EBRD and FINTECC to fund Agrofusion expansion in Ukraine
The European Bank for Reconstruction and Development (EBRD) will be providing a $15m loan to Ukrainian tomato paste producer Agrofusion to expand its tomato farming and processing activities, as well as improve irrigation and plastic waste treatment practices.
The loan will used by Agrofusion to build its third tomato processing plant, which will have the capacity to produce nearly 34,000t of tomato paste.
The new plant will allow the company to increase its production capacity by 50%.
The proceeds from the new facility will be used for the construction of a new greenhouse and its working capital needs, as well as purchase necessary agricultural equipment.
Agrofusion will be implementing farming solutions suggested by the EBRD’s Finance and Technology Transfer Centre for Climate Change (FINTECC) programme to overcome issues, including water leakages in the irrigation system and decrease plastic waste generated during the production cycle.
FUNTECC will also be providing a $700,000 incentive grant for this project.
As well as strengthening the poor irrigation infrastructure in southern Ukraine, the loan will also be used for implementing green agribusiness solutions by introducing modern water management practices, which is reported to be in line with the EBRD’s support for green economies.
The new drip irrigation system is expected to reduce wastage by 20% in comparison to the existing water systems.
It can also be used to inject fertilisers into the soil in an efficient manner, and reduce CO2 up to 3,700t.
The new tomato processing plant will enable Agrofusion to meet the growing demand for organic food products within and outside Ukraine.
Launched last February in Ukraine, the FINTECC programme has been designed to provide technology in climate change mitigation and adaptation.
Image: Agrofusion receives funding from EBRD and FINTECC. Photo: courtesy of European Bank for Reconstruction and Development.