The project sponsor is Tokyo Buhin Kogkyo Co., Ltd. (TBK). TBK, a Japanese corporation listed on the Tokyo Stock Exchange, is the leading manufacturer of brakes for commercial vehicles (CVs) with an approximately 70% market share in Japan. In addition, TBK is the leading producer of oil and water pumps for CVs representing about 90% and 70% of the Japanese market, respectively. The Project will be implemented through a joint venture company to be owned 60% by TBK and 40% by Changchun Shili Automobile Brake Parts Co., Ltd (CSABPC). CSABPC is a producer of brake friction materials owned 51% by Sihuan Chassis Parts Plant, and 49% by Zhejiang Shibao Holding Group Co., Ltd, a Chinese private limited liability corporation.

The total project cost is estimated at $11 million. The proposed IFC investment will be $4 million loan for IFC own account.

4.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	4.0
Equity

* These investment figures are indicative

The plant will be located in the Changchun High-Technology Industries Development Area in the province of Jilin, north east part of China.

The project will upgrade the quality of brake linings and pads for CVs in China. The joint venture being formed will introduce the technology and production experience of the leading Japanese brake manufacturer to the Chinese market. Currently, local linings and pads contain around 40% of asbestos. TBK’s technology would allow the venture to produce brake linings and pads with no asbestos contents, which should make a positive contribution in this regard. The project is also part of an effort to upgrade the reliability and environmental performance of CVs in the country to keep up with strong demand growth, tighter emission requirements, and need to reduce the number of CVs mal-functioning on highways, one of the essential causes for traffic jams, accidents and fatalities. Through financing the project, IFC will help transfer the Japanese advanced technologies to China that will improve the quality of essential products for the country’s important industry. In addition, IFC will also help the joint venture to introduce better industrial practices for the environments including eliminating asbestos in raw materials.

This is a category B project according to IFC’s Environmental and Social Review Procedure because a limited number of specific environmental impacts may result, which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of the Project consisted of appraising technical and environmental information submitted by the project sponsors and a site visits to a TBK site brake linings factory in Dongguang and CSABPC’s brake linings factory in Changchun.
Location of environmental documents in locally affected community
The Environment Review Summary (ERS) is disclosed at the following locations: - the website of CSABPC (www.shcqzd.com); - at the gates of Sihuan Chassis Parts Plant, 40-19 The First Road of Mengjia, Changchun, China; and - Changchun High-Technology Industries Development Area Investment Promotion Center (4000 Silicon Valley Street, Changchun, China).