K3bn loan to boost macadamia, coffee production
The International Finance Corporation (IFC), a member of the World Bank Group, and the Global Agriculture and Food Security Programme (Gafsp) on Thursday announced a $4 million (about K3 billion) loan to support macadamia and coffee production in the country.
In a statement released on Thursday, IFC said the financing will benefit local farmers in Malawi by boosting production and exports of fair-trade certified macadamia and coffee.
The loan will go towards the expansion of Global Tea & Commodities and its subsidiaries. Global Tea is the largest coffee producer and a leading macadamia producer in Malawi.
“Global Tea will use IFC’s financing to expand its operations in Malawi, including planting more macadamia trees, replanting existing coffee plantations and the developing a coffee outgrower programme to support 3 300 smallholder farmers,” reads the statement in part.
The company also plans to explore climate smart and renewable energy solutions at its plantations to reduce water consumption and help offset diesel fuel with solar power. IFC will also provide Global Tea with advisory services on its renewable energy and smallholder coffee programs.
Nadeem Ahmed, the founder and chairman of Global Tea, is quoted saying, “Our partnership with IFC will help Global Tea expand the production of single-origin macadamia and coffee, creating more than 900 jobs for farmers who supply to the group. We chose to work with IFC as it takes a long-term view of our partnership and adds value beyond financing, in areas like corporate governance, environmental and social standards.”
While Jumoke Jagun-Dokunmu, IFC Malawi country manager said, “By investing in companies like Global Tea, IFC supports African branded products and supports livelihoods for local farmers. We are advising Global Tea on climate smart and environment-friendly agricultural practices, which should boost sustainable production of commodities in Malawi.”
Global Tea exports macadamia nuts globally to buyers, including Intersnack in The Netherlands, Marubeni in Japan, and to coffee buyers, including Starbucks.
The group produces packed tea in Kenya under the Baraka Chai Kericho Gold brands, the latter of which dominates the premium tea and fruit and herbal infusions segment in East Africa.
It also exports packed tea from its factory in Mombasa to other markets in Africa and Asia, Australia, European Union, Middle East, South Africa, United Kingdom, and United States.
IFC and Gafsp will also support Global Tea’s processing operations in Kenya.
The company plans to increase packaging capacity at its factory in Kenya, which will help it source an additional 5 000 metric tons of tea from tea farmers and local factories directly and via auction.
