Announcement of Malt Project in Bolivia to Benefit Small Farmers on December 16, 1980

International Finance C01poration 1818 H Street; N .W. • Washington, D.C. 20433, U.S.A . 202-477-1234 IFC Press Release No. 81/25 Tuesday, December 16, 1980 Malt Project in Bolivia To Benefit Small Farmers A new $22.9 million malt project will be initiated in Bolivia with the establishment of a 17,000 metric tons-a-year processing plant and implementa- tion of a complementary agricultural development program to supply the plant with barley. The project consists of the construction of a malt plant near the city of Sucre and an agricultural program to assist some 16,000 low-income, small farmers in the lesser developed areas of Chuquisaca and Potosi in southern Bolivia. The project, which is one of the largest presently being implemented in • Bolivia, is being undertaken by Cerveceria Boliviana Nacional S.A. (CBN). will be financed by Corporacion Andina de Fomento (CAF) and International Finance Corporation (IFC) loans of $10. 4 million and $5. 7 million, respectively; and a share offering and cash generation, $6.8 million. The IFC investment is It its largest to date in Bolivia. CAF is the regional development bank of the Andean Pact countries. IFC, an affiliate of the World Bank, assists the growth of developing economies by supporting the private sector. The concept of the agricultural program was developed in a joint effort by the Company, IFC and the World Bank. It aims at increasing the yields and quality of barley gt'bwn in the region anH at expanding the acreage planted in barley. The program will include technical assistance for farmers in controlling yellow rust disease, which is endangering the nation's barley production, and will distribute and promote the use of selected, high-quality, disease-resistant seed. The program also includes the introduction of pest controls and contracts with farmers and farm cooperatives to assure growers of a mark~t for the barl~Y •• they produce .  - 2 - In addition to 100 new jobs at the plant, farmers growing barley to be processed are expected to substantially increase their incomes, improve their farming practices through closer relations with the Company, and gradually form • into larger, more effective production units. The project will also benefit the Bolivian economy by providing a competitive,, reliable local supply of. a commodity presently imported and by generating estimated net foreign exchange savings of $5 million a year. Although barley has been grown in Bolivia's Altiplano for centuries, current production does not meet the country's needs either in quantity or quality. The CBN project is in line with the Government's efforts to encourage increased agricultural production and r~duce the need for imports. IFC has worked closely with the Company in preparing and structuring the project and has assisted in site analysis and financial planning. • [Any inquiries strictly relating to IFC's participation in this project should be directed to the IFC Information Office, 1818 H Street, N.W., Washington, D.C. 20433, Telephone (202 676-0394.] •