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Research Details
Indorama, the IFC, and Uzbek Cotton
Abstract
In December 2019, Oksana Varodi, a senior operations officer with the International Finance Corporation (IFC), was evaluating an investment in the cotton industry in Uzbekistan. The state-controlled Uzbek cotton system, with a history of labor abuse and environmental disaster, was in urgent need of help, but could be a disaster for the IFC. An investment by the IFC, in the form of a US$60 million loan to Indorama, a Singaporean multinational with a heavy presence in Uzbekistan, could modernize cotton production, eradicate labor abuses, improve environmental sustainability, and help export the nation's textile industry to western markets. Yet just four years earlier, the IFC had approved a similar investment in Uzbekistan--just as a coalition of NGOs, trade unions, and more than 300 brands were boycotting Uzbek cotton due to human rights violations. Activists had accused the IFC of fueling such abuses with the investment. Varodi now had to prepare a recommendation to the IFC board about whether to approve another investment.
Type
Case
Author(s)
Benjamin F. Jones, Ameet Morjaria, Charlotte Snyder
Date Published
08/09/2024
Citations
Jones, Benjamin F., Ameet Morjaria, and Charlotte Snyder. Indorama, the IFC, and Uzbek Cotton. Case KE1323.