Announcement of First IFC Investment in Rwanda Lends Five Million Thirty-Five Thousand US Dollars for Tea Venture on July 26, 1976

Intematimzal Fi?1wzce Cmporatim1 18;8 H Stn·.:<;,t. NW • IFC Press Release No. 77/6 Monday, July 26, 1976 First IFC Investment in Rwanda Lends $535 2 000 for Tea Venture The International Finance Corporation (IFC), an affiliate of the World Bank, is making its first investment in Rwanda with a $465,000 loan and a $70,000 contin- gent loan for a $1.58 million project to establi~h a tea processing plant and to improve commercial services for the country's tea sector. The project supports Rwandan Government efforts to diversify the economy and increase foreign exchange earnings. The main sponsors of the project, investing $555,000 in equity, are Tea • Importers Inc., of the United States; Office des Cultures Industrielles du Rwanda - Departement du The; and the Rwanda Development Bank, which is also making a $100,000 loan to the project. A $465,000 loan and $70,000 contingent loan by the Overseas Private Investment Corporation, of the U.S., completes the financing. The bulk of the funds will be used by Usine a The Cyohaha-Rukeri S.A.R.L. to build a tea factory processing annually about 8,000 tons of green leaf tea from a smallholder tea development project at Cyohoha-Rukeri financed by the European. Development Fund. The smallholder plantation, which is substantially completed, will yield an increasing amou.,1:t of green leaf tea as the tea bushes mature over a seven-year period. The factory has been designed so that capacity can be approximately doubled with a relatively small additional investment to process increased production from the plantation. The project is expected to generate foreign exchange earnings of $500,000 annually in the initial five-year period, rising to $1 million in subse- quent years. The remainder of the project financing will be used to establish Societe d'Investissement Rwandaise du The S.A.R.L. which will provide export marketing • services for tea from the new factory and two other factories, and supply all existing plants with spare parts, accessories, tea chests and other equipment.  • - 2 - The tea factory a.nd the plantation, which is located on reclaimed swampland, will provide job opportunities for some 2,500 families. Tea growing is expected to more than double the income of smallholders curren~ly living in the area. (Any inquiries strictly relating to IFC's participation in this project should be directed to the IFC Business Relations Unit, 1818 H Street, N.W., Washington, D.C. 20433, Telephone (202) 477-5770). • •