The government has started negotiations with Exim Bank for a loan of 105 million dollars for the establishment of a Pulp and Paper factory at Subri Industrial Plantation Limited (SIPL) at Daboase in the Mpohor Wassa East District.

Doctor Kofi Konadu Apraku, Minister of Trade and Industries said this during his familiarisation visit to SIPL at the weekend.

He also stated that a Chinese Company, 'Complant' and another company from Britain, have expressed interest in the establishment of the pulp and paper project.

Dr Apraku said Complant had gone further to sign a memorandum of understanding with the government on conditions that would make it possible to implement its plans.

He said he had been to China and held talks with the company, adding that President J. A. Kufuor was expected to hold further negotiations with the company during his visit to that country.

Dr Apraku expressed the hope that the outcome of the President's negotiation would be made public on his return to Ghana.

He assured the workers that government would ensure none is laid-off by any company that takes over SIPL.

He disclosed that a new board of directors has been appointed for the company and the names would be announced soon.

The Managing Director of SIPL, Mr George Naah, said the company was set up to establish an additional 4,000 hectares of 'Gmelina Arborea' to the existing 1,000 hectares plantation.

He said the company achieved its target in 1996 and has since been looking for a strategic investor who would provide funds for the establishment of a Pulp and Paper Mill.

Mr Naah said a number of feasibility studies had been done and all have concluded that a Pulp and paper mill at Daboase would be a viable venture.

He said Ghana imports 59,806 metric tonnes of paper annually at a cost of 44 million dollars or about 317 billion cedis.

The Managing Director said the company lacked funds for the maintenance of the existing plantations adding that it was also grappling with non-payment of tax arrears as well as utility bills in addition to its indebtedness to suppliers and other creditors.