Project detail - Invesmar International Investment S.A

Who is our prospective customer?

Our client is Invesmar International Investments, an integrated Group focusing on the production and commercialization of fresh fruits. The Group has a long tradition in the export of bananas and plantains from Colombia, and is diversifying into avocados, palm, and tahiti lime.

What is our funding objective?

FMO will be supporting the Wakate Project, Invesmar’s new avocado development. FMO intends to provide up to USD 30mln in financing for the completion of the 1105 hectares of Haas avocado plantations in the Municipality of Caldas, as well as the construction of the packing plant to support the export of the avocados.

Why do we want to fund this investment?

Invesmar has a long tradition in agricultural production and export from Colombia and brings ample experience to this new development. This will be a Green-labelled investment for FMO given that the plantations will be Rainforest Alliance and Global GAP certified. We anticipate that the project will create 240 permanent jobs and up to 450 jobs during peak harvest season. FMO will provide long-term financing to ensure sufficient time for repayment once plantations become fully productive.

What is the Environmental and Social categorization rationale?

This is an E&S B+ categorized investment. The company engages in primary production & packing of avocados, the company is not involved in the supply chain and further distribution of the avocados. The activities of the company comes with potential adverse environmental or social impacts that extend beyond the site boundaries. Although these impacts might in part be irreversible, they can be prevented and addressed through relevant mitigation measures. The E&S characteristics of this investment include the assessment of the land acquisition process, the history of the land, no deforestation on the land, production practices and use of agrochemicals, labor conditions, organizational Health & Safety, biodiversity, and pollution risk management. The E&S context included an analysis of the potential E&S risks presented in sister agriculture companies under Invesmar’s group. ESG performances will be focused on the assessment and management of these risks by incorporating Good International Industry Practices, including World Bank Group (WBG) Environmental, Health and Safety (EHS) General Guidelines, and following FMO’s Human Rights Guidelines and International Sustainable Agriculture Practices. This will allow the group and company to complement their efforts to design and implement mitigants considering the contextual situations, root causes, stakeholders engagement, and unique characteristics of the country of production and population. FMO’s environmental and social due diligence indicates that the investment will have impact which must be managed consistent with the following IFC Performance Standards (PS) in particular: PS 1, PS 2, PS 3, PS 4, and PS 6. PS - 5 Land Acquisition & Involuntary Resettlement, PS - 7 Indigenous Peoples and PS - 8 Cultural Heritage, are not applicable in this period, as the land has been acquired through willing buyer-willing seller transactions, there is no impact on Indigenous Peoples, and no cultural heritages have been identified. Nevertheless, as expansion plans are included, mechanisms and requirements defined by all PSs have been considered to ensure that the company manages potential impacts if they become applicable in new acquisitions. FMO will periodically review the project's compliance with the PSs.