Announcement of IFC Supports Argentine Industry Eight Million US Dollars for Pulp and Paper Project on September 11, 1978

• International Finance Corporation IFC Press Release No. 79/6 1818 H Street, NW Washington, D.C. 20433, U.S.A. 202-393-6360 Monday, September 11, 1978 IFC Supports Argentine Industry $8 Million for Pulp and Paper Projec~ The International Finance Corporation (IFC) is lending $8 million to Massuh S.A. to help finance the Argentine pulp and. paper company's $26.2 million expansion and modernizati0n project. The balance of the project cost is being provided by suppliers' credits of some $5 million and approximately $13.2 million from cash generation and other inf.:ernal company resources,. Manufacturers Hanover Trust of the United States is taking a $3 million participation in IFC's loan. The expansion and modernization is a comprehensive project that includes ~ increasing pulp and paper manufacturing, integrating operations forward into kraft bag and corrugated box manufacturing, installing ecological safeguards, and improving the Company's wood supply through forestation activities. New facilities will increase writing, printing and kraft paper-making capacity from 28,320 metric tons a year at present to 46,800 tons and expand semi-chemical pulp output from the current 17,460 tons a year to 34,200 tons. The Company will enter the container field with equipment to produce annually 7,200 metric tons of corrugated boxes and 9,000 tons of paper bags, utilizing its own liner and kraft papers. Environmental control includes a chemical recovery system and primary and secondary effluent treatment facilities to reduce the ecological impact to accepted international levels as well as to lower operating costs. Massuh will increase the size of its land holdings and plant some 2,500 acres annually, principally with eucalyptus, to improve its wood supply position. The project aims at expanding output to help meet growing local demand and, through economies of scale, reduce costs. It is also expected to increase • manufacturing efficiency and diversify operations and sales •  - 2 - About 100 new direct jobs and an additional 150 indirect jobs in forestry • will be created. At capacity, production will substitute for an estimated $11 million in imports annually. The project conforms with Government objectives of developing the Argentine pulp and paper industry to reduce imports, stimulating reforestation, and reducing industry's ecologic impact. Massuh is entirely locally owned and its shares are listed on the Buenos Aires Stock Exchange. IFC is the World Bank affiliate that supports economy by investing in private enterprises and otherwise assisting the private sector. It took an active role in helping the Company appraise the technical and financial aspects of the project as well as providing part of the financing. • (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) 477-6247.)