CHEMICALS, FORESTRY, PAPER AND PULP SECTOR INSIGHTS | 12 MARCH 2018 The potential of business in the Chemicals, Forestry, Paper and Pulp sector Absa | Corporate and Investment Banking > Insights and Events > The potential of business in the Chemicals, Forestry, Paper and Pulp sector Khumbulani Gumede Head: Chemicals Forestry Paper and Pulp SHARE To the casual observer, there is no obvious connectivity between the chemicals, forestry, paper and pulp sector. But a closer look and study of how these sectors operate and depend on each other will reveal the intricate inter-connectivity that exists in this sector. The common link is chemicals, which are either a by-product of the other three sub-sectors, or are needed in the manufacturer of the by-products we get from paper and pulp. There are also linkages in either the downstream or upper-stream industries. It was for this reason that our unit was established in 2017 to provide tailor-made banking and business solutions to clients in the chemicals, forestry, paper and pulp sector. Our strategy is to become a key catalyst for the growth of this sector, which has significant economic benefits for the country, particularly now when the GDP is low and manufacturing capacity is depressed. There are currently five major players in the sector who form the core of our client base, Synchem, Omnia, AECI, York Timbers and Afrox. We want to develop expertise and presence not only in South Africa – which has the most developed chemicals industry in Africa – but also across the continent. We aim to do this by following our clients in South Africa who plan to expand their business into the Rest of the African region. In the forestry sector this is a long-term business, when you consider that it can take up to 20 years from planting a seed to harvesting a tree. A lot can happen during that period, from diseases, bad weather conditions and natural disasters like fire. We are therefore in this market segment for the long-term and our role is to partner with our clients to nurture and grow their business. In the pulp and paper sector, the pressure is there to diversify into other products in view of the concern about the environment and the impact of cutting down trees. The big challenge then, is how we help our clients respond to these developments by diversifying their business model and product profile And it is also a long-term journey for us. We want to develop solutions for the pulp and paper sub-sector and differentiate ourselves from the market by developing innovative solutions and products for clients. In conclusion, the potential to grow business in this sector is what excites us most. And as a new unit, we are naturally bullish about the opportunities that exist not only in South Africa but across Africa as well. Khumbulani Gumede Head: Chemicals Forestry Paper and Pulp https://cib.absa.africa/wp-content/uploads/2020/07/file_example_MP3_700KB.mp3 Related Articles DEALS Collaborating in responsible lending to create sustainable economies CDC provides $50m risk sharing facility to Absa to support lending to MSMEs and households through Microfinance and Non-Bank Financial Institutions in Africa DEALS Partnering to Power Africa Making business visions a reality with a R11,6 billion renewable energy project DEALS Committed to delivering innovative funding for ground-breaking developments It takes partners with strong foundations to build a brighter future. We’re proud to have successfully funded the Amdec Group for the construction of Harbour Arch, a mixed-use development comprising six residential towers. DEALS Funding that makes a shared future possible Funding partner to Heirs Holdings and Transcorp, for their USD 1.1 billion acquisition of OML 17.