Israel’s biggest bank Bank Hapoalim recently announced that it is supplying over US$200 million credit to an Ethiopian government’s sugar company to finance an irrigation project by Netafim.
The project covers 7,000 hectares of sugarcane. Israel’s Netafim said this was its largest deal ever. Netafim CEO Ran Maidan said that the company “will lead the project together with Baran Group and Global Africa Industries Group, led by Itai Terner”.
The finance will be provided as buyers’ credit, guaranteed by the government of Ethiopia, in tranches against milestones in the project, and will be transferred directly to Netafim as payment for exports. The government sugar company will repay the credit in 9.5 years.
In the current project, Netafim will supply an end-to-end solution from engineering design to the supply of infrastructure for drawing and transporting water, advanced irrigation systems, and control systems, plus agronomic and engineering consulting by the company’s experts from Israel and elsewhere. Sugar cane will be irrigated using advanced subsurface drip irrigation, which has been proven to boost crop yields while saving water and other inputs. The work will start immediately and will be spread over this year and next.
Netafim said this was similar to projects it has carried out in India, South Africa, Brazil and Peru