MIGA issued its first guarantees for a project in Guinea to Société de Promotion Financière et d'Investissement, S.A. of Luxembourg, Agro-Industrial Investment and Development, S.A. of Switzerland, and Promofin Outremer, S.A. of Luxembourg to cover their equity and shareholder loan investments in the construction and operation of a modern flour mill in Dubreka. In addition, MIGA guarantees cover loans by Faisal Finance, S.A. of Switzerland and Belgian banks, Banque Belgolaise, S.A.Crédit Lyonnais Belgium, S.A., against the risks of expropriation and war civil disturbance. The Agency issued $8.35 million in total coverage for this project.
Société des Grands Moulins de Guinée, S.A., the project enterprise, is 21 percent owned by local private interests. It will initially have the capacity to mill 170 tons of wheat flour and bran per day. Bran will be available for export immediately, but flour will initially be sold only on the local market with a view to later increasing capacity and exporting to neighboring countries. The flour produced will be fresher, of higher quality, and significantly less expensive than imported flour. Local flour distributors and users will benefit from a local source of high-quality flour.
The project is expected to generate $1.4 million in net foreign exchange per year for the country as a result of import substitution and export revenues. Additional benefits will accrue from the diversification of economic activities in the country, which is still heavily dependent on mining revenues. Guinea will further benefit from the transfer of modern technology and superior quality-control techniques in flour processing and treatment. The project will create about 70 jobs for Guineans, who will receive administrative and technical training. In addition, the project will sponsor university training programs and events for the local community.