China Eximbank provides export seller’s credit for Thabaung Bleached Pulp Factory Project

China Eximbank provides export seller’s credit for Thabaung Bleached Pulp Factory Project In 2000, Myanmar Paper and Chemical Industries — a subsidiary of Myanmar’s Ministry of Industry No.1 — reportedly signed a $90 million commercial contract with China Metallurgical Construction Group for the Thabaung Bleached Pulp Factory Project.

Then, on August 31, 2000, China Eximbank issued an export seller’s credit to China Metallurgical Construction Group to help finance this commercial contract and facilitate the implementation of the Thabaung Bleached Pulp Factory Project.

The purpose of the project was to construct a bleached pulp mill (factory) — with a daily production capacity of 200 tons of pulp and 50 tons of paper — in Hlay Gyi Tet (Hlaygyitet) Village, Thabaung Township, and Ayeyarwady Region. The mill occupied a 448.48 hectare lot and it was designed to use bamboo as a raw material input.

China Metallurgical Construction Group was the EPC contractor responsible for implementation of the project.

According to the terms of the EPC contract, China Metallurgical Construction Group was responsible for project design, supply of equipment, and technical supervision, while Myanmar Paper and Chemical Industries (the project/factory owner) was responsible for the construction of the factory. Project implementation commenced on November 1, 2001, and completed on May 14, 2005.

In July 2004, during former Prime Minister Khin Nyunt's visit to China, a MoU was signed between China Metallurgical Corporation and the Ministry of Industry-1 for the extension of Thabaung pulp plant. However, the pulp mill ceased production in 2014.

The mill has also caused widespread damage to the surrounding environment, including destroying bamboo forests and killing off fish populations. Land and property was also expropriated without compensation for the construction.