IFC Expands Partnership with Tojik Sodirot Bank to Promote Agricultural Lending in Tajikistan
IFC, a member of the World Bank Group, has announced an investment in Tojik Sodirot Bank, an existing IFC portfolio client, to expand its leasing and trade finance operations and increase financing for agriculture.
IFC will lend the bank $10 million, with $6 million earmarked for loans to the agriculture industry and $4 million set aside for leasing. In addition, IFC will guarantee $5 million of the bank’s trade finance loans to small and medium enterprises.
“Providing farmers with access to fair and market-based funding is a priority for IFC, given the agriculture sector’s importance for Tajikistan’s economy,” said Lars Thunell, IFC Executive Vice President and CEO.
Potential borrowers include individual farmers, farming cooperatives, and food processing companies. The bank will use the $5 million trade finance portion to help smaller clients import wheat, edible oils, and other food products and consumer staples. It will also guarantee short-term pre-export advances from correspondent banks for outward shipments of processed cotton.
The loan agreement was signed in Dushanbe on June 30. Thunell will meet with the bank’s management during his upcoming visit to Tajikistan on August 14.
Since April 2007, IFC has been providing advisory services to help Tojik Sodirot Bank expand its cotton lending operations in southern Tajikistan. The program has allowed it to approve nearly $300,000 of loans to cotton farms in 2007. IFC has also provided training, workshops, and targeted consultation on the development of leasing products.
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