Central Asian republics are the world's third largest cotton exporting region after the USA and India, but yields in Tajikistan remain relatively low due to inefficient production practices and a shortage of quality seeds and fertilizers.
Global commodity trader and processor Ecom is a top 5 global cotton merchant. It first established operations in Tajikistan in 2008 and launched a Farmer Advance Program the following year to provide input financing for seeds, fertilizers, fuel, and access to agronomy services, helping to build direct, long-term relationships with local smallholder farmers.
This is the first facility organised within ABN AMRO's agricultural impact banking initiative, which seeks to finance the smallholders of clients and encourage sustainable practices throughout the commodities value chain.
Speaking on the agriculture panel at the Financial Times Global Commodities Summit in Lausanne, Harris Antoniou, and Global Head of ECT at ABN AMRO, said: "This is a landmark deal for the future of cotton production in Tajikistan and demonstrates our commitment to sustainable banking in the agricultural sector. Our sustainability assessment process enables us to identify projects such as this where, in partnership with our clients, we can make a real difference for smallholder producers. The sustainability performance of our clients is also indicative of their ability to cope with issues such as climate change, water scarcity, population growth and food inflation. It is therefore a key component of our due diligence process and credit risk analysis."
Mr Antoniou also challenged the view that reduced levels of credit in the global banking system were impacting finance available for agriculture. However, he highlighted how ABN AMRO's ownership based financing of commodities – called Icestar – provides a unique 'capital-lite' model, whereby the bank plays an intermediary role by taking ownership of physical commodities for a pre-defined period, enabling clients to efficiently manage their working capital.
"ABN AMRO is one of the few banks with in-house capabilities for trade finance, ownership based financing, brokerage and clearing. Icestar is one of our key growth areas in ECT due to significantly increasing client demand and it now has worldwide coverage via representatives in the US, Europe and Asia, as well as a rapidly expanding product scope within soft and hard commodities," he said.
Textiles | On 29th Apr 2017
The textile sector could have a uniform Goods and Services Tax (GST)...
Textiles | On 30th Apr 2017
Indian Government is working to revamp the technology mission on...
Apparel/Garments | On 30th Apr 2017
Columbia Sportswear Company has announced record net sales of $543.8...
Shri Dinesh Mills Limited
Broad range of fabrics will sell well this financial year
Fashion shows are also encouraging and highlighting sustainable fashion
We constantly communicate with employees at all levels
Coating at a fibre level is a practice not usually seen in the...
Swerea IVF AB
Marten Alkhagen, Senior Scientist - Nonwoven and Technical Textiles of...
Larry L Kinn
Larry L Kinn, Senior Vice President - Operations Americas of Suominen...
Rupa Sood and Sharan Apparao
Nayaab, an exhibition meant to celebrate Indian weaves, is in its second...
Label Ritu Kumar
‘Classics will return’ "There are a lot of people wearing western clothes ...
"We should not compare India and the West. There are things we do that...