The International Finance Corporation (IFC), as administrator of the Environmental Opportunities Facility (EOF), has invested Euros 427,000 in Conox Limited, a Finland-based company dedicated to developing cleaner technologies for use in the paper and pulp industry in developing countries. IFC’s investment will help finance pilot plants using Conox technology at two straw pulp mills in China, the world’s largest producer of straw pulp for papermaking.
In conjunction with this investment, IFC is undertaking a major Technical Assistance project for the development of non-wood fiber based pulp industry in China. The Finnish Ministry of Trade and Industry has provided US$1.4 million for the TA project through its Trust Fund at IFC. Part of this TA will be used to improve the Conox technology.
Conox has developed and patented an innovative technology that is expected to eliminate the main source of water pollution (the “black liquor”) from straw pulp mills. Straw pulp mills use agricultural by-products, instead of wood, as the raw material to make pulp, which is then converted into paper. China has over 1,200 such mills providing approximately 42% of the country’s pulp requirements.
Straw pulp mills discharging black liquor into rivers are one of the largest sources of water pollution in China. The successful installation and operation of Conox’s technology will confirm its technical and commercial viability, and potentially make it available to numerous other straw pulp mills in China as well as in other developing countries.
Peter Woicke, Executive Vice President of IFC, emphasized the importance of this early-stage investment, "Conox’s technology is expected to have a significant developmental impact. We believe that if the technology performs as expected it should be adopted widely in China and in other countries. Cleaning up these plants will improve the lives of the communities and help us meet a major goal of the Chinese Government, namely improving the quality of the environment."
The EOF was established in 2002 to provide flexible financing to innovative ventures that have a strong potential to increase environmental sustainability but must overcome the uncertainty associated with new markets, new technologies, and new ways of doing business. The EOF is part of IFC’s Sustainable Business Assistance Program (SBAP), which provides a platform for making highly selective, strategic interventions in key environmental sectors where the demonstration of sustainable business practices offers potentially significant benefits. Key funders of the EOF include the governments of The Netherlands, Austria, Italy and Norway as well as IFC.
The mission of IFC (
www.ifc.org
) is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY03, IFC has committed more than $37 billion of its own funds and arranged $22 billion in syndications for 2,990 companies in 140 developing countries. IFC's worldwide committed portfolio as of FY03 was $16.8 billion for its own account and $6.6 billion held for participants in loan syndications.
