How do you make a profit out of rubbish? One recipe is to team up EBRD investment with the only paper production plant in Albania – it helps that the owner is also President of the Albanian Recyclers’ Association.

The EBRD has just taken a €2 million equity stake in Edipack, an Albanian packaging company. Operating since 2003, Edipack is already the biggest manufacturer of corrugated cardboard and packaging in Albania. Its market share, however, only amounts to about 10 per cent of the national consumption of cardboard and packaging products. Much of the rest is imported, as Edipack’s own raw materials have been until now. The EBRD’s funds are earmarked for the company’s plans to support the new recycled-paper production line and to establish waste paper recycling networks throughout Albania. With the introduction of the new paper production plant, the company will score a double first in Albania: opening the first paper manufacturing business and establishing the first paper recycling scheme.

“This use of an imported raw material – paper – has always been the company’s highest cost and the EBRD is supporting the company’s efforts to address these high costs,” says Ervin Luga, Associate Banker at the EBRD office in Albania. The funds raised by the EBRD’s equity will allow the company to cut costs significantly, perhaps by as much as 50 per cent, as the new paper production facility will produce enough to supply all Edipack’s needs (and still have some capacity for supplying other cardboard manufacturers). While the fall in costs will enhance the company’s competitiveness and reduce its reliance on expensive imports, some benefit will also be felt by its competitors, who will also be able to access domestically produced materials for the first time.

Recycling pioneers

And that’s just the start. EBRD financing will also help Edipack establish its own structure for collecting waste paper, thus helping improve the country’s waste management situation. The company plans to install wastepaper bins in areas of large use, such as shopping centres, warehouses of importers (especially of fruit and vegetables), ministries, municipalities, universities and printing houses. Current expectations are that the waste paper collected will suffice for the whole of Edipack’s projected paper production.

The owner of Edipack, Bardhyl Ballteza, is also President of the Albanian Recyclers’ Association and it is therefore hardly surprising that he should be pioneering the idea of paper recycling and addressing wider environmental awareness. This deal will introduce paper recycling to Albania by creating the first paper recycling and collection networks, as well as by using the waste collected in the creation of a new product.

“In Albania, unfortunately, many people just throw their garbage on the ground and besides rudimentary recycling, they certainly don’t see the wider environmental and economic benefits of recycling,” says Dan Berg, Head of the EBRD office in Albania. “I hope that this project shows that there’s a better way of dealing with waste. We can show that you can make something profitable out of your garbage.”

It’s not just a question of making cardboard out of waste paper – there are also the jobs created by the project. Some in the actual paper production process but even more in the recycling networks.

Entrepreneurial spirit

The genesis of Edipack is an example of how an entrepreneur spots opportunities. Mr Ballteza first went into business importing cosmetics to Albania. In 1993 he set up Beba Biochem, which manufactured its own, domestically produced, cosmetic products. Obviously, the products needed packaging so he started to make packaging as well, operating as Beba Paper and Packaging. Initially set up to supply his own company, this expanded into supplying other manufacturers too, developing as a strong business in its own right, which has now been spun off as Edipack.

Now Mr Ballteza has spotted another opportunity in manufacturing paper from domestic recycled waste paper. This will allow the company to expand its range of packaging products. His eye is on the packaging and shipment of agricultural products.

By Nikki Braterman, EBRD Communications Manager