SteelAsia Manufacturing Corp. has secured a P1.25-billion green loan from Taiwan-based Cathay United Bank to accelerate the company’s expansion of low-carbon steel production in the Philippines, signaling growing investor support for sustainable industrial projects.

The financing will support SteelAsia’s operations using Electric Arc Furnace technology, a steelmaking process that relies on scrap recycling and renewable energy to significantly reduce carbon emissions compared with conventional production methods.

The company said its Calaca facility in Batangas, operating since 2008, has already been recognized by Norway-based certification firm DNV as among the world’s lowest carbon-emitting steel plants, with emissions estimated to be about 90 percent lower than the global average for traditional steelmaking.

SteelAsia plans to replicate the same green steel model in future facilities, including the country’s first medium sections mill in Lemery, Batangas, scheduled to begin operations later this year.

The transaction also marks SteelAsia’s first financing arrangement under its Sustainable Finance Framework, which received a high sustainability assessment from Moody’s earlier this year.

SteelAsia President and Co-Chief Operating Officer Rafael Hidalgo said the loan reflects confidence in the company’s long-term industrial strategy.

“The green loan represents more than a milestone for the company—it is a sign that we are indeed on the right track in our expansion strategy,” Hidalgo said.

“Steel production with low CO2 emission is not only sustainable for the environment, it is also the foundation upon which we are building the country’s steel industry,” he added.

Cathay United Bank described the agreement as its first overseas green loan granted to a steel manufacturer, while also making SteelAsia the first Philippine steel company to obtain such financing from the bank.

“Cathay United Bank is proud to be part of these initiatives,” said Tony Chao, senior vice president and general manager of Cathay United Bank Manila Branch.

“We are driven to further strengthen our sustainable financing partnership with SteelAsia, as we share a common mission and set of goals,” he added.

SteelAsia, one of Southeast Asia’s largest rebar producers, currently operates four steel mills nationwide and supplies a significant portion of materials used in major infrastructure and high-rise construction projects across the country.

The company said planned green steel facilities in Batangas, Quezon, and Tarlac over the next four years could help avoid as much as seven million tons of carbon dioxide emissions annually.