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MIGA’s goal is to promote foreign direct investment into developing countries to support economic growth and more.

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Learn about the progress MIGA is making in its mission to support economic growth, reduce poverty and improve people’s lives.

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Explore global projects that support economic growth, reduce poverty and improves people’s lives.

Lao People's Democratic Republic

Burapha Agro-Forestry Co., Ltd

$8.1 million
Forestry
Early Disclosure
Proposed

Through this Early Disclosure, MIGA provides access, early in the environmental and social assessment process, to the Environmental and Social Impact Assessment (ESIA) and associated environmental and social management documents. These documents have been prepared by the Burapha Agro-Forestry Co., Ltd and should not be taken as an indication that MIGA has completed its review of the potential investment. The purpose of this Early Disclosure is to enhance the transparency of MIGA’s activities with reference to those projects or investments that are categorized as Category A under MIGA’s Policy on Environmental and Social Sustainability (2013). This document should not be construed as presuming the outcome of the decision by MIGA’s Board of Directors. In addition, prior to any consideration of the investment by MIGA's Board of Directors, the Summary of Proposed Guarantee (SPG) and the Environmental and Social Review Summary (ESRS) would be disclosed at least 60 days in advance. The following Early Disclosure is disclosed in accordance with MIGA's Access to Information Policy (2013).

Project Description

Burapha Agro-Forestry Co., Ltd (Burapha), is an agroforestry and wood processing company operating in the greater Vientiane area in Laos. Burapha has developed forest landscape restoration activities on an area of approximately 6,000 hectares (ha) of private land under various land lease agreements with farmers and village cooperation. It also has operated a sawmill and a furniture factory to process sawn wood products and furniture for the export and Laos domestic market by sourcing wood from its plantations.

Burapha has developed an inclusive agroforestry model, including local communities in its activities in the creation and maintenance of plantations, and is committed to respecting very high responsible and sustainable forestry standards (FSC certified). This innovative model contributes to creating jobs, improving incomes for local communities, fighting against climate change and land degradation, and developing a replicable and sustainable forestry model. Villagers can also intercrop annual crops, improving food security and resilience.

Burapha’s current plan is to scale up its business through (i) the new Production Forestry Area (PFA) concession on a total area of 60,000 ha of the land of the Government of Laos and (ii) the operation of a new plywood mill with a 50,000 m³ annual capacity. To support Burapha’s business expansion plan Burapha sought the financing of US$9.0 million from Land Degradation Neutrality Fund (LDN Fund).

LDN Fund has applied for MIGA’s guarantee to cover its equity investment into Burapha against the risk of Expropriation for up to 15 years.

 

Environmental Categorization

The Project has provisionally been categorized as category A under the MIGA’s Policy on Environmental and Social Sustainability

The ESIA can be accessed below:

Development Impact

The Project is aligned with the World Bank Group’s Country Partnership Framework (CPF) for FY2017-2021, particularly aligned with the CPF’s objective of “promoting environmental protection and sustainable natural resource management”. The project also aligns with the forthcoming CPF for FY2022-26, particularly the objectives under its third focus area “Sustainable livelihoods though better management of natural resources”.  

The Project will contribute to the recovery of the country’s forest area and thus achieve climate mitigation and adaptation benefits through the reduction of the greenhouse gas emissions and soil stabilization, respectively. Emissions from agriculture, land-use change and forestry account for around half of total GHG emissions in Laos and the country is estimated to have lost 3.6 percent of its forest between 2005 and 2015. The expansion of the Burapha plantation will also bring employment opportunities for local population, while the training provided by the company will help employees develop new skills and knowledge. Additional benefits of the Project include the possibility for local communities and individuals to establish their own plantations in collaboration with Burapha, and agricultural development opportunities within Burapha’s plantation, all of which will help to bolster the earning potential of local population.