EBRD loans $52 million to support Chinese investment in Egypt
The European Bank for Reconstruction and Development (EBRD) has secured a $52 million loan to Angel Yeast Egypt, a global manufacturer of yeast and yeast extract, the lender said in a statement on Thursday.
The loan comes in line with EBRD’s keenness to support Egypt’s efforts to attract much-needed foreign direct investment (FDI) in the country’s agribusiness sector.
Angel Yeast Egypt is a joint-stock company incorporated and operating in Egypt. It is fully owned by Angel Yeast Co. Ltd, a China-based firm active in the production of yeast and baking ingredients and listed on the Shanghai Stock Exchange. Founded as a research institute 30 years ago, the firm is now the third-largest producer of yeast and the largest producer of yeast extract in the world.
The loan is the first EBRD cooperation with a Chinese company in the corporate sector. For Angel Yeast, it is also the first cooperation with a non-Chinese financial institution.
It will enable Angel Yeast Egypt to increase production of dry yeast, which is mainly exported, and to launch a yeast extract, a higher value-added product. The company is already working with local suppliers of molasses, a by-product of the sugar industry, and will increase its purchase of local raw materials.
Local farmers will also be able to buy organic fertiliser, which Angel Yeast will manufacture from the by-products of yeast production. Increased exports will contribute to generating foreign currency, helping to make the Egyptian economy more competitive and better integrated into regional and global markets.
The EBRD loan will finance the construction of new production facilities and a modern, highly efficient wastewater treatment plant in Beni Suef in Upper Egypt, an area with high levels of poverty and unemployment, the statement read. Over 200 jobs will be created, while 300 new and current workers will receive in-depth technical training.
The project “will boost exports, bring foreign direct investment, and create jobs. This is a great example of how the idea of increasing trade and cooperation along the ancient Silk Road can bring benefits to local workers and economies.” Janet Heckman, EBRD Managing Director for the Southern and Eastern Mediterranean, said.
“The EBRD is also proud to support the efficient use of water resources in Egypt, in line with EU standards, which is one of our top strategic priorities in the country.” Heckman added.
“Angel’s investment in Egypt in 2010 was an important step for our company as we began international operations. After six years, Angel has become a successful model of how Chinese enterprises can go global.” Haijin Mei, CFO of Angel Yeast, said.
“In 2017, in order to better respond to EU and Egyptian markets, our company decided to invest in a new project, in the production of yeast extract. We are honoured to receive support in this project from the EBRD. We will carefully fulfil the company’s social and environmental action plan, starting production as early as possible, and thus increasing our contribution to the economy of Egypt.” Mei stated.
To date, the EBRD has committed over $3.3 billion in about 76 projects in Egypt. The Bank started operating in the country in 2012. China became a shareholder of the EBRD in 2016.
