Project detail - COMERCIAL INTERNACIONAL EXPORTADORA

Who is our customer

Comercial Internacional Exportadora S.A. (CISA), established in 1952, is the main operating company of the Mercon Coffee Group (MCG) in Nicaragua. MCG is one of the world’s leading coffee merchants. It has sourcing operations in Central America, Brazil and Vietnam and a significant share in sustainable and quality coffees. Mercon is involved in all aspects of the coffee supply chain from primary production, production and distribution of seedlings, sourcing and processing of coffee from third parties to the delivery and export of green coffee. Mercon has developed into a supply chain manager with upstream operations and producer engagement in origin countries and strong relationships with premium coffee buyers. The coffees that Mercon sources are mostly certified (Utz, 4C, RfA, C.A.F.E. Practices) and deliveries are based on long-term relationships between Mercon and the producers.

What is our funding objective?

FMO will provide a USD 25 million facility. The funds will support the expansion and upgrade of its coffee processing facilities and to refinance existing debt with FMO.

Why do we fund this investment?

CISA is the market leader in Nicaragua and sources coffee from over 6,000 producers. The company has various programs in place to help some of their producers increase yields, become more climate resilient and increase their revenues. CISA will further expand and upgrade its coffee processing facilities and refinance existing term loans with FMO.

What is the Environmental and Social categorization rationale?

This is an E&S B+ investment, as the company engages in primary production and primary processing of coffee which comes with potential adverse environmental or social impacts. E&S characteristics of this specific investment include assessment and renewal of a land lease with Organized Indigenous Communities in Nicaragua, Organizational Health and Safety and pollution risk management. The E&S context include potential environmental and social risks in their supply chain -not limited to child labor, poor working conditions, forced labor, impact on ecosystem services, deforestation, and additional pressure on climate vulnerabilities-. ESG performances will be focused on the assessment and management of these risks (own operations, and supply chain) by adoption a root cause analysis allowing the company to steer their efforts to design and implement mitigants. FMO’s environmental and social due diligence indicates that the investment will be managed with the following IFC Performance Standards in particular: PS 1 – Assessment and Management of Environmental and Social Risks and Impacts PS 2 – Labor and working conditions PS 3 – Resource Efficiency and Pollution Prevention, PS 4 – Community Health, Safety and Security, PS 6 - Biodiversity Conservation and Sustainable Management of Living Natural Resources and PS7 Indigenous People. The other Performance Standards (PS 5, and 8) are not applicable during this period as no land acquisitions are taking place, and no impact on cultural heritages has been identified.

More investments

Date	Total FMO financing
9/20/2018	USD 10.00 MLN
10/12/2017	USD 10.00 MLN