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Minsk/Washington, DC, June 30, 2004
.—The International Finance Corporation (IFC), the private sector financing arm of the World Bank Group, has signed an agreement to make an equity investment of $3 million in Detroit Belarus Brewing Company (“DBBC”) and to lend $7 million to CJSC Belarus Brewing Company (“BBC”). DBBC and BBC are participating in the privatization of OJSC Dednovo Brewery (“Dednovo”), located in Bobruisk of the Mohilev Region in Belarus.
This is the first privatization of a brewery involving western investors and among the few privatizations in Belarus. IFC’s loan will support a $31.3 million investment program to expand, modernize and refurbish the Dednovo plant. The project will improve the quality and consistency of production and develop a range of brands for Dednovo’s beer. At project completion in 2005, the plant is expected to produce 500,000 hectoliters of beer for the Belorussian market.
“This is IFC’s first investment in a real sector in Belarus and IFC’s second investment in the country. The project will be a catalyst for additional foreign direct investment in Belarus where such investment has lagged,” commented Mr. Edward Nassim, IFC’s Director of Central and Eastern Europe Department. “IFC hopes that its investment will serve as an example for other Belorussian companies with which we intend to build long-term partnerships through investments and technical assistance.”
Jean-Paul Pinard, IFC’s Director of the Agribusiness Department noted that IFC’s investment in DBBC and BBC represents an important milestone for the agribusiness sector in Belarus. The project is an important opportunity for IFC to participate in the development of the private sector in the country.
International Finance Corporation (www.ifc.org). The International Finance Corporation is a member of the World Bank Group. IFC’s mission is to promote sustainable private sector investment in transition economies, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the emerging markets, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY03, IFC has committed more than $37 billion of its own funds and arranged $22 billion in syndications for 2,990 companies in 140 developing countries. IFC's worldwide committed portfolio as of FY03 was $16.8 billion for its own account and $6.6 billion held for participants in loan syndications.
Belarus joined IFC in 1992. Since then through the end of May, 2004, IFC has committed $14 million in loans to the financial sector. In addition, IFC has been actively involved in technical assistance in Belarus since 1993. The work began with advisory services on privatization of small businesses. Currently, IFC focuses its efforts on small and medium enterprise development and the improvement of the investment climate.
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