The project will double current particleboard production capacity, and substantially increase melamine-facing capacity. The added new capacity will achieve economies of scale, which are critical for the industry. The project is expected to boost margins, enhance the company''s competitive position in Southeastern Europe and provide strategic diversification. In addition, the project will contribute to the modernization of the Bulgarian wood panel industry, which is currently characterized by inefficient, low-quality operations and will have a potentially strong impact on the development of the furniture industry in the country.

IFC’s role in the proposed project is three-fold: (i) increase confidence in and support for the government’s privatization efforts; (ii) act as a catalyst for foreign investment and private sector participation in Bulgaria; and (iii) help the sponsors gain access to long-term financing.

Environmental Category and Issues

This is a category B project according to IFC''s environmental review procedure. Environmental, occupational health and safety issues which were examined during the review of this project include:
site selection and current and previous site land use; air emissions; wastewater treatment; solid waste handling and management; wood supply and sustainability of forests; fire protection and emergency response; and general worker health and safety.

The IFC Technical and Environment Department staff have reviewed the project site and conclude that this project will be implemented and managed in accordance with World Bank Group environmental, health and safety policies and guidelines and host country requirements. IFC will monitor project performance during the lifetime of the project.

The Environmental Review Summary is available from the InfoShop.