Bavaria Project Founded in 1889, GEB is the leading beverage producer and distributor in Colombia, Ecuador, and Panama.   It produces beer and non-alcoholic beverages (water, fruit juices, milk and malt-drinks) at twelve manufacturing plants.  In addition to its core business, the company actively promotes community and social programs, such as developing grain farmers and fruit growers throughout the country,  sponsoring sporting events, and endorsing cultural and educational programs.      The project is designed to allow the company to increase the efficiency of its production and distribution facilities; further develop its non-alcoholic beverage products, including fruit juices and water; and expand outside Colombia within the beverage sector.      Development Impact    ·   Regional Focus:  GEB is embarking on a program that will result in investments in a number of Andean and Central American countries.  These countries by-and-large lack domestic capital markets and also find it difficult to attract foreign investors.   · I  nvestment and Growth:  The investment program, which is significant both in terms of its size and its timing (given the situation in Colombia) will result in growth of output, increased productivity, and an associated rise in income in the targeted countries.   ·   Benefits to Consumers:  The venture will introduce a wider choice of beverages and higher standards for processing and packaging.   ·   Fiscal Benefits:  Beverage companies such as GEB are an important source of tax revenues for governments (including sales and income taxes).  GEB is the single largest tax paying entity in Colombia and it is also expected to be an important tax generator in the other countries in which it operates.   ·   Supply Linkages, from the investment program, should flow to farmers engaged in supply of grains and other raw materials and to manufacturers of glass bottles, crowns, cases, and other packaging supplies.   ·   Corporate Governance:  As the leading Colombian blue chip, the implementation of a new corporate governance program at GEB will set an important example for other companies in Colombia and increase the attractiveness of the market for investors.   ·   Demonstration Effect:  IFCs support and its success in syndicating a B loan could have an important demonstration impact at a particularly difficult time for Colombia.     IFC Role    Until 1999, the Groups complicated organizational configuration hampered its ability to tap local and external financing sources.  IFC is assisting the company in concluding its organizational and financial restructuring, thereby helping the company to position itself for growth and further investment in the region.  Given Colombias current situation, GEB is seeking IFCs assistance in order to tap international capital markets, which are currently not accessible for term financing even to Colombian blue-chips.  The IFC financing package (including the B loan) would be critical for completing GEBs financial plan.  IFC would also assist the company in a number of other areas, including: (a) Corporate Governance:  GEB is in the process of upgrading its corporate governance practices and IFC is supporting the companys efforts in this area; (b) Environment:  With IFCs assistance, the company would further improve its environment, health, and safety standards by bringing them into compliance with World Bank guidelines; and (c) External Linkages:  the IFC financing package would enable the company to expand initiatives with suppliers, including: (i) an outsourcing program that GEB has developed for former employees which includes training and support for undertaking warehousing and distribution activities; and (ii) technical and financial support that the company provides to fruit growers and other suppliers of agricultural inputs.