Uzbekistan: Korzinka COVID-19 Food Retail Supply Chain Support Project
3-year senior secured loan of up to $12 million (local currency equivalent) with 1 year grace period and semi-annual equal amortization to support increased working capital and operational expenditure needs related to COVID-19.
Request for information
8 December 2021
- Agriculture, natural resources and rural development
|Project Name||Korzinka COVID-19 Food Retail Supply Chain Support Project|
|Borrower/Company||Anglesey Food Foreign Enterprise LLC (Korzinka)
|Type or Modality of Assistance||
|Strategic Agendas||Inclusive economic growth
|Drivers of Change||Private sector development
|Sector / Subsector||
Agriculture, natural resources and rural development / Agro-industry, marketing, and trade
|Gender Equity and Mainstreaming||Effective gender mainstreaming|
|Responsible ADB Department|
|Responsible ADB Division|
|Responsible ADB Officer||Noorullah|
|Description||3-year senior secured loan of up to $12 million (local currency equivalent) with 1 year grace period and semi-annual equal amortization to support increased working capital and operational expenditure needs related to COVID-19.|
|Objectives and Scope||The project will provide essential liquidity to Korzinka, a company engaged in food retailing, to enhance resilience to the disruptive economic effects of the coronavirus disease (COVID-19) pandemic, sustain food security, support Korzinka growth, and preserve the livelihoods of more than 4,400 employees and more than 1,200 farm workers. Furthermore, ADB will help raise Korzinka equal opportunity standards in the food retail industry and improve the inclusion of women in the workforce.|
|Linkage to Country/Regional Strategy||
The project is aligned with Strategy 2030, which calls for ADB to scale up its financing for agribusiness. The project will be the first ADB non-sovereign agribusiness transaction in Uzbekistan and is aligned with (i) the government strategy to diversify agricultural output towards high-value horticulture; and (ii) ADB country partnership strategy 2019 to 2023 for Uzbekistan, which targets financing directly to bankable private sector and [state-owned enterprise] clients, principally in the financial, agribusiness, and infrastructure areas. Smaller-ticket transactions will be considered.
The project is consistent with Strategy 2030s Operational Plan (OP) for priority 1 which calls for generating quality jobs, and OP for priority 5, which calls for making an impact in the fast-growing branded food, modern retail, and e-commerce sectors driven by the emergence of urban middle class. It is aligned with Strategy 2030 OP for priority 2, which seeks to expand operations in support of agribusiness value chains whereby women jobs and entrepreneurship opportunities will be enhanced in higher value-generating activities. In addition, it is aligned with pillar 2 of the OP for priority 7 and supports CAREC 2030 in Operational Cluster D by promoting regional trade in agriculture via Korzinka regional cross-border trade links.
The project is aligned with ADB's $20 billion COVID-19 response package, whereby ADB Private Sector Operations Department focuses on financing for working capital and operating expenditure to support continuity of operations of financially strong companies facing temporary liquidity issues because of the pandemic. The project is aligned with Operational Plan for Private Sector Operations, 2019 to 2024, which identifies food brands and food retail as a priority segment because of the potential to drive and structure upstream subsectors (e.g., on quality standards, traceability).
|Summary of Environmental and Social Aspects|
|Environmental Aspects||ADB has categorized the project in compliance with ADB Safeguard Policy Statement (2009) (SPS) as category C for environment. ADB's due diligence included a corporate audit through desktop review. Korzinka is certified as ISO 9001 and ISO 22000 and is currently preparing to apply for ISO 14001, ISO 45001, and ISO 50001 certification, and recertification. Thus, most policies and procedures in the integrated management system either need to be developed or are being revised and amended. The corporate audit observed gaps in Korzinka environmental and social policies and procedures and corrective actions were recommended to enhance the environment, health and safety, social, and labor policies and procedures and to strengthen institutional capacity. Detailed findings and corrective actions have been discussed and agreed.|
|Involuntary Resettlement||ADB has categorized the project in compliance with ADB Safeguard Policy Statement (2009) (SPS) as category C for involuntary resettlement. The loan will not be used to fund any construction or expansion of physical assets which involve activities that may directly or indirectly result in involuntary resettlement.|
|Indigenous Peoples||ADB has categorized the project in compliance with ADB Safeguard Policy Statement (2009) (SPS) as category C for Indigenous Peoples. The loan will not be used to fund any construction or expansion of physical assets which involve activities that may directly or indirectly affect indigenous peoples or vulnerable ethnic minorities.|
|Stakeholder Communication, Participation, and Consultation||ADB's proceeds provide limited opportunities for stakeholder engagement and external consultations. However, Korzinka has a system in place to engage with its customers and the public.|
|Timetable for assistance design, processing and implementation|
|Credit Committee Meeting||-|
|Approval||08 Dec 2021|
|Last PDS Update||14 Dec 2021|
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.
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|Title||Document Type||Document Date|
|Korzinka COVID-19 Food Retail Supply Chain Support Project: Report and Recommendation of the President||Reports and Recommendations of the President||Nov 2021|
|Korzinka COVID-19 Food Retail Supply Chain Support Project: Initial Poverty and Social Analysis||Initial Poverty and Social Analysis||Oct 2021|
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.
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.
ADB, Korzinka Sign Loan to Sustain Food Security and Farmer Livelihoods in UzbekistanThe Asian Development Bank and Anglesey Food Foreign Enterprise LLC (Korzinka) have signed $12 million in debt financing to promote food security and sustain the livelihoods of more than 4,400 employees and 1,200 farm workers in Uzbekistan.