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WASHINGTON, D.C., July 16 -- The International Finance Corporation (IFC) is to provide P.T. Nusantara Tropical Fruit with US$16 million to finance the development of a commercial plantation producing bananas for export from Indonesia. The IFC financing package consists of a $9 million loan for IFC's own account and a US$7 million IFC loan participation for the account of Rabobank Nederland, Singapore Branch. The total project cost is estimated at US$31.4 million. The plantation will be developed in Sumatra on land that was cleared years ago and has been only partially utilized. It will produce Cavendish bananas for sale to Del Monte Fresh Fruit (International) Ltd., which will export the bananas to Japan, Korea, Singapore, and the Middle East. The plantation will benefit the Indonesian economy with additional jobs, foreign exchange earnings, and increased export and government revenues. The investment agreement was signed in Jakarta on June 22, by representatives of the project sponsors: Udayan Wagle, IFC Res
ident Representative; Husodo Angkosubroto, Nusantara President Director and Gunung Sewu Director; and Laird Whipple, Nusantara President Commissioner and Del Monte Senior Vice President/General Manager for Asia/Pacific. IFC's involvement is important because it made possible long-term financing of a relatively long gestation agriculture project that is involved solely in primary production. P.T. Nusantara Tropical Fruit (Nusantara) is a joint venture company between P.T. Umas Jaya Agro Industri (Umas) and Del Monte Fresh Fruit Far East B.V. (Del Monte Far East). Umas is one of more than 40 companies in the Gunung Sewu Group, an Indonesian conglomerate whose interests include agribusiness, trading, manufacturing, real estate, and financial services.
Del Monte Far East is part of the Del Monte Fresh Produce Group, one of the world's largest fresh fruit growers and distributors, which will draw upon its expertise and resources worldwide to assist and support Nusantara in this project. Rabobank Nederland is a leading financial institution with extensive expertise in the global food and agribusiness sector. Rabobank Nederland's participation reflects its commitment to financing trade and investment in the agricultural sector of the region. The project development includes buying the land, preparing the soil, and developing the infrastructure, such as irrigation and cable systems. Packing houses and employee support facilities will be constructed by the time the project is fully developed. IFC is the private sector arm of the World Bank Group and the largest source of direct project financing for private sector enterprises in developing countries.
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