- IFC supports XSD’s green investments with a $28M green loan
- New biomass plant and third production line to boost output by 300,000 tons
- Reduces fossil fuel use and lowers emissions through sustainable practices
The World Bank Group (via the IFC), entered into an agreement to develop XSD International Paper Sdn Bhd (or 'XSDs') sustainability initiatives, expand their capacity to produce from a single machine to a third machine and increase jobs in the rapidly growing paper manufacturing industry in Malaysia. The partnership reaffirms the commitment of IFC in promoting sustainable methods of manufacturing in Asia.
Through the financing of $70,000,000 which includes $28,000,000 green loan funds, XSD can establish a biomass-fuelled co-generation facility in Kulim, Kedah that produces energy, as well as the additional production line will provide an increase in Gregory's annual production up to 300,000 tonnes, raising their production capacity total to 800,000 tonnes while also reducing their dependency on fossil fuels and reducing their greenhouse gas emissions.
XSD, an industry leader in coated duplex and grey board manufacturing, uses recycled material in its products and processes. This collaboration will create a circular economy in Malaysia by increasing the amount of recycled paper that can be produced using renewable energy.
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The Chairman of XSD, Li Shengfeng, stated that this initiative represents a step forward for the green industrial development of both the company as well as the country of Malaysia by promoting a circular economy and reducing the environmental footprint associated with the manufacturing of paper products.
In addition, this initiative will provide a significant social/economic benefit to the community through the creation of an estimated 750 direct jobs along with another 1,810 indirect and induced jobs created as a result of the initiative. The initiative will provide community support and support for the development of worker skills and regional economic growth.
According to Carsten Mueller, the IFC Regional Director for Asia Pacific, this investment represents a significant step toward supporting Malaysia in its efforts to develop the manufacturing sector's competitiveness while creating opportunities for companies to implement sustainable practices.
By investing in renewable energy development and expanding their use of recycle-based production, and now introducing and implementing advanced and green technology, this partnership places Malaysia in a prime position to become a leader in sustainable paper manufacturing in the Asia Pacific region and enhances the ability of Malaysian companies to compete with other environmentally certified products exported from Malaysia.