Lukavac, Bosnia, March 20, 2007 —
IFC, the private sector arm of the World Bank Group, has agreed to support
the post-war rehabilitation and expansion of a soda ash plant in Bosnia
and Herzegovina to invigorate the local economy. IFC’s €24 million loan
to Sisecam Soda Lukavac will be used to fund a comprehensive turnaround
program designed to return the firm to profitability and full capacity.
The funds also support an environmental improvement program.
Revitalizing SSL’s soda ash operations in Bosnia’s Tuzla Canton will
boost the economy, as the plant is the largest customer of local limestone
and salt mines. Limestone and salt are key ingredients for production of
soda ash, which is used in the manufacturing of glass containers, fiberglass
insulation, and flat glass for the housing and automotive industries.
After a recent privatization, SSL is majority-owned by Turkey-based Sisecam
Group, an IFC client with significant investments in Bulgaria and Georgia
as well as Turkey. IFC’s support for the group is part of an effort to
foster South-South investments, in which leading emerging market companies
expand into other emerging markets.
“This transaction underscores our long-standing relationship with IFC
and our shared commitment to invest in emerging markets,” said Dogan Arikan,
President and Chief Executive Officer of Sisecam Group. “We hope to make
this transaction a success story for the development of a globally competitive
IFC’s loan is expected to help increase confidence in Bosnia’s privatization
program, improve SSL’s environmental performance, and support development
of the Tuzla Canton’s limestone and salt companies.
“The successful privatization and turnaround of SSL demonstrates interest
in Bosnia and Herzegovina from international private investors,” said
Shahbaz Mavaddat, IFC’s Director for Southern Europe and Central Asia.
“We hope that the business environment will continue to become increasingly
conducive to such investments.”
Lance Crist, Manager of IFC’s Chemicals Division, added: “Bosnia and
Herzegovina’s abundant limestone and coal resources provide SSL with a
natural competitive advantage for becoming a strong regional player in
the soda ash industry, an advantage the company can now capitalize on.”
IFC, the private sector arm of the World Bank Group, promotes open and
competitive markets in developing countries. IFC supports sustainable
private sector companies and other partners in generating productive jobs
and delivering basic services, so that people have opportunities to escape
poverty and improve their lives. Through FY06, IFC Financial Products has
committed more than $56 billion in funding for private sector investments
and mobilized an additional $25 billion in syndications for 3,531 companies
in 140 developing countries. IFC Advisory Services and donor partners have
provided more than $1 billion in program support to build small enterprises,
to accelerate private participation in infrastructure, to improve the business
enabling environment, to increase access to finance, and to strengthen
environmental and social sustainability. For more information, please visit
Bosnia and Herzegovina became a member and shareholder of IFC in 1996.
Since then, IFC has invested more than $250 million in the country,
including $11 million in syndicated loans, to finance over 21 projects
across a variety of sectors. In FY06, IFC’s investments reached
$34 million. IFC’s committed portfolio in Bosnia currently stands
at $170 million. IFC has invested in key sectors including banking,
general manufacturing, and chemicals. For more information, visit