In its first project in FYR Macedonia, MIGA issued a guarantee totaling $19.2 million in coverage to Balkcem Limited (Balkcem) of Cyprus—a joint venture of the cement companies Titan Cement (Greece) and Holderbank, (Switzerland)—for its equity investment in the acquisition of A.D. Cementarnica USJE (Cementarnica), a cement company located in Skopje, the capital of FYR Macedonia. The MIGA guarantee will cover the investment against the risks of war and civil disturbance.
The investor will support the modernization and expansion of the only cement plant in Macedonia. The objective of this investment is to modernize Cementarnica by upgrading its facilities and machinery and thereby improve efficiency, reduce costs, and protect the environment. Upon the successful diversification of Cementarnica, with its first ready-mixed concrete unit in Skopje, Balkcem's long-term objective is to explore the possibility of setting up additional ready-mixed concrete plants in other parts of Macedonia.
The project is expected to generate taxes and export revenues to the country. Furthermore, Cementarnica will procure 100 percent of the project's inputs locally, purchasing goods and services such as electricity, bags, and pallets.