Sun Paper announced that it has abandoned its plan to build a massive paper mill in southwestern Arkansas that had already been delayed by trade tensions.

According to multiple media reports, Sun Paper, based in Shangdong, China,  told Arkansas Governor Asa Hutchinson and economic development officials that it would not move forward with its plan to build a mill in Arkadelphia, about 60 miles southwest of Little Rock. The company cited “continued political friction and economic instability,” and the coronavirus outbreak as reasons for walking away from the project.

“With the likelihood of the project uncertain, it is also fair to allow the state of Arkansas to use its resources for other ventures that have less uncertainty in the medium term,” Andrzej Bednarski, the company’s International Project Director, said in a letter. “At this moment, the collective uncertainties make it a better choice for both of us to abandon the project.”

The announcement comes after Arkadelphia officials announced that the community was marketing the 1,000-acre site planned for the mill to other potential projects. The $1.8 billion mill was announced in 2016 but has faced uncertainty since then because of trade tensions.

“Sun Paper’s announcement that it is not continuing with the Clark County development project is disappointing but not unexpected in light of the trade wars and the global economic downturn caused by the current coronavirus pandemic,” Gov. Asa Hutchinson said in a statement. “We will continue to work with our local economic development leaders to attract other projects to the area.” 

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