Johannesburg, South Africa, April 6, 2023— To support the growth of the avocado industry in Africa, Asia, South America, and Europe, IFC, HSBC Bank, and Standard Bank today announced an investment in Westfalia Fruit International Limited to help the company expand sustainable avocado production at its existing facilities and explore opportunities in new markets.
IFC, HSBC and Standard Bank have each invested $100 million for a combined $300 million investment in South Africa's Westfalia, supporting its strategy to develop new orchards and nurseries in Colombia, India, Mexico, Mozambique, Peru, and South Africa. Westfalia also plans to upgrade its packing, ripening and storage facilities in Africa, South America, and Europe to improve access to markets.
As part of its strategy to become carbon neutral by 2030, Westfalia will continue to introduce climate smart growing techniques that conserve energy and water and reduce pesticide use. Westfalia will also use drought and disease resilient varieties to address the impact of climate change.
"The investment will enable Westfalia to continue to grow its business, strengthen value chains to sustainably produce and source quality avocados and improve access to export markets to meet the growing demand for the fruit," said Alk Brand, Group Chief Executive Officer, Westfalia Fruit Group. "The partnership with IFC, HSBC and Standard Bank will contribute to our efforts to enhance sustainable farming practices, create jobs in the communities where we operate and support economic growth."
Westfalia has one of the world's largest avocado-growing footprints and will explore investments in new markets, such as China, India, Italy, Kenya, Spain, Tanzania and the United States, to better integrate the avocado sectors in developing countries into the global value chain to meet growing demand for avocados.
"Developing sustainable avocado markets can help boost agriculture productivity to reduce poverty, especially in rural areas where people mainly work in farming," said Adamou Labara, IFC Country Manager for South Africa. "IFC's investment in Westfalia will help increase avocado production to meet growing demand, strengthen global value chains and boost economic growth in developing countries."
"We're pleased to have delivered a bespoke solution to meet Westfalia's specific requirements demonstrating our strong capabilities to lead and coordinate across different teams. The global fresh fruit market is expected to grow by 5.53% annually, and this funding will help to meet rising demand and grow the global agriculture sector, providing new jobs across Africa, South America, and India," said Danny Goldblum, Head of Large Corporates Coverage, London & South Region at HSBC UK. "We also look forward to seeing the business continue its sustainability efforts and meet its net zero targets in 2030."
"Standard Bank is Westfalia's leading banking partner for its South African operations and we are pleased to grow our support for Westfalia's international business and become a key funding partner both locally and globally," said Clive Potter, Head of Client Coverage South Africa at Standard Bank. "This deal will adequately support Westfalia's strategic ambitions by allowing the business to retain its leading global avocado producer status and grow in markets where there is opportunity for growth."
The global avocado market is estimated at $7 billion by value of trade. The market is dominated by countries from sub-Saharan Africa and Latin America who mainly produce avocados to feed into the two largest consumption markets, North America and Europe, and meet the growing demand for the fruit.
The investment will help Westfalia to further develop and promote the avocado industry in existing and new markets with potential for growth, will help create jobs and will ultimately contribute to the growth of the agriculture sector and sustainably meet the global demand for avocados.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2022, IFC committed a record $32.8 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises. For more information, visit www.ifc.org.
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About Westfalia Fruit
The multinational Westfalia Fruit Group is a leading supplier of fresh and processed produce to international markets, offering a diverse range of quality fruit and related products via its vertically integrated supply chain. Founded over 70 years ago on guiding environmental, social, governance & sustainability principles. These practices, premised on the legacy of Dr Hans Merensky are at the heart of all that is done by the Group – "To Do Good", – of which continue to underpin our approach today. Today, operating in 15 countries spread over 5 continents, the Westfalia Fruit Group prides itself on advancing sustainable agricultural practices and being a responsible corporate citizen within the communities in which it operates. For more information visit www.westfaliafruit.com
About Standard Bank
Standard Bank is the largest African bank by assets with a unique footprint across 20 African countries. Our strategic position enables us to connect Africa to other select emerging markets as well as pools of capital in developed markets, and our balanced portfolio of businesses provide significant opportunities for growth. The bank has over 54 000 employees, over 1 200 branches and 8815 ATMs on the African continent enabling it to deliver a complete range of services across personal and business banking, corporate and investment banking and wealth management. Standard Bank's Corporate & Investment Banking division offers its clients banking, trading, investment, risk management and advisory services to connect selected emerging markets to Africa and to each other. It has strong offerings in mining and metals; oil, gas and renewables; power and infrastructure; agribusiness; telecommunications and media; and financial institutions. For further information, go to http://www.standardbank.com
About HSBC UK
HSBC UK serves over 14.75 million customers across the UK, supported by 24,000 colleagues. HSBC UK offers a complete range of retail banking and wealth management to personal and private banking customers, as well as commercial banking for small to medium businesses and large corporates.
HSBC Holdings plc
HSBC Holdings plc, the parent company of HSBC, is headquartered in London. HSBC serves customers worldwide from offices in 63 countries and territories in its geographical regions: Europe, Asia, North America, Latin America, and Middle East and North Africa. With assets of $2,992bn at 30 September 2022, HSBC is one of the world's largest banking and financial services organisations.
