Charoen Pokphand Group (CP Group), Thailand’s food and agribusiness giant, on Sunday signed an agreement with Bahrain-based Al Salam Bank to jointly develop agricultural businesses for the market in the Middle East and North Africa region.
The Memorandum of Understanding (MoU) has formed a strategic partnership between the two parties with an intent to establish Bahrain as the “Halal Food Hub” of the Middle East and North Africa (MENA) region.
According to a statement issued by Al Salam Bank, CP Group’s vice chairman Eam Ngamdamronk said the partnership is CP Group’s first joint venture with an Islamic bank and will serve the company’s vision to become “The Kitchen of the World”.
He said the proposed venture would be envisioned to be an integrated Halal Food company that will invest in farming, food processing, packaging and distribution, with CP Group providing the management team for the venture.
The statement said the alliance marks Al Salam Bank’s entry into the agricultural industry, which falls in line with the bank’s diversification strategy while, for CP Group, it marks the organization’s business expansion into the MENA region.
Al Salam and CP Group will jointly identify suitable agribusiness ventures that will generate attractive risk-adjusted returns while playing a proactive role in addressing food security in the region, it said.
The alliance, it said, will initially carry out detailed feasibility studies to gauge the viability in various target agribusiness sectors, including livestock, staple food, aquaculture, and perishables. The studies will comprehensively cover technical, financial, market and operational due diligence in order to identify target markets in the MENA.
Meanwhile, Yousif Abdulla Taqi, the bank’s chief executive officer, said, “Although Bahrain will be used as a hub, our target market will cover the MENA region in its entirety. The projects will play an important role in creating job opportunities for Bahrainis”.