IFC, a member of the World Bank Group, has invested $4 million in MTI Environment Group Ltd, a leading player in China’s sludge composting and odour control market, to support the company’s expansion in China.

IFC and SIIC Environment Holding Ltd, a Singapore-listed water treatment and environmental protection company, will jointly invest $8 million in MTI, which will use the funds for expanding its research and development as well as marketing and sales functions, and for potential acquisitions.

“IFC’s investment showcases international investors’ confidence in MTI’s technology and business model,” said Liu Feng, Chairman and CEO of MTI Environment. “We will also work with IFC to further enhance our environmental, social and corporate-governance practices in order to create more value for our shareholders and customers.”

MTI has been operating in China’s wastewater treatment sector for more than 10 years - one of its fastest-growing businesses is to provide a composting technology to help municipalities properly handle the sludge generated by wastewater treatment plants and reduce the related odours.

At present, many treatment plants send sludge to landfills at a high cost. MTI’s technology helps kill pathogens in the sludge, render it harmless for the environment, and recycle it into construction fill or non-agricultural fertilizers.

“China has 20 percent of the world’s population and only 5 percent of the world’s renewable freshwater supplies,” said Simon Andrews, IFC’s Country Manager for China, Korea, and Mongolia. “IFC is helping China address this challenge by partnering with innovative businesses like MTI and promoting resource efficiency across the water treatment value chain.”

The investment is part of IFC’s plan to support the transfer of resource-efficiency technology and Clean Tech to the water sector in China. Since 2005, IFC has committed $286 million in 14 projects in China’s waste and water sectors.