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Kyiv, Ukraine, October 7, 2015
— IFC, a member of the World Bank Group, is partnering with Raiffeisen Bank Aval and Bayer to make high-quality crop protection products more affordable for small and medium agricultural companies and farmers, helping Ukraine boost agricultural productivity.
IFC and Raiffeisen Bank Aval are launching a new risk-sharing facility that will enable farmers to buy crop protection products on credit from industry leader Bayer, with the purchases to be paid in full once the year’s crops are sold. It will cover up to $60 million of seasonal payment obligations to Bayer, of which IFC will guarantee up to half the value.
“Our new project will continue to improve access to affordable funding for agribusiness, despite the challenging macroeconomic conditions in Ukraine,” said
Volodymyr Lavrenchuk, CEO of Raiffeisen Bank Aval
. “Since lending is still quite expensive for agrarians, our bank is paying special attention to affiliate programs that offer financing at subsidy interest rates.”
“Given the challenging economic conditions, most SMEs in Ukraine are facing financial constraints and unable to obtain the funds they need to buy crop protection products and seeds. Our joint project will provide the support farmers need to do this and help them maximize quality crop yields,”
said Andreas Loechel, Head of Bayer Crop Science in Northern Black Sea Countries.
The financing is supported by a nationwide program delivered by IFC’s advisory team and Bayer on how to improve crop quality and yields using the best practices of sustainable agriculture. About 8,000 farmers across Ukraine received training in 2014 and more are expected to be trained.
Rufat Alimardanov, IFC’s Country Manager for Ukraine and Belarus, said, “
Agribusiness is key for the Ukrainian economy, accounting for about a third of exports and around 20 percent of employment. IFC is committed to supporting the sector further. We hope this project will highlight the importance of providing affordable financing to SMEs in the agribusiness sector.”
The new project builds on the experience of an innovative previous facility launched four years ago by IFC, Bayer and Raiffeisen Bank Aval, which helped farmers bridge the gap for financing critical inputs between sowing and harvesting. The guarantee provided over $36 million in affordable financing to 128 farms, with the program reaching more than 11,327 farmers.
About Bayer
Bayer is a global enterprise with core competencies in the Life Science fields of health care and agriculture. Its products and services are designed to benefit people and improve their quality of life. At the same time, the Group aims to create value through innovation, growth and high earning power. Bayer is committed to the principles of sustainable development and to its social and ethical responsibilities as a corporate citizen. In fiscal 2014, the Group employed around 119,000 people and had sales of EUR 42.2 billion. Capital expenditures amounted to EUR 2.5 billion, R&D expenses to EUR 3.6 billion. These figures include those for the high-tech polymers business, which is to be floated on the stock market as Covestro.
www.bayer.com
Bayer has been present in Ukraine since 1992. The team is represented by more than 500 professionals who bring knowledge and innovation in both Life Science fields: health care and agriculture.
www.bayer.ua
About Raiffeisen Bank Aval
Raiffeisen Bank Aval was registered on March 27, 1992. Since October 2005, the Bank has been part of Raiffeisen Bank International AG. As of June 30, 2015 the Group held 96.45% of shares in the Bank.
The Bank provides a broad range of standard and innovative banking services through its nationwide network which comprised, as of 1H 2015, 619 outlets located in big cities, provincial and community centers throughout Ukraine. For more information, visit
https://www.aval.ua/
About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets. Working with more than 2,000 businesses worldwide, we use our capital, expertise, and influence, to create opportunity where it’s needed most. In FY15, our long-term investments in developing countries rose to nearly $18 billion, helping the private sector play an essential role in the global effort to end extreme poverty and boost shared prosperity. For more information, visit
www.ifc.org
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