Demerara Distillers Limited (DDL), known primarily for its rum and rum products, today signed a US$22M loan agreement with Inter-American Development Bank’s (IDB)-Investment Department to further improve its production capacity for juice and milk.
The loan would also see DDL being able to continue to expand its energy mix which is another sector the PPP/C Government has been working to foster growth. The signing, which took place at DDL, was overseen by Senior Minister in the Office of the President with Responsibility for Finance, Dr. Ashni Singh.
Speaking at the signing, Dr. Singh said the transaction is the largest ever done by IDB Invest with any private sector entity in Guyana and is in alignment with the 25 by 2025 initiative of the Caribbean Community (CARICOM) which aims to reduce its large food import bill by 25 percent by 2025.
Minister Singh noted as well that the People’s Progressive Party Civic Government has been encouraging IDB-Invest to do more and larger operations with the private sector of Guyana as he recalled that government has been advocating for this for several years.
IDB’s Resident Representative Lorena Solorzano-Salazar and Division Chief of Corporates Aitor Ezcurra pointed out during their remarks that the transaction will assist DDL in energy diversification as well as in expansion of its labour force among other aims.
Mr. Ezcurra emphasized the importance of private sector development to overall social and economic growth further adding that diversification of exports, working with the agricultural value chain, and smaller farmers in the fruits business are all part of the things considered as well as the fact that the agreement would be contributing positively to CARICOM’s 25 by 2025 initiative.
For her part, Mrs. Solorzano-Salazar pointed to the importance of energy and economic diversification and why the IDB-Invest considered the initiative to be imperative.
Executive Chairman of the DDL Board Mr.Komal Samaroo recalled that DDL was the first to be ISO- certified in 1995 and the first to establish a bio-methanization plant in the Caribbean. He said that the company aims to, as part of its future plans, commit in excess of US100 Million dollars in capital projects.
He noted that the loan agreement signed today will provide the resources required to fund projects in pursuance of the diversification strategy of the DDL group and the transition to renewable energy.
Guyana Standard understands that the loan will enable DDL to develop a new one-litre packaging line for juice and milk, set up an automated fruit processing line, and finance the construction of a 3.25MW of solar photovoltaic (PV) generation system with battery storage for self-consumption.
The financing will also help DDL align its growth strategy by increasing productivity and diversifying beyond rum production to incorporate new and healthier products produced locally.
It will also contribute to climate change mitigation by incorporating renewable energy, replacing fossil fuel sources. In addition, the financing will strengthen the local supply chain of Small and Medium Enterprises (SMEs) fruit and vegetable producers by increasing the number of farmers that supply to DDL.
IDB Invest previously provided technical assistance to DDL for the development and implementation of solar PV and energy storage system promoting the adoption of energy efficiency measures and environmental improvements such as fire and safety and water management.
These interventions are expected to contribute to six of the United Nation’s Sustainable Development Goals, Affordable and Clean Energy (SDG 7), Decent Work and Economic Work (SDG 8), Industry, Innovation and Infrastructure (SDG 9), Reduced Inequalities (SDG 10), Responsible Consumption and Production (SDG 12) and Climate Action (SDG 13).
IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector.
IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social and environmental development in the region. With a portfolio of $15.3 billion in asset management and 375 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.
Government has been long advocating for IDB-Invest to finance initiatives in the private sector and the Financial Institution has been moving speedily in this regard. In October, 2022 and January 2023 IDB-Invest signed US$4M loan agreements with Muneshwers and John Fernandes respectively for each to procure a mobile crane.
