETC Group Client Agriculture and Forestry

Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

AfDB Team Leader:

Hyo-Kyung Lee - Investment Officer, AHFR1
Email: h.lee2@afdb.org
Website: www.afdb.org

ACCESS TO INFORMATION

You can submit an information request for project information at: https://www.afdb.org/en/disclosure-and-access-to-information/request-for-documents. Under the AfDBÕs Disclosure and Access to Information policy, if you feel the Bank has omitted to publish information or your request for information is unreasonably denied, you can file an appeal at https://www.afdb.org/en/disclosure-and-access-to-information/appeals-process

ACCOUNTABILITY MECHANISM OF AfDB

The Independent Review Mechanism (IRM), which is administered by the Compliance Review and Mediation Unit (CRMU), is the independent complaint mechanism and fact-finding body for people who have been or are likely to be adversely affected by an African Development Bank (AfDB)-financed project. If you submit a complaint to the IRM, it may assist you by either seeking to address your problems by facilitating a dispute resolution dialogue between you and those implementing the project and/or investigating whether the AfDB complied with its policies to prevent environmental and social harms. You can submit a complaint electronically by emailing crmuinfo@afdb.org, b.kargougou@afdb.org, b.fall@afdb.org, and/or s.toure@afdb.org. You can learn more about the IRM and how to file a complaint at: https://www.afdb.org/en/independent-review-mechanism/ 

How it works

How it works