ADB, ECOM Sign $100 Million Social Loan to Enhance Climate Resilience of Coffee Value Chain in Asia Pacific

MANILA, PHILIPPINES (17 December 2024) — The Asian Development Bank (ADB) has signed a $100 million loan agreement with ECOM Agroindustrial Corporation Limited and ECOM Agroindustrial Asia Private Limited (ECOM) to enhance the climate resilience of the region's coffee value chain. The agreement will benefit more than 62,000 smallholder farmers in India, Indonesia, Papua New Guinea (PNG), and Viet Nam.

The financing will contribute to ECOM’s working capital requirements, including inventories, receivables, and advances to smallholder farmers for coffee procurement. Additionally, it will support operating expenses for extension services such as training, certification support, research and development, and sustainability pilot projects.

This is a certified social loan, which has been validated through a second-party opinion from Det Norske Veritas (DNV) in accordance with the Social Loan Principles established by the Loan Syndications and Trading Association. Social loans are financial instruments designed specifically to fund or refinance new or existing eligible social projects that aim to achieve positive social outcomes.

"Safeguarding coffee farmer livelihoods and resilience in the face of climate change is crucial for maintaining the stability of one of the world's most significant agricultural supply chains,” said ADB Director General for Private Sector Operations Suzanne Gaboury. "This partnership with ECOM underscores ADB's commitment as the region’s climate bank to promoting sustainable agricultural practices and enhancing the productivity and resilience of smallholder farmers across Asia and the Pacific.”

The global supply of coffee depends on the hard work of millions of farmers worldwide. The coffee industry is economically vital in the project’s four target countries, which account for 29% of global production. Climate change threatens coffee production with rising temperatures, unpredictable rainfall, and increased pest and disease pressures. ADB's loan provides farmers with the financial stability they need to invest in climate-resilient practices, such as regenerative and agroforestry practices, ensuring long-term sustainability and supply security.

The financing is accompanied by a technical assistance (TA) grant which will strengthen gender equality in ECOM’s supply chain, particularly in PNG, by empowering women in decision-making, reducing violence, and increasing access to resources. The TA will support smallholder coffee farmers in PNG and Viet Nam with climate-resilient practices, focusing on family-based planning to enhance women's roles in decision-making.

"This partnership with ADB is a testament to our shared commitment to sustainable development and climate resilience. Together, ECOM and ADB aim to empower smallholder farmers by providing them with the financial resources and support needed to adopt climate-smart practices,” said ECOM’s Head of Sustainable Financing Raphaële Muel. "We are grateful for ADB's continued support in enhancing farmer livelihoods and ensuring the long-term sustainability of the global coffee supply chain."

Founded in 1849, ECOM is a global integrated supply chain merchant and processor of agricultural commodities such as cocoa, coffee, and cotton. Operating in over 40 countries and working with more than 650,000 farmers, ECOM’s focus is on sourcing from smallholder farmers and providing them with support to enhance their productivity and resilience.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 69 members—49 from the region.