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September 21, 2021

SCGP plans $352m packaging paper business expansion in Vietnam

The expansion is part of SCGP's growth strategy for the Association of Southeast Asian Nations (ASEAN), particularly Vietnam.

Thailand-based packaging company SCG Packaging (SCGP) has revealed plans to expand its operations in Vietnam to meet the anticipated growth in demand for packaging paper products.

To facilitate the expansion, SCGP will invest a total of THB11.79bn ($353.15m) to build a production complex in Vinh Phuc, Vietnam, which will house a packaging paper production base.

The investment will cover the project’s machinery, civil work, land and financial cost, as well as the working capital of advanced packaging paper production technology and infrastructures.

SCGP CEO Wichan Jitpukdee said: “Driven by SCGP’s existing business model in Vietnam that consists of broad horizontal offerings and deep vertical integration primarily located in the south of Vietnam, our new investment in this production complex will allow us to pursue growth opportunities in the north of Vietnam and the south of China.

“This new strategic complex will enable potential synergies among SCGP’s various businesses in terms of production efficiency and development of integrated packaging solutions and help us meet the increasing demands for packaging products in the region.”

The project is currently undergoing an Environmental Impact Assessment (EIA) process and SCGP expects to complete and begin commercial production at the facility by early 2024.

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It will be operated by Vina Kraft Paper Company (VKPC), a 70:30 joint venture between SCGP and Japanese packaging company Rengo Company.

The facility will increase VKPC’s total annual packaging paper capacity to 870,000t.

Jitpukdee added: “SCGP has launched a growth strategy in the Association of Southeast Asian Nations (ASEAN), especially in Vietnam with its high growth potential.

“Moreover, SCGP has expanded our businesses by investing in various packaging operations in Vietnam, including packaging paper, fibre-based packaging, foodservice packaging, performance and polymer packaging.”

Last November, SCGP acquired UK-based disposable food products packaging manufacturer Go-Pak for an undisclosed sum.

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