The Asian Development Bank (ADB), a multilateral institution based in the Philippines, recently agreed to lend USD 100 million to Louis Dreyfus Company (LDC), a Netherlands-based firm active in agriculture, food processing and shipping. LDC plans to use the funds to finance “coffee, cotton and rice inventories” for 50,000 smallholder farmers who supply the firm’s operations in India, Indonesia, Pakistan, Thailand and Vietnam. Among the goals of the project are to aid farmers in recovering from the economic effects of the COVID-19 pandemic – including supply-chain disruptions – and investing in systems that are more resilient to climate change. The loan is paired with USD 590,000 in technical assistance funding that is slated to help farmers adopt practices such as drip irrigation and the use of biochar as a soil amendment.
Ashok Lavasa, ADB’s Vice President for Private Sector Operations and Public-Private Partnerships, stated, “Smallholder farmers, who are already vulnerable to climate change, are facing increasing difficulties due to the pandemic, resulting in income loss, crop and food wastage, and supply chain disruptions.”
Founded in 1851, LDC employs 17,000 people who generated net sales of USD 49 billion from operations in approximately 100 countries during 2021. The firm is a unit of Netherlands-based Louis Dreyfus Holding, whose 15 subsidiaries are primarily active in agriculture.
Established in 1966, ADB is a development finance institution headquartered in the city of Manila. Its mission is to help its 68 member countries reduce poverty and otherwise improve the quality of life of Asia’s citizens. As of 2020, ADB has total assets of USD 32 billion, including a loan portfolio of USD 22 billion. During that year, its income before tax totaled USD 864 million.
By Hasnat Aslam, Research Associate
Sources and Additional Resources
ADB press release
https://www.adb.org/news/adb-ldc-sign-100-million-loan-support-smallholder-farmer-livelihoods-and-climate-resilience
ADB homepage
https://www.adb.org/
LDC homepage
https://www.ldc.com/
LDC Annual Report 2021
https://www.ldc.com/annual-report-2021/
Previous MicroCapital news on ADB
https://www.microcapital.org/microcapital-brief-adb-raises-27m-in-local-currency-bond-issue-to-promote-housing-lending-by-otbasy-bank-to-women-in-rural-kazakhstan/
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