Announcement of IFC Invests in Mexican Industry Eleven Million Six Hundred US Dollars for Papeles Ponderosa on April 5, 1978

• International Finance Corporation IFC Press Release No. 78/20 1818 H Street, N.W. Washington, D.C. 20433, U.S.A. 202-393-6360 Wednesday, April 5, 1978 IFC Invests in Mexican Industry $11.6 Million for Papeles Ponderosa The International Finance Corporation (IFC), an affiliate of the World Bank, is making an investment of $2.6 million equivalent in equity and $9 million in loan in Papeles Ponderosa S.A., a $28.8 million folding box board project in Mexico. Papeles Ponderosa is sponsored by an established, publicly-quoted, pulp and wood products company, Celulosa de Chihuahua S.A., part of the Chihuahua Group. Celulosa de Chihuahua will subscribe to 51 per cent of the equity. Project funds contemplate a Fondo de Equipamiento Industrial loan of $4.4 • million equivalent, part of which will be derived from World Bank financing, and $2.4 million equivalent in loans from Multibanco Comermex S.A. and Banca Serfin S.A. The First National Bank of Boston is taking a $4.5 million participation in IFC's loan. Papeles Ponderosa is building a 60,000 metric tons-a-year coated and uncoated folding box board plant at San Juan del Rio. The site is in an industrial park about 105 miles north of Mexico C~ty. The Company expects to consume annually 60,000 tons of waste paper and approximately 12,000 tons of pulp. The project will, thereby, benefit the labor- intensive waste paper industry of Mexico City, contribute to recycling of re- sources, and indirectly enhance the operations of the timber cooperatives that supply wood for pulp production. The project itself will create some 220 jobs in a lesser-developed region of Mexico that is subject to seasonal unemployment. The Company's production will be sold domestically for conversion into packaging. It will help meet increasing demand for folding box board and, at full capacity, substitute for prospective imports of some $23 million annually. Papeles Ponderosa is one of the first large-scale projects to be undertaken •  • - 2 - under Mexico's "Alliance for Production" program, which encourages investment in the country. It therefore conforms to Government policy of decentralizing in- dustry and supports Mexico's efforts to develop industries that utilize local, renewable resources. • (Any inquiries strictly relating to IFC's participation in this project should be directed to the IFC Information Office, 1818 H Street, N.W., Washington, D.C. 20433, Telephone (202) 477-5340.)