Proparco lends subordinated finance to Manuchar to fund Brazil and Vietnam operations

News | 26 July 2017

On 25 July Proparco, a French development financial institution that’s owned in part by Agence Française de Développement (AFD) and private shareholders, announced that it had issued a €15 million subordinated loan to Manuchar, a commodiities trading and logistics company based in Belgium.

The funds are scheduled to develop storage and manufacturing infrastructure for two of Manuchar’s agri-food businesses in Brazil and Vietnam.

The project is set to improve port infrastructure in both countries as it involves building warehousing facilities in Imbituba, a small Brazilian port that wants to become a regional export hub, and in Phu My in Vietnam. Proparco said in a statement that its mission is to “develop infrastructure – logistics infrastructure for the hinterlands of smaller, secondary ports – and manufacturing facilities.”

As well as improving port infrastructure by having equipment that improves capacity, security of storage and quality, the projects aim to support 180 local jobs and improve corporate social responsibility (CSR) risk management processes, Proparco said.

The €15m loan is part of a €20m co-financing arrangement backed by BMI-SBI (the Belgian Corporation for International Investment) and Proparco. Proparco did not declare the tenor of the loan, but said it will provide Manuchar with subordinated, medium-term finance that is difficult to obtain from local or regional banks.

Separately on 12 July, Proparco announced that it had teamed up with Ecobank to sign a US$50m trade finance guarantee package for trade between West Africa to Europe.

Proparco will guarantee documentary credits from four Ecobank subsidiaries in four countries in West Africa.

The French development financial institution aims to support Ecobank’s international trade finance operations and expand its range of financial instruments.

In a statement, Proparco said the guarantee package would help boost trade between Africa and Europe by improving Ecobank’s own subsidiaries in Burkina Faso, Côte d’Ivoire, Guinea and Mali to finance imports and exports with EBI, the Nigeria-domiciled bank’s subsidiary in France.

 “The deployment of a pilot trade finance loan forms part of Proparco’s objectives under its 2017-2020 strategy designed to meet customer requirements. We are delighted to conduct our first operation of this type with Ecobank, a longstanding partner and a pioneer in the African banking sector,” said Grégory Clemente, chief executive officer of Proparco at the signing in Abijdan.

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