Coca-Cola ups the ante in Africa
by Eric Schroeder
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WASHINGTON — The Coca-Cola Co. and its African bottling partners are ramping up their investment in Africa, committing to an additional $5 billion over the next six years. The Atlanta-based company now expects to invest $17 billion in Africa between 2010 and 2020.
According to Coca-Cola, the investment will fund new manufacturing lines, cooling and distribution equipment and production; create additional jobs and opportunities across Coca-Cola’s African supply chain; and support key sustainability initiatives and programs focused on safe water access, sustainable sourcing, women’s economic empowerment, community well-being and operational efficiency improvements.
“As an organization that has been part of the economic and social fabric of Africa since 1928, we and our local bottling partners have seen, firsthand, the great promise and potential of this dynamic, growing and vibrant continent,” said Muhtar Kent, chairman and chief executive officer of Coca-Cola. “Even as we see tremendous growth potential in Africa, we know that the strength and sustainability of our business are tied directly to the strength and sustainability of the African communities we proudly serve.”
In addition to the announcement of its investment, Coca-Cola said it has signed a letter of intent to launch Source Africa, an initiative to secure more consistent and sustainable local ingredient sourcing for its products in partnership with the New Alliance for Food Security and Nutrition and Grow Africa. The initiative initially will focus on sustainable mango and tea production in Kenya; citrus, mango and pineapple production in Nigeria; and mango in Malawi, Coca-Cola said. Longer-term, the company said the program may expand to focus on sustainable ingredient production in Ethiopia, Senegal, Tanzania and Mozambique.
“As a business, we’re committed to creating public value and helping our communities overcome development challenges,” Mr. Kent said. “In Africa, we believe we can do more to source agricultural ingredients locally, with significant supply potential that’s underdeveloped and underutilized. Tapping this potential could accelerate the growth of our business and Africa’s emerging economies, making our supply chains more cost effective and enabling sub-Saharan Africa to supply more ingredients to growing markets in Africa and beyond.”
The announcement comes less than a month after Coca-Cola unveiled plans to invest more than $8.2 billion in Mexico during 2014-20, which, combined with earlier investments, would bring the company’s total spending in Mexico during 2010-20 to more than $12.4 billion. In 2012, Coca-Cola pledged to invest $1.3 billion in Chile through 2016, $5 billion in India from 2012 through 2020, and $500 million in Vietnam through 2015.