Phnom Penh, Cambodia, 26 June 2003 — Hagar, a Cambodian NGO that helps destitute mothers rebuild their lives, received financing today to build a new soya milk factory that will generate more profits for its humanitarian work. With the US$ 450,000 in equity financing, which was provided by the International Finance Corporation (IFC), Hagar will build a plant to process and package ultra-high temperature (UHT) soya milk. After the facility opens in September, Hagar Soya (HSL) Limited Company will expand its current output of 300 liters per day to as many as 12,000 liters per day.
In announcing the financing, which was arranged by IFC’s Mekong Private Sector Development Facility (MPDF), Pierre Tami, the director of Hagar, expressed gratitude for IFC’s participation. “This will help Hagar achieve several important objectives. First and foremost it restores the conviction of those who “seek justice, rescue the oppressed, defend the orphan, and plead for the widow.” Formerly poor and destitute women are now employed in a viable and sustainable business and able to support themselves. Second, it will turn locally grown soybeans into a nutritious, delicious drink that is affordable for Cambodia’s poor and often malnourished population.
“From a technical point of view, IFC financing will enable Hagar Soya to build a factory and buy the high tech equipment needed to package UHT soya milk. This doesn’t need refrigeration and has a long shelf life, which means our product can be distributed nation wide and even exported.
“This new product will also allow Hagar to participate in School Feeding Programs, which encourage girls’ education. Last, but not least, by expanding operations, Hagar Soya, and its sister company, Hagar Design, will generate considerably more profits, and in the long term, ensure Hagar’s sustainability.”
MPDF has a strong commitment and track record in helping NGOs develop profitable businesses. According to Adam Sack, MPDF’s Regional Manager for Cambodia and Lao PDR, working with NGOs such as Hagar to commercialize their income generating activities provides an innovative model that can be replicated in many other countries. “The use of private sector mechanisms is increasingly regarded as a sustainable path out of poverty for the most vulnerable members of society.”
MPDF began helping Hagar in 1999 with income generating units producing both silk crafts and soya milk. With MPDF’s help, Hagar obtained US$ 65,000 in funding from the Small Medium Enterprise Department of the World Bank Group to improve its silk production operations. Now Hagar Design has a well-established international market and is able to employ more than 50 previously-destitute women who sew high quality handbags, table mats, and other fabric products.
For Hagar’s soya milk operation, which the NGO launched in 1998, MPDF conducted a market study that showed great potential for UHT soya milk. MPDF also helped Hagar develop the proposal that attracted funding from IFC and others. Now that financing has been approved, MPDF will continue to support Hagar with marketing and sales advice as it prepares to launch the new product in September.
Hagar was established in 1994 to provide a shelter for homeless and abused single mothers and their children. Today, the shelter provides education, training, and basic needs for up to 120 women and 400 children a year. Hagar operates Foster Homes for formerly trafficked and abused children and oversees new rural communities where landless mothers and children earn a living for themselves through agriculture. Hagar also works in two provinces constructing schools and operating special projects such as building and installing bio-sand water filters, a key to rural health. In the last nine years, Hagar has helped more than 20,000 women and children in Cambodia.
