February 19, 2021

By Lynda Kiernan, Global AgInvesting Media

FinDev Canada, a dedicated institution financing the private sector in developing countries to combat poverty through three pillars: job creation, women’s empowerment, and climate change mitigation, has committed $12 million to Miro Forestry Development – a sustainable forestry and timber operator with plantations in Ghana and Sierra Leone.

This investment follows Miro’s closing of a financing package in June 2020 that converted US$10 million of FMO’s existing mezzanine debt into a redeemable preference share funded by the Building Prospects Fund, and another US$5 million share funded by the Dutch Fund for Climate and Development (DFCD). The deal also saw participation by CDC, Finnfund, Mirova, and others.

“Our financing, alongside that of other investors, will contribute to more robust local economies, and significant improvements in reforestation and biodiversity restoration,” said Paulo Martelli, CIO, FinDev Canada.

In business for a decade this year, Miro Forestry is one of the lead integrated forestry and timber operations in West Africa, controlling 32,000 hectares (79,000 acres) of land, and having seeded more than 17 million trees.

The company’s focus is on the production of sawn timber, utility poles, plywood, and energy biomass from rapidly-growing, high-yielding FSC certified trees for both domestic and overseas markets. 

The capital from this investment will enable Miro to expand its forestry plantation holdings and its wood processing capabilities, noted Andrew Collins, CEO, Miro, who said, “Whilst maintaining the quality of our plantations, we are now focused on rapidly developing our timber processing operations to develop into a vertically integrated, profitable, timber products company, with a major focus on plywood for the local, regional and export markets.”

“This is a particularly important task as the overall success of Miro will be a bellweather to the sub-Saharan African sustainable forestry and timber products industry,” continued Collins. “This is an industry sector which requires greater investment into the successful operators producing certified timber products for sustainable economic return, industrial development and balance of trade in the region, which remains one of the most attractive globally.”

So how does this investment meet the three goals FinDev Canada aims to achieve through its investments?

Climate mitigation – This investment will support even greater carbon sequestration by Miro. The company has already planted more than 17 million trees on 15,000 hectares (37,000 acres) of degraded land in Ghana and Sierra Leone, of which 30 percent are under active conservation management.

These holdings have cumulatively sequestered more than 1.3 million tons of CO2 to date, and with the additional trees brought under management through expansion, the company will have the ability to sequester an additional 5 million tons of CO2 by 2030.

Social impact and women’s empowerment – The expansion funded through this investment will sustain 5,000 jobs in Ghana and Sierra Leone, which Miro expects will contribute US$5 million to local communities in salaries and through the sourcing of goods, services, and infrastructure. 

Miro has also signed a 2X Challenge commitment (an initiative developed by the G7 DFIs to deploy capital for business initiatives that benefit women) to increase the number of women in its workforce from the current 18 percent to 40 percent over the coming two years, and has developed a gender action plan to improve the recruitment and retention of women, reduce absenteeism, and boost productivity.

“Sustainable forestry balances economic growth and climate change mitigation, which are two of our core development impact goals,” said Martelli. “By supporting Miro Forestry, we want to contribute to the preservation of forests that will offer a livelihood for generations to come.”

“We are delighted to have FinDev Canada invest into the business,” added Collins. “FinDev Canada is a strong partner and we look forward to further developing Miro with their support.”

– Lynda Kiernan is editor with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, and HighQuest Group’s Oilseed & Grain News. She is also a contributor to the GAI Gazette. She can be reached at lkiernan@globalaginvesting.com.