APP reaches agreement with major creditors

APP reaches agreement with major creditors

The Jakarta Post, Jakarta

Singapore-based Asia Pulp & Paper Co. has reached an agreement
with major creditors on environmental protection for the firm's
affiliates in Indonesia.

The creditors comprise the export credit agencies of Germany,
Japan, France, Austria, Sweden, Finland, Italy, Spain and
Denmark.

The so-termed "environmental covenant" will become an integral
part of Master Restructuring Agreements (MRAs) between the APP
affiliates and the creditors, while the MRAs are to become
effective when a defined threshold of creditor acceptance has
been met, according a media statement.

The agreement has come since the export credit agencies
studied the action taken by APP subsidiaries over the past 12
months with respect to the environment.

During the period, according to the media statement, the APP
subsidiaries set aside 77,000 hectares of production forests for
conservation to create a 165,000-hectare conservation area in
Riau, put in place practices and procedures to guarantee the
legality of wood supply, secured new sources of plantation fiber
and developed plantations on wasteland.

Besides, APP launched the Sustainability Action Plan last
February to ensure the sustainability of its subsidiaries'
operations.

APP is one of the world's leading pulp and paper companies and
is ranked number one in Asia, minus Japan. The combined pulp,
paper and packaging capacity of Indonesian subsidiaries,
including PT Indah Kiat Pulp & Paper and PT Pabrik Kertas Tjiwi
Kimia, amounts to 6.3 million tons per year.