The partnership’s inaugural project was launched in Mexico with an agriculture initiative that seeks to significantly expand commercial sunflower production.
The project is to create a sustainable market for sunflowers – a once-thriving commercial crop which has diminished in recent years – while providing loans and a source of income for some 850 Mexican farmers and their families.
For PepsiCo, the sunflowers will provide a source of heart-healthy high-oleic sunflower oil (HOSO) for cooking potato chips, biscuits, nuts and other snacks PepsiCo produces in Mexico under the Sabritas and Gamesa-Quaker brands.
The five-year partnership between PepsiCo and the IDB will mark the first time a private-sector organisation has participated in the IDB’s innovative regional trust funds for development activities.
As part of the sunflower production program, PepsiCo has committed to purchase 100% of the crop for an estimated $52m over seven years. Additionally, PepsiCo will invest $2.6m to support management of the Mexican sunflower crop and will provide technical training to the small farmers.
Financial partner Agrofinanzas, an institution specialising in supply chain finance, will make available $40.4m for micro-loans to provide the farmers working capital. The IDB, through its Opportunities for the Majority Initiative, will provide Agrofinanzas a partial credit guarantee for up to $5m.
In addition to the Mexican sunflower programme, the partnership will expand on successful projects across the region, such as the Waste Pickers programme launched two years ago in Peru and Colombia.
Waste Pickers promotes recycling by creating a sustainable market for recycled materials and providing the training local recyclers need to generate a sustainable income stream. Waste Pickers will roll out in Argentina, Bolivia, Ecuador and the Dominican Republic as part of the new partnership.
Through the broader regional partnership, the PepsiCo Foundation and the IDB will collaborate to address a variety of critical issues in Latin America and the Caribbean, including water and sanitation, recycling, youth development, disaster relief and recovery, sustainable agriculture, nutrition and food security, and sharing knowledge and best practices about sustainability.
These focus areas are consistent with previously stated PepsiCo sustainability goals, including commitments to provide access to safe water to 3m people in developing countries by the end of 2015, to provide technical support and training to local farmers, and to help address global nutrition challenges.
Through this partnership, PepsiCo will leverage the IDB’s technical and financial strengths to maximise programme impact and achieve scale, while the IDB will leverage PepsiCo Foundation resources on behalf of its development agenda for Latin America and the Caribbean.
Additional programmatic elements of the public-private partnership, as well as financial terms of the agreement, will be released in the coming months.
Source: PepsiCo
© FoodBev Media Ltd 2024