56 



because I watched this take place as I grew up in Ketchikan and 

 worked as a banker in Wrangell. 



The two pulp mills have lived up to their end of the 

 bargain 



For the Japanese, the Sitka mill was their very first post war 

 industrial project in the United States. The contract was actually 

 negotiated through General MacArthur's headquarters. The project 

 represented a serious Japanese commitment and contribution to an 

 economically unstable and undeveloped region of the United States. 



Both companies used the long term timber supply as collateral to 

 obtain financing and made huge investments in facilities. A year- 

 around timber industry grew up around the pulp mills including saw 

 mills, logging camps, stevedoring operations and air taxi services. 



And when markets have been poor, as they were from 1981 to 1985, 

 the pulp mills did not break their contracts with the United States 

 and close their doors on the people of Southeast Alaska. Instead 

 they used the 50 year timber contracts as collateral to finance 

 prolonged operating at a loss. 



The Sitka pulp mill represents an extraordinary 

 commitment on the part of the Japanese government 



The Japanese-owned mill accumulated a staggering debt during the 

 market depression of the mid-80's, but refused to close its doors, 

 treating the upholding of its commitment to the U.S. a matter of 

 honor. This past year Japanese officials have worked long and hard 

 to restructure the past debts of Alaska Pulp. A recent letter from the 

 Japanese Minister of International Trade and Industry bringing news 

 of a government plan to restructure the company's debt provides 

 evidence of the sincere Japanese commitment to this contract. 



I quote: 



"Alaska Pulp had fallen on difficult times ... The concerned 

 parties, however, having examined the feasibility of the 

 company's continued operation - an effort premised on the 

 determination of Alaska Pulp to pursue its operation - and come 

 up with a positive assessment, and recognizing the project's 

 importance to the community of Sitka, the State of Alaska and 

 U.S. - Japanese economic relations, finally arrived at the current 

 restructuring plans. 



