Two members of the World Bank Group are providing $3 million in financing and $7.8 million in political risk insurance coverage for a new raisin processing plant in Afghanistan.
Support from IFC and MIGA would help develop the country’s raisin market and boost its agribusiness sector, the World Bank hoped in a press statement.
Agriculture is a key part of the Afghan economy, contributing 25 percent of GDP and supporting more than 80 percent of the population.
The IFC-MIGA package will help the Rikweda Fruit Process Company develop a state-of-the-art raisin processing plant in the picturesque locality of Istalif.
The objective is to double production levels and improve the quality of processed raisins with modern technology and food safety practices, boosting exports and improving the lives of local farmers.
“Afghanistan was once famous around the world for its raisins and we hope this project will put the country back on the global map for raisin production,” remarked Mase Rikweda, CEO of Rikweda Fruit Process Company.
While Afghanistan’s climate is ideal for raisin production, less than 40 percent of its annual produce is currently exported due to instability, and poor quality and food safety standards.
“Nearly 90 percent of Afghanistan’s poor live in rural areas where agriculture plays a major role in their lives,” said Mouayed Makhlouf, IFC regional director for the Middle East and North Africa.
“Raisin processing can create entry points for farmers, including women, to participate in the value chain and improve the livelihoods of thousands of poor families.”
IFC is providing $3 million in financing to support the project. As well, IFC’s advisory services will help Rikweda provide guidance to small farmers to improve farming practices and implement harvesting, storage, and drying technologies.
MIGA’s political insurance coverage will be against the risk of war and civil disturbance. The Global Agriculture and Food Security Program’s Private Sector Window is providing a first loss guarantee of up to $1.25 million to IFC.
This is the first IFC-MIGA joint project in the country and IFC’s first investment in Afghanistan’s agribusiness sector. The project demonstrates the World Bank Group’s Maximizing Finance for Development approach.
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