CSR activities aimed at developing hemp plantation inspired by the founder's spirit of ITOCHU

-ITOCHU Celebrates Centenary of Manila Branch-

June 11, 2012

ITOCHU Corporation (headquartered in Minato-ku, Tokyo; Masahiro Okafuji, President & CEO; hereinafter “ITOCHU”), at the occasion of the commemoration event held in Manila on June 8 of 100 years since the company’s Manila Branch was first established, finalized funding for a project to rehabilitate a Manila hemp plantation located in a rural part of Irosin in the central province of Sorsogon (hereinafter “Project”), and signed a project agreement with the Fiber Industry Development Authority of the Department of Agriculture (FIDA) and the St. Ann’s Family Service Cooperative (SAFSCO).
As well as a token of appreciation given that the company has been doing business in the Philippines since 1912, ITOCHU intends express our thanks to the local community and to position this project as one of its symbolic CSR initiatives in the Philippines.

Project outline

1. Background

Furukawa Plantation, a company funded entirely by ITOCHU’s predecessor C. Itoh & Co., set up in business growing Manila hemp in Davao on the Philippine island of Mindanao in 1915, during the early days of the Manila hemp (AKA Abaca) industry. The company received full support from C. Itoh & Co., not least because its founder Yoshizo Furukawa was related to Chubei Itoh. The history of ITOCHU’s Manila Branch essentially shadows that of the Abaca trading industry. Whereas business was booming back then however, with as many as 71 Japanese-run Manila hemp companies at its peak, the end of the war heralded the demise of the industry. Abaca diseases during the 1970s later forced many Abaca plantations out of business, leaving the industry in critical condition. Having earmarked Abaca as a key industry in terms of rural development however, the Philippine government started to develop disease-resistant Abaca variety. The industry was further boosted by support from the Japan International Cooperation Agency (JICA). As well as taking a fresh look at the origins of its Manila Branch, ITOCHU has also decided to go ahead this project in order to contribute to the Philippine textile industry where it has now become a raw material for denim fabric, taking account of the relationship with the local community.

2. Significance

Textiles made from Manila hemp are amongst the strongest plant-based fibers available and are used in products such as rope and special types of paper (money, envelopes, etc.)
By planting and growing approximately 144,000 Manila hemp plants, the Project is expected to absorb 18 tons of CO2 a year. It will also help stimulate economic development in the region in accordance with the employment policy which the Philippines Government stipulates in the “Philippines Development Plan”, and contribute to the local textile industry, the original business of ITOCHU. In terms of CSR, the project ties in perfectly with efforts to “eradicate extreme poverty and hunger” and “ensure environmental sustainability” under the UN Millennium Development Goals.

3. Project area

Sorsogon province is one of the most economically underdeveloped parts of the Philippines. It has requested assistance from JICA on several occasions and is currently home to a number of Japanese Overseas Cooperation Volunteers working to revitalize the Manila hemp industry.

The project is due to commence August 2012 and run until March 2014, during which time FIDA intends to provide technical assistances as well as recommendation of appropriate plants, SAFSCO intends to plant Manila hemp plants and to manage the farmers, and ITOCHU intends to donate a total of 2 million yen. This will be enough to plant and grow Abaca across a 90-hectare area.

The “Protection of Environment” as well as “Contribution to local community” are mains CSR activities of ITOCHU. With the globalization of our business, ITOCHU will realize our company policy, “Committed to the Global Good”, through our activities contributing to sustainable development of local community.

Map of Irosin, Sorsogon province