Washington D.C., November 26, 2002
—The International Finance Corporation, the private sector arm of the World Bank, will support the construction and operation of Algerian Cement Company (ACC), Algeria’s first private sector cement plant, with up to US$35 million in financing. The investment reflects IFC’s support for Algeria’s ongoing transition to a market economy.
The investment in the ACC plant, located in the province of M’Sila in central Algeria, 240 km southeast of Algiers, will consist of a loan of up to $35 million for IFC’s own account. The project, estimated to cost $260 million for a total annual cement production capacity of 2 million tons, will use locally available raw materials and inexpensive energy sources to produce and distribute cement in the M'Sila and neighboring region.
Other funding sources for the project will come from the European Investment Bank (EIB) with a foreign currency loan of up to $55 million and Citibank Algeria leading a syndicate of local Algerian banks (Banque de Développement Local, Banque Nationale d’Algérie, Caisse Nationale d’Epargne et de Prévoyance and Crédit Populaire d'Algérie) with local loans equivalent to up to $66 million. The EIB loan will be commercially guaranteed by Citibank International PLC and Eksport Kredit Fonden (EkF), the Danish export credit agency.
The project’s sponsor is Orascom Construction Industries (OCI), Egypt’s largest private sector construction company, which will invest $104 million in the project. The investment in ACC reflects the sponsor’s strategy of regional expansion and will strengthen its position as a key player in the Northern Africa and Mediterranean region.
Sami Haddad, IFC’s Regional Director for Middle East and North Africa, said: “IFC’s presence helped catalyze local and international financing for the first cement plant fully owned by the private sector in Algeria. Furthermore, it supports the Algerian government’s efforts to attract foreign investment in the non-oil sectors.” Mr. Haddad added that “this investment will benefit the country’s infrastructure development and construction efforts, which are critical to overall development of the country.”
IFC’s mission is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people’s lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, and provides technical assistance and advice to governments and businesses. Since its founding in 1956 through FY02, IFC has committed more than $34 billion of its own funds and arranged $21 billion in syndications for 2,825 companies in 140 developing countries. IFC’s worldwide committed portfolio as of FY02 was $15.1 billion for its own account and $6.5 billion held for participants in loan syndications.
