Regional : Olam COVID-19 Smallholder Farmer Livelihood Support Project
The project will help sustain the livelihood of smallholder farmers impacted by COVID-19 in Indonesia, Viet Nam, and PNG by providing working capital financing to Olam International Limited (OIL) and Olam Treasury Private Limited (OTPL) to increase its raw material procurement from these farmers.
Project Details
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Project Officer
Ahmed, Salman
Private Sector Operations Department
Request for information -
Country/Economy
Regional -
Sector
- Agriculture, natural resources and rural development
| Project Name | Olam COVID-19 Smallholder Farmer Livelihood Support Project | |||||
| Project Number | 54325-001 | |||||
| Borrower / Company | Olam International Limited Olam Treasury Private Limited |
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| Country / Economy | Regional Indonesia Papua New Guinea Viet Nam |
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| Location | Indonesia - Nation-wide; Papua New Guinea - Nation-wide; Viet Nam - Nation-wide | |||||
| Type or Modality of Assistance |
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| Operational Priorities | OP1: Addressing remaining poverty and reducing inequalities OP2: Accelerating progress in gender equality OP5: Promoting rural development and food security OP7: Fostering regional cooperation and integration |
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| Sector / Subsector | Agriculture, natural resources and rural development / Agro-industry, marketing, and trade |
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| Gender | Effective gender mainstreaming | |||||
| Responsible ADB Department | Private Sector Operations Department | |||||
| Responsible ADB Division | Portfolio Management Division, PSOD | |||||
| Responsible ADB Officer | Ahmed, Salman | |||||
| Project Sponsor(s) | ||||||
| Description | The project will help sustain the livelihood of smallholder farmers impacted by COVID-19 in Indonesia, Viet Nam, and PNG by providing working capital financing to Olam International Limited (OIL) and Olam Treasury Private Limited (OTPL) to increase its raw material procurement from these farmers. | |||||
| Objectives and Scope | The project will support smallholder farmers that OIL and its subsidiaries (Olam) directly sources from across the project countries. Disruptions to agricultural supply chains caused by the coronavirus disease (COVID-19) pandemic have impacted smallholder farmers as local markets close down and smaller traders cease buying. The COVID-19 impact on livelihoods of female farmers are disproportionately harsh given their limited access to land, credit, and inputs. In this context, Olam role as a sustainable buyer of agricultural products at scale will provide timely support to smallholder farmers livelihoods, in particular for female farmers. | |||||
| Status of Development Objectives | The project has started contributing to its development objectives. | |||||
| Status of Operation/Construction | The full loan amount was disbursed in March 2021 and enabled Olam to sustain its operations amidst increased working capital requirements due to disruptions from Covid-19. | |||||
| Linkage to Country/Regional Strategy | The project is aligned with ADB Strategy 2030, which calls for ADB to scale up its financing for agribusiness and promote gender equality in at least 75% of the number of ADB committed operations by 2030. The project is also aligned with Operational Plan for Private Sector Operations 2019 to 2024 which calls for working with Tier-1 agribusiness companies because of their potential to have widespread impact including as partners in TA. It is consistent with ADB country partnership strategies for Viet Nam, Indonesia, and PNG. The project is consistent with the Strategy 2030 Operational Plan for Priority 1 (OP1) by preserving the livelihoods of smallholder farmers during COVID-19, Operational Plan for Priority 2 (OP2) to protect women workers and farmers and Operational Plan for Priority 5 (OP5) which calls for (i) modern, sustainable, and responsible corporate farming models; (ii) the integration of farmers, agribusinesses, and consumers into efficient and sustainable value chains; and (iii) promote food security and increase agricultural productivity to provide sufficient, safe, and affordable food to the poor. As a regional project benefiting three DMCs, the project is consistent with Operational Plan for Priority 7 (OP7) as it supports nonsovereign lending for cross-border operations for agriculture value chains. The project is also part of ADB Comprehensive Response to COVID-19 Pandemic which proposed $20 billion to address the needs of ADB developing member countries as they respond to the COVID-19 pandemic. |
| Safeguard Categories | |
|---|---|
| Environment | C |
| Involuntary Resettlement | C |
| Indigenous Peoples | C |
| Summary of Environmental and Social Aspects | |
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| Environmental Aspects | ADB has categorized the project in compliance with ADB Safeguard Policy Statement (2009) (SPS) as category C for environment. OIL and OTPL have existing corporate environmental and social management system, composed of various policies, standards, and codes of practices, that were assessed during the due diligence process of the existing loan and found to be compliant with regulatory requirements and international good industry practices. These were strengthened through adoption of ADB Safeguard Policy Statement (SPS, 2009) requirements in the expansion of OIL and OTPL four existing facilities supported by ADB. OIL confirmed through the annual environmental and social monitoring reports submitted to ADB that there are no environmental and social non-compliances and grievances recorded on any of facilities and activities supported by ADB. The environmental and social performance of the existing loan and the institutional capacity of OIL and OTPL to manage environmental and social issues linked to its operations are deemed satisfactory. |
| Involuntary Resettlement | ADB has categorized the project in compliance with ADB Safeguard Policy Statement (2009) (SPS) as category C for involuntary resettlement. |
| Indigenous Peoples | ADB has categorized the project in compliance with ADB Safeguard Policy Statement (2009) (SPS) as category C for Indigenous Peoples. |
| Stakeholder Communication, Participation, and Consultation | |
| Timetable for assistance design, processing and implementation | |
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| Concept Clearance | 12 Aug 2020 |
| Credit Committee Meeting | 01 Oct 2020 |
| Approval | 04 Nov 2020 |
| Last PDS Update | 06 Dec 2022 |
Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.
The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.
The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.
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| Title | Document Type | Document Date |
|---|---|---|
| Olam COVID-19 Smallholder Farmer Livelihood Support Project: Report and Recommendation of the President | Reports and Recommendations of the President | Oct 2020 |
| Olam COVID-19 Smallholder Farmer Livelihood Support Project: Initial Poverty and Social Analysis | Initial Poverty and Social Analysis | Oct 2020 |
Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.
None currently available.
Evaluation Documents See also: Independent Evaluation
None currently available.
Related Publications
None currently available.
The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.
Requests for information may also be directed to the InfoUnit.
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