NIGERIA – IFC, has agreed to issue US$18 million in debt financing to Robust International (Robust), a Singapore-based agricultural company, for establishment of a modern warehouses and processing complex for agricultural commodities in northern Nigeria.
Founded in 2006, Robust primarily trades in specialty crops such as cashews, sesame, ginger, and gum arabic, among others.
The financing package consists of a senior secured loan of up to US$9 million from IFC’s own account, as well as a concessional loan of up to US$9 million from IFC acting as the implementing entity of the International Development Association’s Private Sector Window.
The project is set to improve smallholder farmers’ access to modern storage and processing facilities, while allowing Robust to increase direct sourcing volumes with smallholder farmers.
Construction of the storage facilities will relieve farmers of the need to store their own crops in often poor conditions, which leads to high post-harvest losses and unnecessary GHG emissions related to spoiled food, which account for around 5 percent of Nigeria’s total GHG emissions.
“We are very pleased to work with IFC on this project, which will provide employment opportunities to the local community while significantly contributing to Nigeria’s economic growth and value addition in the country’s supply chain,” said Naarayan Raaghavan, Chairman and Managing Director of Robust.
The project involves a deeper engagement with smallholder farmers, supporting them in the adoption of sustainable farming methodologies.
It is also focused on training farmers to work towards creating awareness on matters pertaining to environmental preservation, as well as contributing to their overall economic wellbeing.
Agribusiness is a significant contributor to Nigeria’s economy, providing more than half of its jobs and contributing over 35 percent of its GDP.
The sector provides a route out of poverty for many smallholder farmers in the north of the country, which is marred by conflict and where poverty levels are five times higher than in the south.
“Modernizing agribusiness and improving the sector’s productivity is crucial to supporting economic development and inclusion in Nigeria, particularly at a time when pandemic-related disruptions and geopolitical tensions are increasing volatility in the sector and impacting food security, further pushing smallholder farmers into poverty,” said Kalim M. Shah, Senior Country Manager for Nigeria at IFC.
As part of the agreement, IFC will support Robust in strengthening its risk management capabilities, improving its environmental and social practices, and smallholder-farmer sourcing and engagement activities, among other areas.
This partnership further underscores IFC’s growing commitment to Nigeria, with a US$2 billion active investment portfolio across sectors including agribusiness, healthcare, manufacturing, infrastructure, technology, and financial services.