Tunisian olive oil producer CHO company clinches US$26m financing, management support from IFC

TUNISIA – One of Tunisia’s largest olive oil producers, CHO Company, has been offered a financing and advisory services package by World Bank Group’s IFC, to enable its scale up its operations.

IFC has indicated that it will provide €22 million in financing with an eight-year tenor to its Tunisian partner since 2015.

CHO will use the funds as working capital and to invest in new equipment, strengthen linkages with farmers and create new jobs in an economy that is recovering from the effects of COVID-19.

Besides financing, IFC will also provide advisory services to small-holder olive farmers in CHO’s supply chain to help them improve productivity.

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This will include training in the use of sustainable agricultural practises, including micro-irrigation techniques, which are expected to boost farmers’ resilience to climate shocks and reduce the volatility of production.

Tunisia produced an estimated 350,000 tonnes of olive oil in 2019/20

“Olives are the lifeblood of many rural communities across Tunisia, the second-largest exporter of olive oil in the world.

“This partnership with IFC will help CHO grow and further promote our brand, Terra Delyssa, creating opportunities in the regions that need them most,” said Rym Makhloufi, CHO’s Deputy General Manager.

The olive oil industry is a crucial part of Tunisia’s rural economy. According to FAO, the country broke the record producing an estimated 350,000 tonnes of olive oil in 2019/20 – an increase of around 70,000 tonnes over the 2017/18 campaign.

More than 13 percent of Tunisia’s population is reliant on all types of agriculture for employment.

CHO employees more than 720 people directly and supports about 140,000 farmers in its supply chain.

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“Supporting a company like CHO and the thousands of farmers who rely on it for their livelihoods will help create jobs and rekindle economic growth as Tunisia’s recovers from COVID-19.

“IFC’s long-term financing, with an eight-year tenor, is a strong testament to our additionality in the Tunisian market as a countercyclical development partner,” said Georges Joseph Ghorra, IFC’s Resident Representative in Tunisia.

CHO was established in 1996 as an olive oil bulk trader in Sfax, Tunisia. It is now one of the largest Tunisian olive oil producers, bottlers and exporters.

It is believed to account for a fifth of Tunisian exports of olive oil and over half of packaged olive oil exports from the North African country.

The company has vertically integrated operations, from orchards and olive fields to mills, refineries, pomace extraction units, accredited laboratory, production units besides packaging facilities.

It was founded by Abdelaziz Makhloufi, Moncef Rekik and Mohamed Tounsi. The trio still own around 93% stake in the company. The rest is with Sicar Invest, a subsidiary of BNA Bank.

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