The International Finance Corporation (IFC), the private sector development arm of the World Bank, will provide support to Syria's private sector with a $13.2 million project finance loan to help build a new company that will provide raw materials for detergents manufacturers.
The IFC loan is part of a $38 million financing package to create United Joint Stock Company for Petrochemical Industries (UCPI). The financing marks the first time a project finance transaction will support the creation of a new company in Syria, establishing an important milestone in Syria's ongoing private sector liberalization.
UCPI will be sponsored by the Syrian business family of Ahmad Daaboul and his sons, who will be the majority partners, and Suleiman Al-Rajhi, a Saudi Arabian businessman who will become the minority partner.
The project consists of the construction and operation of a 30,000 metric ton per year linear alkyl benzene (LAB) plant and the associated infrastructure in a location south of Damascus. LAB is the major feedstock required to produce all kinds of detergents, from liquid soap to laundry powder.
"UCPI will help to narrow the demand/supply imbalance in Middle East's LAB market and will allow regional detergent producers to procure their LAB needs in a cheaper and more timely fashion," stated Director of IFC's Oil, Gas, and Chemicals Department, Rashad R. Kaldany.
Currently, Ahmad Daaboul & Sons Company for Detergent (ADD), the backbone of the Daaboul family's businesses, relies on imported LAB for its production line. ADD will consume one-third of the project's output with the remainder going to local and regional detergent manufacturers.
IFC's mission is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, and provides technical assistance and advice to governments and businesses. Since its founding in 1956 through the close of the last fiscal year on June, 2001, IFC committed more than $31 billion of its own funds and arranged $20 billion in syndications for 2,636 companies in 140 developing countries.
© 2002 Mena Report (www.menareport.com)
