Norwegian Investment Fund (Norfund) has invested $12 million in the Local Nigerian Cocoa Processing Business with the aim to create jobs in Nigeria, while addressing some of the challenges in the cocoa value chain.
The investment was through OH Ecosystems Limited, which successfully acquired a majority stake in FTN Cocoa Processors Plc. Norfund’s investment will upgrade FTN’s operating facilities and extend its reach to produce and sell additional products into the cocoa supply chain.
With 20,000 metric tons of installed capacity, FTN transforms cocoa beans into semi-finished products (cocoa liquor, butter and powder) for commercialisation to global and local clients. Prior to this investment, FTN had been dormant and underutilised for several years. Norfund’s investment will upgrade FTN’s operating facilities and extend its reach to produce and sell additional products into the cocoa supply chain.
Investment manager at Norfund, Obafemi Awobokun said: “increasing the share of raw materials that are processed locally can create a large number of jobs that give the fast-growing population of Nigeria the opportunity to work their way out of poverty, and we are confident that this investment can contribute to this.”
Managing director of OH Ecosystems, Nathaniel Durant said: “We are thankful for Norfund’s partnership as we focus on building out value-add production in Nigeria. Having partners who are aligned over the long-term on both the financial and social impact of our work is extremely important. Together, we can contribute to Nigeria’s agricultural manufacturing with a focus on financial sustainability for farmers in the value chain.”
Also, managing director of FTN Cocoa, Akin Laoye ,added that, this is a strategic alliance come through that will help FTN sew up her pursuit of conversion of cocoa beans, job creation, contribution to the economic diversification goals of the government, delivering value to stakeholders and actualising the vision of being a global player.
He also said: “Norfund’s investment will help create both technical and non-technical employment directly for 600 people and indirectly for more than 1,500 across the cocoa value chain. The investment also contributes towards the Nigerian government’s efforts to diversify export revenues by reducing its reliance on oil and gas.”
The regional director for West Africa for Norfund, Naana Fynn pointed out that the cocoa sector is a very important one for Nigeria and West Africa and could be a key one in the push to diversify Nigeria’s revenue sources, saying, “by partnering with this management team which has deep sector experience in West Africa, a strong technical partner, local investors and current owners, we aim to contribute positively to this effort.
“This investment also presents us the opportunity to partner with these stakeholders to increase local processing of cocoa beans and thus capture more of the value chain dollars at origin, to create jobs and to positively impact the fight against child and forced labour and deforestation in this important value chain.”