The World Bank Group's International Finance Corporation says it has invested in Nature, one of the largest flooring manufacturers in China, to help develop the company's sustainable wood sourcing and promote sustainable development of the flooring industry.
Se Hok Pan, chairman of Nature, said, "IFC is not only providing Nature with long-term financing, but more importantly offering strategic views to help China's wood companies grow in a sustainable way. IFC's standards will also help us become a responsible corporate citizen where we operate around the world."
The USD20 million equity investment and USD30 million long-term loan will help Nature implement its growth strategy in the next three years. The financing will enable the company to develop plantation forests in the Jiangxi Province and establish a steady supply of certified wood. This will help position the company as a leading player in the sector and bring economic benefits to local communities.
Nature plans to increase its independently certified wood, with a long-term goal of 100% certification. The China Forest Trade Network, the national body of the World Wildlife Fund's Global Forest and Trade Network, will regularly assess the company's progress on these targets. Sustainable sourcing promotes sustainable forest management, which allows for wood production without deforestation and does not contribute to climate change.
Wood consumption is estimated at 337 million cubic meters a year in China. With limited domestic forest resources, wood imports into China have risen 16% a year during the past decade. For hardwood, imports are estimated at 8.4 million cubic meters a year. Nature's hardwood demand represents less than 1.5% of this figure, and the company has committed to sourcing targets that will help eliminate unknown sources of wood from its operations by the end of 2009 and 100% verified legal supply by the end of 2011.
