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Projects

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
Silverlands Tanzania Limited
Project ID
12353
Fiscal year
2014
Status
Active
Guarantee holder
Overseas Private Investment Corporation (OPIC)
Investor country
United States
Host country
Tanzania
Environmental category
B
Sector
Agribusiness
Date SPG disclosed
April 11, 2014
Project Board date
May 15, 2014
Gross exposure
 $34.0 million
Project type
Non-SIP
Strategic priority area
IDA
ESRS
Original Version in PDF, April 11, 2014

Project description

This summary covers MIGA’s proposed reinsurance of the Overseas Private Investment Corporation’s (OPIC) proposed coverage to SilverStreet Private Equity Strategies Soparfi Sarl (the Fund), an agricultural fund focused on investing in sub-Saharan Africa. MIGA is proposing to provide reinsurance to OPIC for the fund’s investments in Silverlands Tanzania Limited (the Project). OPIC has requested reinsurance of $34 million for a period of up to 10 years against the risks of transfer restriction, expropriation, and war and civil disturbance.

MIGA’s proposed support to OPIC is in accordance with MIGA’s mandate to cooperate with national entities of its member countries, as stated in MIGA’s Convention.

The Project involves the Fund’s investment of up to $60 million into Silverlands Tanzania Limited (STL) to purchase the assets of two existing agribusinesses and integrating them under two divisions: the Makota Poultry Division, an integrated poultry business and the Selous Cropping and Livestock Division. The Fund is investing in a feedmill, storage silos, rearing and laying houses, hatchery equipment, and related infrastructure to create the leading integrated poultry business in Tanzania.

The Fund’s investments in Tanzania are driven by emerging trends reflecting Tanzania’s growing population, higher incomes, and a requirement for increased feed supplies to sustain the population’s growing demand for protein products. STL aims to invest in several production centers for protein products in Tanzania including Iringa and Dar es Salaam, and then to target fast-growing markets in Tanzania and potentially neighboring regional countries.

Environmental Categorization

The project is a category B under MIGA’s Policy on Environmental and Social Sustainability. Click here to view the Environmental and Social Review Summary.

Development Impact

The project’s main development objective is to support agricultural sustainability by expanding Tanzanian land under cultivation through development of further irrigation capacity and improvement of management processes and skills; increasing livestock production through  more efficient processes and technology; and construction of underlying agricultural infrastructure. By year five of operations, the two divisions are projected to employ 925 local staff on a permanent basis, along with an additional 120 seasonal employees.

MIGA’s proposed support for the project is aligned with Tanzania’s national development strategy, which identifies agriculture as a priority for economic growth, poverty alleviation, and food security. The project is also aligned with the World Bank’s Country Assistance Strategy (CAS) for Tanzania and the World Bank’s Africa Strategy. Under the first pillar of the CAS (Promote Inclusive and Sustainable, Private Sector-led Growth) the Bank supports the government in improving income in the agriculture sector via support for farmers to adopt more productive agricultural techniques and construction of agricultural infrastructure.

 

 
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