Buyer credit for wood processing in Russia
NEFCO and the Russian LLC Novgorod Timber Company Sodruzhestvo have signed a loan agreement aimed at modernising wood processing production in Nebolichi in the Novgorod region in Russia. Sodruzhestvo will replace an existing sawing line with a new one that will increase production, improve the efficiency of wood processing and boost the company’s revenues.
Apart from replacing the sawing line, Sodruzhestvo intends to upgrade the system for feeding, sorting and debarking lumber logs as well as install new firefighting units and noise-cancelling screens. The company intends to sell sawdust and wood chips to clients that will use the residues for heating purposes. This, in turn, will have environmental benefits in terms of reduced emissions of carbon dioxide, nitrogen oxides, sulphur oxide, dust and carbon oxide.
NEFCO will provide a loan of EUR 2.8 million for the project from its Investment Fund. The loan will be secured through a buyer credit guarantee provided by Finnvera Export Credit Agency in Finland. The Finnish company Heinola Sawmill Machinery Inc. will deliver the new equipment and ensure that the best available technology is adopted.
NEFCO’s Board of Directors decided in 2013 to set up a new financing scheme aimed at providing buyer credit financing for environmentally sound investments and deliveries of goods and related services. NEFCO, in co-operation with Nordic Export Credit Agencies, can finance up to 85 per cent of the total value of Nordic exports with a buyer credit. Nordic cleantech innovations and environmental technology in the industrial sector normally generate considerable environmental benefits, such as energy savings, when replacing outdated technology in industrial facilities. The buyer credits can currently only be offered to Nordic deliveries of goods and services to Russia, Ukraine and Belarus.