Minsk/Washington, DC, June 30, 2004.—The
International Finance Corporation (IFC), the private sector financing arm
of the World Bank Group, has signed an agreement to make an equity investment
of $3 million in Detroit Belarus Brewing Company (“DBBC”) and to lend
$7 million to CJSC Belarus Brewing Company (“BBC”). DBBC and BBC are
participating in the privatization of OJSC Dednovo Brewery (“Dednovo”),
located in Bobruisk of the Mohilev Region in Belarus.
This is the first privatization of a brewery involving western investors
and among the few privatizations in Belarus. IFC’s loan will support a
$31.3 million investment program to expand, modernize and refurbish the
Dednovo plant. The project will improve the quality and consistency
of production and develop a range of brands for Dednovo’s beer. At project
completion in 2005, the plant is expected to produce 500,000 hectoliters
of beer for the Belorussian market.
“This is IFC’s first investment in a real sector in Belarus and IFC’s
second investment in the country. The project will be a catalyst
for additional foreign direct investment in Belarus where such investment
has lagged,” commented Mr. Edward Nassim, IFC’s Director of Central and
Eastern Europe Department. “IFC hopes that its investment will serve
as an example for other Belorussian companies with which we intend to build
long-term partnerships through investments and technical assistance.”
Jean-Paul Pinard, IFC’s Director of the Agribusiness Department noted
that IFC’s investment in DBBC and BBC represents an important milestone
for the agribusiness sector in Belarus. The project is an important opportunity
for IFC to participate in the development of the private sector in the
International Finance Corporation (www.ifc.org). The International Finance
Corporation is a member of the World Bank Group. IFC’s mission is to promote
sustainable private sector investment in transition economies, helping
to reduce poverty and improve people's lives. IFC finances private sector
investments in the emerging markets, mobilizes capital in the international
financial markets, helps clients improve social and environmental sustainability,
and provides technical assistance and advice to governments and businesses.
From its founding in 1956 through FY03, IFC has committed more than $37
billion of its own funds and arranged $22 billion in syndications for 2,990
companies in 140 developing countries. IFC's worldwide committed portfolio
as of FY03 was $16.8 billion for its own account and $6.6 billion held
for participants in loan syndications.
Belarus joined IFC in 1992. Since then through the end of May, 2004, IFC
has committed $14 million in loans to the financial sector. In addition,
IFC has been actively involved in technical assistance in Belarus since
1993. The work began with advisory services on privatization of small businesses.
Currently, IFC focuses its efforts on small and medium enterprise development
and the improvement of the investment climate.