Project detail - ARASA FZE

ARASA FZE

Status: Approved investment
Back to map

Why 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

Arasa FZE is a UAE-registered subsidiary of Tiryaki Group. Arasa, directly or via two subsidiaries registered in Ghana (“Arasa Ghana”) and Togo (“Arasa Togo”) originates, processes and exports non-GMO and organic agricultural commodities, farm products and processing by-products from the countries of West Africa, predominantly from Ghana, Benin and Togo but also from Burkina Faso, Nigeria, Ivory Coast, Liberia and Sierra Leone

What is our funding objective?

FMO plans to provide working capital (WC) finance. Arasa will buy, process and export locally-sourced agri-commodities and byproducts. A small part of the loan will be used to refinance a short-term loan taken in anticipation of FMO’s Loan.

Why do we fund this investment?

Tiryaki Group is able to offer higher prices for the products sourced by Arasa in West Africa because it has outlets to sell non-GMO and Organic products for their full value. The higher prices trickle upstream to West Africa farmers to reduce poverty in rural areas.

What is the Environmental and Social categorization rationale?

This concerns an E&S B+ categorized investment, as the company engages in the sourcing of raw agricultural product and by-products from the processing of tropical commodities. These activities come with potential adverse environmental or social impacts that extend site boundaries and might in part be irreversible, although they can be prevented and addressed through relevant mitigation measures. E&S characteristics of this specific investment include sourcing expansion storing and pre-export processing in Ghana and other west African countries. The E&S context include potential environmental and social risks in their supply chain -not limited to child labor, poor working conditions, forced labor, impact on ecosystem services, deforestation, and additional pressure on climate vulnerabilities. ESG performances will be focused on the assessment and management of these risks by adopting policies, risk assessments, monitoring mechanisms and local partnerships to reduce the company’s risk exposure and to drive positive impact. FMO’s environmental and social due diligence indicates that the investment will have impact which must be managed in a manner consistent with the following IFC Performance Standards in particular: PS 1 – Assessment and Management of Environmental and Social Risks and Impacts PS 2 – Labor and working conditions, PS 3– Resource Efficiency and Pollution Prevention, PS4– Community Health, Safety, and Security, and PS 6 - Biodiversity Conservation and Sustainable Management of Living Natural Resources. Risk appraisal have not identified potential impacts related to the Performance Standards (PS5, PS7, and 8). The company’s operations are in industrial zones, no land acquisitions are part of this investment, and no impact on indigenous communities, nor cultural heritages has been identified.

Region
Africa
Country
Africa
Sector
Agribusiness, Food & Water
Publication date
3/9/2022
Effective date
6/1/2022
Total FMO financing
USD 10.00 MLN
Funding
FMO NV
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk Environmental & Social Category
(A, B+, B or C)
B+