Cardboard packaging manufacturer Toprak will receive a $5m loan from the European Bank for Reconstruction and Development (EBRD) to construct a greenfield paper-making facility in Turkmenistan.
The new mill, which would be the first private paper recycling facility in Turkmenistan, will produce up to 25t of cardboard from recycled paper per day.
EBRD manufacturing and services director Frederic Lucenet said the loan will enable Toprak to integrate its production cycle by using new recycling technologies and know-how.
"The EBRD’s main priority in Turkmenistan is to support the private sector, and we continue to provide assistance and financing to local manufacturers," Lucenet added.
A third of the output will be sold by Toprak and the remaining two-thirds will be used for the company’s cardboard packaging production.
By producing its own cardboard from recycled waste paper, the company will be able to minimize its reliance on imported cardboard.
The company, which plans to promote paper recycling in major Turkmen cities, said the venture will also reduce pollution and recycle waste paper which would otherwise be burnt.
The EBRD provided the company with technical cooperation for legal and technical due diligence, and also funded consultancy services from international experts, due to lack of local experts in the cardboard and paper industry.
In 2010, Toprak’s first major expansion was partially financed with a $1.5m loan from the EBRD, which funded the purchase of a new automated folding line.