Paper Maker Stora Enso Favours Shanghai

Feed: 52 - Date: 12/2/2008 - Views: 1,413

One of the world's leading paper producers plans to shift its Asia-Pacific headquarters to Shanghai from Singapore as it considers a new US$1.6 billion investment in China.

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Stora Enso, a Finnish company on the Fortune 500 list of global market leaders, produces magazine paper, newsprint, fine paper, packaging boards and wood products.

Its Chief Executive Jukka Harmala has decided to expand the firm's presence in the country with the best growth potential rather than export more.

Currently, Stora Enso`s production in China accounts for just 1 per cent of its global production of 15 million tons.

"First, Stora Enso will move its Asia-Pacific headquarters from Singapore to China`s economic centre Shanghai," Harmala said.

"We are also planning to expand the coated art paper production capacity in China by adding another production line in our Suzhou factory."

In 1998, Stora Enso acquired a majority share holding of the Stora Enso Suzhou Paper Co Ltd.

The Suzhou company is one of the largest and most technically advanced coated paper manufacturers in China with an annual production capacity of 150,000 tons of multi-coated art paper. It was also the first Chinese fine paper manufacturer to attain ISO9001 certification.

Harmala said that, during his latest visit to China, officials from the State Development Planning Commission told him the application for the new production line at Suzhou would go smoothly.

At the time, he was a member of a Finnish business delegation led by Finnish President Tarja Halonen which met with China`s President Jiang Zemin.

Jiang pointed out at the meeting that co-operation between China and Finland should be focused on three areas -- telecommunications, papermaking and environmental protection.

Jiang's interest in the Finnish papermaking industry buoyed Harmala.

"We are quite confident in the Chinese economy, especially the market environment following World Trade Organization entry," said Harmala.

China used to limit the entry of foreign capital into the papermaking industry.

But a new investment direction from April 1 changed the situation and put forestry plantation and pulp industry -- part of the production of high-quality paper and board -- onto the "encouraged`` list.

China's Ministry of Foreign Trade and Economic Co-operation also decided to dro‌p anti-dumping charges on imported coated art paper from Finland at the end of November -- a move hailed by Harmala, who said Finnish companies always stayed within the rules.

Stora Enso began exporting paper products to China in the 1950s. It set up its first sales office in China in the mid-1980s. Currently, Stora Enso`s offices in China number seven, with the total sales volume hitting 700,000 tons.

"To secure long-term fibre supply in a sustainable way, we have signed a memorandum of understanding with the Guangxi Zhuang Autonomous Region to analyze feasibility of industrial scale plantations and establishing pulp-paper and board integration," Harmala said.

The Guangxi project will demand an investment of US$1.6 billion. The project will cover 333,000 hectares and have the capacity to produce 600,000 tons of pulp and 600,000 tons of paper annually.

The company also provides forestry nurseries in Yunnan, Guangdong and Heilongjiang provinces. This October, Dow Jones ranked Stora Enso as the most sustainable forest products company.

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