Summary of proposed guarantee
Summaries of proposed guarantees are provided prior to Board consideration and before final contract signing, and they are therefore subject to change. Project briefs are disclosed after Board consideration and contract signing and reflect the terms of the project at the time of contract signature. Environmental and Social Review Summaries are provided for projects assigned an Environmental Assessment Category of A or B.
- Project name
- Whirlpool Ukraine LLC
- Project ID
- Fiscal year
- Guarantee holder
n.v. Whirlpool Europe Coordination Center s.a.
- Investor country
- Host country
- Environmental category
- Date SPG disclosed
- May 02, 2012
- Project Board date
- May 18, 2012
- Gross exposure
- $6.6 million
- Project type
This summary covers a non-shareholder loan from n.v. Whirlpool Europe Coordination Center s.a. of Belgium to Whirlpool Ukraine LLC. The investor has applied for a MIGA guarantee of $6.6 million for a period of up to three years against the risks of transfer restriction, expropriation, and war and civil disturbance.
Whirlpool Ukraine (WU) is the local sales office for Whirlpool Corporation, a global leader in the home appliance industry. It sells air conditioners, washing machines, microwaves, dishwashers, built-in stoves, hoods, and built-in ovens to distributors, wholesalers, and retailers in Ukraine. WU’s operations comprise a sales office in downtown Kiev and a warehouse in the outskirts of the city. WU buys its inventory from other Whirlpool entities and from third-party vendors. The company receives the products fully assembled, stores them in its warehouse until they are sold, and delivers them to its customers. WU plans to serve the Moldova, Georgia, Uzbekistan, Armenia, and Azerbaijan markets in the future.
The project is a category B under MIGA’s Policy on Social and Environmental Sustainability. The key environmental and social risks for this warehouse and distribution center relate to worker health and safety, fire and life safety, and fair and equitable employment. These risks may all be readily mitigated.
The warehouse and distribution center is located within a fenced, light industrial area of Kiev. All utility services are provided by the municipality. Pallets are loaded/unloaded using load lifters outfitted with electronic clamps, warehouse shelving load limits are followed, and training is provided to the operators to ensure safe stacking practices are followed. Adequate fire suppression equipment and egress routes in the warehouse and distribution centre are maintained. Whirlpool Ukraine’s labor policies have been registered with the Ministry of Labor, and will be reviewed to ensure compliance with MIGA’s Performance Standard 2: Labor and Work Conditions.
WU has been having a positive development impact in Kiev since its conversion into a sales operation in 2011. The operation has hired six additional employees for a total of 30 permanent positions and expects to open new positions as the company grows and expands into new markets. WU also participates in knowledge transfer by encouraging its employees to take courses at Whirlpool University, Whirlpool’s internal training program. Courses are designed to help the company’s personnel develop leadership, operational, and cross-functional competencies.
The project is aligned with the World Bank Group’s Country Partnership Strategy for Ukraine, which advocates focusing on growth, competitiveness and job creation, improvements in the business climate, and the promotion of domestic investment and foreign direct investments to achieve productivity improvements.
The project would be underwritten through MIGA’s Small Investment Program.