Finnvera guarantees Valmet and Andritz deliveries to China

Finnvera has granted a buyer credit guarantee for a loan of approximately EUR 128 million related to Valmet and Andritz deliveries to Sun Paper in China. Sun Paper, one of the biggest operators within its industry in China, invests around EUR 2 billion in total in a new integrated greenfield pulp and paper mill in Beihai, South China. The deliveries guaranteed by Finnvera are related to the first phase of the project, which focuses on the production of writing and printing paper.

The German DZ BANK AG acts as sole arranger and lender of the financing which comprises equipment supplies from Finland, Sweden and Austria under phase 1 and from Germany under phase 2.

Finnveraand DZ BANK have cooperated in the environmental and social impact assessment of the project and the global consultancy company ERM served as the jointly commissioned external independent consultant for the financing providers. The new pulp and paper mill will be built in Tieshangang Industrial Park. The most significant environmental and human rights risks identified in the project are related to the procurement of wood raw material, land acquisition and resettlement from the project area and are addressed in the project's environmental and social action plan. The credit agreement includes requirements for measures aimed at ensuring that the procurement of wood meets international standards and that the financing providers are given further information on completion of land acquisition and resettlement including subsequent monitoring pursuant to the applicable standards. According to the consultancy report, the land acquisitions, expropriations and compensations have been carried out with the consent of the local population and pursuant to local law. The energy source of the mill is a power plant using bioenergy and coal. The power plant is not included in the financing.

”The implementation of this project was under great time pressure from the very beginning and was successfully completed on time and in a solution-oriented manner despite all the unexpected challenges. This was only possible because of the exceptionally fruitful cooperation within the wider internal and external project team – it is again amazing to see that a good team spirit makes a big difference. Thank you, Finnvera!” DZ BANK comments.