The Board of Directors of the African Development Bank Group has approved a $8.25 million corporate loan to Olivine Industries Limited to support the company’s food production expansion plan in Zimbabwe.
The Bank’s loan, approved on Wednesday, will enable the company to construct new processing plants for margarine and tomato sauce and install upgraded machinery with advanced technologies. Olivine plans to increase its domestic and regional production capacity and food supply.
“With this transaction, the Bank will provide long-term hard currency financing in the Zimbabwean market, and create a strong demonstration effect to both commercial and development finance institutions, which will encourage investments in agribusinesses in Zimbabwe,” said Atsuko Toda, Director, Agriculture Finance and Rural Development at the African Development Bank.
Toda said Olivine presented a unique opportunity for the Bank to participate in rebuilding agricultural value chains in Zimbabwe, thereby creating jobs, improving food security and nutrition while reducing the country’s dependence on food imports. Once the company’s production reaches an adequate level, this project can potentially support 200 to 300 local farmers through Olivine’s corporate farming model to be developed in the near future.
In approving the loan, Board members said the transaction provided a good opportunity for the Bank to deepen effective private sector intervention in a transition state, while also promoting the “Feed Africa” agenda that forms part of the Bank’s High 5 strategic priorities.
Incorporated in 1950, Olivine is one of the largest food producers in Zimbabwe, manufacturing well-known products such as margarine, cooking oil, and canned goods. Olivine has been bolstered by the experience and track record of its majority shareholder, Wilmar International, one of the largest companies listed on the Singapore Stock Exchange.