UK-backed Firm Mobilises Funds To Build $75m Cashew Processing Plant In Nigeria

A United Kingdom- backed firm, GuarantCo has provided a 100 per cent guarantee to support a USD 75 million debt facility for Robust International Pte Ltd to construct a new cashew nut processing plant in Ogun State, Nigeria.

The British Deputy High Commission, which made this known in Lagos, said this move has become necessary to enhance the capacity for local processing in order to add value to cashew nuts instead of the current situation where raw cashew nuts are exported unprocessed.

Nigeria is one of Africa’s largest cashew producers of about 250,000 to 300,000 tonnes of raw cashew nuts annually, yet currently less than 10 per cent are processed domestically,  statement issued on Thursday by the press officer of the High Commission, Amaka Eze, affirmed.

Nigeria experts mostly raw unprocessed cashew nuts to Asian and other countries, forfeiting up to 80 per cent of potential export value and adding exposure to foreign exchange fluctuations.

GuarantCo is a part of the Private Infrastructure Development Group (PIDG) supported by the UK to boost Nigeria’s productive economy.

Speaking about the impact of the plant, British deputy high commissioner, Jonny Baxter, said: “The UK is proud to support innovative financing that mobilises private capital into Nigeria’s productive economy through UK-backed institutions such as PIDG.”

He added that by backing investment into local processing and value addition, this transaction supports jobs, exports and more resilient agricultural supply chains. He noted that this is complemented through the UK-Nigeria Enhanced Trade and Investment Partnerships and the Developing Countries Trading Scheme.

The UK envoy said further that “the UK is supporting Nigerian businesses to scale exports to the UK and beyond, demonstrating how UK-backed partnerships help firms grow and compete internationally.”

Also reacting Dave Chalila, Head of Africa and Middle East Investments at GuarantCo, said: “This transaction marks GuarantCo’s third collaboration with M&G Investments and Symbiotics, emphasising our efforts to bring replicability to everything we do so that we accelerate socio-economic development where it matters most.

“The transaction is consistent with PIDG’s mandate to mobilise private capital into high impact, underfinanced sectors and in this case crowding in institutional investors to the African agri-processing value chain.”

Vishanth Narayan, Group Executive Director at Robust International Group, said: “As a global leader in agricultural commodities, Robust International remains steadfast in its commitment to building resilient, ethical and value-adding supply chains across origin and destination markets.”

According to the statement, this additional plant will more than double Robust’s existing cashew processing capacity from 100 MT per day to 220 MT per day to help reduce this structural gap.

The new plant will be of extensive benefit to the local economy, with procurement of cashew nuts from c. 10,000 primarily low-income smallholder farmers. There is an expected increase in export revenue (c. USD 335 million) and procurement from the local supply chain over the lifetime of the guarantee.