A Glacier Media investigation carried out with partners from the International Consortium of Investigative Journalists (ICIJ), has found unreported ties linking Paper Excellence and Asia Pulp and Paper, a conglomerate environmental groups allege is resp...
This is the second in a series of four articles resulting from a months-long investigation into Paper Excellence, a B.C.-headquartered pulp and paper company that has quickly grown to control large tracts of Canadian forests and become the largest company of its kind in North America. The stories are part of Deforestation Inc., an investigation led by the International Consortium of Investigative Journalists involving 140 journalists from 27 countries.
For decades, the Sino-Indonesian conglomerate has faced allegations of widespread environmental destruction. But Paper Excellence has received less scrutiny, even after the company made a series of multi-billion-dollar acquisitions and gained control of more than 22 million hectares of Canadian forests.
Glacier Media and its ICIJ partners have confirmed at least 13 people have worked for APP and Paper Excellence, many at the same time. Among those are senior members of Paper Excellence‘s leadership. Fifteen years later, Paper Excellence has expanded to nearly 40 pulp and paper mills across Canada, the U.S., France and Brazil. Its latest US-$2.7 billion deal for Montreal-based Resolute Forest Products — completed this month — gives Paper Excellence control of over 22 million hectares of Canadian forest and turned the company into the largest forestry company in North America.
But a filing with the U.S. Securities and Exchange Commission says Paper Excellence B.V. is “indirectly 100% owned by Jackson Wijaya.” And both Government of Canada’s Inter-Corporate Ownership database and the international business database Orbis describe Paper Excellence as an arm of the Sinar Mas/APP conglomerate controlled by the Widjaja family.
Property records filed in B.C. over the past three years indicate Wijaya's principal residence is in Kowloon, China, and that he is not a permanent resident or citizen of Canada. When asked where Wijaya resides, Paper Excellence said “Jackson spends time in the Americas, Europe and Asia as business demands.”
Leaked emails show two companies worked together during takeover The tangled web connecting Paper Excellence and APP also appears to have extended to APP’s headquarters in Shanghai, documents indicate. Emails show senior staff from APP and Paper Excellence worked together to build market forecasts, prepare answers for China’s anti-trust regulator and arrange Canadian pulp shipments to directly supply APP mills.
Richard Schwindt, a former investigator with Canada’s Competition Bureau who reviewed the leaked communications and the companies’ ownership structure, said the level of corporate obfuscation is unlike anything he has seen in his long career. Widjaja asks Pöyry to secretly produce global pulp market price forecasts for two state-owned Chinese banks.“They are China Development Bank and Industrial and Commercial Bank of China ,” responded Widjaja.
A deeper look into historic and titles and overseas corporate registries shows early funding being provided by the China Development Bank, a major state-owned lending institution that finances overseas energy and resource exploitation. The bank also backs major infrastructure projects like the Belt and Road Initiative and Chinese enterprises “going global.”
“The China Development Bank has been critical, not just in Canada, but in Africa and South America,” said McCuaig-Johnston, now a senior fellow at the University of Ottawa’s Institute for Science, Society and Policy. By 2019, China was the fourth largest source of foreign direct investment in Canada, and according to one tally by the University of Alberta’s China Institute, had poured $93 billion into the country. But by then, Chinese investment had increasingly become strategic, focusing on “small and beautiful projects,” as Saint-Jacques described them.
According to Usher, debenture financing agreements are a normal lending tool for powerful companies to finance big acquisitions. If an agreement goes wrong, the lender can spark a legal process that could end in the sale or seizure of all properties and assets. Where the Paper Excellence deals differs, Usher said, was with the lender.
At a global level, public financial statements show APP and Paper Excellence would have a combined annual revenue of more than $34 billion, dwarfing any other pulp and paper company in the world.
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