Eng. Sami Safran, CEO, MEPCO, shares his thoughts on the status of the paper recycling industry in the Middle East, the challenges facing the sector, the strategy and developments at MEPCO, and his role in this significant sector in an interview with Swaliha Shanavas.

Sami-SafranThe Middle East Paper Company (MEPCO) is a leading vertically-integrated paper manufacturer in the Middle East, offering a diverse range of containerboard and specialty paper products serving the packaging, construction, furniture, and paper core industries around the world. MEPCO supplies its products to the local KSA market, the Middle East and Africa, with a growing presence in South Asia, the Americas, and Europe. The company’s innovative approach to doing business with the use of energy- and water-efficient production processes enables it to offer eco-friendly and recyclable products to the market. Through its wholly-owned subsidiary, WASCO, MEPCO’s raw materials are sourced from locations across the Kingdom, securing business sustainability.

In your role as CEO at MEPCO, what is your normal day at work like? How has your journey been so far?

We aim to ensure a relaxed working environment at MEPCO. Senior and middle managers meet casually after lunch every day to discuss business concerns in a friendly atmosphere. I am a strong believer in management by walking around. For the past 15 years, this has helped us make best
use of our time. Personally, I tend to rely less on emails and meetings as I prefer to discuss issues directly with team members. It has been a lifetime of challenges which were well accepted. I believe that those challenges that we overcame represent an achievement, and those that we did not, represent a great learning experience, and will continue to help us succeed going forward.

Please provide an overview of the paper industry in the Middle East. What are the developmental challenges and domestic issues facing this sector at present?

Papermaking in the Middle East is fairly new. This gave us the advantage of adopting the latest technological innovation of this industry. On the market side, the containerboard industry in the Middle East grew at a rate exceeding the global industry growth rate of 3%. The recycling industry in the Middle East is yet to enjoy a proper regulatory framework, which is a barrier to realising its full potential. We are making every effort to increase the level of environmental awareness of both governments and citizens to reach a healthier, cleaner living space for all of us.

How has MEPCO been faring over the past two years, and are there any recent changes in your business model based on the current market situation?

2016 was an exceptionally tough year. We faced unprecedented dumping of end products from some European countries. We took immediate action and filed for antidumping case which was accepted by GCC anti-dumping body and is currently under investigation. At the commercial level, we introduced additional grades that gave us access to new international frontiers.

How important is recycling for the development of the region’s economy? What are the hurdles to the growth of the paper recycling market in the Middle East?

The GCC region is a consumers’ market by default. Paired with strong GDP per capita, these factors constitute the foundation of starting a proper recycling activity as recycling becomes mandatory to reduce the landfill footprint. What it lacks partially is awareness of proper recycling practices to be applied at the household level to improve recovery rates as well as a proper regulatory framework.

What are the measures you are putting in place to reduce overall environmental impact?

MEPCO went way beyond measures. We have a wholly-owned subsidiary, WASCO, which is the largest collector and recycling company in the GCC. WASCO collects in excess of half a million tons of recycling materials per annum; on the other hand, MEPCO sources raw materials from WASCO, on arm’s length transaction basis, to ensure consistency of supply. In addition, MEPCO uses 90% of recovered paper as input for its production. This comes alongside treated industrial water, which is directly obtained from the water treatment facility located in close proximity to our offices in Jeddah saving it from being dumped into the sea or elsewhere causing elevated levels of environmental damage.

How is MEPCO strategising for success in the present market conditions, and what are your key objectives in the short term?

The nature of our business in an international commodity forces us to redefine short-term as less than one year. We are perfectly positioned to take several strategic decisions during the course of the coming 12 months. Unfortunately, it would be inappropriate to give indications of such decisions ahead of time due to disclosure and transparency regulations.

What are the current trends in the paper sector and what is the outlook for 2018-19?

Last year, the international growth for the industry was exceeding 4% and is expected to remain in a healthy level during 2018/2019.

What do you love most about your job, and what is the most challenging aspect?

I am blessed to be doing something I am passionate about. I love papermaking, its technological, commercial, and financial aspects. I go every day to work looking for a new challenge, because I see an opportunity in every challenge.

What do you like to do in your spare time?

I dedicate most of my spare time to my family. I believe that maintaining a proper work/life balance is essential to achieve success on both fronts