MEKONG TIMBER PLANTATIONS
Status: Completed investmentWhy disclosure?
FMO is committed to making publicly available relevant investment information that informs stakeholders and enables them to engage directly with FMO on its investments which, in turn, enhances our investment decisions, the design and implementation of projects and policies, and strengthens development outcomes. Learn more
In case of questions
In case of questions, please contact us at disclosure@fmo.nl
Disclaimer
The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.
Who is our customer
Mekong Timber Plantations (“MTP”) is a limited liability company registered and operating in the Lao People’s Democratic Republic (“Laos”). MTP’s purpose is to grow fiber on an economically sustainable basis and with a strong sense of social and environmental responsibility. The Company has a Government of Lao PDR shareholding of 15%, with the remainder held by Oji Lao Plantation Holdings. The Company currently has approximately 24,000 ha of concession land under management of mostly Eucalyptus and Acacia hybrid plantations, which are spread in clusters in rural areas in Bolikhamxay and Khammouane Provinces. In addition, the Company also operates an Outgrower Scheme (Oji LPFL’s Outgrower Scheme 1 “OGS1”) consisting of approximately 5,000 individual farmers, who also grow Eucalyptus or Acacia. Each farmer has an average plot size of 1ha, which brings the total size of the OGS1 to 5,000ha.
What is our funding objective?
The project aims to support the company’s re-engagement, evaluation and conclusion of its existing OGS1 and the design of a new scheme (“OGS2) through the involvement and re-engagement of 5,000 smallholder farmers.
Why do we fund this investment?
FMO aims to support the company in the process of designing and implementing OGS2, which has a tremendous opportunity to contribute to sustainable socioeconomic development and capacity improvement in rural areas in Laos. The aim is i) to obtain the farmers’ input into “what went wrong” with the first scheme, (ii) to determine their attitude towards continuing, (iii) to receive the farmers’ inputs into how the OGS may be re-designed in the future, and (iv) to conduct a re-inventory of assets and update MTP’s database. In order to do so successfully, there is a need for development of supporting structures and processes within the Company, including (i) a fully functional Grievance and Communication Mechanism, (ii) a system for obtaining Free Prior Informed Consent, and (iii) ongoing monitoring and evaluation. Finally, the Company has to persuade the outgrowers to continue in the OGS.
- Region
- Asia
- Country
- Lao People's Democratic Republic
- Sector
- Agribusiness, Food & Water
- Effective date
- 5/14/2018
- End date
- 6/17/2019
- Total FMO financing
- EUR 0.03 MLN
- Funding
- ForeignAffairs - CD