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Blundering Finnish Pulp Mill CEO Sent Home Following Call from Spanish King

Inauguration Delayed due to Uruguayan Blunder

November 5, 2007 – Montevideo Uruguay. Erkki Varis, Oy Metsa Botnia's CEO traveled to Uruguay to inaugurate Botnia's newest pulp mill plant last week, but much to his dismay, he had to return home empty handed , without having cut the ribbon on its largest pulp factory, set to produce 1 million tons of ECF pulp per year.

Mr. Arana, Uruguay's Environment Minister was set to deliver the message that Botnia could begin producing. Mesta Botnia's CEO Erkki Varis was in Uruguay to cut the ribbon of what would be one of the world's largest pulp mill plants anywhere. Varis surely thought his moment of glory had finally come and that he would be able to send a good notice to his anxious shareholders about “the Uruguay Project” finally getting off the ground. But yet again, Varis' celebration would have to wait … so would Oy Metsa Botnia's investors and shareholders!

Far beyond the belief of the media and corporate invitees present at the public announcement of the inauguration of Botnia's new billion dollar mill, the Minister's cell phone rang. He turned white, fumbled his words, and announced that “the inauguration would be suspended” . It was no small matter, the Spanish King was on the phone (or probably had just been with President Vasquez who was strolling the street in New York at the time) screaming to hold the press. Nobody could believe the last second reversal of the announcement, not even the Minister, certainly not Oy Metsa Botnia's CEO, Erkki Varis.

It turns out, Uruguayan President Tabaré Vazquez forgot the Spanish King was mediating the three year dispute with neighboring Argentina, and had requested that neither country do anything to aggravate the tension caused by the billion dollar Finnish pulp mill investment.

“Inaugurating the largest contaminating pulp mill in Latin America would qualify as aggravating tensions”, claimed local community representative Gustavo Rivollier, one of the coordinators of what has become the world's largest environmental social movements, opposing Erkki Varis' stubborn resolve to keep his project moving forward. “He keeps telling the investors and the public that his mill doesn't contaminate, and he keeps convincing the Uruguayan government and international financiers to defend and financially contribute to his project, but he keeps miscalculating the magnitude of the troubles he is causing.”

Varis' very hands on and personal executive decisions as CEO of Oy Metsa Botnia have been at the heart of much of the cross-border conflict and diplomatic tension that has now made this conflict world renown and a watershed in pulp mill history.

First, Varis caused the collapse of a monumental presidential agreement by refusing to delay construction of the mill while Uruguay and Argentina conducted a 90-day technical review and sought a solution to the mill dispute. Varis' uncollaborative attitude landed Uruguay a complaint at the International Court of Justice. Varis' culturally insensitive decision was contrasted by ENCE's (a Spanish mill which was to build next to Botnia). ENCE, which abided by the 90-day truce, is now advancing its construction at another border site, with no opposition, from either country or communities.

Later, when the King of Spain offered to broker a solution to the dispute, Varis claimed Uruguay had never asked him to stop constructing. The 90-day truce was the key issue on table at the time, and was of public knowledge. Clearly, Erkki Varis had no intension of stopping Botnia's accelerated construction schedule.

Varis also ignored the verdict of the IFC's CAO who told him he got the consultations wrong. The IFC ignored those too, claiming to their board of directors that their project had “broad public support”. Ten days later, 50,000 people marched to the bridge to reject it. One year later 120,000 marched, and the year after that 130,000. Nobody took notice, least of all Varis. The mill construction must go on, “we do not contaminate” resounds Oy Metsa Botnia, as part of their stubborn corporate rhetoric that is unconvincing to Uruguayan and Argentine stakeholders that oppose the project.

The Botnian way is supposed to be different, says Varis and Oy Mesta Botnia, but yet, Botnia workers have died, lost limbs, and fallen gravely ill at the Botnia site, and the factory is not even producing yet. One worker has been roaming aimlessly seeking medical assistance after a serious careless toxic accident (in the rush to complete construction) which gravely affected his intestinal system a few months ago. He claims he has been offered money by Botnia to keep quiet and not speak to foreign press. This sort of treatment, local community groups opposed to the Botnia mill claim, this is the only “Botnian Way” they've seen since the Finnish company showed up at the Uruguayan border town.

As Varis arranged his flight home after a failed ribbon-cutting journey across the Atlantic, he must have wondered (as other Botnia executives surely do) when an Argentine immigrations officer will detain him in transit, to face questioning in a criminal case that is currently before the courts against Oy Metsa Botnia.

Today, the international bridge between Argentina and Uruguay remains blocked, since the eve of the IFC's (agency of the World Bank) vote to give Botnia a US$370 million loan. This desolate bridge is a sour reminder of the schism that exists between once friendly communities. This November 20 th , the roadblock will have its' ONE YEAR anniversary, and communities are already planning massive displays of opposition to the Botnia mill, which is coincidently scheduled to begin producing sometime this month.

Erkki Varis, led Botnia blindly into Latin America, a region it has never had any experience with, assuming his country's (Finland) good reputation would carry his flag. His communications and public relations team failed their mission. Instead Botnia, led by Varis have ruined the Finnish reputation in the region. Other Finnish companies like Nokia, have had to face scrutiny for being associated to their Finnish pulp mill colleague. Varis mapped out a bold but erratic and highly volatile path forging a Finnish cultural fjord in the social cross-border bedrock of a region once peaceful and friendly.

Type “Argentina + Uruguay” into any search engine and instead of getting information about the otherwise historically good and brotherly relations between these two countries, all you see is the Botnia pulp mill conflict. Botnia even has a spoof site www.botnia.com.ar , which conveys local sentiment against the Finnish transnational corporation. Rock songs have appeared with names such as “We must destroy Botnia” (see: http://www.youtube.com/watch?v=zg1vuDy6KGA ) . Movies are being made about the dispute, and Gualeguaychú (the Argentine city across the river from Botnia) home to the multitudinous citizen's environmental assembly, even gets international tourism to visit protests against Botnia!

It seems everyone wants to get a first hand look at the community that simply said, ERKKI GO HOME!

For More Information

jdtaillant@cedha.org.ar