The International Finance Corp., a unit of the World Bank, said it is investing $55 million in Armajaro Trading Ltd. to “support the ethical sourcing of cocoa and coffee.”
“The project will help the company maintain closer contact with farmers and cooperatives and offer value-added services such as long-term supply agreements and price-risk management,” the IFC said in an e-mailed statement.
“IFC’s support will enable us to grow our business while ensuring that we continue to lead the sector in traceability and sustainability,” Richard Ryan, the chief executive officer of London-based Armajaro, said in the statement.
The IFC has been in talks with four banks to share in providing as much as $18 billion in commodities trade finance over three years in developing nations, German Vegarra, global head of agribusiness at the IFC in Washington, said in March.
European banks are reducing their commodities businesses as they cut lending and sell assets amid the sovereign debt crisis. Commodity trade lending may drop at least 25 percent, Jacques- Olivier Thomann, president of the Geneva Trading and Shipping Association and global head of structured finance at BNP Paribas (Suisse) SA, said last year. BNP Paribas was the biggest lender to commodities companies in 2011, followed by Societe Generale and UniCredit SpA (UCG), according to data compiled by Bloomberg.
Armajaro, which has operations in more than 20 countries, said it will continue working with the Washington-based IFC “to identify specific projects that will improve the welfare of farming communities and develop stronger relationships with nongovernmental organizations, development agencies, and charities.”
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