Frigo-Pak

Summary of Proposed Investment

This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only.

Project number	26605
Company name	Frigo-Pak Gida Maddeleri ve Sanayi A.S.
Country	Turkey
Sector	Food & Beverages
Environmental category	B
Department	Agribusiness
Status	Pending Approval

Date SPI disclosed	May 16, 2008
Projected board date	June 19, 2008

View Environmental & Social Review Summary (ESRS), click here

Overview

Sponsor/Cost/Location

Development Impact

Contacts

Attachments

Project description

Frigo-Pak Gida Maddeleri Sanayi ve Ticaret A.S. (Frigo-Pak or the company) is a manufacturer of canned and frozen fruits and vegetables and fruit nectars and juices, with total sales of $20 million. Frigo-Pak exports to various countries, including the UK, USA, Japan, Switzerland and Germany. Frigo-Pak plans to construct a new plant to produce concentrated fruit juices in Bursa, Turkey. The company will use these concentrated juices (sour cherry, pomegranate, peach, apricot, apple and tomato) primarily in its own production, while supplying the excess production to domestic and export markets.

Anticipated development impact of the project

The project is expected to support the continued development of a second-tier export-oriented private enterprise and further the modernization and expansion of the Turkish fruit and vegetable sector. The proposed project aims at balancing the export sales of a private productive enterprise that processes local produce into value-added products. The project will benefit the company's financiers and employees by increasing direct and indirect employment, as well as supporting the activity of SMEs associated with the company's operations (transportation, distribution, etc). In addition, the project will broaden the market access of fruit and vegetable producers in rural areas of Turkey and contribute to private sector development as the company sources all of its raw materials from local small farms.

IFC's expected development contribution

IFC’s expected development contributions include:

- providing access to limited recourse long-term finance; and
- supporting a mid-sized local agribusiness company that has grown from a small local player into a successful producer and exporter of canned fruits and vegetables as it cautiously enters the domestic juice market.

Environmental and social issues - Category B

This is a Category B project with potential impacts which can be minimized if managed in compliance with IFC Performance Standards. Frigo-Pak currently operates with strong quality management and food safety systems certified according to several international standards. The coverage of certifications will be extended to the new operations under the project description. The company manages environmental, health and safety (EHS) matters in compliance with local regulatory requirements and is committed to operate under international SEDEX Ethical Trade audit which covers similar issues with IFC’s performance standards on labor relations. In order to establish a comprehensive management system on EHS, it is expected that the company will enhance its organization by a staff of EHS professionals. With regard to the project, the company has conducted an internal generic environmental impact assessment and will provide a formal assessment by an external certified institution as necessary by the local regulations and by the IFC requirements. The company will furthermore implement a number of actions as defined in the Environmental and Social Action Plan (ESAP).

Further information is provided within the Environmental and Social Review Summary (ESRS).

IFC PROJECTS